Great Southern Bancorp, Inc. (NASDAQ:GSBC), the holding company for
Great Southern Bank, today reported that preliminary earnings for
the three months ended June 30, 2023, were $1.52 per diluted common
share ($18.3 million net income) compared to $1.44 per diluted
common share ($18.2 million net income) for the three months ended
June 30, 2022.
Preliminary earnings for the six months ended June 30, 2023,
were $3.19 per diluted common share ($38.8 million net income)
compared to $2.73 per diluted common share ($35.2 million net
income) for the six months ended June 30, 2022.
For the quarter ended June 30, 2023, annualized return on
average common equity was 13.11%, annualized return on average
assets was 1.28%, and annualized net interest margin was 3.56%,
compared to 12.72%, 1.34% and 3.78%, respectively, for the quarter
ended June 30, 2022. For the six months ended June 30, 2023,
annualized return on average common equity was 13.99%, annualized
return on average assets was 1.36%, and annualized net interest
margin was 3.77%, compared to 11.91%, 1.31% and 3.61%,
respectively, for the six months ended June 30, 2022.
Great Southern President and CEO Joseph W. Turner said, “Our
second quarter performance was solid as we continue to navigate
through a challenging operating environment. Thanks to the hard
work of the Great Southern team, we earned $1.52 per diluted common
share ($18.3 million) for the second quarter of 2023, compared to
$1.44 per diluted common share ($18.2 million) for the second
quarter of 2022. Earnings performance ratios in the second quarter
of 2023 were again good, with an annualized return on average
assets of 1.28% and annualized return on average equity of
13.11%.
“Like many banks, we experienced much higher deposit costs
during the second quarter, reflective of increasing market interest
rates and significant competition for deposits. Higher deposit
costs drove a decrease in net interest income – approximately
$700,000 lower in the second quarter 2023 compared to the same
period in 2022, and about $5 million lower compared to the first
quarter of 2023. Higher funding costs were significantly caused by
a substantial amount of time deposits maturing at relatively low
rates. These time deposits either renewed at higher rates or left
the Company, in turn requiring their replacement with other funding
sources at then-current market rates. Besides the higher funding
costs of deposits, net interest income was also negatively affected
by the Company’s interest rate swaps (two of which began net
settlements in May 2023). These two interest rate swaps reduced
interest income by a total of $1.7 million during the second
quarter and had no impact in previous quarters.”
Turner added, “The Company’s liquidity and capital positions
continue to be strong. Our borrowing capacity at the Federal Home
Loan Bank increased by more than $300 million in the second
quarter. At the end of June 2023, we had available secured funding
lines through the FHLBank and Federal Reserve Bank and on-balance
sheet liquidity totaling approximately $2.4 billion. Total
stockholders’ equity increased by $13 million from the end of 2022,
but decreased a bit from March 2023 as a result of increased
unrealized AOCI losses due to market rate increases in the second
quarter of 2023. Our capital remains substantially above regulatory
well-capitalized thresholds, and our tangible common equity ratio
was 9.4% at June 30, 2023, up from 9.2% at December 31, 2022. As we
noted last quarter, our deposit base is diverse by customer type
and geography and has a low level of uninsured deposits
(approximately 14% of total deposits). While we had run-off of
approximately $72 million in non-interest-bearing checking balances
in the first quarter of 2023, non-interest-bearing checking
balances declined only about $11 million from March 31, 2023 to
June 30, 2023.
“As expected, total outstanding loan balances modestly grew by
$10 million since the end of 2022. Growth primarily came from the
multi-family loan segment (much of this from projects completed and
moved from the construction category to multi-family), mainly
offset by reductions in the construction and commercial real estate
categories. At the end of June 2023, the pipeline of loan
commitments and unfunded lines declined to $1.6 billion, including
$1.1 billion in the unfunded portion of construction loans. At
March 31, 2023, loan commitments and unfunded lines totaled $1.9
billion, with $1.3 billion in unfunded construction lines.
“Overall credit quality metrics remained very strong during the
quarter. Non-performing assets to total assets were 0.20% at June
30, 2023, increasing 15 basis points from March 31, 2023. The
increase was related to one commercial real estate loan
relationship collateralized by an office building being added to
non-performing loans. Delinquencies in our loan portfolio continued
to be at historically low levels.”
Selected Financial Data:
(In thousands, except per
share data) |
Three Months EndedJune 30, |
|
Six Months EndedJune 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
2023 |
|
|
|
2022 |
|
Net interest income |
$ |
48,138 |
|
|
$ |
48,831 |
|
$ |
101,330 |
|
|
$ |
92,097 |
|
Provision (credit) for credit
losses on loans and unfunded commitments |
|
(1,619 |
) |
|
|
2,223 |
|
|
(945 |
) |
|
|
2,030 |
|
Non-interest income |
|
7,769 |
|
|
|
9,319 |
|
|
15,658 |
|
|
|
18,495 |
|
Non-interest expense |
|
34,718 |
|
|
|
33,004 |
|
|
69,181 |
|
|
|
64,271 |
|
Provision for income
taxes |
|
4,488 |
|
|
|
4,699 |
|
|
9,976 |
|
|
|
9,080 |
|
Net income and net income
available to common shareholders |
$ |
18,320 |
|
|
$ |
18,224 |
|
$ |
38,776 |
|
|
$ |
35,211 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per diluted common
share |
$ |
1.52 |
|
|
$ |
1.44 |
|
$ |
3.19 |
|
|
$ |
2.73 |
|
NET INTEREST INCOME
Net interest income for the second quarter of 2023 decreased
$693,000 to $48.1 million, compared to $48.8 million for the second
quarter of 2022. Net interest margin was 3.56% in the second
quarter of 2023, compared to 3.78% in the same period of 2022, a
decrease of 22 basis points. For the three months ended June 30,
2023, net interest margin decreased 43 basis points compared to net
interest margin of 3.99% in the three months ended March 31, 2023.
In comparing the 2023 and 2022 second quarter periods, the average
yield on loans increased 150 basis points while the average rate on
interest-bearing deposits increased 200 basis points. The margin
contraction primarily resulted from increasing interest rates on
all deposit types during the second quarter. The average interest
rate spread was 2.96% for the three months ended June 30, 2023,
compared to 3.65% for the three months ended June 30, 2022 and
3.53% for the three months ended March 31, 2023.
Compared to the first quarter of 2023, interest expense
increased $2.5 million on interest-bearing demand and savings
accounts, increased $1.8 million on time deposits and increased
$2.8 million on brokered deposits. The increase in interest expense
for interest-bearing demand and savings accounts and time deposits
was primarily due to higher market rates. The weighted average
interest rate on interest-bearing demand and savings accounts
increased 44 basis points, while the weighted average interest rate
on time deposits increased 78 basis points. The increase in
interest expense for brokered deposits was primarily due to an
increase in average balance, coupled with a 44-basis point increase
in average interest rate. Interest income on loans increased $2.0
million compared to the first quarter of 2023. Interest income was
reduced $1.7 million in the second quarter of 2023 by the initial
net settlement of two interest rate swaps, described below.
Net interest income for the six months ended June 30, 2023
increased $9.2 million to $101.3 million, compared to $92.1 million
for the six months ended June 30, 2022. Net interest margin was
3.77% in the six months ended June 30, 2023, compared to 3.61% in
the same period of 2022, an increase of 16 basis points. The margin
expansion primarily resulted from increasing market interest rates
and changes in the asset mix, with average loans increasing $396
million and average investment securities increasing $65 million.
The average interest rate spread was 3.24% for the six months ended
June 30, 2023, compared to 3.48% for the six months ended June 30,
2022.
In October 2018, the Company entered into an interest rate swap
transaction as part of its ongoing interest rate management
strategies to hedge the risk of its floating rate loans. The
notional amount of the swap was $400 million with a contractual
termination date in October 2025. As previously disclosed by the
Company, on March 2, 2020, the Company and its swap counterparty
mutually agreed to terminate this swap, effective immediately. The
Company was paid $45.9 million, including accrued but unpaid
interest, from its swap counterparty as a result of this
termination. This $45.9 million, less the accrued to date interest
portion and net of deferred income taxes, is reflected in the
Company’s stockholders’ equity as Accumulated Other Comprehensive
Income and is being accreted to interest income on loans monthly
through the original contractual termination date of October 6,
2025. The Company recorded $2.0 million of interest income related
to the swap in both the three months ended June 30, 2023 and the
three months ended June 30, 2022. The Company recorded $4.0 million
of interest income related to the swap in both the six months ended
June 30, 2023 and the six months ended June 30, 2022. The Company
currently expects to have a sufficient amount of eligible variable
rate loans to continue to accrete this interest income ratably in
future periods. If this expectation changes and the amount of
eligible variable rate loans decreases significantly, the Company
may be required to recognize this interest income more rapidly.
In March 2022, the Company entered into another interest rate
swap transaction as part of its ongoing interest rate management
strategies to hedge the risk of its floating rate loans. The
notional amount of the swap is $300 million, with a contractual
termination date of March 1, 2024. Under the terms of the swap, the
Company receives a fixed rate of interest of 1.6725% and pays a
floating rate of interest equal to one-month USD-LIBOR (or the
equivalent replacement rate if USD-LIBOR rate is not available).
The floating rate resets monthly and net settlements of interest
due to/from the counterparty also occur monthly. The initial
floating rate of interest was set at 0.2414%, with monthly
adjustments to the floating rate occurring after that time. To the
extent that the fixed rate exceeds one-month USD-LIBOR, the Company
will receive net interest settlements, which will be recorded as
loan interest income. If one-month USD-LIBOR exceeds the fixed rate
of interest, the Company will be required to pay net settlements to
the counterparty and will record those net payments as a reduction
of interest income on loans. The Company recorded a reduction of
loan interest income related to this swap transaction of $2.6
million in the three months ended June 30, 2023. The Company
recorded loan interest income of $668,000 in the three months ended
June 30, 2022. The Company recorded a reduction of loan interest
income related to this swap transaction of $4.7 million in the six
months ended June 30, 2023. The Company recorded loan interest
income of $1.0 million in the six months ended June 30, 2022.
In July 2022, the Company entered into two additional interest
rate swap transactions as part of its ongoing interest rate
management strategies to hedge the risk of its floating rate loans.
The notional amount of each swap is $200 million with an effective
date of May 1, 2023 and a termination date of May 1, 2028. Under
the terms of one swap, beginning in May 2023, the Company will
receive a fixed rate of interest of 2.628% and will pay a floating
rate of interest equal to one-month USD-SOFR OIS. Under the terms
of the other swap, beginning in May 2023, the Company will receive
a fixed rate of interest of 5.725% and will pay a floating rate of
interest equal to one-month USD-Prime. In each case, the floating
rate will be reset monthly and net settlements of interest due
to/from the counterparty will also occur monthly. To the extent the
fixed rate of interest exceeds the floating rate of interest, the
Company will receive net interest settlements, which will be
recorded as loan interest income. If the floating rate of interest
exceeds the fixed rate of interest, the Company will be required to
pay net settlements to the counterparty and will record those net
payments as a reduction of interest income on loans. The Company
recorded a reduction of loan interest income related to these swap
transactions of $1.7 million in the three months ended June 30,
2023. At June 30, 2023, the USD-Prime rate was 8.25% and the
one-month USD-SOFR OIS rate was 5.06528%.
The Company’s net interest income was negatively impacted in the
second quarter of 2023 by the high level of competition for
deposits due to asset growth across the industry and the liquidity
events at a few banks in March 2023. The Company also had a
substantial amount of time deposits maturing at relatively low
rates in the second quarter of 2023, and these time deposits either
renewed at higher rates or left the Company, in turn requiring
their replacement with other funding sources at then-current market
rates. In addition, in the first quarter of 2023 the Company
experienced a higher-than-normal reduction in balances of
non-interest-bearing deposits. The outflow of non-interest-bearing
deposits moderated in the second quarter of 2023. Customer balances
in both non-interest-bearing checking and interest-bearing checking
accounts have fluctuated in the first six months of 2023. As market
interest rates for certain checking account types and time deposit
accounts have increased, some customers have chosen to reallocate
funds into higher-rate accounts. The Company has significantly less
low-rate time deposits maturing in the third quarter of 2023
compared to those that matured in the second quarter of 2023.
However, for those time deposits maturing in the third quarter of
2023, we do expect the renewal interest rate will be significantly
higher than the current weighted average interest rate. Subsequent
to June 30, 2023, cumulative time deposit maturities over the next
12 months are as follows: within three months -- $188 million;
within six months -- $500 million; and within twelve months --
$1.03 billion. At June 30, 2023, the weighted average interest
rates on these various cumulative maturities were 2.36%, 2.97% and
3.91%, respectively. Based on time deposit market rates in July
2023, replacement rates for these maturing time deposits are likely
to be near or exceed 4.00%.
If market interest rates remain near their current levels, the
Company’s interest rate swaps will continue to have a negative
impact on net interest income. Based on the interest rates on these
swaps at June 30, 2023, the negative impact of all the interest
rate swaps combined in the third quarter of 2023 is expected to be
approximately $3.0 million.
For additional information on net interest income components,
see the “Average Balances, Interest Rates and Yields” tables in
this release.
NON-INTEREST INCOME
For the quarter ended June 30, 2023, non-interest income
decreased $1.5 million to $7.8 million when compared to the quarter
ended June 30, 2022, primarily as a result of the following
items:
- Other income: Other income decreased $998,000 compared to the
prior year quarter. In the 2022 period, a gain of $1.1 million was
recognized on sales of fixed assets, with no similar transactions
occurring in the current year period.
- Point-of-sale and ATM fees: Point-of-sale and ATM fees
decreased $325,000 compared to the prior year period. This decrease
is primarily due to a reduction in fee income due to a portion of
transactions now being routed through channels with lower fees to
us.
For the six months ended June 30, 2023, non-interest income
decreased $2.8 million to $15.7 million when compared to the six
months ended June 30, 2022, primarily as a result of the following
items:
- Other income: Other income decreased $855,000 compared to the
prior year. In the 2022 period, a gain of $1.1 million was
recognized on sales of fixed assets, with no similar transactions
occurring in the current year period.
- Point-of-sale and ATM fees: Point-of-sale and ATM fees
decreased $588,000 compared to the prior year period, for the same
reason noted above.
- Net gains on loan
sales: Net gains on loan sales decreased $534,000 compared to the
prior year. The decrease was due to a decrease in originations of
fixed-rate single-family mortgage loans during the 2023 period
compared to the 2022 period. Fixed rate single-family mortgage
loans originated are generally subsequently sold in the secondary
market. These loan originations increased substantially when market
interest rates decreased to historically low levels in 2020 and
2021. As a result of the significant volume of refinance activity
in 2020 and 2021, and as market interest rates moved higher
beginning in the second quarter of 2022, mortgage refinance volume
has decreased and fixed rate loan originations and related gains on
sales of these loans have decreased substantially. The lower level
of originations is expected to continue as long as market rates
remain elevated.
- Gain (loss) on derivative interest rate products: In the 2023
period, the Company recognized a loss of $289,000 on the change in
fair value of its back-to-back interest rate swaps related to
commercial loans and the change in fair value on interest rate
swaps related to brokered time deposits. In the 2022 period, the
Company recognized a gain of $297,000 on the change in fair value
of its back-to-back interest rate swaps related to commercial
loans.
NON-INTEREST EXPENSE
For the quarter ended June 30, 2023, non-interest expense
increased $1.7 million to $34.7 million when compared to the
quarter ended June 30, 2022, primarily as a result of the following
items:
- Legal, Audit and Other Professional Fees: Legal, audit and
other professional fees increased $451,000 from the prior year
quarter, to $1.6 million. In the 2023 period, the Company expensed
a total of $986,000 primarily related to training and
implementation costs for the upcoming core systems conversion and
professional fees to consultants engaged to support the Company’s
transition of core and ancillary software and information
technology systems.
- Net occupancy expenses: Net occupancy expenses increased
$601,000 from the prior year quarter. Various components of
computer license and support expenses increased by $180,000 in the
2023 period compared to the 2022 period. In addition, various
repairs and maintenance expenses increased by $446,000 in the 2023
period compared to the 2022 period.
- Insurance: Insurance expense increased $223,000 from the prior
year quarter. The increase was due to previously announced
increases in deposit insurance rates for the FDIC’s Deposit
Insurance Fund.
For the six months ended June 30, 2023, non-interest expense
increased $4.9 million to $69.2 million when compared to the six
months ended June 30, 2022, primarily as a result of the following
item:
- Legal, Audit and Other Professional Fees: Legal, audit and
other professional fees increased $1.6 million from the prior year
period, to $3.6 million, for the same reason noted above.
- Net occupancy expenses: Net occupancy expenses increased $1.4
million from the prior year period. Various components of computer
license and support expenses increased by $650,000 in the 2023
period compared to the 2022 period. In addition, various repairs
and maintenance expenses increased by $560,000 in the 2023 period
compared to the 2022 period.
- Salaries and employee benefits: Salaries and employee benefits
increased $1.4 million from the prior year period. A portion of
this increase related to normal annual merit increases in various
lending and operations areas. In 2023, some of these increases were
larger than in previous years due to the current employment
environment. In addition, compensation costs related to originated
loans which are deferred under accounting rules decreased by
$970,000 in the 2023 period compared to the 2022 period, as the
volume of loans originated in the first six months of 2023
decreased substantially compared to the same period in 2022.
The Company’s efficiency ratio for the quarter ended June 30,
2023, was 62.10% compared to 56.76% for the same quarter in 2022.
The Company’s efficiency ratio for the six months ended June 30,
2023, was 59.13% compared to 58.12% for the same period in 2022.
The Company’s ratio of non-interest expense to average assets was
2.43% and 2.42% for the three- and six-months ended June 30, 2023,
respectively, compared to 2.43% and 2.39% for the three- and
six-months ended June 30, 2022, respectively. Average assets for
the three months ended June 30, 2023, increased $286.8 million, or
5.3%, compared to the three months ended June 30, 2022, primarily
due to an increase in net loans receivable, partially offset by a
decrease in interest bearing cash equivalents and investment
securities. Average assets for the six months ended June 30, 2023,
increased $322.2 million, or 6.0%, compared to the six months ended
June 30, 2022, primarily due to an increase in net loans receivable
and investment securities, partially offset by a decrease in
interest bearing cash equivalents.
INCOME TAXES
For the three months ended June 30, 2023 and 2022, the Company's
effective tax rate was 19.7% and 20.5%, respectively. For the six
months ended June 30, 2023 and 2022, the Company's effective tax
rate was 20.5% and 20.5%, respectively. These effective rates were
near or below the statutory federal tax rate of 21%, due primarily
to the utilization of certain investment tax credits and the
Company’s tax-exempt investments and tax-exempt loans, which
reduced the Company’s effective tax rate. The Company’s effective
tax rate may fluctuate in future periods as it is impacted by the
level and timing of the Company’s utilization of tax credits, the
level of tax-exempt investments and loans, the amount of taxable
income in various state jurisdictions and the overall level of
pre-tax income. State tax expense estimates continually evolve as
taxable income and apportionment between states are analyzed. The
Company's effective income tax rate is currently generally expected
to remain near the statutory federal tax rate due primarily to the
factors noted above. The Company currently expects its effective
tax rate (combined federal and state) will be approximately 20.0%
to 21.5% in future periods.
CAPITAL
As of June 30, 2023, total stockholders’ equity and common
stockholders’ equity were each $546.3 million (9.6% of total
assets), equivalent to a book value of $45.64 per common share.
Total stockholders’ equity and common stockholders’ equity at
December 31, 2022, were each $533.1 million (9.4% of total assets),
equivalent to a book value of $43.58 per common share. At June 30,
2023, the Company’s tangible common equity to tangible assets ratio
was 9.4%, compared to 9.2% at December 31, 2022. See “Non-GAAP
Financial Measures.” Included in stockholders’ equity at June 30,
2023 and December 31, 2022, were unrealized losses (net of taxes)
on the Company’s available-for-sale investment securities totaling
$46.9 million and $47.2 million, respectively. This small change in
net unrealized loss during the six months ended June 30, 2023,
primarily resulted from decreasing intermediate-term market
interest rates (which generally increased the fair value of
investment securities) during the first three months of 2023,
followed by increasing intermediate-term market interest rates
(which generally decreased the fair value of investment securities)
during the three months ended June 30, 2023.
In addition, included in stockholders’ equity at June 30, 2023,
were realized gains (net of taxes) on the Company’s terminated cash
flow hedge (interest rate swap), totaling $14.2 million. This
amount, plus associated deferred taxes, is expected to be accreted
to interest income over the remaining term of the original interest
rate swap contract, which was to end in October 2025. At June 30,
2023, the remaining pre-tax amount to be recorded in interest
income was $18.5 million. The net effect on total stockholders’
equity over time will be no impact as the reduction of this
realized gain will be offset by an increase in retained earnings
(as the interest income flows through pre-tax income).
Also included in stockholders’ equity at June 30, 2023, was an
unrealized loss (net of taxes) on the Company’s three outstanding
cash flow hedges (interest rate swaps) totaling $23.4 million.
Increases in market interest rates since the inception of these
hedges have caused their fair values to decrease.
As noted above, total stockholders' equity increased $13.2
million, from $533.1 million at December 31, 2022 to $546.3 million
at June 30, 2023. Stockholders’ equity increased due to net income
of $38.8 million in the period and a $1.1 million increase in
stockholders’ equity due to stock option exercises. Partially
offsetting these increases were repurchases of the Company’s common
stock totaling $14.3 million and dividends declared on common stock
of $9.6 million. Accumulated other comprehensive loss increased
$2.7 million during the six months ended June 30, 2023, primarily
due to changes in the fair value of cash flow hedges.
The Company also had unrealized losses on its portfolio of
held-to-maturity investment securities, which totaled $24.7 million
at June 30, 2023, that were not included in its total capital
balance. If these held-to-maturity unrealized losses were included
in capital (net of taxes) it would have decreased total
stockholder’s equity by $18.6 million at June 30, 2023. This amount
was equal to 3.4% of total stockholders’ equity of $546.3
million.
On a preliminary basis, as of June 30, 2023, the Company’s Tier
1 Leverage Ratio was 10.8%, Common Equity Tier 1 Capital Ratio was
11.4%, Tier 1 Capital Ratio was 11.8%, and Total Capital Ratio was
14.5%. On June 30, 2023, and on a preliminary basis, the Bank’s
Tier 1 Leverage Ratio was 11.7%, Common Equity Tier 1 Capital Ratio
was 12.7%, Tier 1 Capital Ratio was 12.7%, and Total Capital Ratio
was 14.0%.
In December 2022, the Company’s Board of Directors authorized
the purchase of an additional one million shares of the Company’s
common stock. As of June 30, 2023, a total of approximately 908,000
shares were available in our stock repurchase authorization.
During the three months ended June 30, 2023, the Company
repurchased 170,200 shares of its common stock at an average price
of $50.70 and declared a regular quarterly cash dividend of $0.40
per common share, which, combined, reduced stockholders’ equity by
$13.5 million. During the six months ended June 30, 2023, the
Company repurchased 269,321 shares of its common stock at an
average price of $52.54 and declared regular quarterly cash
dividend of $0.80 per common share, which, combined, reduced
stockholders’ equity by $23.9 million.
LIQUIDITY AND DEPOSITS
Liquidity is a measure of the Company’s ability to generate
sufficient cash to meet present and future financial obligations in
a timely manner. Liquid assets include cash, interest-bearing
deposits with financial institutions and certain investment
securities and loans. As a result of the Company’s management of
the ability to generate liquidity primarily through liability
funding, management believes that the Company maintains overall
liquidity sufficient to satisfy its depositors’ requirements and
meet its borrowers’ credit needs.
The Company’s primary sources of funds are customer deposits,
FHLBank advances, other borrowings, loan repayments, unpledged
securities, proceeds from sales of loans and available-for-sale
securities and funds provided from operations. The Company utilizes
particular sources of funds based on the comparative costs and
availability at the time. The Company has from time to time chosen
not to pay rates on deposits as high as the rates paid by certain
of its competitors and, when believed to be appropriate,
supplements deposits with less expensive alternative sources of
funds.
At June 30, 2023, the Company had the following available
secured lines and on-balance sheet liquidity:
|
|
|
|
|
|
June 30, 2023 |
Federal Home Loan Bank
line |
|
$ |
1,195.5 million |
Federal Reserve Bank line |
|
$ |
409.6 million |
Cash and cash equivalents |
|
$ |
203.9 million |
Unpledged securities –
Available-for-sale |
|
$ |
386.5 million |
Unpledged securities –
Held-to-maturity |
|
$ |
195.0 million |
During the three months ended June 30, 2023, the Company’s total
deposits increased $25 million. Brokered deposits increased $133
million through a variety of sources. Time deposits generated
through the Company’s banking center and corporate services
networks decreased $50 million and time deposits generated through
internet channels decreased $7 million. Interest-bearing checking
balances decreased $40.1 million (about 1.8%) and
non-interest-bearing checking balances decreased $11.0 million
(about 1.1%).
During the six months ended June 30, 2023, the Company’s total
deposits increased $140 million. Brokered deposits increased $258
million through a variety of sources. Time deposits generated
through the Company’s banking center and corporate services
networks decreased $13 million and time deposits generated through
internet channels decreased $27 million. Interest-bearing checking
balances increased $5.7 million (about 0.3%) and
non-interest-bearing checking balances decreased $83.1 million
(about 7.8%).
LOANS
Total net loans, excluding mortgage loans held for sale,
increased $9.8 million, or 0.2%, from $4.51 billion at December 31,
2022 to $4.52 billion at June 30, 2023. This increase was primarily
in other residential (multi-family) loans ($104 million increase),
partially offset by a decrease in construction loans ($49 million
decrease) and commercial real estate loans ($33 million decrease).
The pipeline of loan commitments declined in the second quarter of
2023. The unfunded portion of construction loans remained
significant, but also declined, in the second quarter of 2023. As
construction projects were completed, the related loans were either
paid off or moved from the construction category to the appropriate
permanent loan categories.
For further information about the Company’s loan portfolio,
please see the quarterly loan portfolio presentation available on
the Company’s Investor Relations website under “Presentations.”
Loan commitments and the unfunded portion of loans at the dates
indicated were as follows (in thousands):
|
|
June 30, 2023 |
|
March 31, 2023 |
|
December31, 2022 |
|
December 31, 2021 |
|
December31, 2020 |
Closed non-construction loans with unused available
lines |
|
|
|
|
|
|
|
|
|
|
Secured by real estate (one- to four-family) |
$ |
207,597 |
$ |
205,517 |
$ |
199,182 |
$ |
175,682 |
$ |
164,480 |
Secured by real estate (not one- to four-family) |
|
— |
|
— |
|
— |
|
23,752 |
|
22,273 |
Not secured by real estate - commercial business |
|
109,135 |
|
113,186 |
|
104,452 |
|
91,786 |
|
77,411 |
|
|
|
|
|
|
|
|
|
|
|
Closed construction
loans with unused available lines |
|
|
|
|
|
|
|
|
|
|
Secured by real estate (one-to four-family) |
|
111,491 |
|
104,045 |
|
100,669 |
|
74,501 |
|
42,162 |
Secured by real estate (not one-to four-family) |
|
1,123,860 |
|
1,333,596 |
|
1,444,450 |
|
1,092,029 |
|
823,106 |
|
|
|
|
|
|
|
|
|
|
|
Loan commitments not
closed |
|
|
|
|
|
|
|
|
|
|
Secured by real estate (one-to four-family) |
|
25,571 |
|
33,221 |
|
16,819 |
|
53,529 |
|
85,917 |
Secured by real estate (not one-to four-family) |
|
50,071 |
|
78,384 |
|
157,645 |
|
146,826 |
|
45,860 |
Not secured by real estate - commercial business |
|
21,835 |
|
37,477 |
|
50,145 |
|
12,920 |
|
699 |
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,649,560 |
$ |
1,905,426 |
$ |
2,073,362 |
$ |
1,671,025 |
$ |
1,261,908 |
PROVISION FOR CREDIT LOSSES AND ALLOWANCE FOR CREDIT LOSSES
The Company adopted ASU 2016-13, Financial Instruments –
Credit Losses (Topic 326): Measurement of Credit Losses on
Financial Instruments, effective January 1, 2021. The CECL
methodology replaced the incurred loss methodology with a lifetime
“expected credit loss” measurement objective for loans,
held-to-maturity debt securities and other receivables measured at
amortized cost at the time the financial asset is originated or
acquired. This standard requires the consideration of historical
loss experience and current conditions adjusted for reasonable and
supportable economic forecasts.
Management estimates the allowance balance using relevant
available information, from internal and external sources, relating
to past events, current conditions, and reasonable and supportable
forecasts. Historical credit loss experience provides the basis for
the estimation of expected credit losses. Adjustments to historical
loss information are made for differences in current loan-specific
risk characteristics such as differences in underwriting standards,
portfolio mix, delinquency level or term, as well as for changes in
economic conditions, including but not limited to; changes in the
national unemployment rate, commercial real estate price index,
housing price index, commercial real estate price index, consumer
sentiment, gross domestic product (GDP) and construction
spending.
Challenging or worsening economic conditions from higher
inflation or interest rates, COVID-19 and subsequent variant
outbreaks or similar events, global unrest or other factors may
lead to increased losses in the portfolio and/or requirements for
an increase in provision expense. Management maintains various
controls in an attempt to identify and limit future losses, such as
a watch list of problem loans and potential problem loans,
documented loan administration policies and loan review staff to
review the quality and anticipated collectability of the portfolio.
Additional procedures provide for frequent management review of the
loan portfolio based on loan size, loan type, delinquencies,
financial analysis, on-going correspondence with borrowers and
problem loan work-outs. Management determines which loans are
collateral-dependent, evaluates risk of loss and makes additional
provisions to expense, if necessary, to maintain the allowance at a
satisfactory level.
During the quarters ended June 30, 2023 and June 30, 2022, the
Company did not record a provision expense on its portfolio of
outstanding loans. During the six months ended June 30, 2023, the
Company recorded provision expense of $1.5 million on its portfolio
of outstanding loans. During the six months ended June 30, 2022,
the Company did not record a provision expense on its portfolio of
outstanding loans. Total net charge-offs were $135,000 for the
three months ended June 30, 2023, compared to net recoveries of
$261,000 in the three months ended June 30, 2022. Total net
charge-offs were $128,000 for the six months ended June 30, 2023,
compared to net recoveries of $304,000 in the six months ended June
30, 2022. For the three months ended June 30, 2023, the Company
recorded a negative provision for losses on unfunded commitments of
$1.6 million, compared to a provision of $2.2 million for the three
months ended June 30, 2022. For the six months ended June 30, 2023,
the Company recorded a negative provision for losses on unfunded
commitments of $2.4 million, compared to a provision of $2.0
million for the six months ended June 30, 2022. General market
conditions and unique circumstances related to specific industries
and individual projects contribute to the level of provisions and
charge-offs.
The Bank’s allowance for credit losses as a percentage of total
loans was 1.41%, 1.39% and 1.40% at June 30, 2023, December 31,
2022 and March 31, 2023, respectively. Management considers the
allowance for credit losses adequate to cover losses inherent in
the Bank’s loan portfolio at June 30, 2023, based on recent reviews
of the Bank’s loan portfolio and current economic conditions. If
challenging economic conditions were to last longer than
anticipated or deteriorate further or management’s assessment of
the loan portfolio were to change, additional credit loss
provisions could be required, thereby adversely affecting the
Company’s future results of operations and financial condition.
ASSET QUALITY
At June 30, 2023, non-performing assets were $11.2 million, an
increase of $7.5 million from $3.7 million at December 31, 2022.
Non-performing assets as a percentage of total assets were 0.20% at
June 30, 2023, compared to 0.07% at December 31, 2022.
Non-performing assets were $3.7 million at March 31, 2023. One
significant loan relationship was added to non-performing assets in
the three months ended June 30, 2023. As a result of changes in
balances and composition of the loan portfolio, changes in economic
and market conditions and other factors specific to a borrower’s
circumstances, the level of non-performing assets will
fluctuate.
Compared to December 31, 2022, non-performing loans increased
$7.4 million to $11.1 million at June 30, 2023. The majority of
this increase was in the non-performing commercial real estate
loans category, which increased $8.7 million from December 31,
2022, primarily due to one loan relationship being added to the
category in the three months ended June 30, 2023. Compared to March
31, 2023, non-performing loans increased $8.1 million.
Activity in the non-performing loans categories during the
quarter ended June 30, 2023, was as follows:
|
|
BeginningBalance,April
1 |
|
Additionsto
Non-Performing |
|
Removedfrom
Non-Performing |
|
Transfersto
PotentialProblemLoans |
|
Transfers
toForeclosedAssets
andRepossessions |
|
Charge-Offs |
|
Payments |
|
EndingBalance,June
30 |
|
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
One- to four-family construction |
$ |
— |
$ |
— |
$ |
— |
$ |
— |
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
Subdivision construction |
|
— |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
Land development |
|
384 |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
384 |
Commercial construction |
|
— |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
One- to four-family
residential |
|
625 |
|
173 |
|
— |
|
— |
|
(21 |
) |
|
— |
|
|
(418 |
) |
|
359 |
Other residential |
|
— |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
Commercial real estate |
|
1,526 |
|
8,667 |
|
— |
|
— |
|
— |
|
|
— |
|
|
(1 |
) |
|
10,192 |
Commercial business |
|
16 |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
|
— |
|
|
16 |
Consumer |
|
431 |
|
76 |
|
— |
|
— |
|
— |
|
|
(11 |
) |
|
(298 |
) |
|
198 |
Total non-performing loans |
$ |
2,982 |
$ |
8,916 |
$ |
— |
$ |
— |
$ |
(21 |
) |
$ |
(11 |
) |
$ |
(717 |
) |
$ |
11,149 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FDIC-assisted acquired loans
included above |
$ |
347 |
$ |
65 |
$ |
— |
$ |
— |
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
412 |
At June 30, 2023, the non-performing commercial real estate
category included four loans, one of which was added during the
current quarter. The largest relationship in the category, which
totaled $8.6 million, or 84.7% of the total category, was added to
non-performing loans during the second quarter of 2023 and is
collateralized by an office building in Missouri. The
non-performing one- to four-family residential category included
four loans, two of which were added during the current quarter. The
largest relationship in the category totaled $153,000, or 42.7% of
the category, and was added in a previous period. The
non-performing one- to four-family residential category experienced
$416,000 in repayments during the three months ended June 30, 2023,
primarily related to a note sale of 16 non-performing loans. The
loan sale proceeds were sufficient to result in no loss to the
Company. The non-performing land development category consisted of
one loan added during the first quarter of 2021, which totaled
$384,000 and is collateralized by unimproved zoned vacant ground in
southern Illinois. The non-performing commercial business category
consisted of one loan, which was added during the first quarter of
2023. The non-performing consumer category included 17 loans, eight
of which were added during the current quarter.
Compared to December 31, 2022, potential problem loans decreased
$1.1 million, to $491,000 at June 30, 2023. The decrease during the
period was primarily due to multiple loans totaling $1.0 million
that were upgraded to a satisfactory risk rating. Compared to March
31, 2023, potential problem loans decreased $126,000, to $491,000
at June 30, 2023. The decrease during the quarter was primarily due
to a loan, which totaled $105,000, being transferred to
non-performing loans.
Activity in the potential problem loans category during the
quarter ended June 30, 2023, was as follows:
|
|
BeginningBalance,April
1 |
|
Additions
toPotentialProblem |
|
RemovedfromPotentialProblem |
|
Transfersto
Non-Performing |
|
Transfers
toForeclosedAssets
andRepossessions |
|
Charge-Offs |
|
Loan Advances (Payments) |
|
EndingBalance,June
30 |
|
|
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
One- to four-family construction |
$ |
— |
$ |
— |
$ |
— |
$ |
— |
|
$ |
— |
$ |
— |
|
$ |
— |
|
$ |
— |
|
Subdivision construction |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
Land development |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
Commercial construction |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
One- to four-family
residential |
|
490 |
|
— |
|
— |
|
(105 |
) |
|
— |
|
— |
|
|
(3 |
) |
|
382 |
|
Other residential |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
Commercial real estate |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
Commercial business |
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
Consumer |
|
127 |
|
— |
|
— |
|
— |
|
|
— |
|
(1 |
) |
|
(17 |
) |
|
109 |
|
Total potential problem loans |
$ |
617 |
$ |
— |
$ |
— |
$ |
(105 |
) |
$ |
— |
$ |
(1 |
) |
$ |
(20 |
) |
$ |
491 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FDIC-assisted acquired loans
included above |
$ |
180 |
$ |
— |
$ |
— |
$ |
— |
|
$ |
— |
$ |
— |
|
$ |
(2 |
) |
$ |
178 |
|
At June 30, 2023, the one- to four-family residential category
of potential problem loans included four loans, none of which were
added during the current quarter. The largest relationship in this
category totaled $143,000, or 37.5% of the total category. The
consumer category of potential problem loans included 11 loans,
none of which were added during the current quarter.
Activity in foreclosed assets and repossessions during the
quarter ended June 30, 2023 was as follows:
|
|
BeginningBalance,April
1 |
|
Additions |
|
ORE
andRepossessionSales |
|
CapitalizedCosts |
|
ORE
andRepossessionWrite-Downs |
|
EndingBalance,June
30 |
|
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
One-to four-family construction |
$ |
— |
$ |
— |
$ |
— |
|
$ |
— |
$ |
— |
$ |
— |
Subdivision construction |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
— |
Land development |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
— |
Commercial construction |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
— |
One- to four-family
residential |
|
— |
|
21 |
|
— |
|
|
— |
|
— |
|
21 |
Other residential |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
— |
Commercial real estate |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
— |
Commercial business |
|
— |
|
— |
|
— |
|
|
— |
|
— |
|
— |
Consumer |
|
45 |
|
18 |
|
(49 |
) |
|
— |
|
— |
|
14 |
Total foreclosed assets and repossessions |
$ |
45 |
$ |
39 |
$ |
(49 |
) |
$ |
— |
$ |
— |
$ |
35 |
|
|
|
|
|
|
|
|
|
|
|
|
|
FDIC-assisted acquired loans
included above |
$ |
— |
$ |
21 |
$ |
— |
|
$ |
— |
$ |
— |
$ |
21 |
The additions and sales in the consumer category were due to the
volume of repossessions of automobiles, which generally are subject
to a shorter repossession process.
BUSINESS INITIATIVES
In January 2023, a high-transaction-volume banking center
located at 1615 West Sunshine Street in Springfield, Missouri, was
razed to make way for a new Express Center, which will use only
interactive teller machine (ITM) technology to serve customers. The
modern four-lane drive-up center is expected to open in early
September 2023 and be the first-of-its-kind in the Springfield
market. ITMs, also known as video remote tellers, offer an ATM-like
interface, but with the enhancement of a video screen that allows
customers to speak directly to a service representative in real
time and in a highly personal manner during extended business
hours. Nearly any teller transaction that can be performed in the
traditional drive-thru can be performed at an ITM, including
cashing a check to the penny. ITMs provide convenience and enhanced
access for customers, while creating greater operational
efficiencies for the Bank.
During 2023, the Great Southern team is preparing to convert to
a new core banking platform and ancillary systems, delivered by a
third-party vendor. This upgrade in the operational platform is
expected to provide new and advanced tools and access to more
meaningful information to better serve customers. The migration to
the new system is expected to occur in mid-2024. As significant
preliminary work was completed in 2022 and early 2023, it was
determined to extend the conversion timeline from third quarter
2023 to allow for further system testing related to some of our
more highly-customized applications and products and to accommodate
certain functionality enhancements to the platform.
The Company will host a conference call on Thursday, July 20,
2023, at 2:00 p.m. Central Time to discuss second quarter 2023
preliminary earnings. The call will be available live or in a
recorded version at the Company’s Investor Relations website,
http://investors.greatsouthernbank.com. Participants may register
for the call here.
Headquartered in Springfield, Missouri, Great Southern offers a
broad range of banking services to customers. The Company operates
90 retail banking centers in Missouri, Iowa, Kansas, Minnesota,
Arkansas and Nebraska and commercial lending offices in Atlanta;
Charlotte, North Carolina; Chicago; Dallas; Denver; Omaha,
Nebraska; Phoenix and Tulsa, Oklahoma. The common stock of Great
Southern Bancorp, Inc. is listed on the Nasdaq Global Select Market
under the symbol "GSBC."
www.GreatSouthernBank.com
Forward-Looking Statements
When used in this press release and in other documents filed or
furnished by Great Southern Bancorp, Inc. (the “Company”) with the
Securities and Exchange Commission (the “SEC”), in the Company's
other press releases or other public or stockholder communications,
and in oral statements made with the approval of an authorized
executive officer, the words or phrases “may,” “might,” “could,”
“should,” "will likely result," "are expected to," "will continue,"
"is anticipated," “believe,” "estimate," "project," "intends" or
similar expressions are intended to identify "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements also include, but
are not limited to, statements regarding plans, objectives,
expectations or consequences of announced transactions, known
trends and statements about future performance, operations,
products and services of the Company. The Company’s ability to
predict results or the actual effects of future plans or strategies
is inherently uncertain, and the Company’s actual results could
differ materially from those contained in the forward-looking
statements.
Factors that could cause or contribute to such differences
include, but are not limited to: (i) expected revenues, cost
savings, earnings accretion, synergies and other benefits from the
Company's merger and acquisition activities might not be
realized within the anticipated time frames or at all, and costs or
difficulties relating to integration matters, including but not
limited to customer and employee retention, might be greater than
expected; (ii) changes in economic conditions, either nationally or
in the Company's market areas; (iii) the remaining effects of the
COVID-19 pandemic on general economic and financial market
conditions and on public health; (iv) fluctuations in interest
rates, the effects of inflation or a potential recession, whether
caused by Federal Reserve actions or otherwise; (v) the impact of
bank failures or adverse developments at other banks and related
negative press about the banking industry in general on investor
and depositor sentiment; (vi) slower economic growth caused by
changes in energy prices, supply chain disruptions or other
factors; (vii) the risks of lending and investing activities,
including changes in the level and direction of loan delinquencies
and write-offs and changes in estimates of the adequacy of the
allowance for credit losses; (viii) the possibility of realized or
unrealized losses on securities held in the Company's investment
portfolio; (ix) the Company's ability to access cost-effective
funding and maintain sufficient liquidity; (x) fluctuations in real
estate values and both residential and commercial real estate
market conditions; (xi) the ability to adapt successfully to
technological changes to meet customers' needs and developments in
the marketplace; (xii) the possibility that security measures
implemented might not be sufficient to mitigate the risk of a
cyber-attack or cyber theft, and that such security measures might
not protect against systems failures or interruptions; (xiii)
legislative or regulatory changes that adversely affect the
Company's business; (xiv) changes in accounting policies and
practices or accounting standards; (xv) results of examinations of
the Company and Great Southern Bank by their regulators, including
the possibility that the regulators may, among other things,
require the Company to limit its business activities, change its
business mix, increase its allowance for credit losses, write-down
assets or increase its capital levels, or affect its ability to
borrow funds or maintain or increase deposits, which could
adversely affect its liquidity and earnings; (xvi) costs and
effects of litigation, including settlements and judgments; (xvii)
competition; (xviii) the transition from LIBOR to new interest rate
benchmarks; and (xix) natural disasters, war, terrorist activities
or civil unrest and their effects on economic and business
environments in which the Company operates. The Company wishes to
advise readers that the factors listed above and other risks
described in the Company’s most recent Annual Report on Form 10-K,
including, without limitation, those described under “Item 1A. Risk
Factors,” subsequent Quarterly Reports on Form 10-Q and other
documents filed or furnished from time to time by the Company with
the SEC (which are available on our website at
www.greatsouthernbank.com and the SEC’s website at www.sec.gov),
could affect the Company's financial performance and cause the
Company's actual results for future periods to differ materially
from any opinions or statements expressed with respect to future
periods in any current statements.
The Company does not undertake-and specifically declines any
obligation- to publicly release the result of any revisions which
may be made to any forward-looking statements to reflect events or
circumstances after the date of such statements or to reflect the
occurrence of anticipated or unanticipated events.The following
tables set forth selected consolidated financial information of the
Company at the dates and for the periods indicated. Financial data
at all dates and for all periods is unaudited. In the opinion of
management, all adjustments, which consist only of normal recurring
accrual adjustments, necessary for a fair presentation of the
results at and for such unaudited dates and periods have been
included. The results of operations and other data for the three
and six months ended June 30, 2023 and 2022, and the three months
ended March 31, 2023, are not necessarily indicative of the results
of operations which may be expected for any future period.
|
|
June 30, |
|
|
December 31, |
|
|
2023 |
|
|
2022 |
|
|
Selected Financial Condition Data: |
(In thousands) |
|
|
|
|
|
|
Total assets |
$ |
5,719,630 |
|
$ |
5,680,702 |
Loans receivable, gross |
|
4,590,500 |
|
|
4,581,381 |
Allowance for credit
losses |
|
64,852 |
|
|
63,480 |
Other real estate owned,
net |
|
35 |
|
|
233 |
Available-for-sale securities,
at fair value |
|
476,911 |
|
|
490,592 |
Held-to-maturity securities,
at amortized cost |
|
198,387 |
|
|
202,495 |
Deposits |
|
4,824,571 |
|
|
4,684,910 |
Total borrowings |
|
231,571 |
|
|
366,481 |
Total stockholders’
equity |
|
546,329 |
|
|
533,087 |
Non-performing assets |
|
11,184 |
|
|
3,720 |
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
Three MonthsEnded |
|
|
June 30, |
|
|
June 30, |
|
|
March 31, |
|
|
2023 |
|
|
|
2022 |
|
|
2023 |
|
|
|
2022 |
|
|
2023 |
|
|
(In thousands) |
Selected Operating
Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income |
$ |
73,618 |
|
|
$ |
52,698 |
|
$ |
145,081 |
|
|
$ |
99,372 |
|
$ |
71,463 |
Interest expense |
|
25,480 |
|
|
|
3,867 |
|
|
43,751 |
|
|
|
7,275 |
|
|
18,271 |
Net interest income |
|
48,138 |
|
|
|
48,831 |
|
|
101,330 |
|
|
|
92,097 |
|
|
53,192 |
Provision (credit) for credit losses on loans and unfunded
commitments |
|
(1,619 |
) |
|
|
2,223 |
|
|
(945 |
) |
|
|
2,030 |
|
|
674 |
Non-interest income |
|
7,769 |
|
|
|
9,319 |
|
|
15,658 |
|
|
|
18,495 |
|
|
7,889 |
Non-interest expense |
|
34,718 |
|
|
|
33,004 |
|
|
69,181 |
|
|
|
64,271 |
|
|
34,463 |
Provision for income taxes |
|
4,488 |
|
|
|
4,699 |
|
|
9,976 |
|
|
|
9,080 |
|
|
5,488 |
Net income |
$ |
18,320 |
|
|
$ |
18,224 |
|
$ |
38,776 |
|
|
$ |
35,211 |
|
$ |
20,456 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At or For the ThreeMonths
Ended |
|
At or For the SixMonths
Ended |
|
At or For the Three Months Ended |
|
June 30, |
|
June 30, |
|
March 31, |
|
|
2023 |
|
|
2022 |
|
|
|
2023 |
|
|
2022 |
|
|
|
2023 |
|
|
(Dollars in thousands, except per share data) |
Per Common
Share: |
|
|
|
|
|
|
|
Net income (fully diluted) |
$ |
1.52 |
|
$ |
1.44 |
|
|
$ |
3.19 |
|
$ |
2.73 |
|
|
$ |
1.67 |
|
Book value |
$ |
45.64 |
|
$ |
44.53 |
|
|
$ |
45.64 |
|
$ |
44.53 |
|
|
$ |
45.78 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Performance Ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annualized return on average assets |
|
1.28% |
|
|
1.34% |
|
|
|
1.36% |
|
|
1.31% |
|
|
|
1.43% |
|
Annualized return on average common stockholders’ equity |
|
13.11% |
|
|
12.72% |
|
|
|
13.99% |
|
|
11.91% |
|
|
|
14.88% |
|
Net interest margin |
|
3.56% |
|
|
3.78% |
|
|
|
3.77% |
|
|
3.61% |
|
|
|
3.99% |
|
Average interest rate spread |
|
2.96% |
|
|
3.65% |
|
|
|
3.24% |
|
|
3.48% |
|
|
|
3.53% |
|
Efficiency ratio |
|
62.10% |
|
|
56.76% |
|
|
|
59.13% |
|
|
58.12% |
|
|
|
56.42% |
|
Non-interest expense to average total assets |
|
2.43% |
|
|
2.43% |
|
|
|
2.42% |
|
|
2.39% |
|
|
|
2.42% |
|
|
|
|
|
|
|
|
|
Asset Quality
Ratios: |
|
|
|
|
|
|
|
Allowance for credit losses to period-end loans |
|
1.41% |
|
|
1.38% |
|
|
|
1.41% |
|
|
1.38% |
|
|
|
1.40% |
|
Non-performing assets to period-end assets |
|
0.20% |
|
|
0.08% |
|
|
|
0.20% |
|
|
0.08% |
|
|
|
0.05% |
|
Non-performing loans to period-end loans |
|
0.24% |
|
|
0.10% |
|
|
|
0.24% |
|
|
0.10% |
|
|
|
0.06% |
|
Annualized net charge-offs (recoveries) to average loans |
|
0.01% |
|
|
(0.01)% |
|
|
|
0.01% |
|
|
(0.01)% |
|
|
|
0.00% |
|
|
|
|
|
|
|
|
|
Great Southern Bancorp, Inc. and
SubsidiariesConsolidated Statements of Financial
Condition(In thousands, except number of
shares) |
|
|
|
June 30,2023 |
|
December 31,2022 |
|
March 31,2023 |
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
Cash |
$ |
105,859 |
|
$ |
105,262 |
|
$ |
89,682 |
|
Interest-bearing deposits in other financial institutions |
|
98,080 |
|
|
63,258 |
|
|
94,994 |
|
Cash and cash equivalents |
|
203,939 |
|
|
168,520 |
|
|
184,676 |
|
|
|
|
|
|
|
|
Available-for-sale securities |
|
476,911 |
|
|
490,592 |
|
|
493,330 |
|
Held-to-maturity securities |
|
198,387 |
|
|
202,495 |
|
|
200,427 |
|
Mortgage loans held for sale |
|
10,442 |
|
|
4,811 |
|
|
6,099 |
|
Loans receivable, net of allowance for credit losses of $64,852 –
June 2023; $63,480 – December 2022; $64,987 – March 2023 |
|
4,516,613 |
|
|
4,506,836 |
|
|
4,569,328 |
|
Interest receivable |
|
17,178 |
|
|
19,107 |
|
|
17,484 |
|
Prepaid expenses and other assets |
|
76,194 |
|
|
69,461 |
|
|
89,055 |
|
Other real estate owned and repossessions (1), net |
|
35 |
|
|
233 |
|
|
154 |
|
Premises and equipment, net |
|
140,556 |
|
|
141,070 |
|
|
141,485 |
|
Goodwill and other intangible assets |
|
10,644 |
|
|
10,813 |
|
|
10,702 |
|
Federal Home Loan Bank stock and other interest-earning assets |
|
32,758 |
|
|
30,814 |
|
|
27,658 |
|
Current and deferred income taxes |
|
35,973 |
|
|
35,950 |
|
|
28,322 |
|
|
|
|
|
|
|
|
Total Assets |
$ |
5,719,630 |
|
$ |
5,680,702 |
|
$ |
5,768,720 |
|
|
|
|
|
|
|
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Deposits |
$ |
4,824,571 |
|
$ |
4,684,910 |
|
$ |
4,799,107 |
|
Securities sold under reverse repurchase agreements with
customers |
|
59,257 |
|
|
176,843 |
|
|
70,654 |
|
Short-term borrowings |
|
72,110 |
|
|
89,583 |
|
|
155,710 |
|
Subordinated debentures issued to capital trust |
|
25,774 |
|
|
25,774 |
|
|
25,774 |
|
Subordinated notes |
|
74,430 |
|
|
74,281 |
|
|
74,356 |
|
Accrued interest payable |
|
5,026 |
|
|
3,010 |
|
|
4,671 |
|
Advances from borrowers for taxes and insurance |
|
9,342 |
|
|
6,590 |
|
|
8,086 |
|
Accounts payable and accrued expenses |
|
92,420 |
|
|
73,808 |
|
|
62,862 |
|
Liability for unfunded commitments |
|
10,371 |
|
|
12,816 |
|
|
11,989 |
|
Total Liabilities |
|
5,173,301 |
|
|
5,147,615 |
|
|
5,213,209 |
|
|
|
|
|
|
|
|
Stockholders’ Equity |
|
|
|
|
|
|
Capital stock |
|
|
|
|
|
|
Preferred stock, $.01 par value; authorized 1,000,000 shares;
issued and outstanding June 2023, December 2022 and March 2023 -0-
shares |
|
— |
|
|
— |
|
|
— |
|
Common stock, $.01 par value; authorized 20,000,000 shares; issued
and outstanding June 2023 – 11,969,524 shares; December 2022 –
12,231,290 shares; March 2023 – 12,133,886 shares |
|
120 |
|
|
122 |
|
|
121 |
|
Additional paid-in capital |
|
43,292 |
|
|
42,445 |
|
|
42,870 |
|
Retained earnings |
|
558,927 |
|
|
543,875 |
|
|
553,948 |
|
Accumulated other comprehensive gain (loss) |
|
(56,010 |
) |
|
(53,355 |
) |
|
(41,428 |
) |
Total Stockholders’ Equity |
|
546,329 |
|
|
533,087 |
|
|
555,511 |
|
|
|
|
|
|
|
|
Total Liabilities and Stockholders’ Equity |
$ |
5,719,630 |
|
$ |
5,680,702 |
|
$ |
5,768,720 |
|
(1) At June 30, 2023, December 31, 2022 and
March 31, 2023, includes $0, $183,000 and $109,000, respectively,
of properties which were not acquired through foreclosure, but are
held for sale.
Great Southern Bancorp, Inc. and
SubsidiariesConsolidated Statements of
Income(In thousands, except per share
data)
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
Three Months Ended |
|
|
June 30, |
|
|
June 30, |
|
|
March 31, |
|
|
2023 |
|
|
|
2022 |
|
|
2023 |
|
|
|
2022 |
|
|
2023 |
|
Interest
Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans |
$ |
67,442 |
|
|
$ |
46,764 |
|
$ |
132,880 |
|
|
$ |
89,829 |
|
$ |
65,438 |
|
Investment securities and other |
|
6,176 |
|
|
|
5,934 |
|
|
12,201 |
|
|
|
9,543 |
|
|
6,025 |
|
|
|
73,618 |
|
|
|
52,698 |
|
|
145,081 |
|
|
|
99,372 |
|
|
71,463 |
|
Interest
Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
21,785 |
|
|
|
2,358 |
|
|
36,435 |
|
|
|
4,532 |
|
|
14,650 |
|
Securities sold under reverse repurchase agreements |
|
221 |
|
|
|
8 |
|
|
563 |
|
|
|
18 |
|
|
342 |
|
Short-term borrowings, overnight FHLBank borrowings and other
interest-bearing liabilities |
|
1,943 |
|
|
|
236 |
|
|
3,723 |
|
|
|
237 |
|
|
1,780 |
|
Subordinated debentures issued to capital trust |
|
426 |
|
|
|
159 |
|
|
819 |
|
|
|
277 |
|
|
393 |
|
Subordinated notes |
|
1,105 |
|
|
|
1,106 |
|
|
2,211 |
|
|
|
2,211 |
|
|
1,106 |
|
|
|
25,480 |
|
|
|
3,867 |
|
|
43,751 |
|
|
|
7,275 |
|
|
18,271 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest
Income |
|
48,138 |
|
|
|
48,831 |
|
|
101,330 |
|
|
|
92,097 |
|
|
53,192 |
|
Provision for Credit
Losses on Loans |
|
— |
|
|
|
— |
|
|
1,500 |
|
|
|
— |
|
|
1,500 |
|
Provision (Credit) for
Unfunded Commitments |
|
(1,619 |
) |
|
|
2,223 |
|
|
(2,445 |
) |
|
|
2,030 |
|
|
(826 |
) |
Net Interest Income
After Provision for Credit Losses and Provision (Credit) for
Unfunded Commitments |
|
49,757 |
|
|
|
46,608 |
|
|
102,275 |
|
|
|
90,067 |
|
|
52,518 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest
Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commissions |
|
228 |
|
|
|
389 |
|
|
655 |
|
|
|
686 |
|
|
427 |
|
Overdraft and Insufficient funds fees |
|
1,989 |
|
|
|
1,888 |
|
|
3,885 |
|
|
|
3,753 |
|
|
1,896 |
|
POS and ATM fee income and service charges |
|
3,779 |
|
|
|
4,104 |
|
|
7,480 |
|
|
|
8,068 |
|
|
3,701 |
|
Net gains on loan sales |
|
709 |
|
|
|
498 |
|
|
1,098 |
|
|
|
1,632 |
|
|
389 |
|
Net realized gain (loss) on sale of available-for-sale
securities |
|
— |
|
|
|
— |
|
|
— |
|
|
|
7 |
|
|
— |
|
Late charges and fees on loans |
|
125 |
|
|
|
360 |
|
|
305 |
|
|
|
673 |
|
|
180 |
|
Gain (loss) on derivative interest rate products |
|
2 |
|
|
|
145 |
|
|
(289 |
) |
|
|
297 |
|
|
(291 |
) |
Other income |
|
937 |
|
|
|
1,935 |
|
|
2,524 |
|
|
|
3,379 |
|
|
1,587 |
|
|
|
7,769 |
|
|
|
9,319 |
|
|
15,658 |
|
|
|
18,495 |
|
|
7,889 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest
Expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
|
19,678 |
|
|
|
19,432 |
|
|
38,881 |
|
|
|
37,512 |
|
|
19,203 |
|
Net occupancy and equipment expense |
|
7,409 |
|
|
|
6,808 |
|
|
15,129 |
|
|
|
13,686 |
|
|
7,720 |
|
Postage |
|
914 |
|
|
|
844 |
|
|
1,742 |
|
|
|
1,631 |
|
|
828 |
|
Insurance |
|
1,010 |
|
|
|
787 |
|
|
1,877 |
|
|
|
1,581 |
|
|
867 |
|
Advertising |
|
903 |
|
|
|
875 |
|
|
1,550 |
|
|
|
1,430 |
|
|
647 |
|
Office supplies and printing |
|
258 |
|
|
|
208 |
|
|
526 |
|
|
|
426 |
|
|
268 |
|
Telephone |
|
688 |
|
|
|
832 |
|
|
1,391 |
|
|
|
1,681 |
|
|
703 |
|
Legal, audit and other professional fees |
|
1,647 |
|
|
|
1,196 |
|
|
3,628 |
|
|
|
2,001 |
|
|
1,981 |
|
Expense on other real estate and repossessions |
|
47 |
|
|
|
65 |
|
|
201 |
|
|
|
228 |
|
|
154 |
|
Acquired intangible asset amortization |
|
58 |
|
|
|
177 |
|
|
169 |
|
|
|
335 |
|
|
111 |
|
Other operating expenses |
|
2,106 |
|
|
|
1,780 |
|
|
4,087 |
|
|
|
3,760 |
|
|
1,981 |
|
|
|
34,718 |
|
|
|
33,004 |
|
|
69,181 |
|
|
|
64,271 |
|
|
34,463 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Income
Taxes |
|
22,808 |
|
|
|
22,923 |
|
|
48,752 |
|
|
|
44,291 |
|
|
25,944 |
|
Provision for Income
Taxes |
|
4,488 |
|
|
|
4,699 |
|
|
9,976 |
|
|
|
9,080 |
|
|
5,488 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income |
$ |
18,320 |
|
|
$ |
18,224 |
|
$ |
38,776 |
|
|
$ |
35,211 |
|
$ |
20,456 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Common
Share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
1.52 |
|
|
$ |
1.45 |
|
$ |
3.20 |
|
|
$ |
2.76 |
|
$ |
1.68 |
|
Diluted |
$ |
1.52 |
|
|
$ |
1.44 |
|
$ |
3.19 |
|
|
$ |
2.73 |
|
$ |
1.67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends Declared Per
Common Share |
$ |
0.40 |
|
|
$ |
0.40 |
|
$ |
0.80 |
|
|
$ |
0.76 |
|
$ |
0.40 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Balances, Interest Rates and
Yields
The following table presents, for the periods indicated, the
total dollar amounts of interest income from average
interest-earning assets and the resulting yields, as well as the
interest expense on average interest-bearing liabilities, expressed
both in dollars and rates, and the net interest margin. Average
balances of loans receivable include the average balances of
non-accrual loans for each period. Interest income on loans
includes interest received on non-accrual loans on a cash basis.
Interest income on loans includes the amortization of net loan
fees, which were deferred in accordance with accounting standards.
Net fees included in interest income were $1.5 million and $1.3
million for the three months ended June 30, 2023 and 2022,
respectively. Net fees included in interest income were $2.9
million and $3.1 million for the six months ended June 30, 2023 and
2022, respectively. Tax-exempt income was not calculated on a tax
equivalent basis. The table does not reflect any effect of income
taxes.
|
June 30, 2023 |
|
|
|
Three Months EndedJune 30,
2023 |
|
Three Months EndedJune 30,
2022 |
|
|
|
|
|
|
Average |
|
|
|
|
Yield/ |
|
|
|
Average |
|
|
|
|
Yield/ |
|
|
Yield/Rate |
|
|
|
Balance |
|
|
Interest |
|
Rate |
|
|
|
Balance |
|
|
Interest |
|
Rate |
|
|
(Dollars in thousands) |
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans receivable: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
One- to four-family residential |
3.68 |
% |
|
$ |
911,223 |
|
$ |
8,365 |
|
3.68 |
% |
|
$ |
772,326 |
|
$ |
6,534 |
|
3.39 |
% |
Other residential |
6.82 |
|
|
|
858,225 |
|
|
14,381 |
|
6.72 |
|
|
|
851,031 |
|
|
9,637 |
|
4.54 |
|
Commercial real estate |
6.00 |
|
|
|
1,508,785 |
|
|
22,243 |
|
5.91 |
|
|
|
1,576,285 |
|
|
17,120 |
|
4.36 |
|
Construction |
7.66 |
|
|
|
865,418 |
|
|
15,646 |
|
7.25 |
|
|
|
623,117 |
|
|
7,722 |
|
4.97 |
|
Commercial business |
6.18 |
|
|
|
292,318 |
|
|
4,223 |
|
5.79 |
|
|
|
288,452 |
|
|
3,371 |
|
4.69 |
|
Other loans |
6.39 |
|
|
|
183,446 |
|
|
2,368 |
|
5.18 |
|
|
|
198,543 |
|
|
2,217 |
|
4.48 |
|
Industrial revenue bonds |
6.06 |
|
|
|
12,428 |
|
|
216 |
|
6.97 |
|
|
|
13,345 |
|
|
163 |
|
4.89 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans receivable |
6.02 |
|
|
|
4,631,843 |
|
|
67,442 |
|
5.84 |
|
|
|
4,323,099 |
|
|
46,764 |
|
4.34 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment securities |
2.70 |
|
|
|
699,034 |
|
|
4,983 |
|
2.86 |
|
|
|
741,401 |
|
|
5,720 |
|
3.09 |
|
Other interest-earning
assets |
5.06 |
|
|
|
96,979 |
|
|
1,193 |
|
4.93 |
|
|
|
115,456 |
|
|
214 |
|
0.74 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest-earning assets |
5.61 |
|
|
|
5,427,856 |
|
|
73,618 |
|
5.44 |
|
|
|
5,179,956 |
|
|
52,698 |
|
4.08 |
|
Non-interest-earning
assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
|
|
89,117 |
|
|
|
|
|
|
|
|
95,819 |
|
|
|
|
|
|
Other non-earning assets |
|
|
|
|
201,467 |
|
|
|
|
|
|
|
|
155,822 |
|
|
|
|
|
|
Total assets |
|
|
|
$ |
5,718,440 |
|
|
|
|
|
|
|
$ |
5,431,597 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing demand and savings |
1.35 |
|
|
$ |
2,194,547 |
|
|
6,857 |
|
1.25 |
|
|
$ |
2,389,086 |
|
|
830 |
|
0.14 |
|
Time deposits |
3.30 |
|
|
|
987,523 |
|
|
7,024 |
|
2.85 |
|
|
|
781,811 |
|
|
1,032 |
|
0.53 |
|
Brokered deposits |
4.90 |
|
|
|
637,599 |
|
|
7,904 |
|
4.97 |
|
|
|
132,745 |
|
|
496 |
|
1.50 |
|
Total deposits |
2.46 |
|
|
|
3,819,669 |
|
|
21,785 |
|
2.29 |
|
|
|
3,303,642 |
|
|
2,358 |
|
0.29 |
|
Securities sold under reverse repurchase agreements |
2.38 |
|
|
|
55,257 |
|
|
221 |
|
1.60 |
|
|
|
135,536 |
|
|
8 |
|
0.02 |
|
Short-term borrowings, overnight FHLBank borrowings and other
interest-bearing liabilities |
5.35 |
|
|
|
148,638 |
|
|
1,943 |
|
5.24 |
|
|
|
73,337 |
|
|
236 |
|
1.29 |
|
Subordinated debentures issued to capital trust |
6.90 |
|
|
|
25,774 |
|
|
426 |
|
6.63 |
|
|
|
25,774 |
|
|
159 |
|
2.47 |
|
Subordinated notes |
5.94 |
|
|
|
74,393 |
|
|
1,105 |
|
5.96 |
|
|
|
74,098 |
|
|
1,106 |
|
5.99 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest-bearing liabilities |
2.60 |
|
|
|
4,123,731 |
|
|
25,480 |
|
2.48 |
|
|
|
3,612,387 |
|
|
3,867 |
|
0.43 |
|
Non-interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand deposits |
|
|
|
|
950,896 |
|
|
|
|
|
|
|
|
1,188,967 |
|
|
|
|
|
|
Other liabilities |
|
|
|
|
84,981 |
|
|
|
|
|
|
|
|
57,027 |
|
|
|
|
|
|
Total liabilities |
|
|
|
|
5,159,608 |
|
|
|
|
|
|
|
|
4,858,381 |
|
|
|
|
|
|
Stockholders’ equity |
|
|
|
|
558,832 |
|
|
|
|
|
|
|
|
573,216 |
|
|
|
|
|
|
Total liabilities and stockholders’ equity |
|
|
|
$ |
5,718,440 |
|
|
|
|
|
|
|
$ |
5,431,597 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income: |
|
|
|
|
|
|
$ |
48,138 |
|
|
|
|
|
|
|
$ |
48,831 |
|
|
|
Interest rate spread |
3.01 |
% |
|
|
|
|
|
|
|
2.96 |
% |
|
|
|
|
|
|
|
3.65 |
% |
Net interest margin* |
|
|
|
|
|
|
|
|
|
3.56 |
% |
|
|
|
|
|
|
|
3.78 |
% |
Average interest-earning
assets to average interest-bearing liabilities |
|
|
|
|
131.6 |
% |
|
|
|
|
|
|
|
143.4 |
% |
|
|
|
|
|
*Defined as the Company’s net interest income divided by average
total interest-earning assets.
|
June 30, 2023 |
|
|
|
Six Months EndedJune 30,
2023 |
|
Six Months EndedJune 30,
2022 |
|
|
|
|
|
|
Average |
|
|
|
|
Yield/ |
|
|
|
Average |
|
|
|
|
Yield/ |
|
|
Yield/Rate |
|
|
|
Balance |
|
|
Interest |
|
Rate |
|
|
|
Balance |
|
|
Interest |
|
Rate |
|
|
(Dollars in thousands) |
|
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans receivable: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
One- to four-family residential |
3.68 |
% |
|
$ |
910,452 |
|
$ |
16,530 |
|
3.66 |
% |
|
$ |
737,024 |
|
$ |
12,575 |
|
3.44 |
% |
Other residential |
6.82 |
|
|
|
821,877 |
|
|
27,065 |
|
6.64 |
|
|
|
805,579 |
|
|
18,054 |
|
4.52 |
|
Commercial real estate |
6.00 |
|
|
|
1,509,645 |
|
|
43,778 |
|
5.85 |
|
|
|
1,533,263 |
|
|
32,466 |
|
4.27 |
|
Construction |
7.66 |
|
|
|
892,568 |
|
|
31,853 |
|
7.20 |
|
|
|
645,544 |
|
|
15,251 |
|
4.76 |
|
Commercial business |
6.18 |
|
|
|
287,810 |
|
|
8,340 |
|
5.84 |
|
|
|
288,839 |
|
|
6,697 |
|
4.68 |
|
Other loans |
6.39 |
|
|
|
186,550 |
|
|
4,873 |
|
5.27 |
|
|
|
201,510 |
|
|
4,461 |
|
4.46 |
|
Industrial revenue bonds |
6.06 |
|
|
|
12,580 |
|
|
441 |
|
7.06 |
|
|
|
13,662 |
|
|
325 |
|
4.78 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total loans receivable |
6.02 |
|
|
|
4,621,482 |
|
|
132,880 |
|
5.80 |
|
|
|
4,225,421 |
|
|
89,829 |
|
4.29 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment securities |
2.70 |
|
|
|
702,943 |
|
|
9,986 |
|
2.86 |
|
|
|
638,262 |
|
|
9,131 |
|
2.88 |
|
Other interest-earning
assets |
5.08 |
|
|
|
94,415 |
|
|
2,215 |
|
4.73 |
|
|
|
286,102 |
|
|
412 |
|
0.29 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest-earning assets |
5.61 |
|
|
|
5,418,840 |
|
|
145,081 |
|
5.40 |
|
|
|
5,149,785 |
|
|
99,372 |
|
3.89 |
|
Non-interest-earning
assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
|
|
91,339 |
|
|
|
|
|
|
|
|
93,217 |
|
|
|
|
|
|
Other non-earning assets |
|
|
|
|
201,352 |
|
|
|
|
|
|
|
|
146,313 |
|
|
|
|
|
|
Total assets |
|
|
|
$ |
5,711,531 |
|
|
|
|
|
|
|
$ |
5,389,315 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing demand and savings |
1.35 |
|
|
$ |
2,189,783 |
|
|
11,216 |
|
1.03 |
|
|
$ |
2,382,551 |
|
|
1,607 |
|
0.14 |
|
Time deposits |
3.30 |
|
|
|
1,001,704 |
|
|
12,208 |
|
2.46 |
|
|
|
822,521 |
|
|
2,234 |
|
0.55 |
|
Brokered deposits |
4.90 |
|
|
|
547,708 |
|
|
13,011 |
|
4.79 |
|
|
|
100,254 |
|
|
691 |
|
1.39 |
|
Total deposits |
2.46 |
|
|
|
3,739,195 |
|
|
36,435 |
|
1.96 |
|
|
|
3,305,326 |
|
|
4,532 |
|
0.28 |
|
Securities sold under reverse repurchase agreements |
2.38 |
|
|
|
100,887 |
|
|
563 |
|
1.12 |
|
|
|
131,920 |
|
|
18 |
|
0.03 |
|
Short-term borrowings, overnight FHLBank borrowings and other
interest-bearing liabilities |
5.35 |
|
|
|
150,234 |
|
|
3,723 |
|
5.00 |
|
|
|
38,675 |
|
|
237 |
|
1.24 |
|
Subordinated debentures issued to capital trust |
6.90 |
|
|
|
25,774 |
|
|
819 |
|
6.41 |
|
|
|
25,774 |
|
|
277 |
|
2.17 |
|
Subordinated notes |
5.94 |
|
|
|
74,357 |
|
|
2,211 |
|
6.00 |
|
|
|
74,059 |
|
|
2,211 |
|
6.02 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest-bearing liabilities |
2.60 |
|
|
|
4,090,447 |
|
|
43,751 |
|
2.16 |
|
|
|
3,575,754 |
|
|
7,275 |
|
0.41 |
|
Non-interest-bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand deposits |
|
|
|
|
979,293 |
|
|
|
|
|
|
|
|
1,174,570 |
|
|
|
|
|
|
Other liabilities |
|
|
|
|
87,463 |
|
|
|
|
|
|
|
|
47,519 |
|
|
|
|
|
|
Total liabilities |
|
|
|
|
5,157,203 |
|
|
|
|
|
|
|
|
4,797,843 |
|
|
|
|
|
|
Stockholders’ equity |
|
|
|
|
554,328 |
|
|
|
|
|
|
|
|
591,472 |
|
|
|
|
|
|
Total liabilities and stockholders’ equity |
|
|
|
$ |
5,711,531 |
|
|
|
|
|
|
|
$ |
5,389,315 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income: |
|
|
|
|
|
|
$ |
101,330 |
|
|
|
|
|
|
|
$ |
92,097 |
|
|
|
Interest rate spread |
3.01 |
% |
|
|
|
|
|
|
|
3.24 |
% |
|
|
|
|
|
|
|
3.48 |
% |
Net interest margin* |
|
|
|
|
|
|
|
|
|
3.77 |
% |
|
|
|
|
|
|
|
3.61 |
% |
Average interest-earning
assets toaverage interest-bearing liabilities |
|
|
|
|
132.5 |
% |
|
|
|
|
|
|
|
144.0 |
% |
|
|
|
|
|
*Defined as the Company’s net interest income divided by average
total interest-earning assets.
NON-GAAP FINANCIAL MEASURES
This document contains certain financial information determined
by methods other than in accordance with accounting principles
generally accepted in the United States (“GAAP”), specifically, the
tangible common equity to tangible assets ratio.
In calculating the ratio of tangible common equity to tangible
assets, we subtract period-end intangible assets from common equity
and from total assets. Management believes that the presentation of
this measure excluding the impact of intangible assets provides
useful supplemental information that is helpful in understanding
our financial condition and results of operations, as it provides a
method to assess management’s success in utilizing our tangible
capital as well as our capital strength. Management also believes
that providing a measure that excludes balances of intangible
assets, which are subjective components of valuation, facilitates
the comparison of our performance with the performance of our
peers. In addition, management believes that this is a standard
financial measure used in the banking industry to evaluate
performance.
This non-GAAP financial measurement is supplemental and is not a
substitute for any analysis based on GAAP financial measures.
Because not all companies use the same calculation of non-GAAP
measures, this presentation may not be comparable to other
similarly titled measures as calculated by other companies.
Non-GAAP Reconciliation: Ratio of Tangible Common Equity
to Tangible
Assets
|
|
June 30, |
|
|
|
December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
(Dollars in thousands) |
|
|
|
|
|
Common equity at period
end |
$ |
546,329 |
|
|
$ |
533,087 |
|
Less: Intangible assets at
period end |
|
10,644 |
|
|
|
10,813 |
|
Tangible common equity at
period end (a) |
$ |
535,685 |
|
|
$ |
522,274 |
|
|
|
|
|
|
|
|
|
Total assets at period
end |
$ |
5,719,630 |
|
|
$ |
5,680,702 |
|
Less: Intangible assets at
period end |
|
10,644 |
|
|
|
10,813 |
|
Tangible assets at period end
(b) |
$ |
5,708,986 |
|
|
$ |
5,669,889 |
|
|
|
|
|
|
|
|
|
Tangible common equity to
tangible assets (a) / (b) |
|
9.38 |
% |
|
|
9.21 |
% |
CONTACT: Kelly Polonus, Great Southern, (417) 895-5242
kpolonus@greatsouthernbank.com
Great Southern Bancorp (NASDAQ:GSBC)
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