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The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

          We may offer and sell from time to time, in one or more series, our debt securities, which may consist of notes, debentures, or other evidences of indebtedness, shares of our common stock or preferred stock, warrants representing rights to purchase these securities and units comprised of two or more of these securities in any combination. The debt securities and preferred stock may be convertible into or exchangeable for other securities of ours. This prospectus provides you with a general description of these securities. Each time we offer any securities pursuant to this prospectus, we will provide you with a prospectus supplement, and, if necessary, a pricing supplement, that will describe the specific amounts, prices and terms of the securities being offered. These supplements may also add, update or change information contained in this prospectus. To understand the terms of the securities offered, you should carefully read this prospectus with the applicable supplements, which together provide the specific terms of the securities we are offering.

          Our shares of common stock are quotedis traded on the Nasdaq Global Select Market under the symbol BANR. The last reported sales price of our common stock on October 19, 2006 was $41.58. Our executive offices are located at 10 S. First Avenue, Walla Walla, Washington 99362. You can also contact us by telephone at 1-509-527-3636, or through our website atwww.bannerbank.com. The information on our website is not part of this prospectus. Unless specifically noted otherwise in this prospectus, all references to “we,” “us,” “our,” or the “Company” refer to Banner Corporation and its subsidiaries."BANR."

          Investing in our shares of common stock involves risks. You should consider certain risk factors before enrolling in the Plan. See “Risk Factors” beginning on page 1 of this prospectus and the documents incorporated herein by reference for more information. We suggest you retain this prospectus for future reference.

         Shares of our common stockThese securities are not savingsdeposits or deposit accounts or other obligations of any of oura bank or non-bank subsidiaries,savings association and they are not insured or guaranteed by the Federal Deposit Insurance Corporation the Deposit Insurance Fund or any other governmental agency.

          This prospectus may be used to offer and sell securities only if accompanied by the prospectus supplement for those securities.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upondetermined that this prospectus or the accuracyaccompanying prospectus supplement is accurate or adequacy of this prospectus.complete. Any representation to the contrary is a criminal offense.

applies.

• the credit risks of lending activities, including changes in the level and trend of loan delinquencies and write-offs;
  
• changes in general economic conditions, ma nagement's ability to maintain acceptable asset quality and to successfully resolve neweither nationally or existing credit issues,in our market areas;
  
• changes in the successlevels of our branch expansion strategy, our ability to control operating costs, competition, changes ingeneral interest rates, deposit flows,interest rates, our net interest margin and funding sources;
  
• fluctuations in the demand for mortgagesloans and other loans,in real estate values in our market areas;
  
• fluctuations in agricultural commodity prices, crop yields and weather conditions,conditions;
  

• our ability to control operating costs and expenses;
  
• our ability to successfully implement our branch expansion strategy;
  
• our ability to successfully integrate any assets, liabilities, customers, systems, and management personnel we may acquire into our operations and our ability to realize related revenue synergies and cost savings within expected time frames;
  
• our ability to manage loan delinquency rates, rates;
  
• our ability to retain key members of our senior management team;
  
• costs and effects of litigation;
  
• increased competitive pressures among financial services companies;
  
• changes in consumer spending, borrowing and savings habits;
  
• legislative or regulatory changes that adversely affect our business;
  
• adverse changes in the securities markets;
  
• inability of key third-party providers to perform their obligations to us;
  
• changes in accounting principles,policies and practices, policiesas may be adopted by the financial institution regulatory agencies or guidelines, changes in legislationthe Financial Accounting Standards Board;
  
• war or regulation,terrorist activities; and
  
• other economic, competitive, governmental, regulatory, and technological factors affecting our operations, pricing, products and services. Accordingly, these factors

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OUR BUSINESS

        Banner Corporation isare a bank holding company incorporated in the State of Washington. We areoperate primarily engaged in the business of planning, directing and coordinating the business activities ofthrough our wholly ownedwholly-owned subsidiary, Banner Bank. The Bank, is a Washington-chartered commercial bank thatwhich conducts business from its main office in Walla Walla, Washington and its 58 branch offices and 12 loan production offices located in 24 counties in Washington, Oregon and Idaho. We are subject to regulation by the Board of Governors of the Federal Reserve System, and the Bank is subject to regulation by the State of Washington Department of Financial Institutions, Division of Banks and the Federal Deposit Insurance Corporation. We had total consolidated assets of $3.041 billion and total stockholders' equity of $221.7 million at December 31, 2005.

        TheBanner Bank offers a wide variety of commercial banking services and financial products to individuals, businesses and public sector entities in its primary market areas. Theareas in the Northwest. Banner Bank's primary business is that of a traditional banking institution, accepting deposits and originating loans in locations surrounding its offices in portions of Washington, Oregon and Idaho. The Bank is also an active participant in the secondary market, engaging in mortgage banking operations largely through the origination and sale of one- to four-family residential loans.Northwest. Lending activities include commercial business and commercial real estate loans, agricultural business loans, construction and land development loans, one- to four-family residential loans and consumer loans. A portionAs of September 30, 2006, we had total consolidated assets of $3.453 billion, total deposits of $2.744 billion and total stockholders' equity of $241.7 million.

          Our common stock trades on the Bank's constructionNasdaq Global Select Market under the symbol "BANR."

          Banner Bank is subject to comprehensive regulation, examination and mortgage lending activities are conducted through its subsidiary, Community Financial Corporation, which is located in the Lake Oswego area of Portland, Oregon. In addition to loans, the Bank maintains a significant, although recently declining, portion of its assets in marketable securities. The securities portfolio is heavily weighted toward mortgage-backed securities securedsupervision by one- to four-family residential properties. This portfolio also includes U.S. Government agency (including government-sponsored enterprises) securities, as well as investment grade corporate debt securities and tax-exempt municipal securities primarily issued by entities located in the State of Washington.Washington Department of Financial Institutions, Division of Banks, or the "Division," and the Federal Deposit Insurance Corporation, or the "FDIC." Banner Corporation is subject to regulation, examination and supervision by the Board of Governors of the Federal Reserve System, or the "FRB," as a bank holding company.

          OverOur principal executive offices are located at 10 South First Avenue, Walla Walla, Washington 99362. Our telephone number is (509) 527-3636.

          Additional information about us and our subsidiaries is included in documents incorporated by reference in this prospectus. See"Where You Can Find More Information" on page 4 of this prospectus.

RISK FACTORS

An investment in our common stock is subject to risks inherent to our business. Before you decide to participate in the Plan, you should carefully consider the risks and uncertainties described below together with all of the other information included or incorporated by reference in this prospectus. The risks and uncertainties described below are notThis regulatory framework is intended primarily for the only ones that affect us. Additional risks and uncertainties that management is not awareprotection of or focused on or that management currently deems immaterial may also impair our business operations. If any of the circumstances described in the following risk factors actually occur to a significant adverse degree, our financial condition and results of operations could be materially and adversely affected. If this were to happen, the value of our common stock could decline significantly, and you could lose all or part of your investment. In addition, you should consult your own financial and legal advisors before making an investment.

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The maturity and repricing characteristics of our assets and liabilities are mismatched and subject us to interest rate risk which could adversely affect our net earnings and economic value.

        Our financial condition and operations are influenced significantly by general economic conditions, including the absolute level of interest rates as well as changes in interest ratesdepositors and the slopedeposit insurance funds that insure deposits of banks, rather than for the yield curve. Our profitability is dependent to a large extent on our net interest income, which is the difference between the interest received from our interest-earning assets and the interest expense incurred on our interest-bearing liabilities. Significant changes in market interest rates or errors or misjudgments in our interest rate risk management procedures could have a material adverse effect on our net earnings and economic value.protection of security holders.

          Our activities, like those of all financial institutions, inherently involve the assumption of interest rate risk. Interest rate risk is the risk that changes in market interest rates will have an adverse impact on our earnings and underlying economic value. Interest rate risk is determined by the maturity and repricing characteristics of our assets, liabilities and off-balance-sheet contracts. Interest rate risk is measured by the variability of financial performance and economic value resulting from changes in interest rates. Interest rate risk is the primary market risk affecting our financial performance.

        The greatest source of interest rate risk to us results from the mismatch of maturities or repricing intervals for our rate sensitive assets, liabilities and off-balance-sheet contracts. This mismatch or gap is generally characterized by a substantially shorter maturity structure for interest-bearing liabilities than interest-earning assets. Additional interest rate risk results from mismatched repricing indices and formulae (basis risk and yield curve risk), and product caps and floors and early repayment or withdrawal provisions (option risk), which may be contractual or market driven, that are generally more favorable to customers than to us.

        Our primary monitoring tool for assessing interest rate risk is asset/liability simulation modeling, which is designed to capture the dynamics of balance sheet, interest rate and spread movements and to quantify variations in net interest income resulting from those movements under different rate environments. The sensitivity of our net interest income to changes in the modeled interest rate environments provides a measurement of interest rate risk. We also utilize market value analysis, which addresses changes in estimated net market value of our equity arising from changes in the level of interest rates. The net market value of equity is estimated by separately valuing our assets and liabilities under varying interest rate environments. The extent to which assets gain or lose value in relationChanges to the gains or losses of liability values under the various interest rate assumptions determines the sensitivity of net equity value to changes in interest rateslaws and pr ovides an additional measure of interest rate risk.

        The interest rate sensitivity analysis we perform incorporates beginning-of-the-period rate, balance and maturity data, using various levels of aggregation of that data, as well as certain assumptions concerning the maturity, repricing, amortization and prepayment characteristics of loans and other interest-earning assets and the repricing and withdrawal of deposits and other interest-bearing liabilities into an asset/liability computer simulation model. We update and prepare simulation modeling at least quarterly for review by senior management and the directors. We believe the data and assumptions are realistic representations of our portfolio and possible outcomes under the various interest rate scenarios. Nonetheless, the interest rate sensitivity of our net interest income and net market value of our equity could vary substantially if different assumptions were used or if actual experience differs from the assumptions used and, as a result, our interest rate risk management strategies may prove to be inadequate.

        See Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2005 for a discussion of our balance-sheet restructuring transactions that were executed in the fourth quarter of 2005 and “Market Risk and Asset/Liability Management” for additional information concerning interest rate risk.

Our loan portfolio includes loans with a higher risk of loss.

        We originate construction and land loans, commercial and multifamily mortgage loans, commercial loans, consumer loans, agricultural mortgage loans and agricultural loans as well as residential mortgage loans primarily within our market areas. Generally, the types of loans other than the residential mortgage loans have a higher risk of loss than

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the residential mortgage loans. We had approximately $2.1 billion outstanding in these types of higher risk loans at December 31, 2005, which is a significant increase since December 31, 2004. Commercial and multifamily mortgage, commercial, and consumer loans may expose a lender to greater credit risk than loans secured by residential real estate because the collateral securing these loans may not be sold as easily as residential real estate. These loans also have greater credit risk than residential real estate for the following reasons and those discussed under Item 1, “Business-Lending Activities” of our Annual Report on Form 10-K for the year ended December 31, 2005:

If our allowance for loan losses is not sufficient to cover actual loan losses, our earnings could decrease.

        We make various assumptions and judgments about the collectibility of our loan portfolio, including the creditworthiness of our borrowers and the value of the real estate and other assets serving as collateral for the repayment of many of our loans. In determining the amount of the allowance for loan losses, we review our loans and the loss and delinquency experience, and evaluate economic conditions. If our assumptions are incorrect, the allowance for loan losses may not be sufficient to cover losses inherent in our loan portfolio, resulting in the need for additions to our allowance. Material additions to the allowance could materially decrease our net income. Our allowance for loan losses was 1.27% of total loans and 296% of non-performing loans at December 31, 2005.

        In addition, bank regulators periodically review our allowance for loan losses and may require us to increase our provision for loan losses or recognize further loan charge-offs. Any increase in our allowance for loan losses or loan charge-offs as required by these regulatory authorities may have a material adverse effect on our financial condition and results of operations.

There is no assurance that the change in the mix of our assets and liabilities will improve our operating results.

        In addition to lending and deposit gathering activities, we previously emphasized investments in government agency and mortgage-backed securities, funded with wholesale borrowings. This policy was designed to enhance profitability by allowing asset growth with low overhead expense, although securities generally have lower yields than loans, resulting in a lower interest rate spread. In recent years, we have pursued a strategy to change the mix of our assets and liabilities to have proportionately more loans and fewer securities and more customer deposits, particularly

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transaction and savings deposits, and fewer borrowings. Our implementation of this strategy has included significant loan and deposit growth and was recently accelerated by a series of balance-sheet restructuring transactions which we executed in the fourth quarter of 2005. While the objective of this strategy, including the balance-sheet restructuring, is to improve our net interest income and net income in future periods through an enhanced net interest margin, there is no assurance that this strategy will succeed. See Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2005 for additional information concerning implementation of this strategy, including specifics with respect to the balance-sheet restructuring transactions described under “Recent Developments and Significant Events.”

If we are not able to achieve profitability on new branches it may negatively affect our earnings.

        We have expanded our presence throughout the market area, and intend to pursue further expansion by opening additional new branches. The profitability of our expansion strategy will depend on whether the income that we generate from the new branches will offset the increased expenses resulting from operating these branches. Largely as a result of this de novo branching strategy, our operating expenses have increased faster than revenues, adversely affecting our operating efficiency. As a result, the efficiency ratio, which is the ratio of non-interest expense to net interest income and other income, is higher than many of our competitor institutions, although for the year ended December 31, 2005, the ratio was also adversely affected by our balance-sheet restructuring transactions. We expect that it may take a period of time before certain of these branches can become profitable, especially in areas in which we do not have an established presence. During this p eriod, the expense of operating these branches may negatively affect our net income.

If external funds were not available, this could adversely impact our growth and prospects.

        We rely on deposits and advances from the Federal Home Loan Bank of Seattle (“FHLB-Seattle”) and other borrowings to fund our operations. Although we have historically been able to replace maturing deposits and advances if desired, we might not be able to replace such funds in the future if our financial condition or the financial condition of the FHLB or market conditions were to change. Although we consider such sources of funds adequate for our liquidity needs, we may seek additional debt in the future to achieve our long-term business objectives. There can be no assurance additional borrowings, if sought, would be availableregulations applicable to us or if available, would be on favorable terms. If additional financing sources are unavailable or are not available on reasonable terms, our growth and future prospects could be adversely affected.

Our profitability depends significantly on economic conditions insubsidiaries can affect the statesoperating environment of Washington, Oregon and Idaho.

        Our success depends primarily on the general economic conditions of the States of Washington, Oregon and Idaho and the specific local markets in which we operate. Unlike larger national or other regional banks that are more geographically diversified, we provide banking and financial services to customers located primarily in 24 counties of Washington, Oregon and Idaho. The local economic conditions in our market areas have a significant impact on the demand for our products and services as well as the ability of our customers to repay loans, the value of the collateral securing loans and the stability of our deposit funding sources. Adverse economic conditions unique to these Northwest markets could have a material adverse effect on our financial condition and results of operations. Further, a significant decline in general economic conditions, caused by inflation, recession, acts of terrorism, outbreak of hostilities or other international or domestic occurren ces, unemployment, changes in securities markets or other factors could impact these state and local markets and, in turn, also have a material adverse effect on our financial condition and results of operations.

Strong competition within our market area may limit our growth and profitability.

        Competition in the banking and financial services industry is intense. We compete in our market areas with commercial banks, savings institutions, mortgage brokerage firms, credit unions, finance companies, mutual funds, insurancebank holding companies and brokerage and investment banking firms operating locally and elsewhere. Some of these competitors have substantially greater resources and lending limits than we do, have greater name recognition and market presence that benefit them in attracting business, and offer certain services that we do not or cannot provide. In addition, larger competitors may be able to price loans and deposits more aggressively than we do. Our profitability depends upon

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our continued ability to successfully compete in our market areas. The greater resources and deposit and loan products offered by some of our competitors may limit our ability to increase our interest-earning assets.

The loss of key members of our senior management team could adversely affect our business.

        We believe that our success depends largely on the efforts and abilities of our senior management. Their experience and industry contacts significantly benefit us. The competition for qualified personnel in the financial services industry is intense, and the loss of any of our key personnel or an inability to continue to attract, retain and motivate key personnel could adversely affect our business.

We are subject to extensive government regulation and supervision.

        We are subject to extensive federal and state regulation and supervision, primarily through the Bank and certain non-bank subsidiaries. Banking regulations are primarily intended to protect depositors' funds, federal deposit insurance funds and the banking system as a whole, not shareholders. These regulations affect our lending practices, capital structure, investment practices, dividend policy and growth, among other things. Congress and federal regulatory agencies continually review banking laws, regulations and policies for possible changes. Changes to statutes, regulations or regulatory policies, including changes in interpretation or implementation of statutes, regulations or policies, could affect ustheir subsidiaries in substantial and unpredictable ways. SuchWe cannot accurately predict whether those changes could subject us to additional costs, limitin laws and regulations will occur, and, if those changes occur, the types of financial services and products we may offer and/ultimate effect they would have upon our or increase the ability of non-banks to offer competing financial services and products, among other things. Failure to comply with laws, regulations or policies could result in sanctions by regulatory agencies, civil money penalties and/or reputation damage, which could have a material adverse effect on our business,subsidiaries' financial condition and results of operations. While we have policies and procedures designed to prevent any such violations, there can be no assurance that such violations will not occur.

Our information systems may experience an interruption or breach in security.

        We rely heavily on communications and information systems to conduct our business. Any failure, interruption or breach in security of these systems could result in failures or disruptions in our customer relationship management, general ledger, deposit, loan and other systems. While we have policies and procedures designed to prevent or limit the effect of the failure, interruption or security breach of our information systems, there can be no assurance that any such failures, interruptions or security breaches will not occur or, if they do occur, that they will be adequately addressed. The occurrence of any failures, interruptions or security breaches of our information systems could damage our reputation, result in a loss of customer business, subject us to additional regulatory scrutiny, or expose us to civil litigation and possible financial liability, any of which could have a material adverse effect on our financial condition and results of operations.

• the title and series designation;
  
• the aggregate principal amount and the limit, if any, on the aggregate principal amount or initial issue price of the debt securities which may be issued under the applicable indenture;
  
• the principal amount payable, whether at maturity or upon earlier acceleration;
  
• whether the principal amount payable will be determined with reference to an index, formula or other method which may be based on one or more currencies, currency units, composite currencies, commodities, equity indices or other indices;
  
• whether the debt securities will be issued as original issue discount securities (as defined below);
  
• the date or dates on which the principal of the debt securities is payable;
  
• any fixed or variable interest rate or rates per annum or the method or formula for determining an interest rate;
  
• the date from which any interest will accrue;
  
• any interest payment dates;
  
• whether the debt securities are senior or subordinated, and if subordinated, the terms of the subordination;
  
• the price or prices at which the debt securities will be issued, which may be expressed as a separatepercentage of the aggregate principal amount of those debt securities;
  
• the stated maturity date;

• whether the debt securities are to be issued in global form;
  
• any sinking fund requirements;
  
• any provisions for redemption, the redemption price and distinct legal entityany remarketing arrangements;
  
• the denominations of the securities or series of securities;
  
• whether the debt securities are denominated or payable in United States dollars or a foreign currency or units of two or more foreign currencies;
  
• any restrictions on the offer, sale and delivery of the debt securities;
  
• the place or places where payments or deliveries on the debt securities will be made and may be presented for registration of transfer or exchange;
  
• whether any of the debt securities will be subject to defeasance in advance of the date for redemption or the stated maturity date;
  
• the terms, if any, upon which the debt securities are convertible into other securities of ours or another issuer and the terms and conditions upon which any conversion will be effected, including the initial conversion price or rate, the conversion period and any other provisions in addition to or instead of those described in this prospectus;
  
• a description of any documents or certificates that must be received prior to the issuance of any definitive securities;
  
• whether and under what circumstances additional amounts will be paid to non-U.S. citizens in connection with any tax, assessment or governmental charge and whether securities may be redeemed in lieu of paying such additional fees;
  
• the identity of each security registrar or paying agent (if other than trustee);
  
• any provisions granting special rights to securities holders upon the occurrence of specified events;
  
• any deletions from, modifications of, or additions to any default events or covenants set forth in the form of indenture;
  
• the portion of the principal amount payable upon the declaration of acceleration of the maturity of any securities;
  
• the date any bearer securities of or within the series and any temporary global security representing outstanding securities shall be dated, if other than date of original issuance; and

• any other terms of the debt securities which are not inconsistent with the provisions of the applicable indenture.

• be unsecured;
  
• have a minimum average maturity of five years;
  
• be subordinated in right of payment;
  
• not contain provisions permitting the holders of the debt to accelerate payment of principal prior to maturity except in the event of bankruptcy of the issuer; and
  
• not contain provisions that would adversely affect liquidity or unduly restrict management's flexibility to operate the Bank is unableorganization, particularly in times of financial difficulty, such as limitations on additional secured or senior borrowings, sales or dispositions of assets or changes in control.

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If we fail to maintain an effective system of internal control over financial reporting,option, we may notpay any interest by check mailed to the holders of registered debt securities at their registered addresses.

Global Securities

          Each indenture provides that we may issue debt securities in global form. If any series of debt securities is issued in global form, the prospectus supplement will describe any circumstances under which beneficial owners of interests in any of those global debt securities may exchange their interests for debt securities of that series and of like tenor and principal amount in any authorized form and denomination.

Redemption and Repurchase

          The debt securities of any series may be ableredeemable at our option, may be subject to accurately report our financial resultsmandatory redemption pursuant to a sinking fund or prevent fraud, and, as a result, investors and depositors could lose confidence in our financial reporting, which could adversely affect our business,otherwise, or may be subject to repurchase by us at the trading price of our stock and our ability to attract additional deposits.

        In connection with the enactmentoption of the Sarbanes-Oxley Act of 2002holders, in each case upon the terms, at the times and at the implementationprices set forth in the applicable prospectus supplement and pricing supplement, if any. Unless otherwise stated in the applicable prospectus supplement, however, we currently do not intend to issue subordinated debt securities with redemption or repurchase features to the extent these features would prevent the subordinated debt securities from qualifying as Tier 2 Capital under the guidelines of the rules and regulations promulgated by the Securities and Exchange Commission, we document and evaluate our internal control over financial reporting in order to satisfy the requirementsBoard of Section 404Governors of the Act. This requires usFederal Reserve System. See "--Subordinated Debt Securities Intended to prepare an annual management report on our internal control over financial reporting, including among other matters, management's assessment of the effectiveness of internal control over financial reporting and an attestation report by our independent auditors addressing these assessments.Qualify as Tier 2 Capital."

Conversion or Exchange Rights

          If we fail to identify and correct any significant deficiencies in the designdebt securities may be convertible into or operating effectiveness of our internal control over financial reporting or fail to prevent fraud, current and potential shareholders and depositors could lose confidence in our internal controls and financial reporting, which could adversely affect our business, financial cond ition and results of operations, the trading price of our stock and our ability to attract additional deposits.

You will not know the price of the shares you are purchasing under the Plan at the time you authorize the investment or elect to have your dividends reinvested.

        The price of our shares may fluctuate between the time you decide to purchase shares under the Plan and the time of actual purchase. In addition, during this time period, you may become aware of additional information that might affect your investment decision.

        The Plan Administrator administers the Plan. If you instruct the Plan Administrator to sell shares under the Plan, you will not be able to direct the time or price at which your shares are sold. The price of our shares may decline between the time you decide to sell shares and the time of actual sale.

Future dividends and a return on your investment are not guaranteed.

        This prospectus does not represent a change in our dividend policy or a guarantee of future dividends, which will continue to depend upon our earnings, financial requirements, government regulations and other factors. We cannot assure you a profit, or protect you against losses, on shares purchased pursuant to the Plan. The market price of common stock can fluctuate substantially. You must accept the risks as well as the benefits of the Plan.

THE PLAN

What is the Plan?

      Our Dividend Reinvestment and Direct Stock Purchase and Sale Plan enables new investors to make an initial investment in our common stock and existing investors to increase their holdings of our common stock. Participants can purchase our common stock with optional cash investments and cash dividends.

        The Plan is designed for long-term investors who wish to invest and build their share ownership over time. The Plan is not intended to provide holders of shares of common stock with a mechanism for generating assured short-term profits through rapid turnover of shares acquired at a discount. The Plan's intended purpose precludes any person, organization or other entity from establishing a series of related accounts for the purpose of conducting arbitrage operations and/or exceeding the optional monthly cash investment limit. We accordingly reserve the right to modify, suspend or terminate participation by a shareholder who is using the Plan for purposes inconsistent with its intended purpose.

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What features does the Plan offer?

Initial investment. If you are not an existing shareholder, you can make an initial investment in our common stock, starting with as little as $250 and up to a maximum of $40,000. See“How do I purchase shares if I am not currently a Banner shareholder?” below for more information.

Optional monthly cash investments. Once you are a shareholder, you can buy our common stock and pay fees and commissions lower than those typically charged by stockbrokers for small transactions. You can increase your holdings of our common stock through optional cash investments of $50 or more, up to a maximum of $40,000 per month. You can make optional cash investments by check or electronically with deductions from your personal bank account. If you wish to make optional cash investments in excess of $40,000 in any month or an initial investment in excess of $40,000, see“How do I make cash investments in excess of $40,000?” below for more information.

Automatic dividend reinvestment. You can also increase your holdings of our common stock through automatic reinvestment of your cash dividends. You will also be credited with dividends on fractions of shares you hold in the Plan. You can elect to reinvest all or a portion of your dividends on your shares. You can receive dividends electronically or by check. See“How do I purchase additional shares if I am already a Banner shareholder?” below for more information.

Share safekeeping. You can deposit your stock certificate(s) representing shares of our common stock for safekeeping with the Plan Administrator. See“What is safekeeping of certificates and how do I submit my certificates?” below for more information.

Automated transactions. Unless you are participating through your bank, broker or nominee, you can execute many of your Plan transactions online via the Plan Administrator's website atwww.computershare.com. The information on the Plan Administrator's website is not part of this prospectus. See instructions below describing how to purchase and sell shares for more information. Refer to “What are the fees associated with participation?” below for details on fees charged for these transactions and services.

Who is the Plan Administrator and what does the Plan Administrator do?

        Computershare Trust Company, N.A. (“Computershare”) currently is the Plan Administrator, registered transfer agent, and designated agent for each participating shareholder. Computershare, as Plan Administrator, administers the Plan, purchases and holds shares acquired for you under the Plan, keeps records, sends statements of account activity and performs other duties related to the Plan. The Plan Administrator holds for safekeeping the shares purchased for you together with shares forwarded by you to the Plan Administrator for safekeeping until termination of your participation in the Plan or receipt of your request for a certificate for all or part of your shares. Shares purchased under the Plan and held by the Plan Administrator will be registered in the Plan Administrator's name or the name of its nominee, in either case as your agent. In the event that the Plan Administrator should resign or otherwise cease to act as agent, we will appoint a new a dministrator to administer the Plan. The Plan Administrator also acts as dividend disbursing agent, transfer agent and registrarexchangeable for shares of our common stock.equity securities or other securities, the terms and conditions of conversion or exchange will be stated in the applicable prospectus supplement. The terms will include, among others, the following:

• the conversion or exchange price;
  
• the conversion or exchange period;
  
• provisions regarding the convertibility or exchangeability of the debt securities, including who may convert or exchange;
  
• events requiring adjustment to the conversion or exchange price;
  
• provisions affecting conversion or exchange in the event of our redemption of the debt securities; and
  

• any anti-dilution provisions, if applicable.

• default in the payment of any principal or premium or make-whole amount, if any, on the debt securities when due;
  
• default in the payment of any interest on the debt securities, or of any coupon pertaining thereto, when due, which continues for 30 days;
  
• default in the deposit of any sinking fund payment on the debt securities when due;
  
• default in the performance or breach of any other obligation contained in the applicable indenture for the benefit of that series of debt securities (other than defaults or breaches otherwise specifically addressed), which continues for 90 days after written notice of the default or breach;
  
• specified events in bankruptcy or insolvency of the Company; and
  
• any other event of default provided with respect to the debt securities of any series.

• in the payment of any amounts due and payable or deliverable under the debt securities of that series; or
  
• in an obligation contained in, or a provision of, an indenture which cannot be modified under the terms of that indenture without the consent of each holder of each series of debt securities affected.

• that holder previously gives to act including,the indenture trustee written notice of a continuing event of default with respect to debt securities of that series;

• the holders of not less than 25% in principal amount of the outstanding securities of that series have made written request and offered the indenture trustee indemnity satisfactory to the indenture trustee to institute that proceeding as indenture trustee;
  
• the indenture trustee has not received from the holders of a majority in principal amount or, under certain circumstances, issue price of the outstanding debt securities of that series a direction inconsistent with the request; and
  
• the indenture trustee fails to institute the proceeding within 60 days.

• change the stated maturity date of the principal of (or premium or make-whole amount, if any, on), or any installment of principal or interest on, any debt security issued under that indenture;
  
• reduce the principal amount of or any make-whole amount, the rate of interest on or any additional amounts payable in respect thereof, or any premium payable upon the redemption of any debt security issued under that indenture;
  
• reduce the amount of principal of an original issue discount security or make-whole amount, if any, issued under that indenture payable upon acceleration of its maturity or provable in bankruptcy or adversely affect any right of repayment of a debt security;
  
• change the place or currency of payment of principal or any premium or any make-whole amount or interest on any debt security issued under that indenture;
  
• impair the right to institute suit for the enforcement of any payment or delivery on or with respect to any debt security issued under that indenture;

• reduce the percentage in principal amount of debt securities of any series issued under that indenture, the consent of whose holders is required to modify or amend the indenture or to waive compliance with certain provisions of the indenture; or
  
• make any change that adversely affects the right to convert or exchange any security or decrease the conversion/exchange rate or increase the conversion/exchange price.

• to evidence the succession of another person to the Company;
  
• to add to our covenants for the benefit of the holders of all or any series of debt securities;
  
• to add events of default for the benefit of the holders of all or any series of debt securities;
  
• to add or change any provisions of the indentures to facilitate the issuance of bearer securities;
  
• to change or eliminate any of the provisions of the applicable indenture in respect of any series of debt securities, so long as any such change or elimination will become effective only in respect of any series of securities when there is no outstanding security of that series which is entitled to the benefit of that provision;
  
• to establish the form or terms of debt securities of any series;
  
• to evidence and provide for the acceptance of appointment by a successor indenture trustee;
  
• to cure any ambiguity, to correct or supplement any provision in the applicable indenture, or to make any other provisions with respect to matters or questions arising outunder that indenture, so long as the interests of failureholders of debt securities of any series are not adversely affected in any material respect by the actions taken to terminate yourcure, correct or supplement a provision in an indenture;
  
• to secure securities;
  
• to provide for conversion rights of the holders of the debt securities of any series to enable those holders to convert those securities into other securities;

• to close the indenture with respect to the authentication and delivery of additional series of securities or to qualify or maintain qualifications of the applicable indenture under the Trust Indenture Act; or
  
• to supplement any of the provisions of an indenture as is necessary to permit or facilitate the defeasance or discharge of any series of securities under specified provisions of the indenture, provided that any such action shall not adversely affect the interests of the holders of securities of such series or any other series of securities under the indenture in any material respect.

• there shall be no minimum quorum requirement for such meeting; and

• the principal amount of the outstanding debt securities of such series that vote in favor of such request, demand, authorization, direction, notice, consent, waiver or other action shall be taken into account upon your death,in determining whether such request, demand, authorization, direction, notice, consent, waiver or other action has been made, given or taken under such indenture.

• in the case of debt securities denominated in U.S. dollars, U.S. dollars or U.S. government obligations;
  
• in the case of debt securities denominated in a foreign currency, of money in that foreign currency or foreign government obligations of the foreign government or governments issuing that foreign currency; or
  
• a combination of money and U.S. government obligations or foreign government obligations, as applicable;

• an opinion of independent counsel that the holders of the debt securities of that series will have no federal income tax consequences as a result of that deposit and termination;
  
• an opinion of independent counsel that registration is not required under the Investment Company Act of 1940;
  
• an opinion of counsel as to certain other matters;

• officers' certificates certifying as to compliance with the senior indenture and other matters; and

• there is an event of default with respect to any fluctuationsenior indebtedness which permits the holders of that senior indebtedness to accelerate the maturity of the senior indebtedness; and
  
• the default is the subject of judicial proceedings or we receive notice of the default from an authorized person under the subordinated indenture.

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How do I contactprospectus supplement relating to the Plan Administrator?

        Unless you are participatingparticular series of subordinated debt securities, "senior debt" is defined in the Plan through your bank, brokersubordinated indenture as the principal, premium, if any, unpaid interest (including interest accruing on or nominee, if you have questions regardingafter the Plan, please writefiling of any petition in bankruptcy or for reorganization relating to the Plan Administrator atCompany whether or not a claim for post-filing interest is allowed in such proceeding), fees, charges, expenses, reimbursement and indemnification obligations, and all other amounts payable under or in respect of the following address:indebtedness of the Company for money borrowed, whether any such indebtedness exists as of the date of the indenture or is created, incurred, assumed or guaranteed after such date:

          Banner Corporation
                c/o Computershare Trust(i)          any debt (a) for money borrowed by the Company, N.A.
                P.O. Box 43078
                Providence, RI 02940-3078or (b) evidenced by a bond, note, debenture, or similar instrument (including purchase money obligations) given in connection with the acquisition of any business, property or assets, whether by purchase, merger, consolidation or otherwise, but shall not include any account payable or other obligation created or

or call the Plan Administrator at 1-800-697-8924 within the United States and Canada or 1-312-360-5219 outside the United States and Canada.  Include your name, address, daytime telephone number, account number and reference Banner on all correspondence.  All transaction requests should be directed to the Plan Administrator at P.O. Box 43078, Providence, RI 02940-3078.

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        Thus for example, if 20 shares were acquired by the Plan Administrator on your behalf in the open market, you would
        pay the Plan Administrator $7.40 for the transaction consisting of a check payment service fee of $5.00 and a per share
        commission of $0.12 per share.

        We can change the fee structure of the Plan at any time. We will give you notice of any fee changes prior to the changes becoming effective.

How do I purchase shares if I am not currently a Banner shareholder?

        To make an investment online, log on towww.computershare.com, click “Investment Plans,” then select “All Plans” under “Quick Search.” Select “Banner Corporation.” Then select “Buy Now” and follow the enrollment wizard, which will guide you through the simple investment process. You will be prompted to provide your banking account number and ABA routing number to allow for the direct debit of funds from your savings or checking account. You will receive an email confirming receipt of your transaction as soon as you complete the investment process, as well as a subsequent statement in the mail confirming the number of shares purchased and their price.

        To invest by mail, simply fill out an Initial Enrollment Form, which can be obtained by calling the Plan Administrator at 1-800-697-8924, and enclose a check (minimum $250) made payable to “Computershare” for the value of your investment. The Initial Enrollment Form may also be downloaded from the Plan Administrator's website (www.computershare.com) and mailed to the Plan Administrator.

        Your cash payment, less applicable service charges and commissions, will be used to purchase shares for your account. Both full and fractional shares up to six decimal places (if applicable) will be credited to your Plan account. The Plan Administrator will commingle net dividend funds (if applicable) with cash payments from all participants to purchase shares either directly from Banner or on the open market.

        You may also purchase your initial shares by authorizing the Plan Administrator, on the Direct Debit Authorization Form or through the Plan Administrator's website, to make monthly purchases of a specified dollar amount, paid for by automatic withdrawal from your U.S. bank account if at least $50 a month for five consecutive months. Funds will be withdrawn from your bank account, via electronic funds transfer, or EFT, on the fourth day of each month (or the next business day if the fourth is not a business day). To terminate monthly purchases by automatic withdrawal, you must send the Plan Administrator written, signed instructions. It is your responsibility to notify the Plan Administrator if your direct debit information changes.

How do I make optional cash investments of $40,000 or less if I am already a Banner shareholder?

         If you are a registered holder (i.e., your shares of Banner common stock are registered in the stock transfer books of Banner in your name), to make an investment online, log on towww.computershare.com and select “Investor Centre” and follow the online instructions. Optional cash investments may also be mailed to the Plan Administratorconnection with the tear-off portionobtaining of your account statementmaterials or via detailed written instructions.

        You may also authorize the Plan Administrator, onservices, or (c) which is a Direct Debit Authorization Formdirect or the Plan Administrator's website, to make monthly purchases of a specified dollar amount, paid for by automatic withdrawal from your U.S. bank account. Funds will be withdrawn from your bank account, via EFT, on the fourth day of each month (or the next business day if the fourth is not a business day). To terminate monthly purchases by automatic withdrawal, you must send the Plan Administrator written, signed instructions. It is your responsibility to notify the Plan Administrator if your direct debit information changes.

        In the event that any check, draft or electronic funds transfer you may tender or order as payment to the Plan Administrator to purchase Banner common stock is dishonored, refused or returned, you agree that the purchased shares when credited to your account may be sold, on the Plan Administrator's order without your consent or approval, to satisfy the amount owing on the purchase. The “amount owing” will include the purchase price paid, any purchase and sale transaction fees, any brokerage commissions and the Plan Administrator's returned check or failed electronic payment fee of $25.00. If the sale proceeds of purchased shares are insufficient to satisfy the amount owing, you authorize the

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Plan Administrator to sell additional shares then credited to your account as necessary to cover the amount owing, without your further consent or authorization. The Plan Administrator may sell shares to cover an amount owingindirect obligation which arises as a result of your order inbanker's acceptances or bank letters of credit issued to secure obligations of the Company, or to secure the payment of revenue bonds issued for the benefit of the Company whether contingent or otherwise;

          (ii)          any manner consistent with applicable securities laws. Any sale for that purpose on a national securities market, such as the Nasdaq Global Select Market, will be considered to be commercially reasonable. You grant the Plan Administrator a security interest in all shares credited to your account including securities subsequently acquired and held or tendered for deposit, for purposesdebt of securing any amount owing asothers described in this paragraph.the preceding clause (i) which the Company has guaranteed or for which it is otherwise liable;

          If you are a beneficial owner (i.e., you are a beneficial owner(iii)          the obligation of Banner shares that are registered in a name other than your own, suchthe Company as lessee under any lease of property which is reflected on the Company's balance sheet as a bank, brokercapitalized lease; and

          (iv)          any deferral, amendment, renewal, extension, supplement or other nominee) and wish to purchase additional Banner shares, you must either become a registered holder by having your shares transferred into your own name and following the instructions above, or you must instruct your bank, broker or other nominee to invest on your behalf.

How do I make cash investments in excessrefunding of $40,000?

       If you want to make optional cash investments in excess of $40,000 in any month or an initial investment in excess of $40,000, you must receive our written approval. To obtain our written approval, you must submit a request for waiver form. You can obtain a request for waiver form by contacting Banner directly by calling us at 1-509-526-8894. We have the sole discretion to approve or refuse any request to make an optional cash investment or initial investment in excessliability of the maximum amount and to set the terms of any such optional cash investment or initial investment.

        If we approve your request for waiver, the Plan Administrator will notify you promptly. In deciding whether to approve a request for waiver, we will consider relevant factors, including, but not limited to, the following:

• whether the Plan is then acquiring newly issued shares directly from us or acquiring shareskind described in the open market or in privately negotiated transactions from third parties;

• our need for additional funds;

• the attractiveness of obtaining additional funds through the sale of common stock as compared to other sources of funds;

• the purchase price likely to apply to any sale of common stock;

• the shareholder submitting the request;

• the extent and nature of the shareholder's prior participation in the Plan;

• the number of shares of common stock held of record by the shareholder;

• the aggregate number of optional monthly cash investments and initial investments in excess of $40,000 for which requests for waiver have been submitted by all existing shareholders and new investors; and

• our current and projected capital needs.

If requests for waiver are submitted for an aggregate amount in excess of the amount we are then willing to accept, we may honor such requests in order of receipt, pro rata or by any other method that we determine to be appropriate. We may determine, in our discretion, the maximum amount that an existing shareholder or new investor may invest pursuant to the Plan or the maximum number of shares that may be purchased pursuant to a request for waiver.

How do I enroll to have my cash dividends reinvested?

        If you are the registered holder of shares, you may chose to reinvest all, a portion or none of the cash dividends paid on your shares reinvested under the Plan in additional shares by accessing your account online atwww.computershare.com or by completing an enrollment form and returning it to the Plan Administrator. You can change your dividend reinvestment election at any time by accessing the Plan Administrator's website atwww.computershare.com or by completing and signing a new enrollment form and returning it to the Plan Administrator. For your new or changed participation to be effective for a particular dividend, your notification must be received on or before the record date for that dividend.

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You must choose one of the following when completing the enrollment form:

(a)Full Dividend Reinvestment –If you select this option, the Plan Administrator will reinvest all cash dividends paid on all of the Banner shares registered in your name and you will be able to make optional cash payments for the purchase of additional shares in accordance with the Plan.

Or

(b)Partial Dividend Reinvestment– If you select this option, the Plan Administrator will pay you dividends in cash on the number of shares of Banner common stock that you specify in the appropriate space on the enrollment form and apply the balance of your dividends toward the purchase of additional shares in accordance with the Plan. This option also permits you to make optional cash payments for the purchase of additional shares in accordance with the Plan.

Or

(c)Voluntary Cash Payments Only (No Dividend Reinvestment) – If you select this option, your dividends will not be reinvested. Instead, you will receive payment by check or automatic deposit for all of your cash dividends. This option also permits you to make optional cash payments for the purchase of additional shares in accordance with the Plan.

You may select any of the above investment options. If no option is selected by you on the enrollment form which you return, you will be enrolled in the Full Dividend Reinvestment Option. Regardless of your investment choice, all shares purchased for you through the Plan will be credited to your account by the Plan Administrator until you direct that these shares be sold or issued to you in certificate form.preceding clauses (i), (ii) and (iii).

          If you are a beneficial owner of Banner shares, you must instruct your bank, broker or nominee regarding reinvestment of dividends.

Must I reinvest dividends?

        No. Dividend reinvestment is an option offered under the Plan. When you enroll in the Plan by filling out the enrollment form, you may indicate whether you want cash dividends on your shares reinvested. If you do"Senior debt" does not indicate a preference, however, all cash dividends on your Plan shares will be reinvested.

        If you choose to receive cash dividends on some or all of your shares, your cash dividend can be deposited directly to your bank account. If you are interested in this option, contact the Plan Administrator or your bank, broker or nominee, as appropriate, and request forms for Authorization for Electronic Direct Deposit. Alternatively, if you are a registered holder, you may enroll to receive your cash dividends via direct deposit by accessing the Plan Administrator's website atwww.computershare.com. Select “Investor Centre” and follow the online instructions. If you elect to receive cash dividends, and do not enroll in the direct deposit option or do not enroll in the Plan at all, your dividend payments will continue to be sent, by check, to the address of record on the account.

What is the price I will pay for shares for reinvested dividends and cash investments under $40,000?

         If we direct the Plan Administrator to purchase shares of common stock directly from us with respect to reinvested dividends or optional cash investments of $40,000 or less, the purchase price of shares of common stock purchased will be the average of the closing sales prices of the shares of common stock as reported on the Nasdaq Global Select Market for the five trading days immediately preceding the investment date, less the Plan discount, if any, then in effect. A “trading day” is any day on which trades are reported on the Nasdaq Global Select Market. We may offer discounts ranging from 0% to 5%. At our discretion, the discount may be offered at variable rates on one, all or a combination of the sources of investments, or not at all.

        If the Plan Administrator purchases shares of common stock in market transactions, then your share price will be the weighted average price of all shares purchased for that investment. The share price is the same for all participants

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in a given investment (i.e., initial investors, current investors sending optional cash payments and participants reinvesting their dividends).

What is the investment date for reinvested dividends and cash investments under $40,000?

        The “Purchase Date” is the date or dates on which the Plan Administrator purchases shares of our common stock for the Plan, as described below.

        Dividend Reinvestments. If the Plan Administrator acquires shares directly from us, it will combine the dividend funds of all Plan participants whose dividends are automatically reinvested and will generally invest such dividend funds on the dividend payment date (and any succeeding trading days necessary to complete the order). If the dividend payment date falls on a day that is not a Nasdaq Global Select Market trading day, then the investment will occur on the next trading day. In addition, if the dividend is payable on a day when optional cash payments are to be invested, dividend funds may be commingled withinclude (1) any such pending cash investments and a combined order may be executed. If the Plan Administrator acquires shares from parties other than us through open market transactions, such purchases will occur during a period beginning on the day that would be deemed the Purchase Date if the shares were acquired directly from us and ending no later than 3 0 days following the date on which we paid the applicable cash dividend, except where completion at a later date is necessaryindebtedness, obligation or advisable under any applicable federal or state securities laws or regulations. The record date associated with a particular dividend isliability referred to in this Planclauses (i) through (iv) above as a “dividend record date.”

        Initial and Optional Cash Investments up to $40,000. Ifwhich, in the Plan Administrator acquires shares directly from us, theninstrument creating or evidencing the Purchase Date for optional cash investments upsame or pursuant to $40,000 will be onwhich the tenth calendar day of each month,same is outstanding, it is provided that such indebtedness, obligation or the next trading day if the tenth dayliability is not a trading day. Ifsuperior in right of payment to the Plan Administrator acquires shares from third parties other than us through open market transactions, it will attemptsubordinated debt securities, or ranks pari passu with the subordinated debt securities, (2) any such indebtedness, obligation or liability which is subordinated to buy our common stock inindebtedness of the open market through a registered broker-dealer. Such purchases will begin onCompany to substantially the day that would be deemed the Purchase Date if the shares were acquired directly from us and will be completed no later than 35 days following such date, except where completion at a later date is necessarysame extent as or advisable under any applicable federal or state securities laws or regulations.

        If you are investing by mail, the Plan Administrator must receive your physical check at least two business days prior to a Purchase Date. Initial and optional cash investments received aftergreater extent than the applicable investment date deadline will be applied to purchase shares on the following Purchase Date. If yousubordinated debt securities are investing online, please refer to your confirmation page for the estimated debit date for your one-time deduction. The Plan Administrator will commingle all funds received from participants. Once you have placed your order, you may not request a cash refund or otherwise change your order. No interest will be paid on funds pending investment held by the Plan Administrator.

What is the price I will pay and what will be the investment date for cash investments of more than $40,000?

         Shares of Banner common stock purchased pursuantsubordinated, (3) any indebtedness to a request for waiver for optional cash investmentssubsidiary of more than $40,000 will be acquired at a price to you equalthe Company and (4) the subordinated debt securities.

          The subordinated indenture does not limit or prohibit the incurrence of additional senior indebtedness, which may include indebtedness that is senior to the averagesubordinated debt securities, but subordinate to our other obligations. Any prospectus supplement relating to a particular series of subordinated debt securities will set forth the aggregate amount of our indebtedness senior to the subordinated debt securities as of a recent practicable date.

          The prospectus supplement may further describe the provisions, if any, which may apply to the subordination of the high and low sales prices, computed upsubordinated debt securities of a particular series.

Restrictive Covenants

          The subordinated indenture does not contain any significant restrictive covenants. The prospectus supplement relating to six decimal places,a series of subordinated debt securities may describe certain restrictive covenants, if necessary, of Banner's common stock on the Nasdaq Global Select Market for each trading day during the pricing period. The pricing period for optional investments made pursuantany, to an approved request for waiver will be the day or days set forth in the request for waiver, which we may be bound under the investment date or up to ten trading days prior to and including an investment date. A request for waiver may specify one or more investment dates. Shares purchased with optional cash investments of more than $40,000 pursuant to a request for waiver may be purchased at a discount from the purchase price and may be subject to a threshold price and will only be purchased directly from us, and not through open market transactions .subordinated indenture.

Governing Law

          Unless we waive our right to do so, we may establish for any investment date a minimum price (the “threshold price”) for purchasing shares with optional cash investments made pursuant to written requests for waiver. We will, at least two business days prior to the commencement of the pricing period for an investment date, determine whether to establish a threshold price and, if a threshold price is established, its amount and so notify the Plan Administrator. The determination whether to establish a threshold price and, if a threshold price is established, its amount will be made by us in our discretion after a review of current market conditions, the level of participation in the Plan, and current and projected capital needs.

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        The threshold price for optional cash investments made pursuant to written requests for waiver, if established for any investment date, will be a stated dollar amount that the average of the high and low sales prices of Banner's common stock on the Nasdaq Global Select Market for each trading day of the relevant pricing period (not adjusted for discounts, if any) must equal or exceed. If the threshold price is not satisfied for a trading day in the pricing period, then that trading dayindentures and the trading prices for that daydebt securities will be excluded from that pricing period and a pro rata portion of the participant's cash will be returned, without interest. Thus, for example, if an approved request for waiver specifies that the pricing period is one day (that is, the investment date) and the threshold price is not satisfied on that day, then no investment will be made and the participant's cash will be returned in full. Likewise, if the thre shold price is not satisfied for two of the five trading days in a particular pricing period, then the average sales price for purchases and the amount of optional cash investments which may be invested will be based upon the remaining three trading days when the threshold price is satisfied. In such case, for each trading day on which the threshold price is not satisfied, one-fifth of the optional cash investment made by a participant pursuant to a request for waiver would be returned to such participant, without interest, as soon as practicable after the applicable investment date. Similarly, a pro rata portion of the participant's cash will be returned if there are fewer trading days prior to the investment date than are specified as the pricing period in the request for waiver or if no trades in Banner common stock are reported on the Nasdaq Global Select Market for a trading day during the pricing period, due to a market disruption or for any other reason.

        We may elect to activate for any particular pricing period the pricing period extension feature, which will provide that the initial pricing period will be extended by the number of days during such period that the threshold price is not satisfied, or on which there are no trades of our common stock reported by the Nasdaq Global Select Market, subject to a maximum of five trading days. If we elect to activate the pricing period extension feature and the threshold price is satisfied for any additional day that has been added to the initial pricing period, then that day will be included as one of the trading days for the pricing period in lieu of the day on which the threshold price was not met or trades of our common stock were not reported. For example, if the determined pricing period is ten days, and the threshold price is not satisfied for three out of those ten days in the initial pricing period, and we had previously announced at the time of the request for w aiver acceptance that the pricing period extension feature was activated, then the pricing period will automatically be extended, and if the threshold price is satisfied on the next three trading days (or a subset thereof), then those three days (or a subset thereof) will be included in the pricing period in lieu of the three days on which the threshold price was not met. As a result, the purchase price will be based upon the ten trading days of the initial and extended pricing period on which the threshold price was satisfied and all of the cash investment will be invested (rather than 30% being returned).

        The threshold price and pricing period extension concepts and return procedure discussed above apply only to optional cash investments made pursuant to written requests for waiver. Setting a threshold price for an investment date shall not affect the setting of a threshold price for any subsequent investment date.

         For any particular investment date, we may waive our right to set a threshold price for optional cash investments that exceed $40,000. Neither Banner nor the Plan Administrator shall be required to provide any written notice to participants as to the threshold price for any investment date. Participants, however, may ascertain whether the threshold price applicable to an investment date pursuant to a request for waiver has been set or waived, as applicable, by telephoning Banner at 1-509-526-8894.

        The purchase price will not be known until the purchase is completed. Participants should be aware that the price may fluctuate during the period between submission of a purchase request, its receipt by the Plan Administrator, and the ultimate purchase on the open market.

How do I keep track of the transactions in my account?

         If you are a registered holder, the Plan Administrator will mail a year-to-date summary plan statement after each cash dividend. In addition, a statement will be mailed to you after each purchase, which statement will include the number of shares purchased and the purchase price. You may also view your transaction history online by logging into your account on the Plan Administrator's website atwww.computershare.com. Details available online include share price, commission and fees paid, and transaction type and date.

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        If you are a beneficial owner, you must contact your bank, broker or nominee for information regarding transactions in your account.

What is safekeeping of certificates and how do I submit my certificates?

        If you own shares of Banner common stock in stock certificate form, you may elect to deposit the shares represented by those stock certificates into your Plan account for safekeeping with the Plan Administrator. The Plan Administrator will credit these shares to your Plan account. You may later request issuance of a certificate from the Plan Administrator at any time.        

        To deposit shares with the Plan Administrator, send your stock certificates to the Plan Administrator at the address listed on page 8. We recommend that you send your certificates via registered mail and insured for 3% of the total value of the shares to protect against loss in transit.

How do I withdraw shares held in my Plan account?

        You may request that the Plan Administrator issue a certificate for some or all of the shares held in your Plan account by doing any of the following: 

•  Access the Plan Administrator's website atwww.computershare.com. Select “Investor Centre,” login to your account and then follow the online instructions;   

•  Call 1-800-697-8924 to access the Plan Administrator's automated telephone system; or   

•  Complete and sign the tear-off portion of your statement and mail the instructions to the Plan Administrator.

The Plan Administrator will issue a certificate in the exact registered name shown on your Plan statement. Certificates will be sent by first class mail, generally within a few days of receiving your request. There is no charge to you for this service.

How do I transfer shares to another person?

        You may transfer ownership of some or all of your Plan shares to another person, whether by gift, private sale, or otherwise. In order to transfer some or all of your shares, you must properly complete a Transfer of Ownership Form, or an executed stock power, and return it to the Plan Administrator. Transfers may be made in book-entry or certificated form.

        Requests for transfer of book-entry shares held under the Plan are subject to the same requirements as the transfer of our common stock certificates, including the requirement of a medallion signature guarantee. You may request a copy of the Transfer of Ownership Form by contacting the Plan Administrator at 1-800-697-8924 or by downloading the forms from the Plan Administrator's website atwww.computershare.com.

How do I sell shares held in my account?

        You may instruct the Plan Administrator to sell shares held in your Plan account by doing any of the following:

• Access the Plan Administrator's website atwww.computershare.com. Select “Investor Centre,” login to your account and follow the online instructions;

• Call 1-800-697-8924 to access the Plan Administrator's automated telephone system; or

• Complete and sign the tear-off portion of your account statement and mail the instructions to the Plan Administrator.
  

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If there is more than one individual owner on the Plan account, all participants must authorize the transaction and sign the instruction.

        If you want to sell any shares through the Plan that are held in certificate form, the shares must first be deposited and converted into book-entry shares.

        Upon receipt of your request to sell Plan shares, the Plan Administrator will make every effort to process your order on the day it is received. To do so, your sale instructions must be received by 1:00 p.m. Eastern time on a business day during which the Administrator and the Nasdaq Global Select Market are open. Sales will be made through an independent brokerage organization at the then-current market price. The Plan Administrator will promptly mail you a check for the proceeds, less an administrative fee of $15 and commissions of $0.12 per share sold. Computershare has sole discretion in all matters related to the sale. You cannot specify a price or time to sell your book-entry Plan shares.

        The selling price will not be known until the sale is completed. Participants should be aware that the price may fluctuate during the period between a request for sale, its receipt by the Plan Administrator, and the ultimate sale on the open market. Instructions sent to the Plan Administrator may not be rescinded.

        All sale requests having an anticipated market value of $25,000 or more must be submitted in written form. In addition, all sale requests within thirty (30) days of an address change to your account must be submitted in written form.

How do I close my account?

        If you are a registered holder, you may terminate Plan participation by directing the Plan Administrator to sell all of the shares in your account. You may submit a signed written instruction to the Plan Administrator, complete the tear-off form from your account statement, or you may utilize the Plan Administrator's website. Follow the sales procedure outlined under “How do I sell shares held in my account?” above, making certain to elect the sale of all Plan shares.

        Alternatively, you may elect to receive a certificate for the full shares held in your Plan account and to sell any fractional share remaining. In such case, a certificate will be issued for the whole shares and a cash payment will be made for any remaining fractional share. That cash payment will be based upon the current market price of the common stock, less any service fee, any applicable brokerage commission and any other costs of sale.

        You must specifically inform the Plan Administrator that you wish to terminate participation in the Plan (which option is listed separately on the tear-off form attached to Plan statements). If you fail to do so, future dividends on non-Plan shares will continue to be reinvested in accordance with your pre-termination instructions, until you direct the Plan Administrator otherwise.

        If you are a beneficial owner, you must contact your bank, broker or nominee to close your account.

Additional Information Regarding the Plan

       We reserve the right to curtail or suspend transaction processing until the completion of any stock dividends, stock splits or other corporate actions. Any stock dividends, distributions or stock split shares distributed on stock held by the Plan Administrator for the participant in the Plan will be credited directly into the participant's account.

        Plan participants may vote all shares (full and fractional) held in their Plan account.

      Neither Banner nor the Plan Administrator will be liable for any act performed in good faith or for any good faith omission to act, including, without limitation, any claim of liability (i) arising out of failure to terminate a participant's account, sell stock held in the Plan, or invest optional cash payments or dividends or (ii) with respect to the prices at which stock is purchased or sold for the participant's account and the time such purchases or sales are made.

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        If, at any time, the total number of shares in the participant's account is less than one share, any remaining fraction may be sold and the account closed. See“What are the fees associated with participation?” above for applicable fees associated with the sale of shares.

        We reserve the right to modify the terms of the Plan, including applicable fees, or to terminate the Plan at any time. In addition, we reserve the right to interpret and regulate the Plan as we deem necessary or desirable in connection with its operation. The Plan is generally not for use by institutional investors or financial intermediaries. The Plan shall be governed by, and construed in accordance with, the laws of the State of Washington. Participation in the Plan, via any of the means outlined herein, shall constitute an offer by the participant to establish an agency relationship with the Plan Administrator and shall be governed by the terms and conditions of the Plan.New York.

Neither Banner nor the Plan Administrator will provide any advice, make any recommendations, or offer any opinion with respect to whether or not you should purchase or sell shares or otherwise participate under the Plan. You must make independent investment decisions based on your own judgment and research. The shares held in Plan accounts are not subject to protection under the Securities Investor Protection Act of 1970.

• 25,000,000 shares of common stock, par value $0.01$.01 per share,share; and
  
• 500,000 shares of preferred stock, par value $0.01$.01 per share.

• the designation and stated value per share of the preferred stock and the number of shares offered;
  
• the amount of liquidation preference per share;
  
• the price at which the preferred stock will be issued;
  
• the dividend rate, or method of calculation, the dates on which dividends will be payable, whether dividends will be cumulative or noncumulative and, if cumulative, the dates from which dividends will commence to accumulate;
  
• any voting rights;
  
• any redemption or sinking fund provisions;
  
• any conversion provisions; and
  
• any other rights, preferences, privileges, limitations and restrictions on the preferred stock.

• senior to all classes of common stock and all equity securities issued by us the terms of which specifically provide that the equity securities will rank junior to the preferred stock (referred to as the "junior securities");
  
• equally with all equity securities issued by us the terms of which specifically provide that the equity securities will rank equally with the preferred stock (referred to as the "parity securities"); and
  
• junior to all equity securities issued by us the terms of which specifically provide that the equity securities will rank senior to the preferred stock.

• the designation and terms of the units and of the securities comprising the units, including whether and under what circumstances those securities may be held or transferred separately;
  
• any provisions for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units;
  
• the terms of the unit agreement governing the units;
  
• United States federal income tax considerations relevant to issuethe units; and
  
• whether the units will be issued in fully registered or global form.

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description of units in the applicable prospectus supplement does not purport to be complete and is subject to and is qualified in its entirety by reference to the form of unit agreement which will be filed with the SEC in connection with the

INFORMATION NOT REQUIRED IN THE PROSPECTUS

Item 14. Other Expenses of Issuance and Distribution

Distribution.

             The following table sets forth the estimated expenses, other than underwriting compensation, expected to be incurred in connection with the issuanceregistration and distributionsale of the securities covered by thethis Registration Statement of which this prospectus is a part.We will bear all of these expenses.
Statement.

*Estimated solely forAll of the purpose of this Item. Actual expenses may be more or less.

above amounts, other than the SEC registration fee, are estimates.

Item 15. Indemnification of OfficersDirectors and Directors

Officers

            Article XIV of the Registrant's Articles of Incorporation requires indemnification of directors and officers to the fullest extent permitted by Washington law, except for (i) acts or omissions finally adjudged to violate law; (ii) conduct finally adjudged to violate Section 23B.08.310 of the Washington Business Corporation Act (relating to unlawful distributions by the corporation), or (iii) any transaction with respect to which it was finally adjudged that the director or officer personally received a benefit in money, property or services to which that person was not legally entitled

entitled. Sections 23B.08.500 through 23B.08.600 of the Washington Business Corporation Act authorize a court to award, or a corporation's board of directors to grant, indemnification to directors and officers on terms sufficiently broad to permit indemnification under certain circumstances for liabilities arising under the Securities Act of 1933.

            Section 23B08.320 of the Washington Business Corporation Act authorizes a corporation, in its articles of incorporation, to limit a director's personal liability to the corporation or its shareholders for monetary damages for acts ofor omissions as a director, except in certain circumstances involving intentional misconduct, self-dealing or illegal corporate loans ora knowing violation of law, unlawful distributions by the corporation, or any transactions from which the director personally receives a benefit in money, property or services to which the director is not entitled. The Registrant's articles of incorporation limit a director's liability to full extent permitted by Section 23B08.320.

21            Under a directors' and officers' liability insurance policy, directors and officers of the Registrant are insured against certain liabilities.

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Item 16. Exhibits

            The following exhibits are filed with or incorporated by reference into this Registration Statement:

(1) To be filed as an exhibit to a document to be incorporated by reference in this Registration Statement.

             (b) Financial Statement Schedules:

                          Not Applicable.

Item 17. Undertakings
Undertakings.

             (a)             The undersigned Registrant hereby undertakes:

                     1.             (1) To file, during any period in which offers or sales are being made a post-effective amendment to this Registration Statement:

registration statement:

                          (i)             toTo include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

                          (ii)             toTo reflect in the prospectus any facts or events arising after the effective date of the Registration Statementregistration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Statement;Fee" table in the effective registration statement; and

                          (iii)             toTo include any material information with respect to the plan of distribution not previously disclosed in the Registration Statementregistration statement or any material change into such information in the Registration Statement;

Provided,registration statement;

provided, however, that the undertakings set forth in paragraphs (a)(1)(i), (1)(ii) and (a)(1)(ii)(iii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Securities and Exchange Commission by the Registrantregistration pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the Registration Statement.

                     2.registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement;

             (2)             That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new Registration Statementregistration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initialbona fide offering thereof.

                    3.thereof;

             (3)             To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.offering;

22             (4)             That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

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                          (i)             Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

                          (ii)             Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a)of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initialbona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.

             (5)             That, for the purpose of determining any liability of the Registrant under the Securities Act to any purchaser in the initial distribution of the securities:

             The undersigned Registrant hereby undertakes that in a primary offering of securities of the Registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the Registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

                          (i)             Any preliminary prospectus or prospectus of the Registrant relating to the offering required to be filed pursuant to Rule 424;

                          (ii)             Any free writing prospectus relating to the offering prepared by or on behalf of the Registrant or used or referred to by the Registrant;

                          (iii)             The portion of any other free writing prospectus relating to the offering containing material information about the Registrant or its securities provided by or on behalf of the Registrant; and

                          (iv)             Any other communication that is an offer in the offering made by the Registrant to the purchaser.

             (6)             That, for the purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the Registration Statementthis registration statement shall be deemed to be a new Registration Statementregistration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initialbona fide offering thereof;

             (7)             That:

                          (i)             For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

                          (ii)             For the purposes of determining of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time be deemed to be the initial bona fide offering thereof.

            (c)

             (8)             To file an application for the purpose of determining the eligibility of the trustee to act under subsection (a) of Section 310 of the Trust Indenture Act in accordance with the rules and regulations prescribed by the Commission under Section 305(b)(2) of the Trust Indenture Act.

             Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officerofficers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrantregistrant of expenses incurred or paid by a director, officer or controlling person of the Registrantregistrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.

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             Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Walla Walla, State of Washington, on the 23rd20th day of October,December, 2006.

BANNER CORPORATION

                                                                                                        By:/s/D. Michael Jones                                                         
                                                                                                              D. Michael Jones
                                                                                                              President and Chief Executive Officer
                                                              ��                                              (Duly Authorized Representative)

             Each person whose signature appears below appoints D. Michael Jones, as his true and lawful attorney-in-fact and agent, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement and any Registration Statement (including any amendment thereto) for this offering that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as he might or would do in person, hereby ratifying and confirming all that said attorney-in fact and agent may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.

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EXHIBIT INDEX

    25

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EXHIBIT INDEX

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Exhibit 5

Opinion of Breyer & Associates PC

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[Letterhead of Breyer & Associates PC]

October 23, 2006

Board of Directors
Banner Corporation
10 S. First Avenue
Walla Walla, Washington 99362

Ladies and Gentlemen:

            We have acted as special counsel to Banner Corporation, a Washington corporation (the “Company”), in connection with the preparation of the Registration Statement on Form S-3(1) To be filed with the Securities and Exchange Commission (“Registration Statement”) under the Securities Act of 1933, as amended, relating to shares of common stock, $0.01 par value per share (the “Common Stock”) of the Company, to be offered upon the terms and subject to the conditions set forth in the Banner Corporation Dividend Reinvestment and Direct Stock Purchase and Sale Plan (the “Plan”) included in the Registration Statement. The Registration Statement also registers an indeterminate number of additional shares which may be necessary to adjust the number of shares registered thereby for issuance as the result of a stock split, stock dividend or similar adjustment of the number of issued and outstanding shares of Common Stock. You have requested t he opinion of this firm with respect to certain legal aspects of the proposed offering.

            We have reviewed the Registration Statement, the Articles of Incorporation and Bylaws of the Company, the Plan, a specimen stock certificate evidencing the Common Stock and such other documents and records as we have deemed necessary for purposes of this opinion. We are relying upon the originals, or copies certified or otherwise identified to our satisfaction, of the corporate records of the Company and such other instruments, certificates and representations of public officials, officers and representatives of the Company as we have deemed applicable or relevant as a basis for the opinions set forth below. In addition, we have assumed, without independent verification, the genuineness of all signatures and the authenticity of all documents furnished to us and the conformance in all respects of copies to originals, the legal capacity of all persons or entities executing the same, the lack of any undisclosed termination, modification, waiver or amendment to any document reviewed by us and the due authorization, execution and delivery of all documents where due authorization, execution and delivery are prerequisites to the effectiveness thereof. We have also assumed that the certificates representing the Common Stock will be when issued, properly signed by authorized officers of the Company or their agents. Furthermore, we have made such factual inquiries and reviewed such laws as we determined to be relevant for the purposes of this opinion.

            We are admitted to practice law in the District of Columbia, and we render this opinion only with respect to, and express no opinion herein concerning the application or effect of the laws of any jurisdiction other than, the existing laws of the United States of America and of the State of Washington.

            In connection with our opinion expressed below, we have assumed that, at or prior to the time of the delivery of any shares of Common Stock under the Plan, the Registration Statement will have been declared effective under the Securities Act of 1933, as amended, that the registration will apply to such shares of Common Stock and will not have been modified or rescinded and that there will not have occurred any change in law affecting the validity of the issuance of such shares of Common Stock.

            Based on the foregoing, and subject to the assumptions set forth herein, we are of the opinion as of the date hereof that the shares of Common Stock that may be issued pursuant to the Plan, upon receipt by the Company of any consideration required thereby, as applicable, will be legally issued, fully paid and non-assessable shares of Common Stock.

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Board of Directors
Banner Corporation
October 23, 2006
Page 2

            We consent to the use of this opinion as an exhibit to the Registration Statement and further consent to all references to us, if any, in the Registration Statement, the Prospectus constituting a part thereof and any amendments thereto. This opinion is intended solely for use in connection with issuance and sale of shares subject to the Registration Statement and is notdocument to be relied upon for any other purpose. We assume no obligation to advise you of any fact, circumstance, event or change in the law or the facts that may hereafter be brought to our attention whether or not such occurrence would affect or modify the opinions expressed herein.


            We hereby consent to the filing of this opinion as an exhibit to the Registration Statement on Form S-3.

                                                                                            Sincerely,

                                                                                           /s/ Breyer & Associates PC

                                                                                           BREYER & ASSOCIATES PC

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Exhibit 23.1

Consent of Moss Adams LLP

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Consent of Independent Registered Public Accounting Firm

The Board of Directors
Banner Corporation
Walla Walla, Washington

We consent to incorporation by reference in the Registration Statement on Form S-3 of Banner Corporation, relating to the Banner Corporation Dividend Reinvestment and Direct Stock Purchase and Sale Plan, of our reports dated March 13, 2006, with respect to the consolidated statements of financial condition of Banner Corporation and subsidiaries as of December 31, 2005 and 2004, and the related consolidated statements of income, comprehensive income, changes in stockholders' equity, and cash flows for each of the years in the two-year period ended December 31, 2005, management's assessment of the effectiveness of internal control over financial reporting as of December 31, 2005, and the effectiveness of internal control over financial reporting as of December 31, 2005, which reports appear in the December 31, 2005, annual report on Form 10-K of Banner Corporation.

/s/Moss Adams LLP

Spokane, Washington
October 23, 2006

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We consent to the incorporationincorporated by reference in this Registration Statement on Form S-3 of our report dated March 11, 2004, relating to the financial statements of Banner Corporation and subsidiaries, for the year ended December 31, 2003 appearing in the Annual Report on Form 10-K of Banner Corporation and subsidiaries for the year ended December 31, 2005 and to the reference to us under the heading “Experts” in the Prospectus, which is part of this Registration Statement.

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