Banner Corporation Designated to Join Russell 3000 Index

WALLA WALLA, Wash., June 20, 2011 (GLOBE NEWSWIRE) — Banner Corporation (Nasdaq:BANRD), the parent company of Banner Bank and Islanders Bank, today announced that it has been designated to join the U.S. broad-market Russell 3000^® Index when Russell Investments reconstitutes its comprehensive set of U.S. and global equity indexes on June 24, according to a preliminary list of additions posted June 10 on www.russell.com/indexes.

Annual reconstitution of Russell’s U.S. indexes captures and ranks the 4,000 largest U.S. stocks as of the end of May by total market capitalization. Membership in the Russell 3000, which remains in place for one year, also means that Banner will be included in the small-cap Russell 2000^® Index as well as the appropriate growth and value style indexes. Russell determines membership for its equity indexes primarily by objective, market-capitalization rankings and style attributes.

“Our addition to the Russell 3000^® Index will expand awareness of our accomplishments among institutional investors and the investment community,” said Mark. J. Grescovich, President and CEO, “and we believe that being part of such a broadly benchmarked index should increase demand for our stock from investors seeking to track index performance.”

The Russell 3000 also serves as the U.S. component to the Russell Global Index.

Russell indexes are widely used by investment managers and institutional investors for index funds and as benchmarks for both passive and active investment strategies. �An industry-leading .9 trillion in institutional assets currently are benchmarked to Russell indexes. �These investment tools originated from Russell’s multi-manager investment business in the early 1980s when the company saw the need for a more objective, market-driven set of benchmarks in order to evaluate outside investment managers.

More information about Russell Indexes, including total returns, is available at http://ping.fm/mLLUG.

About Banner Corporation:

Banner Corporation is a .30 billion bank holding company operating two commercial banks in Washington, Oregon and Idaho.�Banner serves the Pacific Northwest region with a full range of deposit services and business, commercial real estate, construction, residential, agricultural and consumer loans.�Visit Banner Bank on the Web at www.bannerbank.com.�

About Russell:

Russell Investments provides strategic advice, world-class implementation, state-of-the-art performance benchmarks and a range of institutional-quality investment products. Russell has approximately 1 billion in assets under management as of March 31, 2011, and serves individual, institutional and advisor clients in more than 35 countries. Founded in 1936, Russell is a subsidiary of The Northwestern Mutual Life Insurance Company.�

Forward-Looking Statements

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

CONTACT: Mark J. Grescovich,
         President & CEO
         Lloyd W. Baker, CFO
         (509) 527-3636

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