Banner Corporation is primarily engaged in the business of planning, directing and coordinating the business activities of its wholly owned subsidiary, Banner Bank (the Bank), a regional bank that offers a wide variety of commercial banking services and financial products to both businesses and individuals in its primary market areas. The Banks 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 operation largely through the origination and sale of residential loans. Lending activities include commercial business and commercial real estate loans, construction and land development loans, one- to four-family residential loans and consumer loans. The Company had total assets of $2.263 billion, as of December 31, 2002.