The parent company of Walla Walla-based Banner Bank is bringing another Washington state financial institution into its fold. 

Banner Corporation will acquire Pacific Financial Corporation, the holding company of Aberdeen-based Bank of the Pacific, in an all-stock transaction. Once complete, Banner will have about $18 billion in assets. 

“Bank of the Pacific is a highly-respected, financially strong community bank with exceptional core deposits, and we’re pleased they selected Banner as their merger partner,” said Mark Grescovich, Banner President and CEO, in a statement. “This transaction expands our presence and density in attractive Western Washington and Western Oregon markets while offering Bank of the Pacific customers broader product offerings and technology tools, increased commercial lending limits and an expanded branch delivery system.” 

Bank of the Pacific has 18 branches, most of them concentrated on or near the Washington state coast, with some concentrated around Bellingham and a few in Oregon’s Willamette Valley. It has assets of $1.29 billion compared to Banner’s $16.34 billion. 

Banner operates 135 bank branches across four Western states, with four branches in the Tri-Cities. 

Under the terms of the merger, Pacific Financial shareholders will receive 0.2633 shares of Banner common stock in exchange for each share of Pacific Financial common stock. Based on the closing price of $66.25 per share of Banner common stock on April 29, the implied value of the merger consideration to be received by Pacific Financial shareholders is equal to $17.44 per share, or about $177 million.