Great Southern Bancorp, Inc.

GSBC

US3909051076

Banks

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May. 08	Transcript : Great Southern Bancorp, Inc. - Shareholder/Analyst Call
Apr. 18	Transcript : Great Southern Bancorp, Inc., Q1 2024 Earnings Call, Apr 18, 2024

GREAT SOUTHERN BANCORP : MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-Q)

May 08, 2020 at 03:19 pm EDT

Forward-looking Statements





When used in this Quarterly Report 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 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 "will likely result," "are
expected to," "will continue," "is anticipated," "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. Such statements are subject to certain risks and uncertainties,
including, among other things, (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) fluctuations in interest rates; (iv) 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 loan losses; (v) the possibility of other-than-temporary
impairments of securities held in the Company's securities portfolio; (vi) the
Company's ability to access cost-effective funding; (vii) fluctuations in real
estate values and both residential and commercial real estate market conditions;
(viii) demand for loans and deposits in the Company's market areas; (ix) the
potential adverse effects of the COVID-19 pandemic on the ability of the
Company's borrowers to satisfy their obligations to the Company, on the demand
for the Company's loans or its other products and services, on other aspects of
the Company's business operations and on financial markets and economic growth;
(x) the ability to adapt successfully to technological changes to meet
customers' needs and developments in the marketplace; (xi) 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; (xii) legislative or regulatory
changes that adversely affect the Company's business, including, without
limitation, the Dodd-Frank Wall Street Reform and Consumer Protection Act of
2010 and its implementing regulations, the overdraft protection regulations and
customers' responses thereto and the Tax Reform Legislation; (xiii) changes in
accounting principles, policies or guidelines; (xiv) monetary and fiscal
policies of the Federal Reserve Board and the U.S. Government and other
governmental initiatives affecting the financial services industry; (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 loan 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; and (xvii) competition. The
Company wishes to advise readers that the factors listed above and other risks
described from time to time in documents filed or furnished by the Company with
the SEC could affect the Company's financial performance and could 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.

Critical Accounting Policies, Judgments and Estimates





The accounting and reporting policies of the Company conform with accounting
principles generally accepted in the United States and general practices within
the financial services industry. The preparation of financial statements in
conformity with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect the
amounts reported in the financial statements and the accompanying notes. Actual
results could differ from those estimates.

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Allowance for Loan Losses and Valuation of Foreclosed Assets





The Company believes that the determination of the allowance for loan losses
involves a higher degree of judgment and complexity than its other significant
accounting policies. The allowance for loan losses is calculated with the
objective of maintaining an allowance level believed by management to be
sufficient to absorb estimated loan losses. Management's determination of the
adequacy of the allowance is based on periodic evaluations of the loan portfolio
and other relevant factors. However, this evaluation is inherently subjective as
it requires material estimates of, among other things, expected default
probabilities, loss once loans default, expected commitment usage, the amounts
and timing of expected future cash flows on impaired loans, value of collateral,
estimated losses, and general amounts for historical loss experience.



The process also considers economic conditions, uncertainties in estimating
losses and inherent risks in the loan portfolio. All of these factors may be
susceptible to significant change. To the extent actual outcomes differ from
management estimates, additional provisions for loan losses may be required
which would adversely impact earnings in future periods. In addition, the Bank's
regulators could require additional provisions for loan losses as part of their
examination process.



See Note 6 "Loans and Allowance for Loan Losses" included in Item 1 for
additional information regarding the allowance for loan losses. Inherent in this
process is the evaluation of individual significant credit relationships. From
time to time certain credit relationships may deteriorate due to payment
performance, cash flow of the borrower, value of collateral, or other factors.
In these instances, management may revise its loss estimates and assumptions for
these specific credits due to changing circumstances. In some cases, additional
losses may be realized; in other instances, the factors that led to the
deterioration may improve or the credit may be refinanced elsewhere and
allocated allowances may be released from the particular credit.  The Company
uses a three-year average of historical losses for the general component of the
allowance for loan loss calculation.  No significant changes were made to
management's overall methodology for evaluating the allowance for loan losses
during the periods presented in the financial statements of this report.



In addition, the Company considers that the determination of the valuations of
foreclosed assets held for sale involves a high degree of judgment and
complexity. The carrying value of foreclosed assets reflects management's best
estimate of the amount to be realized from the sales of the assets.  While the
estimate is generally based on a valuation by an independent appraiser or recent
sales of similar properties, the amount that the Company realizes from the sales
of the assets could differ materially from the carrying value reflected in the
financial statements, resulting in losses that could adversely impact earnings
in future periods.

Carrying Value of Loans Acquired in FDIC-Assisted Transactions





The Company considers that the determination of the carrying value of loans
acquired in the FDIC-assisted transactions involves a high degree of judgment
and complexity. The carrying value of the acquired loans reflects management's
best ongoing estimates of the amounts to be realized on these assets.  The
Company determined initial fair value accounting estimates of the acquired
assets and assumed liabilities in accordance with FASB ASC 805, Business
Combinations. However, the amount that the Company realizes on its acquired loan
assets could differ materially from the carrying value reflected in its
financial statements, based upon the timing of collections on the acquired loans
in future periods. Because of the loss sharing agreements with the FDIC on
certain of these assets, the Company did not expect to incur any significant
losses related to these assets.  Subsequent to the initial valuation, the
Company continued to monitor identified loan pools for changes in estimated cash
flows projected for the loan pools, anticipated credit losses and changes in the
accretable yield.  Analysis of these variables requires significant estimates
and a high degree of judgment.  See Note 7 "FDIC-Assisted Acquired Loans"
included in Item 1 for additional information regarding the TeamBank, Vantus
Bank, Sun Security Bank, InterBank and Valley Bank FDIC-assisted transactions.

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Goodwill and Intangible Assets

Goodwill and intangible assets that have indefinite useful lives are subject to
an impairment test at least annually and more frequently if circumstances
indicate their value may not be recoverable. Goodwill is tested for impairment
using a process that estimates the fair value of each of the Company's reporting
units compared with its carrying value. The Company defines reporting units as a
level below each of its operating segments for which there is discrete financial
information that is regularly reviewed. As of March 31, 2020, the Company had
one reporting unit to which goodwill has been allocated - the Bank.  If the fair
value of a reporting unit exceeds its carrying value, then no impairment is
recorded. If the carrying value exceeds the fair value of a reporting unit,
further testing is completed comparing the implied fair value of the reporting
unit's goodwill to its carrying value to measure the amount of impairment, if
any. Intangible assets that are not amortized must be tested for impairment at
least annually by comparing the fair values of those assets to their carrying
values. At March 31, 2020, goodwill consisted of $5.4 million at the Bank
reporting unit, which included goodwill of $4.2 million that was recorded during
2016 related to the acquisition of 12 branches from Fifth Third Bank.  Other
identifiable intangible assets that are subject to amortization are amortized on
a straight-line basis over a period of seven years. At March 31, 2020, the
amortizable intangible assets consisted of core deposit intangibles of $2.4
million, which are reflected in the table below.  These amortizable intangible
assets are reviewed for impairment if circumstances indicate their value may not
be recoverable based on a comparison of fair value.



At March 31, 2020, the Company evaluated the current circumstances brought about
by the COVID-19 pandemic and its effect on the valuation of the Company and
other bank holding companies and determined that no triggering event had
occurred requiring an evaluation of goodwill or other intangible asset
impairment. While the Company believes no impairment of its goodwill or other
intangible assets existed at March 31, 2020, different conditions or assumptions
used to measure fair value of reporting units, or changes in cash flows or
profitability, if significantly negative or unfavorable, could have a material
adverse effect on the outcome of the Company's impairment evaluation in the
future.

A summary of goodwill and intangible assets is as follows:





                                 March 31,     December 31,
                                   2020            2019
                                       (In Thousands)

Goodwill - Branch acquisitions $     5,396   $        5,396
Deposit intangibles
Boulevard Bank                         122              153
Valley Bank                            500              600
Fifth Third Bank                     1,791            1,949
                                     2,413            2,702
                               $     7,809   $        8,098




Current Economic Conditions



Changes in economic conditions could cause the values of assets and liabilities
recorded in the financial statements to change rapidly, resulting in material
future adjustments in asset values, the allowance for loan losses, or capital
that could negatively impact the Company's ability to meet regulatory capital
requirements and maintain sufficient liquidity.



Following the housing and mortgage crisis and correction beginning in mid-2007,
the United States entered an economic downturn.  Unemployment rose from 4.7% in
November 2007 to peak at 10.0% in October 2009.  Following that time, economic
conditions improved considerably, as indicated by higher consumer confidence
levels, increased economic activity and low unemployment levels. The U.S.
economy continued to operate at historically strong levels until the impact of
COVID-19 began to take its toll in March 2020.  While the severity and extent of
the coronavirus pandemic on the global, national and regional economies is still
uncertain, it will most likely have a detrimental impact on the performance of
our loan portfolio, at least in the near term.  Short-term modifications to loan
terms to help our customers navigate through the current pandemic situation were
made in accordance with guidance from the banking regulatory authorities. These
modifications did not result in the loans being classified as troubled debt

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restructurings, potential problem loans or non-performing loans. More severely impacted industries in our portfolio include retail, motel/hotel and restaurants.





In March 2020, employment fell by 701,000 jobs and the unemployment rate rose to
4.4%, up from 3.5% in December 2019. This was the largest month-over-month
increase in the rate since January 1975, when the increase was also 0.9
percentage points, based on household survey data. The changes in these measures
reflect the effects of the coronavirus pandemic and efforts to contain it.
Employment in leisure and hospitality fell by 459,000, mainly in food services
and drinking establishments. Notable declines also occurred in health care and
social assistance, professional and business services, retail, and construction.
The number of unemployed persons rose by 1.4 million to 7.1 million in March. In
March 2020, the U.S. labor force participation rate (the share of working-age
Americans employed or actively looking for a job) decreased by 0.7 percentage
points to 62.7% and the employment population ratio dropped by 1.1 percentage
points to 60.0%. The unemployment rate for the Midwest, where the Company
conducts most of its business, increased from 3.5% in December 2019 to 4.1% in
March 2020.  Unemployment rates for March 2020 were Arkansas at 4.7%, Colorado
at 4.8%, Georgia at 4.3%, Illinois at 4.4%, Iowa at 3.8%, Kansas at 3.1%,
Minnesota at 3.9%, Missouri at 4.5%, Nebraska at 4.3%, Oklahoma at 2.8%, and
Texas at 4.7%. Of the metropolitan areas in which the Company does business, the
largest year-over-year employment increases occurred in the Dallas area with an
increase of 126,000 jobs. Chicago was one of two MSA's in the nation with the
largest unemployment rate decreases in February of 0.9%, ending with a rate of
3.6%, but they still have the highest unemployment rate among the metropolitan
areas in which the Company does business.  Unemployment levels have increased
dramatically in April 2020, with the number of unemployment claims in the U.S.
spiking to over 30 million as "Stay-at-Home" mandates were enacted by nearly
every state.



Sales of newly built single-family homes for March 2020 were at a seasonally
adjusted annual rate of 627,000 according to U.S. Census Bureau and the
Department of Housing and Urban Development estimates.  This is 15.4% below the
revised February 2020 rate of 741,000, and is 9.5% below the March 2020
preliminary estimate of 693,000.  The median sales price of new houses sold in
March 2020 was $321,400, down slightly from $321,500 a year earlier.  The March
2020 average sales price of $375,300 was down slightly from $383,900 a year ago.

The inventory of new homes for sale at the end of March would support 6.4 months' supply at the current sales pace, up from 5.8 months in March 2019.





Existing-home sales fell in March 2020, after significant nationwide gains in
February 2020, according to the National Association of Realtors. Total existing
home sales dropped 8.5% from February 2020 to a seasonally adjusted rate of 5.27
million in March 2020.  Despite the decline, overall sales increased
year-over-year for the ninth straight month, up 0.8% from a year ago.  Total
housing inventory at the end of March was at 1.50 million, up 2.7% from February
2020, but down 10.2% from one year ago (1.67 million).  Unsold inventory sits at
a 3.4-month supply at the current sales pace, up from 3.0 months in February
2020 and down from the 3.8-month figure in March 2019.  The median existing home
price for all housing types in December 2019 was $280,600. This price marks the
97th straight month of year-over-year gains.  In the Midwest region, the
existing home median sale price was $219,700 in February 2020, which is a 9.7%
increase from a year ago. First-time buyers accounted for 34% of sales in March
2020, up from 32% in February 2020 and 33% in March 2019.  According to Freddie
Mac, the average commitment rate for a 30-year, conventional, fixed-rate
mortgage was 3.45% in March 2020, down from 3.47% in February 2020. The average
commitment rate for all of 2019 was 3.94%, down slightly from 4.54% for 2018.



The effects of the coronavirus pandemic on mutifamily real estate markets are
already appearing in CoStar's multifamily data with daily asking rents for
apartment units declining since March 11-just as the prime leasing season began
to unfold. A $2 trillion plus stimulus package included direct cash payments to
renter households which should temporarily mitigate the impact on the apartment
sector. About $53 billion in rent payments were due on April 1 2020, but
strapped households may still have opted to buy food or necessities, or just
hoard cash, instead of paying rent. Fannie Mae, Freddie Mac, and HUD have
announced prohibitions on evictions in all GSE-financed communities, and the
NMHC has published guidelines to its members to avoid evictions and delay rent
hikes. As of the end of March 2020, national apartment vacancy rates had
increased slightly to 6.6% while our market areas reflected the following
vacancy levels: Springfield, Mo. at 5.2%, St. Louis at 9.0%, Kansas City at
7.6%, Minneapolis at 5.2%, Tulsa, Okla. at 8.8%, Dallas-Fort Worth at 8.7%,
Chicago at 6.6%, Atlanta at 9.0% and Denver at 8.0%.

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Per information provided by Integra IRR Viewpoint prior to the pandemic, all of
the Company's market areas within the multi-family sector were in expansion
phase with the exception of Denver and Atlanta, which were both currently in a
hyper-supply phase. Markets in hyper-supply phase exhibit increasing vacancy
rates, moderate/high new construction, low/negative absorption, moderate/low
employment growth and medium/low rental rate growth.



Demand for U.S. office space ended the first quarter in positive territory,
though it was the lowest quarterly total since 2011 and much of the positive
absorption occurred prior to March.  Annual rent growth has been slowing over
the past several months, though remained positive in the first quarter. Even
before the disruption caused by the coronavirus pandemic, the trend of slowing
growth was expected to continue in 2020 and beyond.



Per Integra prior to the pandemic, approximately 63% of the suburban office
markets nationally were in an expansion market cycle -- characterized by
decreasing vacancy rates, moderate/high new construction, high absorption,
moderate/high employment growth and medium/high rental rate growth. The
Company's larger market areas in the suburban office market cycle include:
Minneapolis, Dallas-Ft. Worth, and St. Louis.  Tulsa, OK, Chicago, IL, and
Kansas City were in the recovery/expansion market cycle -- typified by
decreasing vacancy rates, low new construction, moderate absorption,
low/moderate employment growth and negative/low rental rate growth. We expect
that market trends in the office sector will be markedly worse in the second
quarter of 2020.



For a sector where brick-and-mortar retail destinations had already been
weathering a slew of headwinds over the past several years, the temporary
closing of shopping malls, retailers and entertainment venues adds more
uncertainty for landlords, existing tenants, potential tenants, investors and
lenders alike. The near freezing of economic and social activity taken in an
effort to contain the spread of coronavirus has hurt, and will continue to hurt
the retail sector.  In the third quarter of 2019, e-commerce sales accounted for
11.2% of total sales with more than $145 billion in online transactions.  The
impact of COVID-19 will likely accelerate the transition to internet-based
transactions.



The degree to which the retail sector has suffered and will continue to suffer
is yet unknown, as the path and progression of the virus, and the economy's
response to such measures taken, remains fluid. In addition to forced and
voluntary store closures, many retailers will struggle amid near-total loss of
foot traffic, declining consumer sentiment, lost wages and restrained consumer
spending activity. Demand for retail in the second quarter of 2020 is on pace to
register its first quarter of negative net absorption since 2009 with additional
losses expected throughout 2020.



According to Integra, prior to the impact of COVID-19, approximately 54% of the
retail sector was in the expansion phase of the market cycle, with another 35%
in recovery mode and the remaining 11% in hyper-supply and recession.  The
Company's larger market areas which were in the retail expansion market segments
are Chicago, Kansas City, Dallas-Ft. Worth, and St. Louis.  Denver and
Minneapolis were in the hyper-supply cycle. The Atlanta and Tulsa markets were
each in recovery phase.



Though the industrial sector is expected to fare best among commercial real
estate sectors, its operating fundamentals will not fully escape the negative
impacts of the COVID-19 recession. U.S. economic growth faces many headwinds as
a result of the coronavirus pandemic, including dampened aggregate demand and
reduced export growth, both of which will adversely impact the industrial
warehouse sector. Disrupted and curtailed supply chains also present a headwind
for port markets and industrial distribution operators. Meanwhile, labor
shortages arising from mandatory construction suspensions place further pressure
on industrial operators, distributors and manufacturers. CoStar accordingly
anticipates a slowing in leasing activity in the first half of 2020 as
retailers, manufacturers, logistics operators, and distribution firms turn more
cautious amid heightened uncertainty brought on by the COVID-19 pandemic.



Prior to COVID-19, Integra had included all of the Company's larger industrial
market areas in the expansion cycle with prospects of continuing good economic
growth.  Three market areas, Chicago, Minneapolis and Kansas City, were in the
latter stages of the expansion cycle.

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Occupancy, absorption, sales and rental income levels of commercial real estate
properties located throughout the Company's market areas will be impacted by
COVID-19; however, at this time the extent of the impact is uncertain. The
Company will continue to monitor regional, national, and global economic
indicators such as unemployment, GDP, housing starts and prices, commercial real
estate occupancy, absorption and rental rates, as these could significantly
affect customers in each of our market areas.

COVID-19 Impact to Our Business and Response





Great Southern is actively monitoring and responding to the effects of the
rapidly-changing COVID-19 pandemic. As always, the health, safety and well-being
of our customers, associates and communities are the Company's top priorities.
Centers of Disease Control (CDC) guidelines, as well as directives from federal,
state and local officials, are being closely followed to make informed
operational decisions.  During April 2020, all states in the Company's 11-state
footprint were under statewide "Stay at Home" lockdown, except Arkansas, Iowa,
and Nebraska.  The Company has several locations and personnel in Iowa, with one
location each in Arkansas and Nebraska. During the month of May, several states
or regions in our markets are expected to begin reopening with a gradual
loosening of "Stay at Home" restrictions.



In January 2020, the Company activated its long-established Pandemic Response
Plan.  This plan promotes the health and safety of the Company's constituents
and specifies responsive actions to support continuous service for customers. A
summary of the Company's major COVID-19 responses and actions are highlighted
below.



Great Southern Associates:  During this unprecedented time, the Company is
working diligently with its nearly 1,200 associates to enforce CDC-advised
health, hygiene and social distancing practices.  Approximately 50% of our
non-frontline associates are currently working from home. Teams in nearly every
operational department have been split, with part of each team working at an
off-site disaster recovery facility to promote social distancing and to avoid
service disruptions. Through May 5, 2020, there have been no service disruptions
or reductions in staffing.



Paid time off and other benefits were enhanced and implemented to support Great
Southern associates. Part-time associates were awarded paid sick benefits for
the first time. Any full-time and part-time associate will receive full pay if
placed under a restrictive quarantine due to COVID-19 infection or direct
exposure to an infected individual. The Company's Employee Assistance Program
(EAP) was enhanced at no cost for associates and family members seeking
counseling services for mental health and emotional support needs. As a token of
appreciation and to help support some of the needs of our associates, the
Company rewarded all full-time and part-time associates with special pre-tax
bonuses of $1,000 and $600, respectively.



Great Southern Communities:  To support local COVID-19 relief efforts, in March
2020, Great Southern committed up to $300,000 to Feeding America food banks,
local United Way agencies and other nonprofit organizations to address food
insecurity and support critical health and human services during this time of
crisis. The funds were distributed to agencies serving Great Southern local
markets across its 11-state franchise.



Great Southern Customers:  During the COVID-19 event, taking care of customers
and providing uninterrupted access to services are top priorities. As always,
customers can conduct their banking business using the banking center network,
online and mobile banking services, ATMs, Telephone Banking, and online account
opening services. Since March 21, 2020, following social distancing guidance
from the CDC and government officials, all Great Southern banking centers have
been providing drive-thru service only and in-person service by appointment.



The COVID-19 event is causing a growing number of customers to experience
financial uncertainty and hardships. The Company has been reaching out to
customers and is strongly encouraging customers to call for assistance. Certain
account maintenance and service fees are being waived or refunded for depository
customers. Payment relief options and loan modifications for consumer and
commercial loan customers are available on a case-by-case basis.  See Loan
Modifications below for further details of loan modifications to date.

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The Company has been actively utilizing the $2 trillion CARES Act stimulus
package to assist consumers and businesses.  The CARES Act made available Small
Business Administration (SBA) lending programs that offer relief for small
businesses, including the Paycheck Protection Program (PPP). Great Southern is
actively participating in the PPP, which provides emergency financial support to
small businesses (primarily those with less than 500 employees) using
federally-guaranteed loans through the SBA. These loans may be eligible for
forgiveness contingent upon how the loan proceeds are used by the borrower. The
PPP has been met with very high demand throughout the country and in all Great
Southern markets.  Based on loans approved or funded to date and the total
amount currently authorized for the PPP under the CARES Act, as amended by the
Paycheck Protection Program and Health Care Enhancement Act, we anticipate that
we will originate approximately 1,500 PPP loans totaling approximately $119
million.

In addition to the PPP, Great Southern has also helped promote the SBA's Emergency Injury Disaster Loan (EIDL) program. EIDL is available directly through the SBA for small businesses seeking assistance related to COVID-19.

As a resource to customers, a COVID-19 information center has been made available on the Company's website, www.GreatSouthernBank.com. General information about the Company's pandemic response, how to receive assistance, and how to avoid COVID-19 scams and fraud are included.





Impacts to Our Business Going Forward:  The Company expects that the COVID-19
pandemic will impact our business in future periods in one or more of the
following ways, among others.  The magnitude of the impact is unknown at this
time, and will depend on the length and severity of the economic downturn
brought on by the pandemic.

?Significantly lower market interest rates will have a negative impact on our variable rate loans indexed to LIBOR and prime

?Certain fees for deposit and loan products may be waived or reduced

?Point-of-sale fee income may decline due to a decrease in spending by our debit card customers as they deal with "Stay at Home" requirements and may be adversely affected by reductions in their personal income and job losses

?Non-interest expenses may increase to deal with the effects of the COVID-19 pandemic, including cleaning costs, supplies, equipment and other items

?Operations in our banking center lobbies will likely be somewhat restricted until the emergency status is lifted

?Additional loan modifications may occur and borrowers may default on their loans, which may necessitate further increases to the allowance for loan losses

?The contraction in economic activity may reduce demand for our loans and for our other products and services

Paycheck Protection Program Loans

As noted above, Great Southern is actively participating in the PPP through the SBA. The PPP has been met with very high demand throughout the country, resulting in a second round of funding through an amendment to the CARES Act.


 Based on loans approved or funded through the end of April 2020, we anticipate
that we will originate approximately 1,500 PPP loans totaling approximately $119
million.  Great Southern will receive a fee from the SBA for originating these
loans based on the amount of each loan.  We currently anticipate these fees will
total approximately $4.4 million.  The fees, net of origination costs, will be
deferred in accordance with standard accounting practices and will be accreted
to interest income on loans over the contractual life of each loan.  These loans
generally have a contractual maturity of two years from origination date, but
may be repaid or forgiven (by the SBA) two to three months after the loan was
funded.  If these loans are repaid or forgiven prior to their contractual
maturity date, the remaining deferred fee for such loan will be accreted to
interest income on loans immediately.  We expect a significant portion of these
net deferred fees will accrete to interest income in the three months ending
September 30, 2020.

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Loan Modifications





Through April 27, 2020, we have modified 319 commercial loans with a total
principal balance outstanding of $705.1 million and 1,446 consumer and mortgage
loans with a total principal balance outstanding of $67.5 million. The loan
modifications were made as provided for under Section 4013 of the CARES Act and
within the guidance provided by the federal banking regulatory agencies, the
Securities and Exchange Commission and the Financial Accounting Standards Board;
therefore they are not considered troubled debt restructurings.  The modified
loans are in the following categories (dollars in millions):



                                                                                        Weighted
                                                                                        Average
                                                    Interest Interest   Full     Full   Loan to
                                           Interest   Only     Only   Payment  Payment  Value of
                     # of Loans $ of Loans   Only     4-6      7-12

Deferral Deferral Loans


  Collateral Type     Modified   Modified  3 Months  Months   Months  3 Months 6 Months Modified

Retail                       82    $ 192.1  $ 176.1    $ 4.3   $ 11.7    $   -    $   -      64%
Healthcare                   20      140.6     94.0        -        -        -     46.6      60%
Hotel/Motel                  23      131.0     87.1        -        -     10.2     33.7      65%
Multifamily                  36       95.3     70.9     24.4        -        -        -      72%
Office                       25       59.8     57.1        -      0.3        -      2.4      54%
Warehouse/Other              35       48.6     34.9      0.3      7.8      0.3      5.3      60%
Commercial Business          69       16.9      6.1      2.0      0.1      0.3      8.4
Restaurants                  18       15.3     15.3        -        -        -        -      68%
Land                         11        5.5      4.5        -      1.0        -        -
Total Commercial            319      705.1    546.0     31.0     20.9     10.8     96.4

Residential Mortgage        240       54.7     20.6      1.5        -     32.6        -      71%
Consumer                  1,206       12.8        -        -        -     12.8        -
Total Consumer            1,446       67.5     20.6      1.5        -     45.4        -

Total                     1,765    $ 772.6  $ 566.6   $ 32.5   $ 20.9   $ 56.2   $ 96.4

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Total loans outstanding in the following categories at March 31, 2020, were as follows (dollars in millions):





                                                                      Weighted
                                 Percentage                           Average
                     Outstanding  of Loans               Percentage   Loan to
                     Balance of  Modified To              of Loans    Value of
                        Loans    Total Loans Percentage    of This    Loans in
                       of This     of This    of Loans   Collateral     This
                     Collateral  Collateral  Modified To   Type to   Collateral
  Collateral Type       Type        Type     Total Loans Total Loans    Type

Retail                  $  431.2         45%          5%         10%        64%
Healthcare                 284.3         49%          3%          7%        58%
Hotel/Motel                179.8         73%          3%          4%        55%
Multifamily                927.5         10%          2%         22%        71%
Office                     257.9         23%          1%          6%        61%
Warehouse/Other            261.8         19%          1%          6%        52%
Commercial Business        270.1          6%         <1%          7%
Restaurants                 73.1         21%         <1%          2%        63%
Land                        38.5         14%         <1%          1%
Total Commercial         2,724.2         26%         17%         65%

Residential Mortgage       562.3         10%          1%         14%        72%
Consumer                   298.1          4%         <1%          7%
Total Consumer             860.4          8%          1%         21%

Total                  $ 3,584.6         22%         18%         86%




General



The profitability of the Company and, more specifically, the profitability of
its primary subsidiary, the Bank, depend primarily on its net interest income,
as well as provisions for loan losses and the level of non-interest income and
non-interest expense. Net interest income is the difference between the interest
income the Bank earns on its loans and investment portfolios, and the interest
it pays on interest-bearing liabilities, which consists mainly of interest paid
on deposits and borrowings. Net interest income is affected by the relative
amounts of interest-earning assets and interest-bearing liabilities and the
interest rates earned or paid on these balances. When interest-earning assets
approximate or exceed interest-bearing liabilities, any positive interest rate
spread will generate net interest income.



Great Southern's total assets increased $57.9 million, or 1.2%, from $5.02
billion at December 31, 2019, to $5.07 billion at March 31, 2020. Full details
of the current period changes in total assets are provided in the "Comparison of
Financial Condition at March 31, 2020 and December 31, 2019" section of this
Quarterly Report on Form 10-Q.



Loans.  Net outstanding loans increased $41.1 million, or 1.0%, from $4.15
billion at December 31, 2019, to $4.20 billion at March 31, 2020.  The net
increase in loans reflects reductions of $10.0 million in the FDIC-assisted
acquired loan portfolios.  This increase was primarily in other residential
(multi-family) loans, owner occupied one- to four-family residential loans and
commercial real estate loans.  These increases were partially offset by
decreases in construction loans and consumer auto loans.  The increases were
primarily due to loan growth in our existing banking center network and our
commercial loan production offices.  Excluding FDIC-assisted acquired loans and
mortgage loans held for sale, total gross loans increased $54.5 million from
December 31, 2019 to March 31, 2020.  As loan demand is affected by a variety of
factors, including general economic conditions, and because of the competition
we face and our focus on pricing discipline and credit quality, no assurances
can be made regarding our future loan growth.  We expect minimal loan growth for
the foreseeable future due to deteriorating economic conditions resulting from
the COVID-19 pandemic. The Company's strategy continues to be focused on
maintaining credit risk and interest rate risk at appropriate levels.

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                                       44

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Recent loan growth has occurred in several loan types, primarily commercial real
estate loans, other residential (multi-family) loans and one- to four-family
residential mortgage loans and in most of Great Southern's primary lending
locations, including Springfield, St. Louis, Kansas City, Des Moines and
Minneapolis, as well as the loan production offices in Atlanta, Chicago, Dallas,
Denver, Omaha and Tulsa.  Certain minimum underwriting standards and monitoring
help assure the Company's portfolio quality. Great Southern's loan committee
reviews and approves all new loan originations in excess of lender approval
authorities.  Generally, the Company considers commercial construction,
consumer, and commercial real estate loans to involve a higher degree of risk
compared to some other types of loans, such as first mortgage loans on one- to
four-family, owner-occupied residential properties.  For commercial real estate,
commercial business and construction loans, the credits are subject to an
analysis of the borrower's and guarantor's financial condition, credit history,
verification of liquid assets, collateral, market analysis and repayment
ability.  It has been, and continues to be, Great Southern's practice to verify
information from potential borrowers regarding assets, income or payment ability
and credit ratings as applicable and as required by the authority approving the
loan.  To minimize construction risk, projects are monitored as construction
draws are requested by comparison to budget and with progress verified through
property inspections.  The geographic and product diversity of collateral,
equity requirements and limitations on speculative construction projects help to
mitigate overall risk in these loans. Underwriting standards for all loans also
include loan-to-value ratio limitations, which vary depending on collateral
type, debt service coverage ratios or debt payment to income ratio guidelines,
where applicable, credit histories, use of guaranties and other recommended
terms relating to equity requirements, amortization, and maturity.  Consumer
loans are primarily secured by new and used motor vehicles and these loans are
also subject to certain minimum underwriting standards to assure portfolio
quality.  While Great Southern's consumer underwriting and pricing standards
were fairly consistent in recent years, the Company tightened its underwriting
guidelines on automobile lending beginning in the latter part of 2016.
Management took this step in an effort to improve credit quality in the
portfolio and reduce delinquencies and charge-offs.  The underwriting standards
employed by Great Southern for consumer loans include a determination of the
applicant's payment history on other debts, credit scores, employment history
and an assessment of ability to meet existing obligations and payments on the
proposed loan.  In 2019, the Company discontinued indirect auto loan
originations.  See "Item 1. Business - Lending Activities - General,
- Commercial Real Estate and Construction Lending, and - Consumer Lending" in
the Company's December 31, 2019 Annual Report on Form 10-K.



While our policy allows us to lend up to 95% of the appraised value on one-to
four-family residential properties, originations of loans with loan-to-value
ratios at that level are minimal.  Private mortgage insurance is typically
required for loan amounts above the 80% level.  Few exceptions occur and would
be based on analyses which determined minimal transactional risk to be involved.
 We consider these lending practices to be consistent with or more conservative
than what we believe to be the norm for banks our size.  At March 31, 2020 and
December 31, 2019, none of our owner occupied one- to four-family residential
loans had loan-to-value ratios above 100% at origination.  At March 31, 2020 and
December 31, 2019, an estimated 0.6% and 0.6%, respectively, of total non-owner
occupied one- to four-family residential loans had loan-to-value ratios above
100% at origination.



At March 31, 2020, troubled debt restructurings totaled $2.0 million, or 0.05%
of total loans, up $85,000 from $1.9 million, or 0.05% of total loans, at
December 31, 2019.  Concessions granted to borrowers experiencing financial
difficulties may include a reduction in the interest rate on the loan, payment
extensions, forgiveness of principal, forbearance or other actions intended to
maximize collection.  For troubled debt restructurings occurring during the
three months ended March 31, 2020, five loans totaling $156,000 were
restructured into multiple new loans.  For troubled debt restructurings
occurring during the year ended December 31, 2019, five loans totaling $34,000
were restructured into multiple new loans.  For further information on troubled
debt restructurings, see Note 6 of the Notes to Consolidated Financial
Statements contained in this report.



Loans that were acquired through FDIC-assisted transactions, which are accounted
for in pools, are currently included in the analysis and estimation of the
allowance for loan losses.  If expected cash flows to be received on any given
pool of loans decreases from previous estimates, then a determination is made as
to whether the loan pool should be charged down or the allowance for loan losses
should be increased (through a provision for loan

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                                       45

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losses).  Acquired loans are described in Note 7 of the Notes to Consolidated
Financial Statements contained in this report.  For acquired loan pools, the
Company may allocate, and at March 31, 2020, has allocated, a portion of its
allowance for loan losses related to these loan pools in a manner similar to how
it allocates its allowance for loan losses to those loans which are collectively
evaluated for impairment.



The level of non-performing loans and foreclosed assets affects our net interest
income and net income. We generally do not accrue interest income on these loans
and do not recognize interest income until the loans are repaid or interest
payments have been made for a period of time sufficient to provide evidence of
performance on the loans.  Generally, the higher the level of non-performing
assets, the greater the negative impact on interest income and net income.



Available-for-sale Securities.  In the three months ended March 31, 2020,
available-for-sale securities increased $21.6 million, or 5.8%, from $374.2
million at December 31, 2019, to $395.8 million at March 31, 2020.  The increase
was primarily due to the purchase of FNMA and GNMA fixed-rate multi-family
mortgage-backed securities and collateralized mortgage obligations, partially
offset by calls of municipal securities and normal monthly payments received
related to the portfolio of mortgage-backed securities.  The Company used
increased deposits and short-term borrowings to fund this increase in investment
securities.  The addition of these securities is a component of the Company's
asset/liability management strategy to partially mitigate risk from falling
interest rates.



Deposits.  The Company attracts deposit accounts through its retail branch
network, correspondent banking and corporate services areas, and brokered
deposits. The Company then utilizes these deposit funds, along with FHLBank
advances and other borrowings, to meet loan demand or otherwise fund its
activities. In the three months ended March 31, 2020, total deposit balances
increased $218.8 million, or 5.5%.  Transaction account balances increased $62.2
million to $2.30 billion at March 31, 2020, while retail certificates of deposit
increased $32.1 million, to $1.38 billion at March 31, 2020.  The increases in
transaction accounts were primarily a result of increases in money market and
NOW deposit accounts.  Retail certificates of deposit increased due to an
increase in customer deposits in the CDARS reciprocal program. Customer deposits
at March 31, 2020 and December 31, 2019, totaling $65.9 million and $35.3
million, respectively, were part of the CDARS program, which allows customers to
maintain balances in an insured manner that would otherwise exceed the FDIC
deposit insurance limit. Brokered deposits, including CDARS program purchased
funds, were $496.2 million at March 31, 2020, an increase of $124.5 million from
$371.7 million at December 31, 2019.



Our deposit balances may fluctuate depending on customer preferences and our
relative need for funding.  We do not consider our retail certificates of
deposit to be guaranteed long-term funding because customers can withdraw their
funds at any time with minimal interest penalty.  When loan demand trends
upward, we can increase rates paid on deposits to increase deposit balances and
utilize brokered deposits to provide additional funding.  The level of
competition for deposits in our markets is high. It is our goal to gain deposit
market share, particularly checking accounts, in our branch footprint.  To
accomplish this goal, increasing rates to attract deposits may be necessary,
which could negatively impact the Company's net interest margin.



Our ability to fund growth in future periods may also depend on our ability to
continue to access brokered deposits and FHLBank advances. In times when our
loan demand has outpaced our generation of new deposits, we have utilized
brokered deposits and FHLBank advances to fund these loans. These funding
sources have been attractive to us because we can create either fixed or
variable rate funding, as desired, which more closely matches the interest rate
nature of much of our loan portfolio.  It also gives us greater flexibility in
increasing or decreasing the duration of our funding.  While we do not currently
anticipate that our ability to access these sources will be reduced or
eliminated in future periods, if this should happen, the limitation on our
ability to fund additional loans could have a material adverse effect on our
business, financial condition and results of operations.



Federal Home Loan Bank Advances and Short-Term Borrowings.  The Company's
Federal Home Loan Bank advances were $-0- at both March 31, 2020 and December
31, 2019.  At March 31, 2020, there were also no overnight borrowings from the
FHLBank.  At December 31, 2019, there were no borrowings from the FHLBank other
than overnight advances, which are included in the short term borrowings
category.

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                                       46

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Short term borrowings and other interest-bearing liabilities decreased $226.9
million from $228.2 million at December 31, 2019 to $1.3 million at March 31,
2020.  The short term borrowings included overnight FHLBank borrowings of $-0-
and $196.0 million at March 31, 2020 and December 31, 2019, respectively. The
Company utilizes both overnight borrowings and short-term FHLBank advances
depending on relative interest rates.



Net Interest Income and Interest Rate Risk Management.  Our net interest income
may be affected positively or negatively by changes in market interest rates. A
large portion of our loan portfolio is tied to one-month LIBOR, three-month
LIBOR or the "prime rate" and adjusts immediately or shortly after the index
rate adjusts (subject to the effect of contractual interest rate floors on some
of the loans, which are discussed below). We monitor our sensitivity to interest
rate changes on an ongoing basis (see "Item 3. Quantitative and Qualitative
Disclosures About Market Risk").  In addition, our net interest income has been
impacted by changes in the cash flows expected to be received from acquired loan
pools.  As described in Note 7 of the Notes to the Consolidated Financial
Statements contained in this report, the Company's evaluation of cash flows
expected to be received from acquired loan pools has been on-going and increases
in cash flow expectations have been recognized as increases in accretable yield
through interest income.  Decreases in cash flow expectations have been
recognized as impairments through the allowance for loan losses.



The current level and shape of the interest rate yield curve poses challenges
for interest rate risk management. Prior to its increase of 0.25% on December
16, 2015, the FRB had last changed interest rates on December 16, 2008. This was
the first rate increase since September 29, 2006.  The FRB also implemented rate
change increases of 0.25% on eight additional occasions beginning December 14,
2016 and through December 31, 2018, with the Federal Funds rate reaching as high
as 2.50%.  After December 2018, the FRB paused its rate increases and, in July,
September and October 2019, implemented rate change decreases of 0.25% on each
of those occasions. At December 31, 2019, the Federal Funds rate stood at 1.75%.
 In response to the COVID-19 pandemic in the first quarter of 2020, the FRB
decreased interest rates on two occasions in March 2020, a 0.50% decrease on
March 3 and a 1.00% decrease on March 16. At March 31, 2020, the Federal Funds
rate stood at 0.25%.  A substantial portion of Great Southern's loan portfolio
($1.97 billion at March 31, 2020) is tied to the one-month or three-month LIBOR
index and will be subject to adjustment at least once within 90 days after March
31, 2020.  Of these loans, $1.81 billion had interest rate floors.  Great
Southern also has a portfolio of loans ($203 million at March 31, 2020) tied to
a "prime rate" of interest and will adjust immediately with changes to the
"prime rate" of interest.  A rate cut by the FRB generally would have an
anticipated immediate negative impact on the Company's net interest income due
to the large total balance of loans tied to the one-month or three-month LIBOR
index and will be subject to adjustment at least once within 90 days or loans
which generally adjust immediately as the Federal Funds rate adjusts. Interest
rate floors may at least partially mitigate the negative impact of interest rate
decreases. Loans at their floor rates are, however, subject to the risk that
borrowers will seek to refinance elsewhere at the lower market rate.  Because
the Federal Funds rate is again very low, there may also be a negative impact on
the Company's net interest income due to the Company's inability to
significantly lower its funding costs in the current competitive rate
environment, although interest rates on assets may decline further. Conversely,
interest rate increases would normally result in increased interest rates on our
LIBOR-based and prime-based loans.  As of March 31, 2020, Great Southern's
interest rate risk models indicate that, generally, rising interest rates are
expected to have a positive impact on the Company's net interest income, while
declining interest rates are expected to have a negative impact on net interest
income. We model various interest rate scenarios for rising and falling rates,
including both parallel and non-parallel shifts in rates. The results of our
modeling indicate that net interest income is not likely to be significantly
affected either positively or negatively in the first twelve months following a
rate change, regardless of any changes in interest rates, because our portfolios
are relatively well-matched in a twelve-month horizon. In a situation where
market interest rates decrease significantly in a short period of time, as they
did in March 2020, our net interest margin decrease may be more pronounced in
the very near term (first one to three months), due to fairly rapid decreases in
LIBOR interest rates. In the subsequent months we expect that the net interest
margin would stabilize and begin to improve, as renewal interest rates on
maturing time deposits are expected to decrease compared to the current rates
paid on those products. The effects of interest rate changes, if any, on net
interest income are expected to be greater in the 12 to 36 months following rate
changes.  During the latter half of 2019 and the three months ended March 31,
2020, we did experience some compression of our net interest margin percentage
due to 2.25% of Federal Fund rate cuts during the nine month period of July 2019
through March 2020.  Margin compression primarily resulted from generally slower
changing average interest rates on deposits and borrowings

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                                       47

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and lower yields on loans and other interest-earning assets.  LIBOR interest
rates have recently decreased, putting pressure on loan yields, and strong
pricing competition for loans and deposits remains in most of our markets.  For
further discussion of the processes used to manage our exposure to interest rate
risk, see "Item 3.  Quantitative and Qualitative Disclosures About Market Risk
- How We Measure the Risks to Us Associated with Interest Rate Changes."



Non-Interest Income and Non-Interest (Operating) Expenses.  The Company's
profitability is also affected by the level of its non-interest income and
operating expenses. Non-interest income consists primarily of service charges
and ATM fees, late charges and prepayment fees on loans, gains on sales of loans
and available-for-sale investments and other general operating income.
Non-interest income may also be affected by the Company's interest rate
derivative activities, if the Company chooses to implement derivatives.  See
Note 16 "Derivatives and Hedging Activities" in the Notes to Consolidated
Financial Statements included in this report.



Operating expenses consist primarily of salaries and employee benefits,
occupancy-related expenses, expenses related to foreclosed assets, postage, FDIC
deposit insurance, advertising and public relations, telephone, professional
fees, office expenses and other general operating expenses.  Details of the
current period changes in non-interest income and non-interest expense are
provided in the "Results of Operations and Comparison for the Three Months Ended
March 31, 2020 and 2019" section of this report.

Effect of Federal Laws and Regulations





General. Federal legislation and regulation significantly affect the operations
of the Company and the Bank, and have increased competition among commercial
banks, savings institutions, mortgage banking enterprises and other financial
institutions. In particular, the capital requirements and operations of
regulated banking organizations such as the Company and the Bank have been and
will be subject to changes in applicable statutes and regulations from time to
time, which changes could, under certain circumstances, adversely affect the
Company or the Bank.



Dodd-Frank Act. In 2010, sweeping financial regulatory reform legislation
entitled the "Dodd-Frank Wall Street Reform and Consumer Protection Act" (the
"Dodd-Frank Act") was signed into law. The Dodd-Frank Act implemented
far-reaching changes across the financial regulatory landscape.  Certain aspects
of the Dodd-Frank Act have been affected by the recently Economic Growth Act, as
defined and discussed below under "-Economic Growth Act."



Capital Rules. The federal banking agencies have adopted regulatory capital
rules that substantially amend the risk-based capital rules applicable to the
Bank and the Company. The rules implement the "Basel III" regulatory capital
reforms and changes required by the Dodd-Frank Act. "Basel III" refers to
various documents released by the Basel Committee on Banking Supervision. For
the Company and the Bank, the general effective date of the rules was January 1,
2015, and, for certain provisions, various phase-in periods and later effective
dates apply. The chief features of these rules are summarized below.



The rules refine the definitions of what constitutes regulatory capital and add
a new regulatory capital element, common equity Tier 1 capital. The minimum
capital ratios are (i) a common equity Tier 1 ("CET1") risk-based capital ratio
of 4.5%; (ii) a Tier 1 risk-based capital ratio of 6%; (iii) a total risk-based
capital ratio of 8%; and (iv) a Tier 1 leverage ratio of 4%. In addition to the
minimum capital ratios, the rules include a capital conservation buffer, under
which a banking organization must have CET1 more than 2.5% above each of its
minimum risk-based capital ratios in order to avoid restrictions on paying
dividends, repurchasing shares, and paying certain discretionary bonuses.  The
capital conservation buffer requirement began phasing in on January 1, 2016 when
a buffer greater than 0.625% of risk-weighted assets was required, which amount
increased an equal amount each year until the buffer requirement of greater than
2.5% of risk-weighted assets became fully implemented on January 1, 2019.



Effective January 1, 2015, these rules also revised the prompt corrective action
framework, which is designed to place restrictions on insured depository
institutions if their capital levels show signs of weakness. Under the revised
prompt corrective action requirements, insured depository institutions are
required to meet the following in order to

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                                       48

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qualify as "well capitalized:" (i) a common equity Tier 1 risk-based capital
ratio of at least 6.5%, (ii) a Tier 1 risk-based capital ratio of at least 8%,
(iii) a total risk-based capital ratio of at least 10% and (iv) a Tier 1
leverage ratio of 5%, and must not be subject to an order, agreement or
directive mandating a specific capital level.



Economic Growth Act. In May 2018, the Economic Growth, Regulatory Relief, and
Consumer Protection Act (the "Economic Growth Act"), was enacted to modify or
eliminate certain financial reform rules and regulations, including some
implemented under the Dodd-Frank Act. While the Economic Growth Act maintains
most of the regulatory structure established by the Dodd-Frank Act, it amends
certain aspects of the regulatory framework for small depository institutions
with assets of less than $10 billion and for large banks with assets of more
than $50 billion. Many of these amendments could result in meaningful regulatory
changes.



The Economic Growth Act, among other matters, expands the definition of
qualified mortgages which may be held by a financial institution and simplifies
the regulatory capital rules for financial institutions and their holding
companies with total consolidated assets of less than $10 billion by instructing
the federal banking regulators to establish a single "Community Bank Leverage
Ratio" of between 8 and 10 percent. Any qualifying depository institution or its
holding company that exceeds the "Community Bank Leverage Ratio" will be
considered to have met generally applicable leverage and risk-based regulatory
capital requirements and any qualifying depository institution that exceeds the
new ratio will be considered "well-capitalized" under the prompt corrective
action rules. Effective January 1, 2020, the Community Bank Leverage Ratio was
9.0%. In April 2020, pursuant to the CARES Act, the federal bank regulatory
agencies announced the issuance of two interim final rules, effective
immediately, to provide temporary relief to community banking organizations.
 Under the interim final rules, the Community Bank Leverage Ratio requirement is
a minimum of 8% for the remainder of calendar year 2020, 8.5% for calendar year
2021, and 9% thereafter.  The Company and the Bank have chosen to not utilize
the new Community Bank Leverage Ratio.

In addition, the Economic Growth Act includes regulatory relief in the areas of examination cycles, call reports, mortgage disclosures and risk weights for certain high-risk commercial real estate loans.





It is difficult at this time to predict when or how any new standards under the
Economic Growth Act will ultimately be applied to us or what specific impact the
Economic Growth Act and the forthcoming implementing rules and regulations will
have on us.



Business Initiatives



The Company's retail online banking platform and mobile banking application are
currently being upgraded to enhance customer functionality and convenience. The
new platform and app are expected to be available to customers during the third
quarter of 2020.



The banking center network continues to evolve. During the first quarter 2020,
remodeling of the downtown office at 1900 Main in Parsons, Kansas, continued,
which includes the addition of drive-thru banking lanes. Once completed the
nearby drive-thru facility will be consolidated into the downtown office,
leaving one location serving the Parsons market.



In early April 2020, the Company was notified by its landlord that the Great
Southern banking centers located inside the Hy-Vee stores at 2900 Devils Glen Rd
in Bettendorf, Iowa, and 2351 W. Locust St. in Davenport, Iowa, must permanently
cease operations due to store infrastructure changes. These locations are
currently closed due to the COVID-19 pandemic. Bank customers have been informed
that the Hy-Vee banking centers will permanently close on July 17, 2020, with
customer accounts transferring to nearby offices. After the July closures, Great
Southern will operate three banking centers in the Quad Cities market area - two
in Davenport and one in Bettendorf.

Comparison of Financial Condition at March 31, 2020 and December 31, 2019

During the three months ended March 31, 2020, the Company's total assets increased by $57.9 million to $5.07 billion. The increase was primarily attributable to an increase in loans receivable, available-for-sale investment securities, and cash equivalents.

--------------------------------------------------------------------------------

Cash and cash equivalents were $240.5 million at March 31, 2020, an increase of $20.3 million, or 9.2%, from $220.2 million at December 31, 2019.





The Company's available-for-sale securities increased $21.6 million, or 5.8%,
compared to December 31, 2019.  The increase was primarily due to the purchase
of FNMA and GNMA fixed-rate multi-family mortgage-backed securities, partially
offset by calls of municipal securities and normal monthly payments received
related to the portfolio of mortgage-backed securities.  The available-for-sale
securities portfolio was 7.8% and 7.5% of total assets at March 31, 2020 and
December 31, 2019, respectively.



Net loans increased $41.1 million from December 31, 2019, to $4.20 billion at
March 31, 2020.  Excluding FDIC-assisted acquired loans and mortgage loans held
for sale, total gross loans (including the undisbursed portion of loans)
increased $54.5 million, or 1.1%, from December 31, 2019 to March 31, 2020. This
increase was primarily in other residential (multi-family) loans ($98.3
million), owner occupied one- to four-family residential loans ($37.8 million),
and commercial real estate loans ($33.2 million).  These increases were
partially offset by decreases in construction loans ($102.8 million) and
consumer auto loans ($20.3 million).

Total liabilities increased $46.8 million, from $4.41 billion at December 31, 2019 to $4.46 billion at March 31, 2020. The increase was primarily attributable to an increase in deposits and securities sold under reverse repurchase agreements, primarily offset by a decrease in short term borrowings.





Total deposits increased $218.8 million, or 5.5%, to $4.18 billion at March 31,
2020.  Transaction account balances increased $62.2 million to $2.30 billion at
March 31, 2020, while retail certificates of deposit increased $32.1 million
compared to December 31, 2019, to $1.38 billion at March 31, 2020.  The increase
in transaction accounts was primarily a result of increases in money market and
NOW deposit accounts.  Retail certificates of deposit increased due to an
increase in customer deposits in the CDARS reciprocal program. Customer deposits
at March 31, 2020 and December 31, 2019 totaling $65.9 million and $35.3
million, respectively, were part of the CDARS program, which allows customers to
maintain balances in an insured manner that would otherwise exceed the FDIC
deposit insurance limit. Brokered deposits, including CDARS program purchased
funds, were $496.2 million at March 31, 2020, an increase of $124.5 million from
$371.7 million at December 31, 2019.



The Company's FHLBank advances were $-0- at both March 31, 2020 and December 31,
2019.  At December 31, 2019, there were no borrowings from the FHLBank other
than overnight advances, which are included in the short term borrowings
category.  There were no overnight advances outstanding at March 31, 2020.



Short term borrowings and other interest-bearing liabilities decreased $226.8
million from $228.2 million at December 31, 2019 to $1.3 million at March 31,
2020.  Short term borrowings at March 31, 2020 and December 31, 2019, included
overnight FHLBank borrowings of $-0- million and $196.0 million, respectively.
The Company utilizes both overnight borrowings and short term FHLBank advances
depending on relative interest rates.



Securities sold under reverse repurchase agreements with customers increased
$40.3 million from $84.2 million at December 31, 2019 to $124.5 million at March
31, 2020.  These balances fluctuate over time based on customer demand for this
product.



Total stockholders' equity increased $11.2 million from $603.1 million at
December 31, 2019 to $614.2 million at March 31, 2020.  The Company recorded net
income of $14.9 million for the three months ended March 31, 2020.   Accumulated
other comprehensive income increased $23.0 million due to increases in the fair
value of available-for-sale investment securities and the termination value of
the cash flow hedge.  In addition, total stockholders' equity increased $535,000
due to stock option exercises. These increases were partially offset by
dividends declared on common stock of $19.1 million and repurchases of the
Company's common stock totaling $8.1 million.

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                                       50

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Results of Operations and Comparison for the Three Months Ended March 31, 2020 and 2019





General



Net income was $14.9 million for the three months ended March 31, 2020 compared
to $17.6 million for the three months ended March 31, 2019.  This decrease of
$2.7 million, or 15.6%, was primarily due to an increase in non-interest expense
of $2.3 million, or 8.1%, and an increase in provision for loan losses of $1.9
million, or 98.5%, partially offset by a decrease in income tax expense of $1.2
million, or 31.2%, and an increase in net interest income of $333,000, or 0.75%.




Total Interest Income



Total interest income increased $116,000, or 0.2%, during the three months ended
March 31, 2020 compared to the three months ended March 31, 2019.  The increase
was due to a $542,000 increase in interest income on investments and other
interest-earning assets partially offset by a decrease in interest income on
loans of $426,000.  Interest income on loans decreased for the three months
ended March 31, 2020 compared to the same period in 2019, due to lower average
rates of interest on loans, partially offset by higher average balances.

Interest income from investment securities and other interest-earning assets increased during the three months ended March 31, 2020 compared to the same period in 2019 primarily due to higher average balances of investment securities, partially offset by lower average rates of interest.





Interest Income - Loans



During the three months ended March 31, 2020 compared to the three months ended
March 31, 2019, interest income on loans decreased $2.6 million as a result of
lower average interest rates on loans.  The average yield on loans decreased
from 5.42% during the three months ended March 31, 2019, to 5.15% during the
three months ended March 31, 2020.  This decrease was primarily due to decreased
yields in most loan categories as a result of decreased LIBOR and Federal Funds
interest rates.  Interest income on loans increased $2.1 million as the result
of higher average loan balances, which increased from $4.08 billion during the
three months ended March 31, 2019, to $4.23 billion during the three months
ended March 31, 2020.  The higher average balances were primarily due to organic
loan growth in commercial real estate loans, other residential (multi-family),
and one- to four-family residential loans, partially offset by decreases in
outstanding construction and consumer loans.



On an on-going basis, the Company has estimated the cash flows expected to be
collected from the acquired loan pools. For each of the loan portfolios
acquired, the cash flow estimates have increased, based on the payment histories
and the collection of certain loans, thereby reducing loss expectations of
certain loan pools, resulting in adjustments to be spread on a level-yield basis
over the remaining expected lives of the loan pools.  For the three months ended
March 31, 2020 and 2019, the adjustments increased interest income by $1.9
million and $1.5 million, respectively.



As of March 31, 2020, the remaining accretable yield adjustment that will affect
interest income was $5.7 million.  Of the remaining adjustments affecting
interest income, we expect to recognize $3.7 million of interest income during
the remainder of 2020.  Apart from the yield accretion, the average yield on
loans was 4.97% during the three months ended March 31, 2020, compared to 5.27%
during the three months ended March 31, 2019, as a result of lower current
market rates on adjustable rate loans and new loans originated during the year.




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.  Under the terms of the swap, the
Company received a fixed rate of interest of 3.018% and paid a floating rate of
interest equal to one-month USD-LIBOR.  The floating rate reset monthly and net
settlements of interest due to/from the counterparty also occurred monthly.

the extent that the fixed rate exceeded one-month USD-LIBOR, the Company received net interest settlements, which were recorded as interest income on loans. If one-month USD-LIBOR exceeded the fixed rate of interest, the Company

--------------------------------------------------------------------------------


was required to pay net settlements to the counterparty and record those net
payments as a reduction of interest income on loans.  The Company recorded loan
interest income related to this swap transaction of $1.6 million and $513,000 in
the three months ended March 31, 2020 and 2019, respectively.



On March 2, 2020, the Company and its swap counterparty mutually agreed to
terminate the swap, effective immediately.  The Company received a payment of
$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 interest
portion and net of deferred income taxes, is reflected in the Company's
stockholders' equity as Accumulated Other Comprehensive Income and a portion of
it will be accreted to interest income on loans monthly through the original
contractual termination date of October 6, 2025.  This will have the effect of
reducing Accumulated Other Comprehensive Income and increasing Net Interest
Income and Retained Earnings over the period. In future quarterly periods, the
Company expects to record loan interest income related to this swap transaction
of approximately $2.0 million, based on the termination value of the swap.

Interest Income - Investments and Other Interest-earning Assets





Interest income on investments increased in the three months ended March 31,
2020 compared to the three months ended March 31, 2019.  Interest income
increased $871,000 as a result of an increase in average balances from $278.5
million during the three months ended March 31, 2019, to $385.0 million during
the three months ended March 31, 2020.  Average balances of securities increased
primarily due to purchases of agency multi-family mortgage-backed securities
which have a fixed rate of interest with expected lives of six to twelve years.

These purchased securities fit with the Company's current asset/liability management strategies. Interest income did not change significantly due to a change in average interest rates between the two periods.

Interest income on other interest-earning assets decreased in the three months ended March 31, 2020 compared to the three months ended March 31, 2019.


 Interest income decreased $290,000, primarily as a result of the decrease in
average interest rates to 1.16% during the three months ended March 31, 2020
compared to 2.37% during the three months ended March 31, 2019.  Market interest
rates earned on balances held at the Federal Reserve Bank were significantly
lower in the 2020 period due to significant reductions in the federal funds rate
of interest.



Total Interest Expense



Total interest expense decreased $217,000, or 1.7%, during the three months
ended March 31, 2020, when compared with the three months ended March 31, 2019,
due to a decrease in interest expense on short-term borrowings and repurchase
agreements of $273,000, or 29.6%, and a decrease in interest expense on
subordinated notes of $51,000, or 19.1%, partially offset by an increase in
interest expense on deposits of $107,000, or 1.0%.



Interest Expense - Deposits



Interest expense on demand deposits increased $219,000 due to average rates of
interest that increased from 0.49% in the three months ended March 31, 2019 to
0.54% in the three months ended March 31, 2020.  Along with that increase,
interest expense on demand deposits increased $135,000, due to an increase in
average balances from $1.47 billion during the three months ended March 31, 2019
to $1.58 billion during the three months ended March 31, 2020.  The Company
experienced increased balances in money market accounts and certain types of NOW
accounts.



Interest expense on time deposits decreased $476,000 as a result of a decrease
in average rates of interest from 2.11% during the three months ended March 31,
2019, to 1.99% during the three months ended March 31, 2020.  Interest expense
on time deposits increased $229,000 due to an increase in average balances of
time deposits from $1.67 billion during the three months ended March 31, 2019 to
$1.71 billion in the three months ended March 31, 2020.

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                                       52

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A large portion of the Company's certificate of deposit portfolio matures within
six to eighteen months and therefore reprices fairly quickly; this is consistent
with the portfolio over the past several years.  Older certificates of deposit
that renewed or were replaced with new deposits generally resulted in the
Company paying a lower rate of interest due to market interest rate decreases
during 2019 and the beginning of 2020.  In the three months ended March 31,
2020, the increase in average balances of time deposits was a result of
increases in both retail customer time deposits obtained through on-line
channels and brokered deposits added through the CDARS program purchased funds.

Interest Expense - FHLBank Advances, Short-term Borrowings and Repurchase Agreements, Subordinated Debentures Issued to Capital Trusts and Subordinated Notes





FHLBank advances were not utilized during the three months ended March 31, 2020
and 2019.  Overnight borrowings from the FHLBank were utilized during the three
months ended March 31, 2019 and are included in short-term borrowings.



Interest expense on short-term borrowings and repurchase agreements decreased
$297,000 due to a decrease in average rates from 1.45% in the three months ended
March 31, 2019 to 0.99% in the three months ended March 31, 2020.  The decrease
was due to a decrease in market interest rates during the period and the lower
interest rate charged on overnight FHLBank borrowings.  Interest expense on
short-term borrowings and repurchase agreements increased $24,000 due to an
increase in average balances from $258.2 million during the three months ended
March 31, 2019 to $265.1 million during the three months ended March 31, 2020,
which was primarily due to changes in the Company's funding needs and the mix of
funding, which can fluctuate.



During the three months ended March 31, 2020, compared to the three months ended
March 31, 2019, interest expense on subordinated debentures issued to capital
trusts decreased $51,000 due to lower average interest rates.  The average
interest rate was 4.20% in the three months ended March 31, 2019 compared to
3.37% in the three months ended March 31, 2020.  The subordinated debentures are
variable-rate debentures which bear interest at an average rate of three-month
LIBOR plus 1.60%, adjusting quarterly, which was 3.36% at March 31, 2020.  There
was no change in the average balance of the subordinated debentures between the
2020 and the 2019 periods.



In August 2016, the Company issued $75 million of 5.25% fixed-to-floating rate
subordinated notes due August 15, 2026.  The notes were sold at par, resulting
in net proceeds, after underwriting discounts and commissions and other issuance
costs, of approximately $73.5 million.  These issuance costs are amortized over
the expected life of the notes, which is five years from the issuance date, and
therefore impact the overall interest expense on the notes.  Interest expense on
the subordinated notes for the three months ended March 31, 2020 was unchanged
compared to the three months ended March 31, 2019.



Net Interest Income



Net interest income for the three months ended March 31, 2020 increased $333,000
to $44.9 million compared to $44.6 million for the three months ended March 31,
2019.  Net interest margin was 3.84% in the three months ended March 31, 2020,
compared to 4.06% in the three months ended March 31, 2019, a decrease of 22
basis points, or 5.4%.  In both three month periods, the Company's net interest
income and margin were positively impacted by the increases in expected cash
flows from the FDIC-assisted acquired loan pools and the resulting increase to
accretable yield, which were previously discussed in Note 7 of the Notes to
Consolidated Financial Statements.  The positive impact of these changes in the
three months ended March 31, 2020 and 2019 were increases in interest income of
$1.9 million and $1.5 million, respectively, and increases in net interest
margin of 16 basis points and 13 basis points, respectively.  Excluding the
positive impact of the additional yield accretion, in the three months ended
March 31, 2020, net interest margin decreased 25 basis points when compared to
the year-ago three month period.  The decrease was primarily due to lower market
interest rates, which caused lower LIBOR interest rates and generally resulted
in lower yields on loans and lower yields on other interest-earning assets. .



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                                       53

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The Company's overall average interest rate spread decreased 21 basis points, or
5.6%, from 3.75% during the three months ended March 31, 2019 to 3.54% during
the three months ended March 31, 2020.  The decrease was due to a 30 basis point
decrease in the weighted average rate paid on interest-earning assets, partially
offset by a nine basis point decrease in the weighted average yield on
interest-bearing liabilities. In comparing the two periods, the yield on loans
decreased 27 basis points, the yield on investment securities decreased six
basis points and the yield on other interest-earning assets decreased 121 basis
points. The rate paid on deposits decreased six basis points, the rate paid on
short-term borrowings and repurchase agreements decreased 46 basis points, the
rate paid on subordinated debentures issued to capital trusts decreased 83 basis
points, and the rate paid on subordinated notes decreased eight basis points.

For additional information on net interest income components, refer to the "Average Balances, Interest Rates and Yields" tables in this Quarterly Report on Form 10-Q.

Provision for Loan Losses and Allowance for Loan Losses





In the first quarter of 2020, pursuant to the recently-enacted CARES Act and
guidance from the SEC and FASB, we elected to delay adoption of the new
accounting standard (CECL) related to accounting for credit losses.  Our first
quarter financial statements are prepared under the existing incurred loss
methodology standard for accounting for loan losses.



Management records a provision for loan losses in an amount it believes is
sufficient to result in an allowance for loan losses that will cover current net
charge-offs as well as risks believed to be inherent in the loan portfolio of
the Bank. The amount of provision charged against current income is based on
several factors, including, but not limited to, past loss experience, current
portfolio mix, actual and potential losses identified in the loan portfolio,
economic conditions, and internal as well as external reviews.  The levels of
non-performing assets, potential problem loans, loan loss provisions and net
charge-offs fluctuate from period to period and are difficult to predict.



Worsening economic conditions from the COVID-19 pandemic have led and may
continue to lead, and higher inflation or interest rates or other factors may
lead, to increased losses in the portfolio and/or requirements for an increase
in loan loss provision expense. Management maintains various controls in an
attempt to limit future losses, such as a watch list of possible 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
potentially uncollectible, or represent a greater risk of loss, and makes
additional provisions to expense, if necessary, to maintain the allowance at a
satisfactory level.



The provision for loan losses for the quarter ended March 31, 2020 was $3.9
million compared with $2.0 million for the quarter ended March 31, 2019.  Total
net charge-offs were $237,000 and $1.7 million for the three months ended March
31, 2020 and 2019, respectively.  During the quarter ended March 31, 2020,
$203,000 of the $237,000 of net charge-offs were in the consumer auto category.
We have seen and expect to continue to see rapid reductions in the automobile
loan outstanding balance as we determined in February 2019 to cease providing
indirect lending services to automobile dealerships.  At March 31, 2020,
indirect automobile loans totaled approximately $90 million.  We expect this
balance will be largely paid off in the next two years. General market
conditions and unique circumstances related to individual borrowers and projects
contributed to the level of provisions and charge-offs.  Collateral and
repayment evaluations of all assets categorized as potential problem loans,
non-performing loans or foreclosed assets were completed with corresponding
charge-offs or reserve allocations made as appropriate.



All FDIC-acquired loans were grouped into pools based on common characteristics
and were recorded at their estimated fair values, which incorporated estimated
credit losses at the acquisition date.  These loan pools have been
systematically reviewed by the Company to determine the risk of losses that may
exceed those identified at the time of the acquisition.  Techniques used in
determining risk of loss are similar to those used to determine the risk of loss
for the legacy Great Southern Bank portfolio, with most focus being placed on
those loan pools which include the

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                                       54

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larger loan relationships and those loan pools which exhibit higher risk characteristics. Review of the acquired loan portfolio also includes review of financial information, collateral valuations and customer interaction to determine if additional reserves are warranted.





The Bank's allowance for loan losses as a percentage of total loans, excluding
FDIC-assisted acquired loans, was 1.06% and 1.00% at March 31, 2020 and December
31, 2019, respectively.  Management considers the allowance for loan losses
adequate to cover losses inherent in the Bank's loan portfolio at March 31,
2020, based on recent reviews of the Bank's loan portfolio and current economic
conditions. If economic conditions were to deteriorate further or management's
assessment of the loan portfolio were to change, it is expected that additional
loan loss provisions would be required, thereby adversely affecting the
Company's future results of operations and financial condition.



Non-performing Assets



Non-performing assets acquired through FDIC-assisted transactions, including
foreclosed assets and potential problem loans, are not included in the totals or
in the discussion of non-performing loans, potential problem loans and
foreclosed assets below.  These assets were initially recorded at their
estimated fair values as of their acquisition dates and are accounted for in
pools.  Therefore, these loan pools are analyzed rather than the individual
loans. The overall performance of the loan pools acquired in each of the five
FDIC-assisted transactions has been better than original expectations as of the
acquisition dates.

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.





Non-performing assets, excluding all FDIC-assisted acquired assets, at March 31,
2020 were $8.1 million, a decrease of $119,000 from $8.2 million at December 31,
2019.  Non-performing assets, excluding all FDIC-assisted acquired assets, as a
percentage of total assets were 0.16% at both March 31, 2020 and December 31,
2019.



Compared to December 31, 2019, non-performing loans increased $760,000 to $5.3
million at March 31, 2020, and foreclosed assets decreased $879,000 to $2.8
million at March 31, 2020.  Non-performing one- to four-family residential loans
comprised $2.3 million, or 43.5%, of the total non-performing loans at March 31,
2020, an increase of $822,000 from December 31, 2019. Non-performing commercial
business loans comprised $1.2 million, or 22.7%, of the total non-performing
loans at March 31, 2020, a decrease of $36,000 from December 31, 2019.
 Non-performing consumer loans comprised $1.0 million, or 19.8%, of the total
non-performing loans at March 31, 2020, a decrease of $131,000 from December 31,
2019.  Non-performing commercial real estate loans comprised $737,000, or 14.0%,
of the total non-performing loans at March 31, 2020, an increase of $105,000
from December 31, 2019.

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                                       55

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Non-performing Loans. Activity in the non-performing loans category during the three months ended March 31, 2020 was as follows:







                                                                   Transfers to     Transfers to
                      Beginning     Additions        Removed        Potential        Foreclosed                                 Ending
                      Balance,       to Non-        from Non-        Problem         Assets and       Charge-                  Balance,
                      January 1     Performing      Performing        Loans

Repossessions Offs Payments March 31


                                                                       (In Thousands)
One- to four-family
construction        $         -   $          -    $          -   $            -   $             -   $       -   $        -   $        -
Subdivision
construction                  -              -               -                -                 -           -            -            -
Land development              -              -               -                -                 -           -            -            -
Commercial
construction                  -              -               -                -                 -           -            -            -
One- to four-family

residential 1,477 961 - - - - (139) 2,299
Other residential - - - - - - - -
Commercial real
estate 632 107 - - - - (2) 737
Commercial business 1,235 - - - - - (36) 1,199
Consumer 1,175 189 - - (58) (123) (139) 1,044

Total $ 4,519 $ 1,257 $ - $ - $ (58) $ (123) $ (316) $ 5,279

At March 31, 2020, the non-performing commercial business category included
three loans, none of which were added during 2020. The largest relationship in
this category, which was added during 2018, totaled $1.0 million, or 87.0% of
the total category. This relationship is collateralized by an assignment of an
interest in a real estate project. The non-performing one- to four-family
residential category included 31 loans, ten of which were added during the three
months ended March 31, 2020. The largest relationship in the category totaled
$276,000, or 12.5% of the total category. The non-performing commercial real
estate category included three loans, none of which was added during the three
months ended March 31, 2020. The largest relationship in the category totaled
$530,000, or 71.9% of the total category. This balance is primarily related to
a multi-tenant building in Arkansas. The non-performing consumer category
included 102 loans, 21 of which were added during the three months ended March
31, 2020, and the majority of which are indirect used automobile loans.

Potential Problem Loans. Compared to December 31, 2019, potential problem loans
decreased $197,000, or 4.5%, to $4.2 million at March 31, 2020. This decrease
was primarily due to payments of $192,000 on potential problem loans, $119,000
in loans transferred to non-performing loans, $21,000 in loans transferred to
foreclosed assets and repossessions, and $47,000 in loan write-downs, partially
offset by $182,000 in loans added to potential problem loans. Potential problem
loans are loans which management has identified through routine internal review
procedures as having possible credit problems that may cause the borrowers
difficulty in complying with the current repayment terms. These loans are not
reflected in non-performing assets, but are considered in determining the
adequacy of the allowance for loan losses.

Due to the deteriorating economic conditions from COVID-19, it is possible that
we could experience an increase in potential problem loans in the remainder of
2020. As noted, we experienced an increased level of loan modifications in late
March and early April 2020. In accordance with guidance from the banking
regulatory agencies, we made certain short-term modifications to loan terms to
help our customers navigate through the current pandemic situation. Although
these loan modifications were made, they did not result in these loans being
classified as troubled debt restructurings, potential problem loans or
non-performing loans. If more severe or lengthier negative impacts of the
COVID-19 pandemic occur or the effects of the SBA loan programs and other loan
and stimulus programs don't allow for companies and individuals to completely
recover financially, this could result in longer-term modifications, additional
potential problem loans and/or additional non-performing loans. This could in
turn require further actions on our part, including additions to the allowance
for loan losses.

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Activity in the potential problem loans category during the three months ended March 31, 2020, was as follows:







                                                       Removed                        Transfers to
                      Beginning      Additions          from        Transfers to       Foreclosed                                 Ending
                      Balance,      to Potential      Potential         Non-           Assets and       Charge-                  Balance,
                      January 1       Problem          Problem       Performing       Repossessions      Offs       Payments     March 31
                                                                        (In Thousands)
One- to four-family
 construction       $         -   $            -    $         -   $            -    $             -   $       -   $        -   $        -
Subdivision
  construction                -                -              -                -                  -           -            -            -
Land development              -                -              -                -                  -           -            -            -
Commercial
  construction                -                -              -                -                  -           -            -            -
One- to four-family
  residential               791                -              -             (83)                  -           -        (118)          590
Other residential             -                -              -                -                  -           -            -            -
Commercial real
  estate                  3,078                -              -                -                  -           -         (11)        3,067
Commercial
  business                    -                -              -                -                  -           -            -            -
Consumer                    512              182              -             (36)               (21)        (47)         (63)          527

Total               $     4,381   $          182    $         -   $        (119)    $          (21)   $    (47)   $    (192)   $    4,184






At March 31, 2020, the commercial real estate category of potential problem
loans included two loans, neither of which was added during 2020.  The largest
relationship in this category (added during 2018), which totaled $1.8 million,
or 59.9% of the total category, is collateralized by a mixed use commercial
retail building.  Payments were current on this relationship at March 31, 2020.
The other relationship in the category (added during 2019), which totaled $1.2
million, or 40.1% of the total category, is collateralized by a commercial
retail building.  Payments were current at March 31, 2020. The one- to
four-family residential category of potential problem loans included 14 loans,
none of which were added during the three months ended March 31, 2020. The
consumer category of potential problem loans included 60 loans, 21 of which were
added during the three months ended March 31, 2020.



Other Real Estate Owned and Repossessions.  Of the total $5.0 million of other
real estate owned and repossessions at March 31, 2020, $1.3 million represents
the fair value of foreclosed and repossessed assets related to loans acquired in
FDIC-assisted transactions and $860,000 represents properties which were not
acquired through foreclosure. The foreclosed and other assets acquired in the
FDIC-assisted transactions and the properties not acquired through foreclosure
are not included in the following table and discussion of other real estate
owned and repossessions.

Activity in other real estate owned and repossessions during the three months ended March 31, 2020, was as follows:





                         Beginning                                                             Ending
                         Balance,                                 Capitalized      Write-     Balance,
                         January 1      Additions      Sales         Costs         Downs      March 31
                                                        (In Thousands)
One- to four-family
construction           $         -    $         -   $      -    $           -    $     -    $        -
Subdivision
construction                   689              -       (195)             126        (10)          610
Land development             1,816              -       (315)               -       (143)        1,358
Commercial
construction                     -              -          -                -          -             -
One- to four-family
residential                    601              -       (310)               -          -           291
Other residential                -              -          -                -          -             -
Commercial real estate           -              -          -                -          -             -
Commercial business              -              -          -                -          -             -
Consumer                       545            511       (543)               -          -           513

Total                  $     3,651    $       511   $ (1,363)   $         126    $  (153)   $    2,772

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At March 31, 2020, the land development category of foreclosed assets included
three properties, the largest of which was located in the Branson, Mo. area and
had a balance of $768,000, or 56.5% of the total category.  Of the total dollar
amount in the land development category of foreclosed assets, 60.2% was located
in the Branson, Mo. area, including the largest property previously mentioned. A
portion of a land development property located in the Branson, Mo. area was sold
during the three months ending March 31, 2020 for $315,000, which resulted in a
write-down of $143,000.  The subdivision construction category of foreclosed
assets included two properties, the largest of which was located in the Branson,
Mo. area and had a balance of $350,000, or 57.4% of the total category. All of
the properties in the subdivision construction category of foreclosed assets are
located in the Branson, Mo. area.  One property in the Branson, Mo. area was
sold during the three months ended March 31, 2020, which reduced the foreclosed
assets balance by $69,000.  The one- to four-family residential category of
foreclosed assets included one property with a balance of $291,000 in
Springfield, Mo.  A one- to four-family residential property located in Lake
Ozark, Mo. was sold during the three months ended March 31, 2020 for $380,000,
resulting in a gain of $70,000.  The amount of additions and sales in the
consumer loans category are due to the volume of repossessions of automobiles,
which generally are subject to a shorter repossession process.  The Company
experienced increased levels of delinquencies and repossessions in indirect and
used automobile loans throughout 2016 and 2017.  The level of delinquencies and
repossessions in indirect and used automobile loans generally decreased in 2018
through 2020.



Non-interest Income

For the three months ended March 31, 2020, non-interest income decreased $83,000 to $7.4 million when compared to the three months ended March 31, 2019, primarily as a result of the following items:





Gain (loss) on derivative interest rate products:  The net loss on derivative
interest rate products increased $382,000 compared to the net loss in the prior
year period. In the 2020 period, the Company recognized a $407,000 decrease in
the net fair value related to interest rate swaps in the Company's back-to-back
swap program with loan customers and swap counterparties.  As market interest
rates fall this generally decreases the net fair value of these back-to-back
swaps.  This is a non-cash item as there was no required settlement of this
amount between the Company and its swap counterparties.



Service charges and ATM fees:  Service charges and ATM fees decreased $200,000
compared to the prior year period primarily related to additional expenses
netted into ATM fee income during the conversion to a new debit card processing
system.  This conversion was completed in the first quarter of 2020.



Net gains on loan sales:  Net gains on loan sales increased $342,000 compared to
the prior year period.  The increase was due to an increase in originations of
fixed-rate loans during the 2020 period compared to the 2019 period.  Fixed rate
single-family mortgage loans originated are generally subsequently sold in the
secondary market.



Other income:  Other income increased $226,000 compared to the prior year
period. In the 2020 period, the Company recognized approximately $486,000 of fee
income related to newly-originated interest rate swaps in the Company's
back-to-back swap program with loan customers and swap counterparties.  The
Company also recognized approximately $441,000 in income related to the exit of
certain tax credit partnerships during the three months ended March 31, 2020. In
the 2019 period, the Company recognized gains totaling $677,000 from the sale
of, or recovery of, receivables and assets that were acquired several years
prior in FDIC-assisted transactions.



Non-interest Expense



For the three months ended March 31, 2020, non-interest expense increased $2.3
million to $30.8 million when compared to the three months ended March 31, 2019,
primarily as a result of the following items:

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                                       58

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Salaries and employee benefits:  Salaries and employee benefits increased $2.5
million from the prior year period.  The increase was primarily due to annual
employee compensation merit increases and increased incentives in lending and
operations areas. Additionally, in March 2020, the Company approved a special
cash bonus to all employees totaling $1.1 million in response to the COVID-19
pandemic. This bonus was paid in April 2020.



Net occupancy expense:  Net occupancy expense increased $365,000 compared to the
prior year period.  This was primarily related to increased depreciation on new
ATM/ITMs and ATM operating software upgrades implemented during the fourth
quarter of 2019.



Other operating expenses: Other operating expenses increased $12,000 from the
prior year period. In response to the COVID-19 pandemic, the Company made
contributions of $234,000 during the current year period to various
organizations that assist the communities the Company serves. This was partially
offset by a decrease of $178,000 in losses recognized during the three months
ended March 31, 2019 that were not repeated during the three months ended March
31, 2020.



Insurance:  Insurance expense decreased $284,000 compared to the prior year
period. This decrease was primarily due to a decrease in FDIC deposit insurance
premiums.  The Bank has a credit with the FDIC for a portion of premiums
previously paid to the deposit insurance fund. The deposit insurance fund
balance was sufficient to result in no premium being due for the three months
ended March 31, 2020. We expect the remaining credit to offset a portion of the
deposit insurance premium due for the three months ending June 30, 2020.



The Company's efficiency ratio for the three months ended March 31, 2020, was
58.91% compared to 54.74% for the same period in 2019.  The higher efficiency
ratio in the 2020 three-month period was primarily due to an increase in
non-interest expense.  The Company's ratio of non-interest expense to average
assets was 2.48% for the three months ended March 31, 2020, compared to 2.41%
for the three months ended March 31, 2019.  The increase in the current
three-month ratio was primarily due to an increase in non-interest expense,
partially offset by an increase in average assets.  Average assets for the three
months ended March 31, 2020, increased $239.3 million, or 5.1%, from the three
months ended March 31, 2019, primarily due to increases in loans receivable and
investment securities.



Provision for Income Taxes



For the three months ended March 31, 2020 and 2019, the Company's effective tax
rate was 15.6% and 18.5%, respectively.  These effective rates were lower than
the statutory federal tax rate of 21%, due primarily to the utilization of
certain investment tax credits and to 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 and the level of tax-exempt
investments and loans and the overall level of pre-tax income.  The Company's
effective income tax rate is currently expected to continue to be less than the
statutory rate due primarily to the factors noted above. The Company currently
expects its effective tax rate (combined federal and state) to be approximately
16.0% to 17.5% in 2020 and future years.

Average Balances, Interest Rates and Yields





The following table presents, for the periods indicated, the total dollar amount
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 $1.1 million and $1.0
million for the three months ended March 31, 2020 and 2019, respectively.

Tax-exempt income was not calculated on a tax equivalent basis. The table does not reflect any effect of income taxes.

--------------------------------------------------------------------------------


                     March 31,             Three Months Ended                       Three Months Ended
                      2020(2)                March 31, 2020                           March 31, 2019
                      Yield/         Average                    Yield/        Average                   Yield/
                       Rate          Balance         Interest    Rate         Balance        Interest    Rate
                                                      (Dollars in Thousands)
Interest-earning
assets:
Loans receivable:
 One- to four-family
  residential             3.94 %   $   603,872     $    7,138     4.75 %

$ 497,129 $ 6,388 5.21 %

Other residential 4.79 826,431 10,755 5.23


   811,084         10,990     5.50
 Commercial real
estate                    4.65       1,489,790         18,581     5.02       1,387,423         17,696     5.17
 Construction             4.98         709,974          9,722     5.51         667,625         10,173     6.18

Commercial business 4.55 269,160 3,192 4.77

264,179 3,392 5.21


 Other loans              5.41         317,437          4,533     5.74

436,979 5,704 5.29


 Industrial revenue
bonds(1)                  4.57          10,274            209     8.17          15,205            213     5.68

Total loans
receivable                4.77       4,226,938         54,130     5.15       4,079,624         54,556     5.42

Investment
securities(1)             3.16         385,003          3,083     3.22         278,536          2,251     3.28
Other
interest-earning
assets                    0.24          90,122            261     1.16          94,374            551     2.37

Total
interest-earning
assets                    4.49       4,702,063         57,474     4.92       4,452,534         57,358     5.22
Non-interest-earning
assets:
 Cash and cash
equivalents                             90,780                                  90,804
 Other non-earning
assets                                 170,673                                 180,876
Total assets                       $ 4,963,516                             $ 4,724,214

Interest-bearing
liabilities:
Interest-bearing
demand
 and savings              0.48     $ 1,575,511          2,117     0.54     $ 1,472,959          1,763     0.49
Time deposits             1.74       1,712,901          8,460     1.99       1,672,677          8,707     2.11
Total deposits            1.15       3,288,412         10,577     1.29       3,145,636         10,470     1.35
Short-term
borrowings,
 repurchase
agreements
 and other
interest-bearing
 liabilities              0.03         265,054            649     0.99         258,183            922     1.45
Subordinated
debentures
 issued to capital
trusts                    3.36          25,774            216     3.37          25,774            267     4.20

Subordinated notes 5.88 74,335 1,094 5.92

     73,900          1,094     6.00

Total
interest-bearing
 liabilities              1.23       3,653,575         12,536     1.38       3,503,493         12,753     1.47
Non-interest-bearing
 liabilities:
 Demand deposits                       675,984                                 658,409
 Other liabilities                      34,946                                  25,467
Total liabilities                    4,364,505                               4,187,369
Stockholders' equity                   599,011                                 536,845
Total liabilities
and
 stockholders'
equity                             $ 4,963,516                             $ 4,724,214

Net interest income:
 Interest rate
spread                    3.26 %                   $   44,938     3.54 %

$   44,605     3.75 %
 Net interest
margin*                                                           3.84 %                                  4.06 %
Average
interest-earning
 assets to average
interest-
 bearing liabilities                     128.7 %                                 127.1 %




*   Defined as the Company's net interest income divided by total average

interest-earning assets. (1) Of the total average balances of investment securities, average tax-exempt

investment securities were $32.6 million and $47.9 million for the three

months ended March 31, 2020 and 2019, respectively. In addition, average

tax-exempt loans and industrial revenue bonds were $21.0 million and $21.7

million for the three months ended March 31, 2020 and 2019, respectively.

Interest income on tax-exempt assets included in this table was $524,000 and

$636,000 for the three months ended March 31, 2020 and 2019, respectively.

Interest income net of disallowed interest expense related to tax-exempt

assets was $478,000 and $575,000 for the three months ended March 31, 2020


    and 2019, respectively.
(2) The yield on loans at March 31, 2020 does not include the impact of the

accretable yield (income) on loans acquired in the FDIC-assisted

transactions. See "Net Interest Income" for a discussion of the effect on

results of operations for the three months ended March 31, 2020.

--------------------------------------------------------------------------------

Rate/Volume Analysis





The following tables present the dollar amounts of changes in interest income
and interest expense for major components of interest-earning assets and
interest-bearing liabilities for the periods shown. For each category of
interest-earning assets and interest-bearing liabilities, information is
provided on changes attributable to (i) changes in rate (i.e., changes in rate
multiplied by old volume) and (ii) changes in volume (i.e., changes in volume
multiplied by old rate). For purposes of this table, changes attributable to
both rate and volume, which cannot be segregated, have been allocated
proportionately to volume and rate. Tax-exempt income was not calculated on a
tax equivalent basis.



                                                   Three Months Ended March 31,
                                                          2020 vs. 2019
                                            Increase (Decrease)                   Total
                                                  Due to                         Increase
                                            Rate          Volume                (Decrease)
                                                       (Dollars in Thousands)
Interest-earning assets:
Loans receivable                        $   (2,561)     $  2,135              $      (426)
Investment securities                          (39)          871                      832
Other interest-earning assets                 (263)          (27)

(290)


Total interest-earning assets               (2,863)        2,979

116


Interest-bearing liabilities:
Demand deposits                                219           135                      354
Time deposits                                 (476)          229                     (247)
Total deposits                                (257)          364                      107
Short-term borrowings                         (297)           24                     (273)
Subordinated debentures issued to
capital trust                                  (51)            -

(51)


Subordinated notes                              (9)            9                        -
Total interest-bearing liabilities            (614)          397                     (217)
Net interest income                     $   (2,249)     $  2,582              $       333




Liquidity



Liquidity is a measure of the Company's ability to generate sufficient cash to
meet present and future financial obligations in a timely manner through either
the sale or maturity of existing assets or the acquisition of additional funds
through liability management. These obligations include the credit needs of
customers, funding deposit withdrawals, and the day-to-day operations of the
Company. 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. At March 31, 2020, the Company had commitments of
approximately $237.1 million to fund loan originations, $1.16 billion of unused
lines of credit and unadvanced loans, and $20.4 million of outstanding letters
of credit.

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Loan commitments and the unfunded portion of loans at the dates indicated were
as follows (in thousands):



                                March 31,     December 31,     December 31,     December 31,     December 31,
                                  2020            2019             2018             2017             2016
Closed non-construction loans
with unused
available lines
 Secured by real estate (one-
to four-family)               $   156,381   $      155,831   $      150,948

$ 133,587 $ 123,433


 Secured by real estate (not
one- to four-family)               16,832           19,512           11,063           10,836           26,062
 Not secured by real estate -
commercial business                79,117           83,782           87,480          113,317           79,937

Closed construction loans
with unused
    available lines
 Secured by real estate
(one-to four-family)               50,101           48,213           37,162           20,919           10,047
 Secured by real estate (not
one-to four-family)               809,436          798,810          906,006

718,277 542,326

Loan Commitments not closed


 Secured by real estate
(one-to four-family)              141,432           69,295           24,253           23,340           15,884
 Secured by real estate (not
one-to four-family)                95,652           92,434          104,871

156,658 119,126


 Not secured by real estate -
commercial business                     -                -              405            4,870            7,022

                              $ 1,348,951   $    1,267,877   $    1,322,188   $    1,181,804   $      923,837




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 March 31, 2020, the Company had these available secured lines and on-balance sheet liquidity:





Federal Home Loan Bank line $  1,027.1 million
Federal Reserve Bank line    $   368.0 million
Cash and cash equivalents    $   240.5 million
Unpledged securities         $   249.8 million




Statements of Cash Flows. During both the three months ended March 31, 2020 and
the three months ended March 31, 2019, the Company had positive cash flows from
operating activities, negative cash flows from investing activities and positive
cash flows from financing activities.



Cash flows from operating activities for the periods covered by the Statements
of Cash Flows have been primarily related to changes in accrued and deferred
assets, credits and other liabilities, the provision for loan losses,
depreciation and amortization, realized gains on sales of loans and the
amortization of deferred loan origination fees and discounts (premiums) on loans
and investments, all of which are non-cash or non-operating adjustments to
operating cash flows. Net income adjusted for non-cash and non-operating items
and the origination and sale of loans held for sale were the primary source of
cash flows from operating activities. Operating activities provided cash flows
of $17.7 million and $29.8 million during the three months ended March 31, 2020
and 2019, respectively.



During the three months ended March 31, 2020, investing activities used cash of
$4.3 million, primarily due to the net origination of loans, the purchase of
investment securities and the purchase of equipment, partially offset by cash
proceeds from the termination of interest rate derivatives, the sale of other
real estate owned and payments received on investment securities. Investing
activities in the 2019 period used cash of $88.2 million, primarily due to the
purchase of loans and the net origination of loans, the purchase of investment
securities and the purchase of equipment, partially offset by the sale of other
real estate owned, the sale of investment securities and payments received on
investment securities.

--------------------------------------------------------------------------------


                                       62

--------------------------------------------------------------------------------


Changes in cash flows from financing activities during the periods covered by
the Statements of Cash Flows are due to changes in deposits after interest
credited, changes in FHLBank advances and changes in short-term borrowings, as
well as advances from borrowers for taxes and insurance, dividend payments to
stockholders, purchases of the Company's common stock and the exercise of common
stock options.  Financing activities provided cash of $7.0 million and $61.8
million during the three months ended March 31, 2020 and 2019, respectively.  In
the 2020 three-month period, financing activities provided cash primarily as a
result of net increases in checking account balances and certificates of
deposit, partially offset by decreases in short-term borrowings, dividends paid
to stockholders and the purchase of the Company's common stock.  In the 2019
three-month period, financing activities provided cash primarily as a result of
net increases in checking account balances and certificates of deposit,
partially offset by decreases in short-term borrowings and dividends paid to
stockholders.



Capital Resources



Management continuously reviews the capital position of the Company and the Bank
to ensure compliance with minimum regulatory requirements, as well as to explore
ways to increase capital either by retained earnings or other means.



At March 31, 2020, the Company's total stockholders' equity and common
stockholders' equity were each $614.2 million, or 12.1% of total assets,
equivalent to a book value of $43.61 per common share. As of December 31, 2019,
total stockholders' equity and common stockholders' equity were each $603.1
million, or 12.0% of total assets, equivalent to a book value of $42.29 per
common share.  At March 31, 2020, the Company's tangible common equity to
tangible assets ratio was 12.0%, compared to 11.9% at December 31, 2019 (See
Non-GAAP Financial Measures below).



Included in stockholders' equity at March 31, 2020 and December 31, 2019, were
unrealized gains (net of taxes) on the Company's available-for-sale investment
securities totaling $20.6 million and $9.0 million, respectively.  This increase
in unrealized gains primarily resulted from lower market interest rates which
increased the fair value of the investment securities.



Also included in stockholders' equity at March 31, 2020, were realized gains
(net of taxes) on the Company's cash flow hedge (interest rate swap), which was
terminated in March 2020, totaling $34.6 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 March 31, 2020, the remaining pre-tax amount to be recorded in
interest income was $44.8 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).



Banks are required to maintain minimum risk-based capital ratios. These ratios
compare capital, as defined by the risk-based regulations, to assets adjusted
for their relative risk as defined by the regulations. Under current guidelines
banks must have a minimum common equity Tier 1 capital ratio of 4.50%, a minimum
Tier 1 risk-based capital ratio of 6.00%, a minimum total risk-based capital
ratio of 8.00%, and a minimum Tier 1 leverage ratio of 4.00%. To be considered
"well capitalized," banks must have a minimum common equity Tier 1 capital ratio
of 6.50%, a minimum Tier 1 risk-based capital ratio of 8.00%, a minimum total
risk-based capital ratio of 10.00%, and a minimum Tier 1 leverage ratio of
5.00%. On March 31, 2020, the Bank's common equity Tier 1 capital ratio was
13.2%, its Tier 1 capital ratio was 13.2%, its total capital ratio was 14.2% and
its Tier 1 leverage ratio was 12.4%. As a result, as of March 31 2020, the Bank
was well capitalized, with capital ratios in excess of those required to qualify
as such.  On December 31, 2019, the Bank's common equity Tier 1 capital ratio
was 13.1%, its Tier 1 capital ratio was 13.1%, its total capital ratio was 14.0%
and its Tier 1 leverage ratio was 12.3%. As a result, as of December 31, 2019,
the Bank was well capitalized, with capital ratios in excess of those required
to qualify as such.



The FRB has established capital regulations for bank holding companies that
generally parallel the capital regulations for banks. On March 31, 2020, the
Company's common equity Tier 1 capital ratio was 12.6%, its Tier 1 capital ratio
was 13.2%, its total capital ratio was 15.7% and its Tier 1 leverage ratio was
12.3%. To be considered

--------------------------------------------------------------------------------


                                       63

--------------------------------------------------------------------------------


well capitalized, a bank holding company must have a Tier 1 risk-based capital
ratio of at least 6.00% and a total risk-based capital ratio of at least
10.00%.  As of March 31, 2020, the Company was considered well capitalized, with
capital ratios in excess of those required to qualify as such.  On December 31,
2019, the Company's common equity Tier 1 capital ratio was 12.0%, its Tier 1
capital ratio was 12.5%, its total capital ratio was 15.0% and its Tier 1
leverage ratio was 11.8%.  As of December 31, 2019, the Company was considered
well capitalized, with capital ratios in excess of those required to qualify as
such.



In addition to the minimum common equity Tier 1 capital ratio, Tier 1 risk-based
capital ratio and total risk-based capital ratio, the Company and the Bank have
to maintain a capital conservation buffer consisting of additional common equity
Tier 1 capital greater than 2.5% of risk-weighted assets above the required
minimum levels in order to avoid limitations on paying dividends, repurchasing
shares, and paying discretionary bonuses.



For additional information, see "Item 1. Business--Government Supervision and
Regulation-Capital" in the Company's Annual Report on Form 10-K for the year
ended December 31, 2019.



Dividends. During the three months ended March 31, 2020, the Company declared
common stock cash dividends of $1.34 per share, or 129% of net income per
diluted common share for that three month period, and paid common stock cash
dividends of $1.34 per share ($0.34 of which was declared in December 2019).
 The total dividends declared consisted of a regular cash dividend of $0.34 per
share and a special cash dividend of $1.00 per share.  During the three months
ended March 31, 2019, the Company declared common stock cash dividends of $1.07
per share, or 87% of net income per diluted common share for that three month
period, and paid common stock cash dividends of $1.07 per share ($0.32 of which
was declared in December 2018).  The Board of Directors meets regularly to
consider the level and the timing of dividend payments.  The $0.34 per share
dividend declared but unpaid as of March 31, 2020, was paid to stockholders in
April 2020.



Common Stock Repurchases and Issuances. The Company has been in various buy-back
programs since May 1990. During the three months ended March 31, 2020, the
Company issued 6,475 shares of stock at an average price of $37.58 per share to
cover stock option exercises and repurchased 183,707 shares of its common stock
at an average price of $44.36 per share. During the three months ended March 31,
2019, the Company issued 35,600 shares of stock at an average price of $29.56
per share to cover stock option exercises and repurchased 16,040 shares of its
common stock at an average price of $52.93 per share.



On April 18, 2018, the Company's Board of Directors authorized management to
repurchase up to 500,000 shares of the Company's outstanding common stock, under
a program of open market purchases or privately negotiated transactions. The
plan does not have an expiration date.  Management has historically utilized
stock buy-back programs from time to time as long as management believed that
repurchasing the stock would contribute to the overall growth of shareholder
value. The number of shares of stock that will be repurchased at any particular
time and the prices that will be paid are subject to many factors, several of
which are outside of the control of the Company. The primary factors, however,
are the number of shares available in the market from sellers at any given time,
the price of the stock within the market as determined by the market and the
projected impact on the Company's earnings per share and capital.



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"), consisting of 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


--------------------------------------------------------------------------------


                                       64

--------------------------------------------------------------------------------


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 measure 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 similarly titled measures as calculated by other companies.



Non-GAAP Reconciliation:  Ratio of Tangible Common Equity to Tangible Assets



                                                      March 31,       December 31,
                                                        2020              2019
                                                         (Dollars in Thousands)

Common equity at period end                         $   614,232     $      603,066
Less:  Intangible assets at period end                    7,809

8,098


Tangible common equity at period end (a)            $   606,423     $

594,968



Total assets at period end                          $ 5,073,020     $

5,015,072


Less:  Intangible assets at period end                    7,809

8,098


Tangible assets at period end (b)                   $ 5,065,211     $

5,006,974

Tangible common equity to tangible assets (a) / (b) 11.97 %

11.88 %

--------------------------------------------------------------------------------

Latest news about Great Southern Bancorp, Inc.

Transcript : Great Southern Bancorp, Inc. - Shareholder/Analyst Call	May. 08
Transcript : Great Southern Bancorp, Inc., Q1 2024 Earnings Call, Apr 18, 2024	Apr. 18
Tranche Update on Great Southern Bancorp, Inc.'s Equity Buyback Plan announced on December 21, 2022.	Apr. 18	CI
Earnings Flash (GSBC) GREAT SOUTHERN BANCORP Reports Q1 EPS $1.13, vs. Street Est of $1.04	Apr. 17	MT
Great Southern Bancorp, Inc. Reports Net Charge-Offs for the First Quarter Ended March 31, 2024	Apr. 17	CI
Great Southern Bancorp, Inc. Reports Earnings Results for the First Quarter Ended March 31, 2024	Apr. 17	CI
North American Morning Briefing : Stock Futures -2-	Apr. 17	DJ
Constantinople Operating Company Pty Ltd announced that it has received AUD 50 million in funding from Prosus Ventures N.V., Square Peg Capital Pty. Ltd., AirTree Ventures Pty Ltd, Great Southern Bancorp, Inc.	Apr. 01	CI
Great Southern Bancorp Keeps Quarterly Dividend at $0.40 a Share, Payable April 16 to Shareholders as of April 2	Mar. 20	MT
Great Southern Bancorp, Inc. Announces Dividend for the First Quarter of the Calendar Year Ending December 31, 2024, Payable on April 16, 2024	Mar. 20	CI
Keefe Bruyette & Woods Adjusts Great Southern Bancorp's Price Target to $58 From $59, Keeps Market Perform Rating	Jan. 25	MT
Piper Sandler Trims Price Target on Great Southern Bancorp to $57 From $58, Maintains Neutral Rating	Jan. 24	MT
Transcript : Great Southern Bancorp, Inc., Q4 2023 Earnings Call, Jan 23, 2024	Jan. 23
Great Southern Bancorp, Inc. Reports Earnings Results for the Fourth Quarter and Full Year Ended December 31, 2023	Jan. 22	CI
North American Morning Briefing : S&P 500 Seen Extending Record	Jan. 22	DJ
Tranche Update on Great Southern Bancorp, Inc.'s Equity Buyback Plan announced on December 21, 2022.	Jan. 21	CI
Great Southern Bancorp, Inc. Announces the Appointment of Amelia Counts to Boards of Directors, Effective January 1, 2024	Dec. 21	CI
Great Southern Bancorp Maintains Quarterly Dividend at $0.40 a Share, Payable on Jan. 17 to Shareholders as of Jan. 2	Dec. 20	MT
Great Southern Bancorp, Inc. Announces Quarterly Dividend, Payable on January 17, 2024	Dec. 20	CI
Great Southern Bancorp, Inc. Announces Demise of Larry D. Frazier, Member of the Board of Directors	Nov. 24	CI
Transcript : Great Southern Bancorp, Inc., Q3 2023 Earnings Call, Oct 19, 2023	23-10-19
Tranche Update on Great Southern Bancorp, Inc.'s Equity Buyback Plan announced on December 21, 2022.	23-10-19	CI
Earnings Flash (GSBC) GREAT SOUTHERN BANCORP Reports Q3 EPS $1.33, vs. Street Est of $1.21	23-10-18	MT
Great Southern Bancorp, Inc. Reports Earnings Results for the Third Quarter and Nine Months Ended September 30, 2023	23-10-18	CI
North American Morning Briefing : Geopolitical -2-	23-10-18	DJ

Chart Great Southern Bancorp, Inc.

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Company Profile

Great Southern Bancorp, Inc. is a bank holding company of Great Southern Bank (the Bank). The Company conducts its business as a financial holding company. Through the Bank and subsidiaries of the Bank, the Company primarily offers a variety of banking and banking-related services. The Bank offers a range of banking services through its 89 banking centers located in southern and central Missouri; the Kansas City, Missouri area; the St. Louis area; eastern Kansas; northwestern Arkansas; the Minneapolis area and eastern, western and central Iowa. The Company operates through a single segment, banking operation. The banking operation segment is principally engaged in the business of originating residential and commercial real estate loans, construction loans, commercial business loans and consumer loans and funding these loans by attracting deposits from the general public, accepting brokered deposits and borrowing from the Federal Home Loan Bank and others.

Sector

Banks

Calendar

2024-07-16 - Q2 2024 Earnings Release (Projected)

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Russell 2000

More about the company

Income Statement Evolution

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Ratings for Great Southern Bancorp, Inc.

Trading Rating

Investor Rating

ESG Refinitiv

C-

More Ratings

Analysts' Consensus

Sell

Buy

Mean consensus

HOLD

Number of Analysts

Last Close Price

52.88 USD

Average target price

55 USD

Spread / Average Target

+4.01%

Consensus

EPS Revisions

Estimates Revisions

Quarterly earnings - Rate of surprise

Company calendar

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Great Southern Bancorp, Inc.

Equities

GSBC

US3909051076

Banks

GREAT SOUTHERN BANCORP : MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-Q)

EPS Revisions