Great Southern Bancorp Inc. (GSBC, Financial) filed Quarterly Report for the period ended 2009-03-31.
Great Southern Bancorp Inc. is a financial holding company which owned directly all of the stock of Great Southern Bank and other non-bankingsubsidiaries. Great Southern Bancorp Inc. has a market cap of $266.15 million; its shares were traded at around $19.89 with a P/E ratio of 22.1 and P/S ratio of 1.54. The dividend yield of Great Southern Bancorp Inc. stocks is 3.62%. Great Southern Bancorp Inc. had an annual average earning growth of 17% over the past 10 years. GuruFocus rated Great Southern Bancorp Inc. the business predictability rank of 2-star.
TeamBank operated 17 locations in Kansas, Missouri and Nebraska. Great Southern assumed approximately $511 million of the deposits of TeamBank at a premium of $4.9 million. Additionally, Great Southern purchased approximately $434 million in loans, additional loan commitments and $6 million of other real estate owned (ORE) at a discount of $100 million. The loans, commitments and ORE purchased are covered by a loss share agreement between the FDIC and Great Southern which affords Great Southern significant protection. Under the agreement, the FDIC has agreed to cover 80% of the losses on the loans, commitments and ORE up to $115 million, and 95% of losses that exceed that amount. In addition, Great Southern also purchased cash equivalents and investment securities of TeamBank valued at $203 million, and assumed $80 million in Federal Home Loan Bank advances and other borrowings. The Company anticipates buying all primary banking center buildings available for purchase from the FDIC, except the Lee s Summit office, which was opened in mid-2007 and served primarily as a loan production office. This office will be closed in July and customers of this office will have access to the existing Great Southern banking center in Lee s Summit, as well as an additional banking center currently under construction. Acquisition costs of the buildings will be based on current appraisals and determined at a later date.
During the three months ended March 31, 2009, the Company increased total assets by $747.9 million to $3.41 billion. Most of the increase is attributable to the loans and investment securities acquired in the FDIC-assisted TeamBank transaction. Net loans increased by $211.5 million; the net loans added from TeamBank were $222.6 million. In the three months ended March 31, 2009, the disbursed portion of residential and commercial construction loan balances decreased $71.7 million. The main loan areas experiencing increases in the first three months of 2009 were commercial real estate loans and one- to four-family real estate loans, partially offset by lower average balances in construction loans. The Company's strategy continues to be focused on maintaining credit risk and interest rate risk at appropriate levels given the current credit and economic environments. The Company does not expect to grow the loan portfolio significantly at this time. Related to the loans purchased in the FDIC-assisted transaction, the Company recorded an asset of $154 million which represents an estimate of the fair value of the FDIC indemnification of losses in the TeamBank loans acquired. This amount will fluctuate over time, in tandem with the balance of loans acquired in the transaction, as the results of loan workouts and collections are recognized. Available-for-sale investment securities increased by $120.7 million and cash and cash equivalents increased $255.3 million. Most of the increase in investment securities is attributable to the investment securities acquired in the FDIC-assisted transaction. In the three months ended March 31, 2009, the Company experienced excess funding due to increases in deposits and customer reverse repurchase accounts. In some instances, the Company invested these excess funds in short-term cash equivalents at rates that at times caused the Company to earn a negative spread. While the Company generally earned a positive spread on securities purchased, it was much smaller than the Company's overall net interest spread, having the effect of increasing net interest income but decreasing net interest margin. While there is no specifically stated goal, the available-for-sale securities portfolio has in recent quarters been approximately 15% to 20% of total assets. The available-for-sale securities portfolio was 22.5% and 24.3% of total assets at March 31, 2009 and December 31, 2008, respectively. The Company expects that it may maintain this higher level of investment securities and cash and cash equivalents for the time being as excess liquidity in these uncertain times for the U.S. economy and the banking industry, subject to funding activities which are discussed below, and recognizing that this will continue to have the effect of decreasing net interest margin and net interest income. Foreclosed assets increased $7.7 million during the three months ended March 31, 2009. See “Non-performing assets – foreclosed assets” for additional information on the Company s foreclosed assets.
Total liabilities increased $727.2 million from December 31, 2008 to $3.15 billion at March 31, 2009. Deposits increased $545.7 million, securities sold under reverse repurchase agreements with customers increased $95.9 million and FHLBank advances increased $80.7 million. The increases in securities sold under repurchase agreements with customers was the result of corporate customers desires to place funds in excess of deposit insurance limits in secured accounts. FHLBank advances increased from $120.5 million at December 31, 2008, to $201.2 million at March 31, 2009, as a result of the advances assumed in the FDIC-assisted transaction. The level of FHLBank advances will fluctuate depending on growth in the Company's loan portfolio and other funding needs and sources of the Company. Total deposits increased $545.7 million from December 31, 2008. Deposits acquired from the FDIC were approximately $511 million. Retail CDs and non-interest-bearing transaction accounts increased $330.5 million and $5.2 million, respectively. Interest-bearing checking accounts (mainly money market accounts) increased $282.1 million. Checking account balances totaled $812.6 million at March 31, 2009, up from $525.2 million at December 31, 2008. Total brokered deposits were $608.5 million at March 31, 2009, down from $806.2 million at December 31, 2008. Excluded from these totals at March 31, 2009 and December 31, 2008, were Great Southern Bank customer deposits totaling $269.9 million and $168.3 million, respectively, that are part of the CDARS program which allows bank customers to maintain balances in an insured manner that would otherwise exceed the FDIC deposit insurance limit. The FDIC had previously counted these deposits as brokered, but changed their policy on this in 2009. The Company also decided to increase the amount of longer-term brokered certificates of deposit during 2008 to provide liquidity for operations and to maintain in reserve its available secured funding lines with the FHLBank and the FRB. As market interest rates on these types of deposits have decreased in recent months, the Company has begun to redeem some of these certificates in 2009 in order to lock in cheaper funding rates or reduce excess cash balances. In addition, the Company has had several brokered deposits mature in 2009 without replacement due to the deposit increases in other areas.
Including the effects of the Company's accounting entries recorded in 2009 and 2008 for certain interest rate swaps, net income increased $33.4 million during the three months ended March 31, 2009, compared to the three months ended March 31, 2008. This increase was primarily due to a decrease in provision for loan losses of $32.8 million, or 86.8%, and an increase in non-interest income of $20.9 million, or 205.1%, partially offset by an increase in provision for income taxes of $18.8 million, an increase in non-interest expense of $1.1 million, or 7.8%, and a decrease in net interest income of $288,000, or 1.6%.
Excluding the effects of the Company's accounting entries recorded in 2009 and 2008 for certain interest rate swaps, economically, net income increased $34.0 million during the three months ended March 31, 2009, compared to the three months ended March 31, 2008. This increase was primarily due to a decrease in provision for loan losses of $32.8 million, or 86.8%, and an increase in non-interest income of $23.0 million, or 319.3%, partially offset by an increase in provision for income taxes of $19.1 million, an increase in non-interest expense of $1.1 million, or 7.8%, and a decrease in net interest income of $1.5 million, or 8.0%.
Read the The complete Report
Great Southern Bancorp Inc. is a financial holding company which owned directly all of the stock of Great Southern Bank and other non-bankingsubsidiaries. Great Southern Bancorp Inc. has a market cap of $266.15 million; its shares were traded at around $19.89 with a P/E ratio of 22.1 and P/S ratio of 1.54. The dividend yield of Great Southern Bancorp Inc. stocks is 3.62%. Great Southern Bancorp Inc. had an annual average earning growth of 17% over the past 10 years. GuruFocus rated Great Southern Bancorp Inc. the business predictability rank of 2-star.
Highlight of Business Operations:
In the three months ended March 31, 2009, Great Southern's net loans increased $211.5 million, or 12.3%, from $1.72 billion at December 31, 2008, to $1.93 billion at March 31, 2009. The legacy Great Southern loan portfolio decreased slightly as the Company added $222.6 million of loans, net of significant discounts, due to its FDIC-assisted acquisition of certain TeamBank loans and other assets. As loan demand is affected by a variety of factors, including general economic conditions, and because of the competition we face, we cannot be assured that our loan growth will match or exceed the level of increases achieved in prior years. Based upon the current lending environment and economic conditions, the Company does not expect to grow the overall loan portfolio significantly, if at all, at this time. However, some loan categories have experienced increases. The main loan areas experiencing increases in the first three months of 2009 were commercial real estate loans and one- to four-family real estate loans, partially offset by lower balances in construction loans and commercial business loans. In the three months ended March 31, 2009, outstanding residential and commercial construction loan balances decreased $46.1 million, to $497.7 million at March 31, 2009. In addition, the undisbursed portion of construction and land development loans decreased $38.3 million from $73.9 million at December 31, 2008, to $35.6 million at March 31, 2009. The Company's strategy continues to be focused on maintaining credit risk and interest rate risk at appropriate levels given the current credit and economic environments.TeamBank operated 17 locations in Kansas, Missouri and Nebraska. Great Southern assumed approximately $511 million of the deposits of TeamBank at a premium of $4.9 million. Additionally, Great Southern purchased approximately $434 million in loans, additional loan commitments and $6 million of other real estate owned (ORE) at a discount of $100 million. The loans, commitments and ORE purchased are covered by a loss share agreement between the FDIC and Great Southern which affords Great Southern significant protection. Under the agreement, the FDIC has agreed to cover 80% of the losses on the loans, commitments and ORE up to $115 million, and 95% of losses that exceed that amount. In addition, Great Southern also purchased cash equivalents and investment securities of TeamBank valued at $203 million, and assumed $80 million in Federal Home Loan Bank advances and other borrowings. The Company anticipates buying all primary banking center buildings available for purchase from the FDIC, except the Lee s Summit office, which was opened in mid-2007 and served primarily as a loan production office. This office will be closed in July and customers of this office will have access to the existing Great Southern banking center in Lee s Summit, as well as an additional banking center currently under construction. Acquisition costs of the buildings will be based on current appraisals and determined at a later date.
During the three months ended March 31, 2009, the Company increased total assets by $747.9 million to $3.41 billion. Most of the increase is attributable to the loans and investment securities acquired in the FDIC-assisted TeamBank transaction. Net loans increased by $211.5 million; the net loans added from TeamBank were $222.6 million. In the three months ended March 31, 2009, the disbursed portion of residential and commercial construction loan balances decreased $71.7 million. The main loan areas experiencing increases in the first three months of 2009 were commercial real estate loans and one- to four-family real estate loans, partially offset by lower average balances in construction loans. The Company's strategy continues to be focused on maintaining credit risk and interest rate risk at appropriate levels given the current credit and economic environments. The Company does not expect to grow the loan portfolio significantly at this time. Related to the loans purchased in the FDIC-assisted transaction, the Company recorded an asset of $154 million which represents an estimate of the fair value of the FDIC indemnification of losses in the TeamBank loans acquired. This amount will fluctuate over time, in tandem with the balance of loans acquired in the transaction, as the results of loan workouts and collections are recognized. Available-for-sale investment securities increased by $120.7 million and cash and cash equivalents increased $255.3 million. Most of the increase in investment securities is attributable to the investment securities acquired in the FDIC-assisted transaction. In the three months ended March 31, 2009, the Company experienced excess funding due to increases in deposits and customer reverse repurchase accounts. In some instances, the Company invested these excess funds in short-term cash equivalents at rates that at times caused the Company to earn a negative spread. While the Company generally earned a positive spread on securities purchased, it was much smaller than the Company's overall net interest spread, having the effect of increasing net interest income but decreasing net interest margin. While there is no specifically stated goal, the available-for-sale securities portfolio has in recent quarters been approximately 15% to 20% of total assets. The available-for-sale securities portfolio was 22.5% and 24.3% of total assets at March 31, 2009 and December 31, 2008, respectively. The Company expects that it may maintain this higher level of investment securities and cash and cash equivalents for the time being as excess liquidity in these uncertain times for the U.S. economy and the banking industry, subject to funding activities which are discussed below, and recognizing that this will continue to have the effect of decreasing net interest margin and net interest income. Foreclosed assets increased $7.7 million during the three months ended March 31, 2009. See “Non-performing assets – foreclosed assets” for additional information on the Company s foreclosed assets.
Total liabilities increased $727.2 million from December 31, 2008 to $3.15 billion at March 31, 2009. Deposits increased $545.7 million, securities sold under reverse repurchase agreements with customers increased $95.9 million and FHLBank advances increased $80.7 million. The increases in securities sold under repurchase agreements with customers was the result of corporate customers desires to place funds in excess of deposit insurance limits in secured accounts. FHLBank advances increased from $120.5 million at December 31, 2008, to $201.2 million at March 31, 2009, as a result of the advances assumed in the FDIC-assisted transaction. The level of FHLBank advances will fluctuate depending on growth in the Company's loan portfolio and other funding needs and sources of the Company. Total deposits increased $545.7 million from December 31, 2008. Deposits acquired from the FDIC were approximately $511 million. Retail CDs and non-interest-bearing transaction accounts increased $330.5 million and $5.2 million, respectively. Interest-bearing checking accounts (mainly money market accounts) increased $282.1 million. Checking account balances totaled $812.6 million at March 31, 2009, up from $525.2 million at December 31, 2008. Total brokered deposits were $608.5 million at March 31, 2009, down from $806.2 million at December 31, 2008. Excluded from these totals at March 31, 2009 and December 31, 2008, were Great Southern Bank customer deposits totaling $269.9 million and $168.3 million, respectively, that are part of the CDARS program which allows bank customers to maintain balances in an insured manner that would otherwise exceed the FDIC deposit insurance limit. The FDIC had previously counted these deposits as brokered, but changed their policy on this in 2009. The Company also decided to increase the amount of longer-term brokered certificates of deposit during 2008 to provide liquidity for operations and to maintain in reserve its available secured funding lines with the FHLBank and the FRB. As market interest rates on these types of deposits have decreased in recent months, the Company has begun to redeem some of these certificates in 2009 in order to lock in cheaper funding rates or reduce excess cash balances. In addition, the Company has had several brokered deposits mature in 2009 without replacement due to the deposit increases in other areas.
Including the effects of the Company's accounting entries recorded in 2009 and 2008 for certain interest rate swaps, net income increased $33.4 million during the three months ended March 31, 2009, compared to the three months ended March 31, 2008. This increase was primarily due to a decrease in provision for loan losses of $32.8 million, or 86.8%, and an increase in non-interest income of $20.9 million, or 205.1%, partially offset by an increase in provision for income taxes of $18.8 million, an increase in non-interest expense of $1.1 million, or 7.8%, and a decrease in net interest income of $288,000, or 1.6%.
Excluding the effects of the Company's accounting entries recorded in 2009 and 2008 for certain interest rate swaps, economically, net income increased $34.0 million during the three months ended March 31, 2009, compared to the three months ended March 31, 2008. This increase was primarily due to a decrease in provision for loan losses of $32.8 million, or 86.8%, and an increase in non-interest income of $23.0 million, or 319.3%, partially offset by an increase in provision for income taxes of $19.1 million, an increase in non-interest expense of $1.1 million, or 7.8%, and a decrease in net interest income of $1.5 million, or 8.0%.
Read the The complete Report
