10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES ACT OF 1934

For the Quarterly Period Ended September 30, 2014

Commission File Number 0-18082

GREAT SOUTHERN BANCORP, INC.

(Exact name of registrant as specified in its charter)

Maryland	43-1524856
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification Number)
1451 E. Battlefield, Springfield, Missouri	65804
(Address of principal executive offices)	(Zip Code)
(417) 887-4400

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  

Yes /X/     No /  /

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data file required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes/X/   No /  /

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “accelerated filer,” “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

(Check one):

Large accelerated filer /  /	Accelerated filer /X/	Non-accelerated filer /  /	Smaller reporting company /  /
		(Do not check if a smaller reporting company)

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). 

Yes /  /   No /X/

The number of shares outstanding of each of the registrant's classes of common stock: 13,727,671 shares of common stock, par value $.01, outstanding at November 6, 2014.

PART I FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(In thousands, except number of shares)

	SEPTEMBER 30,		DECEMBER 31,
	2014		2013
	(Unaudited)
ASSETS
Cash	$	94,682	$	96,167
Interest-bearing deposits in other financial institutions		126,704		131,758
Cash and cash equivalents		221,386		227,925
Available-for-sale securities		425,156		555,281
Held-to-maturity securities (fair value $505  – September 2014;
$912 - December 2013)		450		805
Mortgage loans held for sale		30,361		7,239
Loans receivable, net of allowance for loan losses of
$38,081 – September 2014; $40,116 - December 2013		2,921,310		2,439,530
FDIC indemnification asset		51,603		72,705
Interest receivable		11,214		11,408
Prepaid expenses and other assets		63,334		72,904
Other real estate owned, net		43,762		53,514
Premises and equipment, net		120,891		104,534
Goodwill and other intangible assets		7,945		4,583
Investment in Federal Home Loan Bank stock		12,013		9,822
Total Assets	$	3,909,425	$	3,560,250
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits	$	3,071,170	$	2,808,626
Federal Home Loan Bank advances		190,664		126,757
Securities sold under reverse repurchase agreements with customers		171,828		134,981
Short-term borrowings		1,155		1,128
Structured repurchase agreements		—		50,000
Subordinated debentures issued to capital trusts		30,929		30,929
Accrued interest payable		1,024		1,099
Advances from borrowers for taxes and insurance		7,744		3,721
Accounts payable and accrued expenses		22,258		18,502
Current and deferred income tax liability		3,603		3,809
Total Liabilities		3,500,375		3,179,552
Stockholders' Equity:
Capital stock
Serial preferred stock – $.01 par value; authorized 1,000,000 shares; issued      and outstanding September 2014 and December 2013 - 57,943 shares,      $1,000 liquidation amount		57,943		57,943
Common stock, $.01 par value; authorized 20,000,000 shares;      issued and outstanding September 2014  – 13,706,950 shares;
December 2013 - 13,673,709 shares		137		137
Additional paid-in capital		21,486		19,567
Retained earnings		322,529		300,589
Accumulated other comprehensive income		6,955		2,462
Total Stockholders' Equity		409,050		380,698
Total Liabilities and Stockholders' Equity	$	3,909,425	$	3,560,250

See Notes to Consolidated Financial Statements

2

GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

	THREE MONTHS ENDED
	SEPTEMBER 30,
	2014			2013
				Retrospectively Adjusted – Note 3
	(Unaudited)
INTEREST INCOME
Loans	$	44,948		$	40,087
Investment securities and other		2,659			2,932
TOTAL INTEREST INCOME		47,607			43,019
INTEREST EXPENSE
Deposits		2,884			2,822
Federal Home Loan Bank advances		461			1,005
Short-term borrowings and repurchase agreements		13			587
Subordinated debentures issued to capital trusts		143			141
TOTAL INTEREST EXPENSE		3,501			4,555
NET INTEREST INCOME		44,106			38,464
PROVISION FOR LOAN LOSSES		945			2,677
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES		43,161			35,787
NON-INTEREST INCOME
Commissions		284			158
Service charges and ATM fees		5,168			4,729
Net realized gains on sales of loans		1,543			1,179
Net realized gains on sales of available-for-sale securities		321			110
Late charges and fees on loans		248			284
Gain (loss) on derivative interest rate products		10			(125	)
Accretion (amortization) of income/expense related to business acquisitions		(6,463	)		(6,339	)
Other income		667			933
TOTAL NON-INTEREST INCOME		1,778			929
NON-INTEREST EXPENSE
Salaries and employee benefits		14,884			13,034
Net occupancy and equipment expense		6,172			5,216
Postage		935			790
Insurance		940			1,083
Advertising		522			433
Office supplies and printing		393			320
Telephone		695			679
Legal, audit and other professional fees		1,389			1,186
Expense on foreclosed assets		982			1,068
Partnership tax credit investment amortization		420			556
Other operating expenses		2,066			1,791
TOTAL NON-INTEREST EXPENSE		29,398			26,156
INCOME BEFORE INCOME TAXES		15,541			10,560
PROVISION FOR INCOME TAXES		3,951			2,121
NET INCOME		11,590			8,439
Preferred stock dividends		145			145
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	11,445		$	8,294

3

	THREE MONTHS ENDED SEPTEMBER 30,
	2014		2013
BASIC EARNINGS PER COMMON SHARE	$	0.84	$	0.61
DILUTED EARNINGS PER COMMON SHARE	$	0.83	$	0.61
DIVIDENDS DECLARED PER COMMON SHARE	$	0.20	$	0.18

See Notes to Consolidated Financial Statements

See Notes to Consolidated Financial Statements

4

GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

	NINE MONTHS ENDED
	SEPTEMBER 30,
	2014			2013
				Retrospectively Adjusted – Note 3
	(Unaudited)
INTEREST INCOME
Loans	$	125,669		$	122,226
Investment securities and other		8,617			11,630
TOTAL INTEREST INCOME		134,286			133,856
INTEREST EXPENSE
Deposits		8,297			9,611
Federal Home Loan Bank advances		2,446			2,968
Short-term borrowings and repurchase agreements		1,082			1,758
Subordinated debentures issued to capital trusts		418			421
TOTAL INTEREST EXPENSE		12,243			14,758
NET INTEREST INCOME		122,043			119,098
PROVISION FOR LOAN LOSSES		4,099			14,573
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES		117,944			104,525
NON-INTEREST INCOME
Commissions		910			836
Service charges and ATM fees		14,064			13,800
Net realized gains on sales of loans		2,700			4,236
Net realized gains on sales of available-for-sale securities		963			241
Late charges and fees on loans		827			785
Gain (loss) on derivative interest rate products		(223	)		283
Initial gain recognized on business acquisition		10,805			—
Accretion (amortization) of income/expense related to business acquisitions		(20,061	)		(17,900	)
Other income		3,347			3,898
TOTAL NON-INTEREST INCOME		13,332			6,179
NON-INTEREST EXPENSE
Salaries and employee benefits		41,371			39,334
Net occupancy and equipment expense		16,786			15,451
Postage		2,572			2,454
Insurance		2,820			3,204
Advertising		1,690			1,599
Office supplies and printing		1,050			950
Telephone		2,112			2,169
Legal, audit and other professional fees		3,230			2,936
Expense on foreclosed assets		3,173			3,478
Partnership tax credit investment amortization		1,300			1,552
Other operating expenses		13,585			5,663
TOTAL NON-INTEREST EXPENSE		89,689			78,790
INCOME BEFORE INCOME TAXES		41,587			31,914
PROVISION FOR INCOME TAXES		10,125			6,858
NET INCOME		31,462			25,056
Preferred stock dividends		435			435
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	31,027		$	24,621

5

	NINE MONTHS ENDED SEPTEMBER 30,
	2014		2013
BASIC EARNINGS PER COMMON SHARE	$	2.27	$	1.81
DILUTED EARNINGS PER COMMON SHARE	$	2.25	$	1.80
DIVIDENDS DECLARED PER COMMON SHARE	$	0.60	$	0.54

See Notes to Consolidated Financial Statements

6

GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

	THREE MONTHS ENDED SEPTEMBER 30,
	2014			2013
	(Unaudited)
Net Income	$	11,590		$	8,439
Unrealized appreciation (depreciation) on available-for-sale securities, net
of taxes (credit) of $127 and $(2,812), for 2014 and 2013, respectively		236			(5,221	)
Reclassification adjustment for gains included in net income,
net of taxes of $(112) and $(38), for 2014 and 2013, respectively		(209	)		(72	)
Change in fair value of cash flow hedge, net of taxes (credit) of $29
and $(24), for 2014 and 2013, respectively		53			(45	)
Comprehensive Income	$	11,670		$	3,101

	NINE MONTHS ENDED SEPTEMBER 30,
	2014			2013
	(Unaudited)
Net Income	$	31,462		$	25,056
Unrealized appreciation (depreciation) on available-for-sale securities, net of
taxes (credit) of $2,805 and $(6,863), for 2014 and 2013, respectively		5,209			(12,745	)
Non-credit component of unrealized gain (loss) on available-for-sale debt
securities for which a portion of an other-than-temporary impairment
has been recognized, net of taxes  (credit) of $0 and $(20), for
2014 and 2013, respectively		—			(37	)
Reclassification adjustment for gains included in net income,
net of taxes of $(337) and $(84), for 2014 and 2013, respectively		(626	)		(157	)
Change in fair value of cash flow hedge, net of taxes (credit) of $(67)
and $(24), for 2014 and 2013, respectively		(90	)		(45	)
Comprehensive Income	$	35,955		$	12,072

See Notes to Consolidated Financial Statements

7

GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	NINE MONTHS ENDED SEPTEMBER 30,
	2014			2013
	(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	31,462		$	25,056
Proceeds from sales of loans held for sale		101,872			184,382
Originations of loans held for sale		(122,252	)		(171,035	)
Items not requiring (providing) cash:
Depreciation		6,410			5,971
Amortization of other assets		2,385			5,421
Compensation expense for stock option grants		409			333
Provision for loan losses		4,099			14,573
Net gains on loan sales		(2,700	)		(4,236	)
Net gains on sale of available-for-sale investment securities		(963	)		(241	)
Net gains on sale of premises and equipment		(46	)		(10	)
Loss on sale of foreclosed assets		1,360			1,823
Initial gain recognized on business acquisition		(10,805	)		—
Amortization of deferred income, premiums, discounts
and fair value adjustments		17,023			22,518
(Gain) loss on derivative interest rate products		223			(284	)
Deferred income taxes		(4,370	)		(13,625	)
Changes in:
Interest receivable		1,232			1,823
Prepaid expenses and other assets		4,187			(8,339	)
Accounts payable and accrued expenses		2,685			4,376
Income taxes refundable/payable		1,744			668
Net cash provided by operating activities		33,955			69,174
CASH FLOWS FROM INVESTING ACTIVITIES
Net increase in loans		(243,837	)		(19,044	)
Purchase of loans		(73,244	)		(20,388	)
Cash received from acquisitions		189,437			—
Cash received from FDIC loss sharing reimbursements		7,532			24,583
Purchase of premises and equipment		(11,598	)		(9,761	)
Proceeds from sale of premises and equipment		198			1,275
Proceeds from sale of foreclosed assets		17,661			35,973
Capitalized costs on foreclosed assets		(95	)		(291	)
Proceeds from sales of available-for-sale investment securities		179,204			108,485
Proceeds from maturing investment securities		110			—
Proceeds from called investment securities		6,235			4,160
Principal reductions on mortgage-backed securities		78,228			179,710
Purchase of available-for-sale securities		(40,661	)		(92,425	)
Redemption (purchase) of Federal Home Loan Bank stock		(2,191	)		240
Net cash provided by investing activities		106,979			212,517
CASH FLOWS FROM FINANCING ACTIVITIES
Net decrease in certificates of deposit		(89,219	)		(163,327	)
Net decrease in checking and savings deposits		(106,924	)		(136,191	)
Proceeds from Federal Home Loan Bank advances		2,517,000			1,980
Repayments of Federal Home Loan Bank advances		(2,450,300	)		(246	)
Net increase (decrease)  in short-term borrowings		36,307			(44,625	)
Repayments of structured repurchase agreements		(50,000	)		(3,000	)
Advances from borrowers for taxes and insurance		3,395			3,660
Dividends paid		(8,371	)		(5,361	)
Purchase of company stock		(512	)		—
Stock options exercised		1,151			1,092
Net cash used in financing activities		(147,473	)		(346,018	)
DECREASE IN CASH AND CASH EQUIVALENTS		(6,539	)		(64,327	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		227,925			404,141
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	221,386		$	339,814

See Notes to Consolidated Financial Statements

8

GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1: BASIS OF PRESENTATION

The accompanying unaudited interim consolidated financial statements of Great Southern Bancorp, Inc. (the "Company" or "Great Southern") have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The financial statements presented herein reflect all adjustments which are, in the opinion of management, necessary to fairly present the financial condition, results of operations and cash flows of the Company for the periods presented. Those adjustments consist only of normal recurring adjustments. Operating results for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the full year. The consolidated statement of financial condition of the Company as of December 31, 2013, has been derived from the audited consolidated statement of financial condition of the Company as of that date.   Certain prior period amounts have been reclassified to conform to the current period presentation.  These reclassifications had no effect on net income.

Certain information and note disclosures normally included in the Company's annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for 2013 filed with the Securities and Exchange Commission.

NOTE 2: NATURE OF OPERATIONS AND OPERATING SEGMENTS

The Company operates as a one-bank holding company.  The Company’s business primarily consists of the operations of Great Southern Bank (the “Bank”), which provides a full range of financial services to customers primarily located in Missouri, Iowa, Kansas, Minnesota, Nebraska and Arkansas.  In addition, the Company operates commercial loan production offices in Dallas, Texas and Tulsa, Oklahoma.  The Company and the Bank are subject to the regulation of certain federal and state agencies and undergo periodic examinations by those regulatory agencies.

The Company’s banking operation is its only reportable segment.  The banking operation 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 through attracting deposits from the general public, accepting brokered deposits and borrowing from the Federal Home Loan Bank and others.  The operating results of this segment are regularly reviewed by management to make decisions about resource allocations and to assess performance.  Selected information is not presented separately for the Company’s reportable segment, as there is no material difference between that information and the corresponding information in the consolidated financial statements.

NOTE 3: RECENT ACCOUNTING PRONOUNCEMENTS

In January 2014, the FASB issued ASU No. 2014-01 to amend FASB ASC Topic 323, Investments – Equity Method and Joint Ventures.  The objective of this Update is to provide guidance on accounting for investments by a reporting entity in flow-through limited liability entities that manage or invest in affordable housing projects that qualify for the low-income housing tax credit.  The amendments in the Update permit reporting entities to make an accounting policy election to account for their investments in qualified affordable housing projects using the proportional amortization method if certain conditions are met.  Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense (benefit).  The Update would be effective for the Company beginning January 1, 2015; however, early adoption was permitted.  The Company elected to adopt this Update early, adopting it during the three months ended March 31, 2014.  There was no material impact on the Company’s financial position or results of operations, except that the investment amortization expense which was previously included in Other Noninterest Expense in the Consolidated Statements of Income was moved from Other Noninterest Expense to Provision for Income Taxes in the Consolidated Statements of Income.  For the three months ended September 30, 2013, $1.0 million was moved from Other Noninterest Expense to Provision for Income Taxes.  For the nine months ended September 30, 2013, $2.9 million was moved from Other Noninterest Expense to Provision for Income Taxes.  This had the effect of reducing Noninterest Expense and increasing Provision for Income Taxes, but did not have any impact on Net Income.

9

In January 2014, the FASB issued ASU No. 2014-04 to amend FASB ASC Topic 310, Receivables – Troubled Debt Restructurings by Creditors.  The objective of the amendments in this Update is to reduce diversity by clarifying when an in substance repossession or foreclosure occurs, that is, when a creditor should be considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan such that the loan receivable should be derecognized and the real estate property recognized.  The amendments in this Update clarify that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction.  The Update will be effective for the Company beginning January 1, 2015, and is not expected to have a material impact on the Company’s financial position or results of operations.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 660): Summary and Amendments that Create Revenue from Contracts with Customers (Topic 606) and Other Assets and Deferred Costs—Contracts with Customers (Subtopic 340-40). The guidance in this update supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and most industry-specific guidance throughout the industry topics of the codification. For public companies, this update will be effective for interim and annual periods beginning after December 15, 2016 and early application is not permitted. The Company is currently assessing the impact that this guidance will have on its consolidated financial statements, but does not expect the guidance to have a material impact on the Company's financial position or results of operations.

NOTE 4: STOCKHOLDERS' EQUITY

Previously, the Company's stockholders approved the Company's reincorporation to the State of Maryland. Under Maryland law, there is no concept of "Treasury Shares." Instead, shares purchased by the Company constitute authorized but unissued shares under Maryland law. Accounting principles generally accepted in the United States of America state that accounting for treasury stock shall conform to state law. The cost of shares purchased by the Company has been allocated to Common Stock and Retained Earnings balances.

NOTE 5: EARNINGS PER SHARE

	Three Months Ended September 30,
	2014		2013
	(In Thousands, Except Per Share Data)
Basic:
Average shares outstanding		13,696		13,647
Net income available to common stockholders	$	11,445	$	8,294
Per common share amount	$	0.84	$	0.61
Diluted:
Average shares outstanding		13,696		13,647
Net effect of dilutive stock options – based on the treasury
stock method using average market price		89		58
Diluted shares		13,785		13,705
Net income available to common stockholders	$	11,445	$	8,294
Per common share amount	$	0.83	$	0.61

10

	Nine Months Ended September 30,
	2014		2013
	(In Thousands, Except Per Share Data)
Basic:
Average shares outstanding		13,693		13,634
Net income available to common stockholders	$	31,027	$	24,621
Per share amount	$	2.27	$	1.81
Diluted:
Average shares outstanding		13,693		13,634
Net effect of dilutive stock options – based on the treasury
stock method using average market price		75		58
Diluted shares		13,768		13, 692
Net income available to common stockholders	$	31,027	$	24,621
Per share amount	$	2.25	$	1.80

Options to purchase 118,600 and 304,630 shares of common stock were outstanding at September 30, 2014 and 2013, respectively, but were not included in the computation of diluted earnings per common share for the three month periods because the options’ exercise prices were greater than the average market prices of the common shares for the three months ended September 30, 2014 and 2013, respectively.  Options to purchase 232,735 and 304,630 shares of common stock were outstanding at September 30, 2014 and 2013, respectively, but were not included in the computation of diluted earnings per common share for the nine month periods because the options’ exercise prices were greater than the average market prices of the common shares for the nine months ended September 30, 2014 and 2013, respectively.

NOTE 6: INVESTMENT SECURITIES

	September 30, 2014
			Gross		Gross				Tax
	Amortized		Unrealized		Unrealized		Fair		Equivalent
	Cost		Gains		Losses		Value		Yield
	(In Thousands)
AVAILABLE-FOR-SALE SECURITIES:
U.S. government agencies	$	20,000	$	—	$	1,063	$	18,937		2.00	%
Mortgage-backed securities		273,358		4,502		1,233		276,627		2.02
States and political subdivisions		120,060		6,713		226		126,547		5.37
Equity securities		847		2,198		—		3,045		—
	$	414,265	$	13,413	$	2,522	$	425,156		2.98	%
HELD-TO-MATURITY SECURITIES:
States and political subdivisions	$	450	$	55	$	—	$	505		7.37	%

	December 31, 2013
			Gross		Gross				Tax
	Amortized		Unrealized		Unrealized		Fair		Equivalent
	Cost		Gains		Losses		Value		Yield
	(In Thousands)
AVAILABLE-FOR-SALE SECURITIES:
U.S. government agencies	$	20,000	$	—	$	2,745	$	17,255		2.00	%
Mortgage-backed securities		365,020		4,824		2,266		367,578		2.04
Small Business Administration
loan pools		43,461		1,394		—		44,855		1.34
States and political subdivisions		122,113		2,549		1,938		122,724		5.47
Equity securities		847		2,022		—		2,869		—
	$	551,441	$	10,789	$	6,949	$	555,281		2.74	%
HELD-TO-MATURITY SECURITIES:
States and political subdivisions	$	805	$	107	$	—	$	912		7.37	%

11

The amortized cost and fair value of available-for-sale securities at September 30, 2014, by contractual maturity, are shown below.  Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized		Fair
	Cost		Value
	(In Thousands)
One year or less	$	110	$	111
After one through five years		1,472		1,486
After five through ten years		7,504		7,794
After ten years		130,974		136,093
Securities not due on a single maturity date		273,358		276,627
Equity securities		847		3,045
	$	414,265	$	425,156

The held-to-maturity securities at September 30, 2014, by contractual maturity, are shown below.  Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized		Fair
	Cost		Value
	(In Thousands)
After one through five years	$	450	$	505

Certain investments in debt securities are reported in the financial statements at an amount less than their historical cost. Total fair value of these investments at September 30, 2014 and December 31, 2013, respectively, was approximately $131.5 million and $237.6 million, which is approximately 30.9% and 42.7% of the Company’s available-for-sale and held-to-maturity investment portfolio, respectively.

Based on an evaluation of available evidence, including recent changes in market interest rates, credit rating information and information obtained from regulatory filings, management believes the declines in fair value for these debt securities are temporary at September 30, 2014.

The following table shows the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at September 30, 2014 and December 31, 2013:

	September 30, 2014
	Less than 12 Months					12 Months or More					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
Description of Securities	Value		Losses			Value		Losses			Value		Losses
	(In Thousands)
U.S. government agencies	$	—	$	—		$	20,000	$	(1,063	)	$	20,000	$	(1,063	)
Mortgage-backed securities		51,442		(514	)		46,054		(719	)		97,496		(1,233	)
State and political
subdivisions		2,561		(8	)		11,393		(218	)		13,954		(226	)
	$	54,003	$	(522	)	$	77,447	$	(2,000	)	$	131,450	$	(2,522	)

12

	December 31, 2013
	Less than 12 Months					12 Months or More					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
Description of Securities	Value		Losses			Value		Losses			Value		Losses
	(In Thousands)
U.S. government agencies	$	20,000	$	(2,745	)	$	—	$	—		$	20,000	$	(2,745	)
Mortgage-backed securities		127,901		(1,871	)		39,255		(395	)		167,156		(2,266	)
State and political
subdivisions		50,401		(1,938	)		—		—			50,401		(1,938	)
	$	198,302	$	(6,554	)	$	39,255	$	(395	)	$	237,557	$	(6,949	)

Gross gains of $656,000 and $1.3 million and gross losses of $335,000 and $335,000 resulting from sales of available-for-sale securities were realized for the three and nine months ended September 30, 2014, respectively.  Gross gains of $644,000 and $795,000 and gross losses of $534,000 and $554,000 resulting from sales of available-for-sale securities were realized for the three and nine months ended September 30, 2013, respectively.  Gains and losses on sales of securities are determined on the specific-identification method.

Other-than-temporary Impairment.  Upon acquisition of a security, the Company decides whether it is within the scope of the accounting guidance for beneficial interests in securitized financial assets or will be evaluated for impairment under the accounting guidance for investments in debt and equity securities.

The accounting guidance for beneficial interests in securitized financial assets provides incremental impairment guidance for a subset of the debt securities within the scope of the guidance for investments in debt and equity securities.  For securities where the security is a beneficial interest in securitized financial assets, the Company uses the beneficial interests in securitized financial asset impairment model.  For securities where the security is not a beneficial interest in securitized financial assets, the Company uses the debt and equity securities impairment model.  The Company does not currently have securities within the scope of this guidance for beneficial interests in securitized financial assets.

The Company routinely conducts periodic reviews to identify and evaluate each investment security to determine whether an other-than-temporary impairment has occurred.  The Company considers the length of time a security has been in an unrealized loss position, the relative amount of the unrealized loss compared to the carrying value of the security, the type of security and other factors.  If certain criteria are met, the Company performs additional review and evaluation using observable market values or various inputs in economic models to determine if an unrealized loss is other-than-temporary.  The Company uses quoted market prices for marketable equity securities and uses broker pricing quotes based on observable inputs for equity investments that are not traded on a stock exchange.  For non-agency collateralized mortgage obligations, to determine if the unrealized loss is other-than-temporary, the Company projects total estimated defaults of the underlying assets (mortgages) and multiplies that calculated amount by an estimate of realizable value upon sale in the marketplace (severity) in order to determine the projected collateral loss.  The Company also evaluates any current credit enhancement underlying these securities to determine the impact on cash flows.  If the Company determines that a given security position will be subject to a write-down or loss, the Company records the expected credit loss as a charge to earnings.

During the three and nine months ended September 30, 2014, no securities were determined to have impairment that was other than temporary.

Credit Losses Recognized on Investments.  Certain debt securities have experienced fair value deterioration due to credit losses, as well as due to other market factors, but are not otherwise other-than-temporarily impaired.

13

The following table provides information about debt securities for which only a credit loss was recognized in income and other losses are recorded in other comprehensive income.

	Accumulated
	Credit Losses
	(In Thousands)
Credit losses on debt securities held
January 1, 2013	$	4,176
Additions related to other-than-temporary losses not previously recognized		—
Additions related to increases in credit losses on debt securities for which
other-than-temporary impairment losses were previously recognized		—
Reductions due to final principal payments		(4,176	)
September 30, 2013	$	—

Amounts Reclassified Out of Accumulated Other Comprehensive Income.  Amounts reclassified from accumulated other comprehensive income and the affected line items in the statements of income during the three and nine months ended September 30, 2014 and 2013, were as follows:

	Amounts Reclassified from Other Comprehensive Income Three Months Ended September 30,						Affected Line Item in the Statements
	2014			2013			of Income
	(In Thousands)
Unrealized gains (losses) on available-							Net realized gains on available-
for-sale securities	$	321		$	110		for-sale securities
							(Total reclassified amount before tax)
Income Taxes		(112	)		(38	)	Provision for income taxes
Total reclassifications out of accumulated
other comprehensive income	$	209		$	72

	Amounts Reclassified from Other Comprehensive Income Nine Months Ended September 30,						Affected Line Item in the Statements
	2014			2013			of Income
	(In Thousands)
Unrealized gains (losses) on available-							Net realized gains on available-
for-sale securities	$	963		$	241		for-sale securities
							(Total reclassified amount before tax)
Income Taxes		(337	)		(84	)	Provision for income taxes
Total reclassifications out of accumulated
other comprehensive income	$	626		$	157

14

NOTE 7: LOANS AND ALLOWANCE FOR LOAN LOSSES

	September 30,			December 31,
	2014			2013
	(In Thousands)
One- to four-family residential construction	$	43,386		$	34,662
Subdivision construction		35,344			40,409
Land development		48,581			57,841
Commercial construction		361,971			184,019
Owner occupied one- to four-family residential		78,984			89,133
Non-owner occupied one- to four-family residential		143,414			145,908
Commercial real estate		872,294			780,690
Other residential		353,225			325,599
Commercial business		349,387			315,269
Industrial revenue bonds		42,941			42,230
Consumer auto		274,250			134,717
Consumer other		78,676			82,260
Home equity lines of credit		61,152			58,283
FDIC-supported loans, net of discounts (TeamBank)		15,294			49,862
Acquired loans no longer covered by FDIC loss sharing agreements,
net of discounts (TeamBank) ("acquired non-covered loans")		28,341			—
FDIC-supported loans, net of discounts (Vantus Bank)		43,653			57,920
FDIC-supported loans, net of discounts (Sun Security Bank)		54,394			64,843
FDIC-supported loans, net of discounts (InterBank)		203,787			213,539
Acquired loans not covered by FDIC loss sharing agreements, net of
discounts (Valley Bank)  (“acquired non-covered loans”)		152,497			—
		3,241,571			2,677,184
Undisbursed portion of loans in process		(279,435	)		(194,544	)
Allowance for loan losses		(38,081	)		(40,116	)
Deferred loan fees and gains, net		(2,745	)		(2,994	)
	$	2,921,310		$	2,439,530
Weighted average interest rate		4.78	%		5.10	%

15

Classes of loans by aging were as follows:

	September 30, 2014
													Total Loans
					Past Due								> 90 Days
	30-59 Days		60-89 Days		90 Days		Total Past				Total Loans		Past Due and
	Past Due		Past Due		or More		Due		Current		Receivable		Still Accruing
	(In Thousands)
One- to four-family
residential construction	$	—	$	—	$	223	$	223	$	43,163	$	43,386	$	—
Subdivision construction		—		—		1,223		1,223		34,121		35,344		—
Land development		—		—		265		265		48,316		48,581		—
Commercial construction		—		—		—		—		361,971		361,971		—
Owner occupied one- to four-
family residential		184		565		1,616		2,365		76,619		78,984		170
Non-owner occupied one- to
four-family residential		—		168		2,997		3,165		140,249		143,414		—
Commercial real estate		—		59		2,968		3,027		869,267		872,294		—
Other residential		—		—		—		—		353,225		353,225		—
Commercial business		21		13		427		461		348,926		349,387		—
Industrial revenue bonds		—		—		1,205		1,205		41,736		42,941		—
Consumer auto		144		1,331		131		1,606		272,644		274,250		—
Consumer other		168		1,025		649		1,842		76,834		78,676		244
Home equity lines of credit		46		404		337		787		60,365		61,152		—
FDIC-supported loans, net of
discounts (TeamBank)		65		115		415		595		14,699		15,294		—
Acquired non-covered loans,
net of discounts
(TeamBank)		—		—		—		—		28,341		28,341		—
FDIC-supported loans, net of
discounts (Vantus Bank)		85		12		1,022		1,119		42,534		43,653		56
FDIC-supported loans,
net of discounts
(Sun Security Bank)		353		149		2,714		3,216		51,178		54,394		—
FDIC-supported loans,
net of discounts
(InterBank)		696		1,375		14,731		16,802		186,985		203,787		—
Acquired non-covered loans,
net of discounts
(Valley Bank)		9,727		2,716		12,329		24,772		127,725		152,497		—
		11,489		7,932		43,252		62,673		3,178,898		3,241,571		470
Less FDIC-supported loans,
and acquired non-covered
loans, net of discounts		10,926		4,367		31,211		46,504		451,462		497,966		56
Total	$	563	$	3,565	$	12,041	$	16,169	$	2,727,436	$	2,743,605	$	414

16

	December 31, 2013
													Total Loans
					Past Due								> 90 Days
	30-59 Days		60-89 Days		90 Days		Total Past				Total Loans		Past Due and
	Past Due		Past Due		or More		Due		Current		Receivable		Still Accruing
	(In Thousands)
One- to four-family
residential construction	$	—	$	—	$	—	$	—	$	34,662	$	34,662	$	—
Subdivision construction		—		—		871		871		39,538		40,409		—
Land development		145		38		338		521		57,320		57,841		—
Commercial construction		—		—		—		—		184,019		184,019		—
Owner occupied one- to four-
family residential		1,233		344		3,014		4,591		84,542		89,133		211
Non-owner occupied one- to
four-family residential		1,562		171		843		2,576		143,332		145,908		140
Commercial real estate		2,856		131		6,205		9,192		771,498		780,690		—
Other residential		—		—		—		—		325,599		325,599		—
Commercial business		17		19		5,208		5,244		310,025		315,269		—
Industrial revenue bonds		—		—		2,023		2,023		40,207		42,230		—
Consumer auto		955		127		168		1,250		133,467		134,717		—
Consumer other		1,258		333		732		2,323		79,937		82,260		257
Home equity lines of credit		168		16		504		688		57,595		58,283		—
FDIC-supported loans, net of
discounts (TeamBank)		414		130		1,396		1,940		47,922		49,862		6
FDIC-supported loans, net of
discounts (Vantus Bank)		675		31		2,356		3,062		54,858		57,920		42
FDIC-supported loans,
net of discounts
(Sun Security Bank)		510		121		4,241		4,872		59,971		64,843		147
FDIC-supported loans, net of
discounts (InterBank)		6,024		1,567		16,768		24,359		189,180		213,539		20
		15,817		3,028		44,667		63,512		2,613,672		2,677,184		823
Less FDIC-supported loans,
net of discounts		7,623		1,849		24,761		34,233		351,931		386,164		215
Total	$	8,194	$	1,179	$	19,906	$	29,279	$	2,261,741	$	2,291,020	$	608

Nonaccruing loans (excluding FDIC-supported loans, net of discount and acquired non-covered loans, net of discount) are summarized as follows:

	September 30,		December 31,
	2014		2013
	(In Thousands)
One- to four-family residential construction	$	223	$	—
Subdivision construction		1,223		871
Land development		265		338
Commercial construction		—		—
Owner occupied one- to four-family residential		1,446		2,803
Non-owner occupied one- to four-family residential		2,997		703
Commercial real estate		2,968		6,205
Other residential		—		—
Commercial business		1,632		5,208
Industrial revenue bonds		—		2,023
Consumer auto		131		168
Consumer other		405		475
Home equity lines of credit		337		504
Total	$	11,627	$	19,298

17

The following table presents the activity in the allowance for loan losses by portfolio segment for the three and nine months ended September 30, 2014.  Also presented is the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of September 30, 2014:

	One- to Four-
	Family
	Residential and			Other			Commercial			Commercial			Commercial
	Construction			Residential			Real Estate			Construction			Business			Consumer			Total
	(In Thousands)
Allowance for loan losses
Balance June 30, 2014	$	5,073		$	1,723		$	16,476		$	8,249		$	2,582		$	3,979		$	38,082
Provision (benefit) charged to expense		(1,647	)		545			2,838			(2,499	)		632			1,076			945
Losses charged off		(106	)		—			(520	)		(1	)		(50	)		(1,107	)		(1,784	)
Recoveries		120			14			170			24			—			510			838
Balance September 30, 2014	$	3,440		$	2,282		$	18,964		$	5,773		$	3,164		$	4,458		$	38,081
Balance January 1, 2014	$	6,235		$	2,678		$	16,939		$	4,464		$	6,451		$	3,349		$	40,116
Provision (benefit) charged to expense		(1,280	)		(423	)		2,704			1,263			(619	)		2,454			4,099
Losses charged off		(1,803	)		(2	)		(1,239	)		(131	)		(2,737	)		(2,891	)		(8,803	)
Recoveries		288			29			560			177			69			1,546			2,669
Balance September 30, 2014	$	3,440		$	2,282		$	18,964		$	5,773		$	3,164		$	4,458		$	38,081
Ending balance:
Individually evaluated for
impairment	$	1,340		$	—		$	1,736		$	1,514		$	596		$	198		$	5,384
Collectively evaluated for
impairment	$	2,100		$	2,274		$	16,800		$	4,241		$	2,559		$	4,221		$	32,195
Loans acquired and accounted
for under ASC 310-30	$	—		$	8		$	428		$	18		$	9		$	39		$	502
Loans
Individually evaluated for
impairment	$	11,284		$	10,203		$	28,899		$	7,791		$	5,126		$	1,256		$	64,559
Collectively evaluated for
impairment	$	289,844		$	343,022		$	843,395		$	402,761		$	387,202		$	412,822		$	2,679,046
Loans acquired and accounted
for under ASC 310-30	$	248,701		$	54,594		$	106,877		$	20,084		$	18,251		$	49,459		$	497,966

The following table presents the activity in the allowance for loan losses by portfolio segment for the three and nine months ended September 30, 2013:

	One- to Four-
	Family
	Residential and			Other			Commercial			Commercial			Commercial
	Construction			Residential			Real Estate			Construction			Business			Consumer			Total
	(In Thousands)
Allowance for loan losses
Balance July 1, 2013	$	6,125		$	3,373		$	16,419		$	5,789		$	5,664		$	2,815		$	40,185
Provision (benefit) charged to expense		(234	)		(372	)		1,474			1,291			(1,732	)		2,250			2,677
Losses charged off		(847	)		(201	)		(608	)		(346	)		(1,303	)		(2,215	)		(5,520	)
Recoveries		87			6			888			50			648			435			2,114
Balance September 30, 2013	$	5,131		$	2,806		$	18,173		$	6,784		$	3,277		$	3,285		$	39,456
Balance January 1, 2013	$	6,822		$	4,327		$	17,441		$	3,938		$	5,096		$	3,025		$	40,649
Provision (benefit) charged to expense		292			1,329			6,736			3,413			137			2,666			14,573
Losses charged off		(2,088	)		(2,887	)		(7,138	)		(675	)		(2,672	)		(3,884	)		(19,344	)
Recoveries		105			37			1,134			108			716			1,478			3,578
Balance September 30, 2013	$	5,131		$	2,806		$	18,173		$	6,784		$	3,277		$	3,285		$	39,456

18

The following table presents the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of December 31, 2013:

	One- to Four-
	Family
	Residential and		Other		Commercial		Commercial		Commercial
	Construction		Residential		Real Estate		Construction		Business		Consumer		Total
	(In Thousands)
Allowance for loan losses
Individually evaluated for
impairment	$	2,501	$	—	$	90	$	473	$	4,162	$	218	$	7,444
Collectively evaluated for
impairment	$	3,734	$	2,678	$	16,845	$	3,991	$	2,287	$	3,131	$	32,666
Loans acquired and accounted
for under ASC 310-30	$	—	$	—	$	4	$	—	$	2	$	—	$	6
Loans
Individually evaluated for
impairment	$	13,055	$	10,983	$	31,591	$	12,628	$	8,755	$	1,389	$	78,401
Collectively evaluated for
impairment	$	297,057	$	314,616	$	791,329	$	229,232	$	306,514	$	273,871	$	2,212,619
Loans acquired and accounted
for under ASC 310-30	$	206,964	$	35,095	$	84,591	$	6,989	$	4,883	$	47,642	$	386,164

The portfolio segments used in the preceding two tables correspond to the loan classes used in all other tables in Note 7 as follows:

· The one-to four-family residential and construction segment includes the one- to four-family residential construction, subdivision construction, owner occupied one- to four-family residential and non-owner occupied one- to four-family residential classes

· The other residential segment corresponds to the other residential class

· The commercial real estate segment includes the commercial real estate and industrial revenue bonds classes

· The commercial construction segment includes the land development and commercial construction classes

· The commercial business segment corresponds to the commercial business class

· The consumer segment includes the consumer auto, consumer other and home equity lines of credit classes

A loan is considered impaired, in accordance with the impairment accounting guidance (FASB ASC 310-10-35-16), when based on current information and events, it is probable the Company will be unable to collect all amounts due from the borrower in accordance with the contractual terms of the loan. Impaired loans include not only nonperforming loans but also include loans modified in troubled debt restructurings where concessions have been granted to borrowers experiencing financial difficulties.

19

Impaired loans (excluding FDIC-supported loans, net of discount and acquired non-covered loans, net of discount), are summarized as follows:

	September 30, 2014
			Unpaid
	Recorded		Principal		Specific
	Balance		Balance		Allowance
	(In Thousands)
One- to four-family residential construction	$	—	$	—	$	—
Subdivision construction		2,304		4,716		373
Land development		7,791		8,224		1,514
Commercial construction		—		—		—
Owner occupied one- to four-family residential		4,366		5,064		517
Non-owner occupied one- to four-family residential		4,614		4,837		450
Commercial real estate		28,899		30,210		1,736
Other residential		10,203		10,203		—
Commercial business		2,150		2,173		596
Industrial revenue bonds		2,976		4,288		—
Consumer auto		175		227		26
Consumer other		635		764		95
Home equity lines of credit		446		473		77
Total	$	64,559	$	71,179	$	5,384

	Three Months Ended				Nine Months Ended
	September 30, 2014				September 30, 2014
	Average				Average
	Investment		Interest		Investment		Interest
	in Impaired		Income		in Impaired		Income
	Loans		Recognized		Loans		Recognized
	(In Thousands)
One- to four-family residential construction	$	121	$	—	$	59	$	—
Subdivision construction		2,207		8		2,549		38
Land development		7,650		70		10,403		213
Commercial construction		—		—		—		—
Owner occupied one- to four-family residential		4,665		56		5,100		168
Non-owner occupied one- to four-family residential		4,550		53		4,137		163
Commercial real estate		29,531		298		30,204		988
Other residential		10,304		86		10,665		296
Commercial business		2,163		31		2,657		99
Industrial revenue bonds		3,362		192		2,998		192
Consumer auto		216		4		182		11
Consumer other		678		15		690		57
Home equity lines of credit		415		6		461		20
Total	$	65,862	$	819	$	70,105	$	2,245

20

	At or for the Year Ended December 31, 2013
							Average
			Unpaid				Investment		Interest
	Recorded		Principal		Specific		in Impaired		Income
	Balance		Balance		Allowance		Loans		Recognized
	(In Thousands)
One- to four-family residential construction	$	—	$	—	$	—	$	36	$	—
Subdivision construction		3,502		3,531		1,659		3,315		163
Land development		12,628		13,042		473		13,389		560
Commercial construction		—		—		—		—		—
Owner occupied one- to four-family residential		5,802		6,117		593		5,101		251
Non-owner occupied one- to four-family residential		3,751		4,003		249		4,797		195
Commercial real estate		31,591		34,032		90		42,242		1,632
Other residential		10,983		10,983		—		13,837		434
Commercial business		6,057		6,077		4,162		6,821		179
Industrial revenue bonds		2,698		2,778		—		2,700		27
Consumer auto		216		231		32		145		16
Consumer other		604		700		91		630		63
Home equity lines of credit		569		706		95		391		38
Total	$	78,401	$	82,200	$	7,444	$	93,404	$	3,558

	September 30, 2013
			Unpaid
	Recorded		Principal		Specific
	Balance		Balance		Allowance
	(In Thousands)
One- to four-family residential construction	$	—	$	—	$	—
Subdivision construction		3,785		3,896		851
Land development		15,444		15,848		2,192
Commercial construction		—		—		—
Owner occupied one- to four-family residential		5,174		5,393		430
Non-owner occupied one- to four-family residential		4,351		5,233		369
Commercial real estate		40,981		42,507		2,416
Other residential		11,367		11,367		169
Commercial business		6,138		6,140		1,512
Industrial revenue bonds		2,698		2,778		—
Consumer auto		184		228		28
Consumer other		595		664		89
Home equity lines of credit		410		424		91
Total	$	91,127	$	94,478	$	8,147

21

	Three Months Ended				Nine Months Ended
	September 30, 2013				September 30, 2013
	Average				Average
	Investment		Interest		Investment		Interest
	in Impaired		Income		in Impaired		Income
	Loans		Recognized		Loans		Recognized
	(In Thousands)
One- to four-family residential construction	$	48	$	—	$	48	$	5
Subdivision construction		4,062		34		3,206		140
Land development		15,573		111		13,025		477
Commercial construction		—		—		—		—
Owner occupied one- to four-family residential		5,035		60		4,899		176
Non-owner occupied one- to four-family residential		4,832		12		5,112		173
Commercial real estate		40,792		506		44,374		1,246
Other residential		11,444		136		14,895		353
Commercial business		6,274		86		7,074		161
Industrial revenue bonds		2,698		—		2,701		14
Consumer auto		153		7		130		11
Consumer other		593		12		639		44
Home equity lines of credit		333		10		316		20
Total	$	91,837	$	974	$	96,419	$	2,820

At September 30, 2014, $25.1 million of impaired loans had specific valuation allowances totaling $5.4 million.  At December 31, 2013, $18.0 million of impaired loans had specific valuation allowances totaling $7.4 million.

Included in certain loan categories in the impaired loans are troubled debt restructurings that were classified as impaired. Troubled debt restructurings are loans that are modified by granting concessions to borrowers experiencing financial difficulties.  These concessions could include a reduction in the interest rate on the loan, payment extensions, forgiveness of principal, forbearance or other actions intended to maximize collection.  The types of concessions made are factored into the estimation of the allowance for loan losses for troubled debt restructurings primarily using a discounted cash flows or collateral adequacy approach.

The following tables present newly restructured loans during the three and nine months ended September 30, 2014 by type of modification:

	Three Months Ended September 30, 2014
							Total
	Interest Only		Term		Combination		Modification
	(In Thousands)
Mortgage loans on real estate:
One -to four- family residential	$	308	$	—	$	—	$	308
One -to four- family residential
construction		—		—		223		223
Commercial business		—		243		—		243
Consumer		—		6		—		6
	$	308	$	249	$	223	$	780

22

	Nine Months Ended September 30, 2014
							Total
	Interest Only		Term		Combination		Modification
	(In Thousands)
Mortgage loans on real estate:
Subdivision construction	$	—	$	250	$	—	$	250
One -to four- family residential
construction		—		—		223		223
One -to four- family residential		308		386		—		694
Commercial real estate		506		1,929		—		2,435
Commercial business		—		1,881		—		1,881
Industrial revenue bonds		—		1,150		—		1,150
Consumer		—		59		—		59
	$	814	$	5,655	$	223	$	6,692

At September 30, 2014, the Company had $52.1 million of loans that were modified in troubled debt restructurings and impaired, as follows:  $8.6 million of construction and land development loans, $15.6 million of single family and multi-family residential mortgage loans, $23.9 million of commercial real estate loans, $3.7 million of commercial business loans and $250,000 of consumer loans.  Of the total troubled debt restructurings at September 30, 2014, $47.4 million were accruing interest and $19.8 million were classified as substandard using the Company’s internal grading system, which is described below.  The Company had no troubled debt restructurings which were modified in the previous 12 months and subsequently defaulted during the nine months ended September 30, 2014.  When loans modified as troubled debt restructuring have subsequent payment defaults, the defaults are factored into the determination of the allowance for loan losses to ensure specific valuation allowances reflect amounts considered uncollectible.  At December 31, 2013, the Company had $10.9 million of construction and land development loans, $16.6 million of single family and multi-family residential mortgage loans, $24.8 million of commercial real estate loans, $1.5 million of commercial business loans and $310,000 of consumer loans that were modified in troubled debt restructurings and impaired.  Of the troubled debt restructurings totaling $54.1 million at December 31, 2013, $49.6 million were accruing interest and $22.1 million were classified as substandard using the Company’s internal grading system.

During the three months ended September 30, 2014, loans designated as troubled debt restructurings totaling $1.4 million met the criteria for placement back on accrual status.  The $1.4 million was made up of $1.4 million of commercial real estate loans and $6,000 of consumer loans.  During the nine months ended September 30, 2014, loans designated as troubled debt restructurings totaling $2.1 million met the criteria for placement back on accrual status.  The $2.1 million was made up of $1.5 million of commercial real estate loans, $591,000 of residential mortgage loans and $6,000 of consumer loans.

The Company reviews the credit quality of its loan portfolio using an internal grading system that classifies loans as “Satisfactory,” “Watch,” “Special Mention,” “Substandard” and “Doubtful.”  Substandard loans are characterized by the distinct possibility that the Bank will sustain some loss if certain deficiencies are not corrected.  Doubtful loans are those having all the weaknesses inherent to those classified Substandard with the added characteristics that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.  Special mention loans possess potential weaknesses that deserve management’s close attention but do not expose the Bank to a degree of risk that warrants substandard classification.  Loans classified as watch are being monitored because of indications of potential weaknesses or deficiencies that may require future classification as special mention or substandard.  Loans not meeting any of the criteria previously described are considered satisfactory.  The FDIC-covered loans are evaluated using this internal grading system.  These loans are accounted for in pools and are currently substantially covered through loss sharing agreements with the FDIC.  Minimal adverse classification in the loan pools was identified as of September 30, 2014 and December 31, 2013, respectively.  The acquired non-covered loans are also evaluated using this internal grading system.  These loans are accounted for in pools and minimal adverse classification in the loan pools was identified as of September 30, 2014.  See Note 8 for further discussion of the acquired loan pools and loss sharing agreements.  The loan grading system is presented by loan class below:

23

			September 30, 2014
					Special
	Satisfactory		Watch		Mention		Substandard		Doubtful		Total
			(In Thousands)
One- to four-family residential
construction	$	43,163	$	—	$	—	$	223	$	—	$	43,386
Subdivision construction		33,310		21		—		2,013		—		35,344
Land development		37,514		5,000		—		6,067		—		48,581
Commercial construction		361,971		—		—		—		—		361,971
Owner occupied one- to four-
family residential		76,166		611		—		2,207		—		78,984
Non-owner occupied one- to four-
family residential		139,070		350		—		3,994		—		143,414
Commercial real estate		808,064		51,967		—		12,263		—		872,294
Other residential		341,224		10,045		—		1,956		—		353,225
Commercial business		347,691		446		—		1,250		—		349,387
Industrial revenue bonds		41,114		622		—		1,205		—		42,941
Consumer auto		274,079		—		—		171		—		274,250
Consumer other		78,149		4		—		523		—		78,676
Home equity lines of credit		60,707		—		—		445		—		61,152
FDIC-supported loans, net of
discounts (TeamBank)		15,275		—		—		19		—		15,294
Acquired non--covered loans, net
of discounts (TeamBank)		28,333		—		—		8		—		28,341
FDIC-supported loans, net of
discounts (Vantus Bank)		43,252		—		—		401		—		43,653
FDIC-supported loans, net of
discounts (Sun Security Bank)		53,859		—		—		535		—		54,394
FDIC-supported loans, net of
discounts (InterBank)		202,904		—		—		883		—		203,787
Acquired non-covered loans,
net of discounts (Valley Bank)		152,497		—		—		—		—		152,497
Total	$	3,138,342	$	69,066	$	—	$	34,163	$	—	$	3,241,571

			December 31, 2013
					Special
	Satisfactory		Watch		Mention		Substandard		Doubtful		Total
			(In Thousands)
One- to four-family residential
construction	$	34,364	$	298	$	—	$	—	$	—	$	34,662
Subdivision construction		36,524		706		—		3,179		—		40,409
Land development		45,606		1,148		—		11,087		—		57,841
Commercial construction		184,019		—		—		—		—		184,019
Owner occupied one- to four-
family residential		84,931		503		—		3,699		—		89,133
Non-owner occupied one- to four-
family residential		137,003		6,718		—		2,187		—		145,908
Commercial real estate		727,668		37,937		—		15,085		—		780,690
Other residential		311,320		12,323		—		1,956		—		325,599
Commercial business		307,540		1,803		—		3,528		2,398		315,269
Industrial revenue bonds		39,532		675		—		2,023		—		42,230
Consumer auto		134,516		—		—		201		—		134,717
Consumer other		81,769		6		—		485		—		82,260
Home equity lines of credit		57,713		—		—		570		—		58,283
FDIC-supported loans, net of
discounts (TeamBank)		49,702		—		—		160		—		49,862
FDIC-supported loans, net of
discounts (Vantus Bank)		57,290		—		—		630		—		57,920
FDIC-supported loans, net of
discounts (Sun Security Bank)		63,360		—		—		1,483		—		64,843
FDIC-supported loans, net of
discounts (InterBank)		213,539		—		—		—		—		213,539
Total	$	2,566,396	$	62,117	$	—	$	46,273	$	2,398	$	2,677,184

24

NOTE 8: ACQUIRED LOANS, LOSS SHARING AGREEMENTS AND FDIC INDEMNIFICATION ASSETS

On March 20, 2009, Great Southern Bank entered into a purchase and assumption agreement with loss share with the Federal Deposit Insurance Corporation (FDIC) to assume all of the deposits (excluding brokered deposits) and acquire certain assets of TeamBank, N.A., a full service commercial bank headquartered in Paola, Kansas.

The loans, commitments and foreclosed assets purchased in the TeamBank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the Bank shares in the losses on assets covered under the agreement (referred to as covered assets). On losses up to $115.0 million, the FDIC agreed to reimburse the Bank for 80% of the losses. On losses exceeding $115.0 million, the FDIC agreed to reimburse the Bank for 95% of the losses.  Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by the Bank.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans, which five-year period ended March 31, 2014.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A discount was recorded in conjunction with the fair value of the acquired loans and the amount accreted to yield during the three and nine months ended September 30, 2014 was $-0-.  The amount accreted to yield during the three and nine months ended September 30, 2013 was $0 and $134,000, respectively.

On September 4, 2009, Great Southern Bank entered into a purchase and assumption agreement with loss share with the FDIC to assume all of the deposits and acquire certain assets of Vantus Bank, a full service thrift headquartered in Sioux City, Iowa.

The loans, commitments and foreclosed assets purchased in the Vantus Bank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the Bank shares in the losses on assets covered under the agreement (referred to as covered assets). On losses up to $102.0 million, the FDIC agreed to reimburse the Bank for 80% of the losses. On losses exceeding $102.0 million, the FDIC agreed to reimburse the Bank for 95% of the losses. Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by the Bank.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans, which five year period ended on September 30, 2014.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A discount was recorded in conjunction with the fair value of the acquired loans and the amount accreted to yield during the three and nine months ended September 30, 2014 was $-0-.  The amount accreted to yield during the three and nine months ended September 30, 2013 was $19,000 and $99,000, respectively.

On October 7, 2011, Great Southern Bank entered into a purchase and assumption agreement with loss share with the FDIC to assume all of the deposits and acquire certain assets of Sun Security Bank, a full service bank headquartered in Ellington, Missouri.

The loans and foreclosed assets purchased in the Sun Security Bank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the FDIC agreed to cover 80% of the losses on the loans (excluding approximately $4 million of consumer loans) and foreclosed assets purchased subject to certain limitations.  Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by Great Southern.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets

25

acquired, no goodwill was recorded.  A discount was recorded in conjunction with the fair value of the acquired loans and the amount accreted to yield during the three and nine months ended September 30, 2014 was $0 and $105,000, respectively.  The amount accreted to yield during the three and nine months ended September 30, 2013 was $210,000 and $827,000, respectively.

On April 27, 2012, Great Southern Bank entered into a purchase and assumption agreement with loss share with the FDIC to assume all of the deposits and acquire certain assets of Inter Savings Bank, FSB (“InterBank”), a full service bank headquartered in Maple Grove, Minnesota.

The loans and foreclosed assets purchased in the InterBank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the FDIC agreed to cover 80% of the losses on the loans (excluding approximately $60,000 of consumer loans) and foreclosed assets purchased subject to certain limitations.  Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by Great Southern.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A premium was recorded in conjunction with the fair value of the acquired loans and the amount amortized to yield during the three and nine months ended September 30, 2014 was $133,000 and $417,000, respectively.  The amount amortized to yield during the three and nine months ended September 30, 2013 was $155,000 and $485,000, respectively.

On June 20, 2014, Great Southern Bank entered into a purchase and assumption agreement with the FDIC to purchase a substantial portion of the loans and investment securities, as well as certain other assets, and assume all of the deposits, as well as certain other liabilities, of Valley Bank (“Valley”), a full-service bank headquartered in Moline, Illinois, with significant operations in Iowa.  This transaction did not include a loss sharing agreement.

Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded. A premium was recorded in conjunction with the fair value of the acquired loans and the amount amortized to yield during each of the three and nine months ended September 30, 2014 was $263,000.

Fair Value and Expected Cash Flows.  At the time of these acquisitions, the Company determined the fair value of the loan portfolios based on several assumptions. Factors considered in the valuations were projected cash flows for the loans, type of loan and related collateral, classification status, fixed or variable interest rate, term of loan, current discount rates and whether or not the loan was amortizing. Loans were grouped together according to similar characteristics and were treated in the aggregate when applying various valuation techniques. Management also estimated the amount of credit losses that were expected to be realized for the loan portfolios. The discounted cash flow approach was used to value each pool of loans. For non-performing loans, fair value was estimated by calculating the present value of the recoverable cash flows using a discount rate based on comparable corporate bond rates. This valuation of the acquired loans is a significant component leading to the valuation of the loss sharing assets recorded.

The amount of the estimated cash flows expected to be received from the acquired loan pools in excess of the fair values recorded for the loan pools is referred to as the accretable yield.  The accretable yield is recognized as interest income over the estimated lives of the loans.  The Company continues to evaluate the fair value of the loans including cash flows expected to be collected.  Increases in the Company’s cash flow expectations are recognized as increases to the accretable yield while decreases are recognized as impairments through the allowance for loan losses.  During the three and nine months ended September 30, 2014, increases in expected cash flows related to the acquired loan portfolios resulted in adjustments of $5.1 million and $25.0 million, respectively, to the accretable yield to be spread over the estimated remaining lives of the loans on a level-yield basis. During the three and nine months ended September 30, 2013, similar such adjustments totaling $11.9 million and $26.9 million, respectively, were made to the accretable yield.  The current year increases in expected cash flows also reduced the amount of expected reimbursements under the loss sharing agreements.  During the three and nine months ended September 30, 2014, this resulted in corresponding adjustments of $4.1 million and $20.0 million, respectively, to the indemnification assets to be amortized on a level-yield basis over the remainder of the loss sharing agreements or the remaining expected lives of the loan pools, whichever is shorter.  During the three and nine months ended September 30, 2013, corresponding adjustments of $9.4 million and $21.3 million, respectively, were made to the indemnification assets.

26

Because these adjustments will be recognized over the remaining lives of the loan pools and the remainder of the loss sharing agreements, respectively, they will impact future periods as well.  The remaining accretable yield adjustment that will affect interest income is $29.6 million and the remaining adjustment to the indemnification assets, including the effects of the clawback liability related to Interbank, that will affect non-interest income (expense) is $(26.0) million.  Of the remaining adjustments, we expect to recognize $7.2 million of interest income and $(6.0) million of non-interest income (expense) in the remainder of 2014.  Additional adjustments may be recorded in future periods from the FDIC-assisted acquisitions, as the Company continues to estimate expected cash flows from the acquired loan pools.

The impact of adjustments on the Company’s financial results is shown below:

	Three Months Ended					Three Months Ended
	September 30, 2014					September 30, 2013
	(In Thousands, Except Per Share Data
	and Basis Points Data)
Impact on net interest income/
net interest margin (in basis points)		$	8,848		98 bps		$	8,412		101 bps
Non-interest income			(7,438	)				(7,310	)
Net impact to pre-tax income		$	1,410				$	1,102
Net impact net of taxes		$	917				$	716
Impact to diluted earnings per common share		$	0.07				$	0.05

	Nine Months Ended				Nine Months Ended
	September 30, 2014				September 30, 2013
	(In Thousands, Except Per Share Data
	and Basis Points Data)
Impact on net interest income/
net interest margin (in basis points)	$	25,836		101 bps	$	26,508		103 bps
Non-interest income		(21,915	)			(22,529	)
Net impact to pre-tax income	$	3,921			$	3,979
Net impact net of taxes	$	2,549			$	2,586
Impact to diluted earnings per common share	$	0.19			$	0.19

The loss sharing asset is measured separately from the loan portfolio because it is not contractually embedded in the loans and is not transferable with the loans should the Bank choose to dispose of them. Fair value was estimated using projected cash flows available for loss sharing based on the credit adjustments estimated for each loan pool (as discussed above) and the loss sharing percentages outlined in the Purchase and Assumption Agreement with the FDIC. These cash flows were discounted to reflect the uncertainty of the timing and receipt of the loss sharing reimbursement from the FDIC. The loss sharing asset is also separately measured from the related foreclosed real estate.

The loss sharing agreement on the InterBank transaction includes a clawback provision whereby if credit loss performance is better than certain pre-established thresholds, then a portion of the monetary benefit is shared with the FDIC.  The pre-established threshold for credit losses is $115.7 million for this transaction.  The monetary benefit required to be paid to the FDIC under the clawback provision, if any, will occur shortly after the termination of the loss sharing agreement, which in the case of InterBank is 10 years from the acquisition date.

At September 30, 2014 and December 31, 2013, the Bank’s internal estimate of credit performance was expected to be better than the threshold set by the FDIC in the loss sharing agreement.  Therefore, a separate clawback liability totaling $5.8 million and $3.7 million was recorded as of September 30, 2014 and December 31, 2013, respectively.

27

As changes in the fair values of the loans and foreclosed assets are determined due to changes in expected cash flows, changes in the amount of the clawback liability will occur.

TeamBank Loans, Foreclosed Assets and Indemnification Asset.  The following tables present the balances of the FDIC indemnification asset related to the TeamBank transaction at September 30, 2014 and December 31, 2013. Gross loan balances (due from the borrower) were reduced approximately $389.9 million since the transaction date because of $256.1 million of repayments from borrowers, $61.6 million in transfers to foreclosed assets and $72.2 million in charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

	September 30, 2014
				Foreclosed
	Loans			Assets
	(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$	46,222		$	169
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)		(2,061	)		—
Original estimated fair value of assets, net of activity since
acquisition date		(43,635	)		(156	)
Expected loss remaining		526			13
Assumed loss sharing recovery percentage		83	%		77	%
Estimated loss sharing value		438			10
Indemnification asset to be amortized resulting from
change in expected losses		327			—
Accretable discount on FDIC indemnification asset		—			—
FDIC indemnification asset	$	765		$	10

	December 31, 2013
				Foreclosed
	Loans			Assets
	(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$	53,553		$	664
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)		(2,882	)		—
Original estimated fair value of assets, net of activity since
acquisition date		(49,862	)		(647	)
Expected loss remaining		809			17
Assumed loss sharing recovery percentage		82	%		76	%
Estimated loss sharing value		665			13
Indemnification asset to be amortized resulting from
change in expected losses		593			—
Accretable discount on FDIC indemnification asset		(10	)		—
FDIC indemnification asset	$	1,248		$	13

28

Vantus Bank Loans, Foreclosed Assets and Indemnification Asset.  The following tables present the balances of the FDIC indemnification asset related to the Vantus Bank transaction at September 30, 2014 and December 31, 2013. Gross loan balances (due from the borrower) were reduced approximately $286.7 million since the transaction date because of $240.6 million of repayments from borrowers, $16.5 million in transfers to foreclosed assets and $29.6 million in charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

	September 30, 2014
				Foreclosed
	Loans			Assets
	(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$	44,877		$	1,205
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)		(456	)		—
Original estimated fair value of assets, net of activity since
acquisition date		(43,653	)		(1,015	)
Expected loss remaining		768			190
Assumed loss sharing recovery percentage		74	%		—	%
Estimated loss sharing value(1)		566			—
Indemnification asset to be amortized resulting from
change in expected losses		278			—
Accretable discount on FDIC indemnification asset		—			—
FDIC indemnification asset	$	844		$	—

(1) Includes $153,000 impairment of indemnification asset for foreclosed assets.  Resolution of certain items related to commercial foreclosed assets did not occur prior to the expiration of the non-single-family loss sharing agreement for Vantus Bank on September 30, 2014.

	December 31, 2013
				Foreclosed
	Loans			Assets
	(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$	60,011		$	1,986
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)		(1,202	)		—
Original estimated fair value of assets, net of activity since
acquisition date		(57,920	)		(1,092	)
Expected loss remaining		889			894
Assumed loss sharing recovery percentage		78	%		80	%
Estimated loss sharing value		690			716
Indemnification asset to be amortized resulting from
change in expected losses		919			—
Accretable discount on FDIC indemnification asset		(32	)		—
FDIC indemnification asset	$	1,577		$	716

29

Sun Security Bank Loans, Foreclosed Assets and Indemnification Asset.  The following tables present the balances of the FDIC indemnification asset related to the Sun Security Bank transaction at September 30, 2014 and December 31, 2013.  Gross loan balances (due from the borrower) were reduced approximately $171.7 million since the transaction date because of $112.8 million of repayments from borrowers, $27.6 million in transfers to foreclosed assets and $31.3 million of charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

	September 30, 2014
				Foreclosed
	Loans			Assets
	(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$	62,722		$	2,598
Reclassification from nonaccretable discount to accretable discount    due to change in expected losses (net of accretion to date)		(3,540	)		—
Original estimated fair value of assets, net of activity since
acquisition date		(54,394	)		(1,521	)
Expected loss remaining		4,788			1,077
Assumed loss sharing recovery percentage		66	%		80	%
Estimated loss sharing value		3,173			862
Indemnification asset to be amortized resulting from
change in expected losses		2,827			—
Accretable discount on FDIC indemnification asset		(363	)		(63	)
FDIC indemnification asset	$	5,637		$	799

	December 31, 2013
				Foreclosed
	Loans			Assets
	(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$	78,524		$	3,582
Non-credit premium/(discount), net of activity since acquisition date		(105	)		—
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)		(5,062	)		—
Original estimated fair value of assets, net of activity since
acquisition date		(64,843	)		(2,193	)
Expected loss remaining		8,514			1,389
Assumed loss sharing recovery percentage		70	%		80	%
Estimated loss sharing value		5,974			1,111
Indemnification asset to be amortized resulting from
change in expected losses		4,049			—
Accretable discount on FDIC indemnification asset		(680	)		(93	)
FDIC indemnification asset	$	9,343		$	1,018

30

InterBank Loans, Foreclosed Assets and Indemnification Asset.  The following table presents the balances of the FDIC indemnification asset related to the InterBank transaction at September 30, 2014.  Gross loan balances (due from the borrower) were reduced approximately $138.8 million since the transaction date because of $107.2 million of repayments by the borrower, $11.4 million in transfers to foreclosed assets and $20.2 million of charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

	September 30, 2014
				Foreclosed
	Loans			Assets
	(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$	254,427		$	5,076
Non-credit premium/(discount), net of activity since acquisition date		1,488			—
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)		(23,518	)		—
Original estimated fair value of assets, net of activity since
acquisition date		(203,787	)		(3,976	)
Expected loss remaining		28,610			1,100
Assumed loss sharing recovery percentage		82	%		80	%
Estimated loss sharing value(1)		23,444			880
FDIC loss share clawback		3,793			—
Indemnification asset to be amortized resulting from
change in expected losses		18,814			—
Accretable discount on FDIC indemnification asset		(3,350	)		(33	)
FDIC indemnification asset	$	42,701		$	847

(1) Includes $400,000 impairment of indemnification asset for loans

	December 31, 2013
				Foreclosed
	Loans			Assets
	(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$	284,975		$	6,543
Non-credit premium/(discount), net of activity since acquisition date		1,905			—
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)		(21,218	)		—
Original estimated fair value of assets, net of activity since
acquisition date		(213,539	)		(5,073	)
Expected loss remaining		52,123			1,470
Assumed loss sharing recovery percentage		82	%		80	%
Estimated loss sharing value		42,654			1,176
FDIC loss share clawback		2,893			—
Indemnification asset to be amortized resulting from
change in expected losses		16,974			—
Accretable discount on FDIC indemnification asset		(4,874	)		(33	)
FDIC indemnification asset	$	57,647		$	1,143

31

Valley Bank Loans and Foreclosed Assets.  The following table presents the balances of the loans and discount related to the Valley Bank transaction at September 30, 2014.  Gross loan balances (due from the borrower) were reduced approximately $14.1 million since the transaction date because of $12.3 million of repayments by the borrower and $1.8 million of charge-offs to customer loan balances.  The Valley Bank transaction did not include a loss sharing agreement; however, the loans were recorded at a discount, which is accreted to yield over the life of the loans.

	September 30, 2014
				Foreclosed
	Loans			Assets
	(In Thousands)
Initial basis, net of activity since acquisition date	$	179,065		$	—
Non-credit premium/(discount), net of activity since acquisition date		1,752			—
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)		—			—
Original estimated fair value of assets, net of activity since
acquisition date		(152,497	)		—
Expected loss remaining	$	28,320		$	—

	June 20, 2014
				Foreclosed
	Loans			Assets
	(In Thousands)
Initial basis	$	193,186		$	—
Non-credit premium/(discount)		2,015			—
Original estimated fair value of assets		(165,098	)		—
Expected loss remaining	$	30,103		$	—

32

Changes in the accretable yield for acquired loan pools were as follows for the three months ended September 30, 2014 and 2013:

							Sun Security
	TeamBank			Vantus Bank			Bank			InterBank			Valley Bank
	(In Thousands)
Balance, July 1, 2013	$	8,610		$	8,647		$	10,055		$	34,967		$	—
Accretion		(1,450	)		(1,832	)		(4,795	)		(7,034	)		—
Reclassification from
nonaccretable yield(1)		1,109			(379	)		5,293			7,774			—
Balance, September 30, 2013	$	8,269		$	6,436		$	10,553		$	35,707		$	—
Balance July 1, 2014	$	7,434		$	4,578		$	9,427		$	41,108		$	22,811
Accretion		(887	)		(859	)		(2,119	)		(10,002	)		(2,062	)
Reclassification from
nonaccretable yield(1)		725			916			789			4,857			—
Balance, September 30, 2014	$	7,272		$	4,635		$	8,097		$	35,963		$	20,749

(1) Represents increases in estimated cash flows expected to be received from the acquired loan pools, primarily due to lower estimated credit losses.  The numbers also include changes in expected accretion of the loan pools for TeamBank, Vantus Bank, Sun Security Bank and InterBank for the three months ended September 30, 2014, totaling $522,000, $831,000, $139,000 and $707,000, respectively, and for the three months ended September 30, 2013, totaling $340,000, $0, $4.3 million and $7.3 million, respectively. There have not yet been any changes to the expected accretion of the loan pools for Valley Bank.

Changes in the accretable yield for acquired loan pools were as follows for the nine months ended September 30, 2014 and 2013:

							Sun Security
	TeamBank			Vantus Bank			Bank			InterBank			Valley Bank
	(In Thousands)
Balance, January 1, 2013	$	12,128		$	13,538		$	11,259		$	42,574		$	—
Accretion		(7,050	)		(7,492	)		(13,021	)		(20,423	)		—
Reclassification from
nonaccretable yield(1)		3,191			390			12,315			13,556			—
Balance, September 30, 2013	$	8,269		$	6,436		$	10,553		$	35,707		$	—
Balance January 1, 2014	$	7,402		$	5,725		$	11,113		$	40,095		$	—
Additions		—			—			—			—			22,976
Accretion		(3,169	)		(2,990	)		(7,343	)		(28,404	)		(2,227	)
Reclassification from
nonaccretable yield(1)		3,039			1,900			4,327			24,272			—
Balance, September 30, 2014	$	7,272		$	4,635		$	8,097		$	35,963		$	20,749

(1) Represents increases in estimated cash flows expected to be received from the acquired loan pools, primarily due to lower estimated credit losses.  The numbers also include changes in expected accretion of the loan pools for TeamBank, Vantus Bank, Sun Security Bank and InterBank for the nine months ended September 30, 2014, totaling $2.8 million, $1.8 million, $1.5 million and $2.4 million, respectively, and for the nine months ended September 30, 2013, totaling $2.5 million, $516,000, $9.0 million and $14.9 million, respectively.  There have not yet been any changes to the expected accretion of the loan pools for Valley Bank.

33

NOTE 9: OTHER REAL ESTATE OWNED

Major classifications of other real estate owned were as follows:

	September 30,		December 31,
	2014		2013
	(In Thousands)
Foreclosed assets held for sale
One- to four-family construction	$	—	$	—
Subdivision construction		9,778		11,652
Land development		17,752		16,788
Commercial construction		—		2,132
One- to four-family residential		1,564		744
Other residential		3,577		5,900
Commercial real estate		1,779		4,135
Commercial business		59		77
Consumer		565		969
		35,074		42,397
FDIC-supported foreclosed assets, net of discounts		6,668		9,006
Foreclosed assets held for sale, net		41,742		51,403
Other real estate owned not acquired through
foreclosure		2,020		2,111
Other real estate owned	$	43,762	$	53,514

Other real estate owned not acquired through foreclosure includes 12 properties, 11 of which were branch locations that have been closed and are held for sale, and one of which is land which was acquired for a potential branch location.

Expenses applicable to foreclosed assets included the following:

	Three Months Ended September 30,
	2014		2013
	(In Thousands)
Net (gain) loss on sales of foreclosed assets	$	126	$	27
Valuation write-downs		158		258
Operating expenses, net of rental income		698		783
	$	982	$	1,068

	Nine Months Ended September 30,
	2014		2013
	(In Thousands)
Net (gain) loss on sales of foreclosed assets	$	72	$	(255	)
Valuation write-downs		1,357		1,313
Operating expenses, net of rental income		1,744		2,420
	$	3,173	$	3,478

34

NOTE 10: DEPOSITS

		September 30,		December 31,
		2014		2013
		(In Thousands)
Time Deposits:
0.00% - 0.99%	$	802,532	$	669,698
1.00% - 1.99%		245,047		251,118
2.00% - 2.99%		65,449		61,042
3.00% - 3.99%		9,424		9,413
4.00% - 4.99%		1,712		1,852
5.00% and above		420		819
Total time deposits (0.77% - 0.69%)		1,124,584		993,942
Non-interest-bearing demand deposits		521,705		522,805
Interest-bearing demand and savings deposits (0.19% - 0.20%)		1,424,881		1,291,879
Total Deposits	$	3,071,170	$	2,808,626

NOTE 11: ADVANCES FROM FEDERAL HOME LOAN BANK

Advances from the Federal Home Loan Bank at September 30, 2014 and December 31, 2013 consisted of the following:

	September 30, 2014					December 31, 2013
			Weighted					Weighted
			Average					Average
			Interest					Interest
Due In	Amount		Rate			Amount		Rate
	(In Thousands)		(In Thousands)			(In Thousands)
2014	$	149,015		0.21	%	$	2,315		1.02	%
2015		10,065		3.87			10,065		3.87
2016		70		5.06			25,070		3.81
2017		30,825		3.20			85,825		3.92
2018		81		5.06			81		5.06
2019 and thereafter		529		5.51			529		5.51
		190,585		0.91			123,885		3.85
Unamortized fair value adjustment		79					2,872
	$	190,664				$	126,757

Included in the Bank’s FHLB advances at September 30, 2014 and December 31, 2013, was a $10.0 million advance with a maturity date of October 26, 2015.  The interest rate on this advance is 3.86%.  The advance has a call provision that allows the Federal Home Loan Bank of Topeka to call the advance quarterly.

Included in the Bank’s FHLB advances at September 30, 2014 and December 31, 2013, was a $30.0 million advance with a maturity date of November 24, 2017.  The interest rate on this advance is 3.20%.  The advance has a call provision that allows the Federal Home Loan Bank of Des Moines to call the advance quarterly.

Included in the Bank’s FHLB advances at December 31, 2013, was a $25.0 million advance with a maturity date of December 7, 2016.  The interest rate on this advance was 3.81%.  This advance was repaid by the Bank in June 2014.

Included in the Bank’s FHLB advances at December 31, 2013, was a $30.0 million advance with a maturity date of March 29, 2017.  The interest rate on this advance was 4.07%.  This advance was repaid by the Bank in June 2014.

Included in the Bank’s FHLB advances at December 31, 2013, was a $25.0 million advance with a maturity date of June 20, 2017.  The interest rate on this advance was 4.57%.  This advance was repaid by the Bank in June 2014.

35

The Company prepaid $80 million of its Federal Home Loan Bank advances and $50 million of structured repurchase agreements (see Note 12) in the nine months ended September 30, 2014 as part of a strategy to utilize the Bank’s liquidity and improve net interest margin.  As a result, the Company incurred one-time prepayment penalties totaling $7.4 million, which were included in other operating expenses.

NOTE 12: STRUCTURED REPURCHASE AGREEMENTS

In September 2008, the Company entered into a structured repurchase borrowing transaction for a total of $50 million.  This borrowing bore interest at a fixed rate of 4.34%, was scheduled to mature September 15, 2015, and had a call provision that allowed the repurchase counterparty to call the borrowing quarterly.  The Company pledged investment securities to collateralize this borrowing.

In June 2014, the Company elected to repay this structured repurchase borrowing.

NOTE 13: INCOME TAXES

Reconciliations of the Company’s effective tax rates to the statutory corporate tax rates were as follows:

	Three Months Ended September 30,
	2014			2013
Tax at statutory rate		35.0	%		35.0	%
Nontaxable interest and dividends		(3.1	)		(4.3	)
Tax credits		(8.4	)		(12.2	)
State taxes		1.7			3.0
Other		0.2			(1.4	)
		25.4	%		20.1	%

	Nine Months Ended September 30,
	2014			2013
Tax at statutory rate		35.0	%		35.0	%
Nontaxable interest and dividends		(3.3	)		(4.3	)
Tax credits		(9.2	)		(11.1	)
State taxes		1.5			2.1
Other		0.4			(0.2	)
		24.4	%		21.5	%

The Company and its consolidated subsidiaries have not been audited recently by the Internal Revenue Service (IRS) or the state taxing authorities with respect to income or franchise tax returns, and as such, tax years through December 31, 2005, have been closed without audit. The Company, through one of its subsidiaries, is a partner in two partnerships currently under IRS examination for 2006 and 2007. As a result, the Company’s 2006 and subsequent tax years remain open for examination. The IRS audits of the two partnerships are ongoing.  The IRS has raised questions about the validity of the allocation of a portion of the credits by one of the partnerships.  At this time, the Company believes that the partnership has sufficient technical support for itsallocation position regarding these credits and that it is more likely than not these allocations will ultimately be sustained; therefore, a reserve for uncertain tax positions is not required.

36

NOTE 14: FAIR VALUE MEASUREMENT

ASC Topic 820, Fair Value Measurements, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.  Topic 820 also specifies a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.  The standard describes three levels of inputs that may be used to measure fair value:

·   Quoted prices in active markets for identical assets or liabilities (Level 1): Inputs that are quoted unadjusted prices in active markets for identical assets that the Company has the ability to access at the measurement date. An active market for the asset is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

·   Other observable inputs (Level 2): Inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity including quoted prices for similar assets, quoted prices for securities in inactive markets and inputs derived principally from or corroborated by observable market data by correlation or other means.

·   Significant unobservable inputs (Level 3): Inputs that reflect assumptions of a source independent of the reporting entity or the reporting entity's own assumptions that are supported by little or no market activity or observable inputs.

Financial instruments are broken down as follows by recurring or nonrecurring measurement status. Recurring assets are initially measured at fair value and are required to be remeasured at fair value in the financial statements at each reporting date. Assets measured on a nonrecurring basis are assets that, due to an event or circumstance, were required to be remeasured at fair value after initial recognition in the financial statements at some time during the reporting period.

Recurring Measurements

				Fair value measurements using
				Quoted prices
				in active
				markets		Other		Significant
				for identical		observable		unobservable
				assets		inputs		inputs
	Fair value			(Level 1)		(Level 2)		(Level 3)
	(In Thousands)
September 30, 2014
U.S. government agencies	$	18,937		$	—	$	18,937	$	—
Mortgage-backed securities		276,627			—		276,627		—
States and political subdivisions		126,547			—		126,547		—
Equity securities		3,045			—		3,045		—
Mortgage servicing rights		189			—		—		189
Interest rate derivative asset		2,050			—		—		2,050
Interest rate derivative liability		(1,489	)		—		—		(1,489	)
December 31, 2013
U.S. government agencies	$	17,255		$	—	$	17,255	$	—
Mortgage-backed securities		367,578			—		367,578		—
Small Business Administration loan pools		44,855			—		44,855		—
States and political subdivisions		122,724			—		122,724		—
Equity securities		2,869			—		2,869		—
Mortgage servicing rights		211			—		—		211
Interest rate derivative asset		2,544			—		—		2,544
Interest rate derivative liability		(1,613	)		—		—		(1,613	)

37

The following is a description of inputs and valuation methodologies used for assets recorded at fair value on a recurring basis and recognized in the accompanying statements of financial condition at September 30, 2014 and December 31, 2013, as well as the general classification of such assets pursuant to the valuation hierarchy.  There have been no significant changes in the valuation techniques during the three-month period ended September 30, 2014.

Securities Available for Sale. Investment securities available for sale are recorded at fair value on a recurring basis. The fair values used by the Company are obtained from an independent pricing service, which represent either quoted market prices for the identical asset or fair values determined by pricing models, or other model-based valuation techniques, that consider observable market data, such as interest rate volatilities, LIBOR yield curve, credit spreads and prices from market makers and live trading systems.  Recurring Level 2 securities include U.S. government agency securities, mortgage-backed securities, Small Business Administration (SBA) loan pools, state and municipal bonds and equity securities. Inputs used for valuing Level 2 securities include observable data that may include dealer quotes, benchmark yields, market spreads, live trading levels and market consensus prepayment speeds, among other things. Additional inputs include indicative values derived from the independent pricing service’s proprietary computerized models.There were no Recurring Level 3 securities at September 30, 2014 or December 31, 2013.

Mortgage Servicing Rights.Mortgage servicing rights do not trade in an active, open market with readily observable prices.  Accordingly, fair value is estimated using discounted cash flow models.  Due to the nature of the valuation inputs, mortgage servicing rights are classified within Level 3 of the hierarchy.

Interest Rate Swaps. Interest rate swaps are recorded at fair value on a recurring basis. The fair values used by the Company are obtained from an independent valuation service, and are based on prevailing observable market data, such as the LIBOR swap curves and Overnight Index Swap “OIS” curves, and derived from proprietary models based on well recognized financial principles and reasonable estimates about future market conditions (which may include assumptions and estimates that are not readily observable in the marketplace).  Included in the fair values are credit valuation adjustments which represent the consideration of credit risk (credit standing) of the counterparties to the transaction and the effect of any credit enhancements related to the transaction.  Certain inputs to the credit valuation models may be based on assumptions and best estimates that are not readily observable in the marketplace.

The Company considers transfers between the levels of the hierarchy to be recognized at the end of related reporting periods.  From December 31, 2013 to September 30, 2014, no assets for which fair value is measured on a recurring basis transferred between any levels of the hierarchy.

Level 3 Reconciliation

The following is a reconciliation of the beginning and ending balances of recurring fair value measurements recognized in the accompanying balance sheet using significant unobservable (Level 3) inputs.

	Mortgage Servicing Rights
	2014			2013
	(In Thousands)
Balance, July 1	$	196		$	246
Additions		28			32
Amortization		(35	)		(42	)
Balance, September 30	$	189		$	236

38

	Mortgage Servicing Rights
	2014			2013
	(In Thousands)
Balance, January 1	$	211		$	152
Additions		81			224
Amortization		(103	)		(140	)
Balance, September 30	$	189		$	236

	Interest Rate Derivative Asset
	2014			2013
	(In Thousands)
Balance, July 1	$	1,722		$	1,379
Change in fair value through earnings		(210	)		182
Balance, September 30	$	1,512		$	1,561

	Interest Rate Derivative Asset
	2014			2013
	(In Thousands)
Balance, January 1	$	1,859		$	2,112
Change in fair value through earnings		(347	)		(551	)
Balance, September 30	$	1,512		$	1,561

	Interest Rate Cap Derivative Asset Designated as Hedging Instrument
	2014		2013
	(In Thousands)
Balance, July 1	$	462	$	—
Additions		—		738
Change in fair value through other
comprehensive income		76		(69	)
Balance, September 30	$	538	$	669

	Interest Rate Cap Derivative Asset Designated as Hedging Instrument
	2014			2013
	(In Thousands)
Balance, January 1	$	685		$	—
Additions		—			738
Change in fair value through other
comprehensive income		(147	)		(69	)
Balance, September 30	$	538		$	669

39

	Interest Rate Swap Liability
	2014			2013
	(In Thousands)
Balance, July 1	$	1,711		$	1,019
Change in fair value through earnings		(222	)		307
Balance, September 30	$	1,489		$	1,326

	Interest Rate Swap Liability
	2014			2013
	(In Thousands)
Balance, January 1	$	1,613		$	2,160
Change in fair value through earnings		(124	)		(834	)
Balance, September 30	$	1,489		$	1,326

Nonrecurring Measurements

The following tables present the fair value measurements of assets measured at fair value during the periods presented on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at September 30, 2014 and December 31, 2013:

			Fair Value Measurements Using
			Quoted prices
			in active
			markets		Other		Significant
			for identical		observable		unobservable
			assets		inputs		inputs
	Fair value		(Level 1)		(Level 2)		(Level 3)
	(In Thousands)
September 30, 2014
Impaired loans
One- to four-family residential construction	$	—	$	—	$	—	$	—
Subdivision construction		275		—		—		275
Land development		3,952		—		—		3,952
Owner occupied one- to four-family residential		1,505		—		—		1,505
Non-owner occupied one- to four-family residential		954		—		—		954
Commercial real estate		5,343		—		—		5,343
Other residential		—		—		—		—
Commercial business		317		—		—		317
Consumer auto		46		—		—		46
Consumer other		411		—		—		411
Home equity lines of credit		239		—		—		239
Total impaired loans	$	13,042	$	—	$	—	$	13,042
Foreclosed assets held for sale	$	1,887	$	—	$	—	$	1,887

40

December 31, 2013
Impaired loans
One- to four-family residential construction	$	—	$	—	$	—	$	—
Subdivision construction		145		—		—		145
Land development		1,474		—		—		1,474
Owner occupied one- to four-family residential		349		—		—		349
Non-owner occupied one- to four-family residential		388		—		—		388
Commercial real estate		5,224		—		—		5,224
Other residential		1,440		—		—		1,440
Commercial business		61		—		—		61
Consumer auto		19		—		—		19
Consumer other		275		—		—		275
Home equity lines of credit		70		—		—		70
Total impaired loans	$	9,445	$	—	$	—	$	9,445
Foreclosed assets held for sale	$	2,169	$	—	$	—	$	2,169

The following is a description of valuation methodologies used for assets measured at fair value on a nonrecurring basis and recognized in the accompanying statements of financial condition, as well as the general classification of such assets pursuant to the valuation hierarchy.

Loans Held for Sale.  Mortgage loans held for sale are recorded at the lower of carrying value or fair value.  The fair value of mortgage loans held for sale is based on what secondary markets are currently offering for portfolios with similar characteristics.  As such, the Company classifies mortgage loans held for sale as Nonrecurring Level 2.  Write-downs to fair value typically do not occur as the Company generally enters into commitments to sell individual mortgage loans at the time the loan is originated to reduce market risk.  The Company typically does not have commercial loans held for sale.  At September 30, 2014 and December 31, 2013, the aggregate fair value of mortgage loans held for sale exceeded their cost.  Accordingly, no mortgage loans held for sale were marked down and reported at fair value.

Impaired Loans.  A loan is considered to be impaired when it is probable that all of the principal and interest due may not be collected according to its contractual terms. Generally, when a loan is considered impaired, the amount of reserve required under FASB ASC 310, Receivables, is measured based on the fair value of the underlying collateral. The Company makes such measurements on all material loans deemed impaired using the fair value of the collateral for collateral dependent loans. The fair value of collateral used by the Company is determined by obtaining an observable market price or by obtaining an appraised value from an independent, licensed or certified appraiser, using observable market data. This data includes information such as selling price of similar properties and capitalization rates of similar properties sold within the market, expected future cash flows or earnings of the subject property based on current market expectations, and other relevant factors. All appraised values are adjusted for market-related trends based on the Company’s experience in sales and other appraisals of similar property types as well as estimated selling costs.  Each quarter management reviews all collateral dependent impaired loans on a loan-by-loan basis to determine whether updated appraisals are necessary based on loan performance, collateral type and guarantor support.  At times, the Company measures the fair value of collateral dependent impaired loans using appraisals with dates prior to one year from the date of review.  These appraisals are discounted by applying current, observable market data about similar property types such as sales contracts, estimations of value by individuals familiar with the market, other appraisals, sales or collateral assessments based on current market activity until updated appraisals are obtained.  Depending on the length of time since an appraisal was performed and the data provided through our reviews, these appraisals are typically discounted 10-40%.  The policy described above is the same for all types of collateral dependent impaired loans.

The Company records impaired loans as Nonrecurring Level 3. If a loan’s fair value as estimated by the Company is less than its carrying value, the Company either records a charge-off of the portion of the loan that exceeds the fair value or establishes a reserve within the allowance for loan losses specific to the loan.  Loans for which such charge-offs or reserves were recorded during the nine months ended September 30, 2014 or the year ended December 31, 2013, are shown in the table above (net of reserves).

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Foreclosed Assets Held for Sale.  Foreclosed assets held for sale are initially recorded at fair value less estimated cost to sell at the date of foreclosure.  Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less estimated cost to sell.  Foreclosed assets held for sale are classified as Level 3.  The foreclosed assets represented in the table above have been re-measured during the nine months ended September 30, 2014 or the year ended December 31, 2013, subsequent to their initial transfer to foreclosed assets.

The following disclosure relates to financial assets for which it is not practicable for the Company to estimate the fair value at September 30, 2014 and December 31, 2013.

FDIC Indemnification Asset: As part of the Purchase and Assumption Agreements, the Bank and the FDIC entered into loss sharing agreements. These agreements cover realized losses on loans and foreclosed real estate, subject to certain limitations which are more fully described in Note 8.

Under the TeamBank agreement, the FDIC agreed to reimburse the Bank for 80% of the first $115 million in realized losses and 95% for realized losses that exceed $115 million.  The indemnification asset was originally recorded at fair value on the acquisition date (March 20, 2009) and at September 30, 2014 and December 31, 2013, the carrying value was $775,000 and $1.3 million, respectively.

Under the Vantus Bank agreement, the FDIC agreed to reimburse the Bank for 80% of the first $102 million in realized losses and 95% for realized losses that exceed $102 million.  The indemnification asset was originally recorded at fair value on the acquisition date (September 4, 2009) and at September 30, 2014 and December 31, 2013, the carrying value of the FDIC indemnification asset was $844,000 and $2.3 million, respectively.

Under the Sun Security Bank agreement, the FDIC agreed to reimburse the Bank for 80% of realized losses.  The indemnification asset was originally recorded at fair value on the acquisition date (October 7, 2011) and at September 30, 2014 and December 31, 2013, the carrying value of the FDIC indemnification asset was $6.4 million and $10.4 million, respectively.

Under the InterBank agreement, the FDIC agreed to reimburse the Bank for 80% of realized losses.  The indemnification asset was originally recorded at fair value on the acquisition date (April 27, 2013) and at September 30, 2014 and December 31, 2013, the carrying value of the FDIC indemnification asset was $43.5 million and $58.8 million, respectively.

From the dates of acquisition, each of the four agreements extend ten years for 1-4 family real estate loans and five years for other loans.  The loss sharing assets are measured separately from the loan portfolios because they are not contractually embedded in the loans and are not transferable with the loans should the Bank choose to dispose of them.  Fair values on the acquisition dates were estimated using projected cash flows available for loss sharing based on the credit adjustments estimated for each loan pool and the loss sharing percentages.  These cash flows were discounted to reflect the uncertainty of the timing and receipt of the loss sharing reimbursements from the FDIC.  The loss sharing assets are also separately measured from the related foreclosed real estate.  Although the assets are contractual receivables from the FDIC, they do not have effective interest rates.  The Bank will collect the assets over the next several years.  The amount ultimately collected will depend on the timing and amount of collections and charge-offs on the acquired assets covered by the loss sharing agreements.  While the assets were recorded at their estimated fair values on the acquisition dates, it is not practicable to complete fair value analyses on a quarterly or annual basis.  Estimating the fair value of the FDIC indemnification asset would involve preparing fair value analyses of the entire portfolios of loans and foreclosed assets covered by the loss sharing agreements from all four acquisitions on a quarterly or annual basis.

Fair Value of Financial Instruments

The following methods were used to estimate the fair value of all other financial instruments recognized in the accompanying statements of financial condition at amounts other than fair value:

Cash and Cash Equivalents and Federal Home Loan Bank Stock. The carrying amount approximates fair value.

Loans and Interest Receivable.  The fair value of loans is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities.  Loans with similar characteristics are aggregated for purposes of the calculations.  The carrying amount of accrued interest receivable approximates its fair value.

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Deposits and Accrued Interest Payable.  The fair value of demand deposits and savings accounts is the amount payable on demand at the reporting date, i.e., their carrying amounts.  The fair value of fixed maturity certificates of deposit is estimated using a discounted cash flow calculation that applies the rates currently offered for deposits of similar remaining maturities.  The carrying amount of accrued interest payable approximates its fair value.

Federal Home Loan Bank Advances.  Rates currently available to the Company for debt with similar terms and remaining maturities are used to estimate fair value of existing advances.

Short-Term Borrowings.  The carrying amount approximates fair value.

Subordinated Debentures Issued to Capital Trusts.  The subordinated debentures have floating rates that reset quarterly.  The carrying amount of these debentures approximates their fair value.

Structured Repurchase Agreements.  Structured repurchase agreements are collateralized borrowings from a counterparty.  In addition to the principal amount owed, the counterparty also determines an amount that would be owed by either party in the event the agreement is terminated prior to maturity by the Company.  The fair values of the structured repurchase agreements are estimated based on the amount the Company would be required to pay to terminate the agreement at the reporting date.

Commitments to Originate Loans, Letters of Credit and Lines of Credit.  The fair value of commitments is estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present creditworthiness of the counterparties.  For fixed rate loan commitments, fair value also considers the difference between current levels of interest rates and the committed rates.  The fair value of letters of credit is based on fees currently charged for similar agreements or on the estimated cost to terminate them or otherwise settle the obligations with the counterparties at the reporting date.

The following table presents estimated fair values of the Company’s financial instruments.  The fair values of certain of these instruments were calculated by discounting expected cash flows, which method involves significant judgments by management and uncertainties.  Fair value is the estimated amount at which financial assets or liabilities could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.  Because no market exists for certain of these financial instruments and because management does not intend to sell these financial instruments, the Company does not know whether the fair values shown below represent values at which the respective financial instruments could be sold individually or in the aggregate.

	September 30, 2014						December 31, 2013
	Carrying		Fair		Hierarchy		Carrying		Fair		Hierarchy
	Amount		Value		Level		Amount		Value		Level
	(In Thousands)
Financial assets
Cash and cash equivalents	$	221,386	$	221,386		1	$	227,925	$	227,925		1
Held-to-maturity securities		450		505		2		805		912		2
Mortgage loans held for sale		30,361		30,361		2		7,239		7,239		2
Loans, net of allowance for loan losses		2,921,310		2,931,098		3		2,439,530		2,442,917		3
Accrued interest receivable		11,214		11,214		3		11,408		11,408		3
Investment in FHLB stock		12,013		12,013		3		9,822		9,822		3
Financial liabilities
Deposits		3,071,170		3,076,464		3		2,808,626		2,813,779		3
FHLB advances		190,664		193,004		3		126,757		131,281		3
Short-term borrowings		172,983		172,983		3		136,109		136,109		3
Structured repurchase agreements		—		—		3		50,000		53,485		3
Subordinated debentures		30,929		30,929		3		30,929		30,929		3
Accrued interest payable		1,024		1,024		3		1,099		1,099		3
Unrecognized financial instruments (net of
contractual value)
Commitments to originate loans		—		—		3		—		—		3
Letters of credit		31		31		3		76		76		3
Lines of credit		—		—		3		—		—		3

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NOTE 15:  DERIVATIVES AND HEDGING ACTIVITIES

Risk Management Objective of Using Derivatives

The Company is exposed to certain risks arising from both its business operations and economic conditions.  The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities.  The Company manages economic risks, including interest rate, liquidity and credit risk, primarily by managing the amount, sources and duration of its assets and liabilities.  In the normal course of business, the Company may use derivative financial instruments (primarily interest rate swaps) from time to time to assist in its interest rate risk management.  The Company has interest rate derivatives that result from a service provided to certain qualifying loan customers that are not used to manage interest rate risk in the Company’s assets or liabilities and are not designated in a qualifying hedging relationship.  The Company manages a matched book with respect to its derivative instruments in order to minimize its net risk exposure resulting from such transactions.  In addition, the Company has interest rate derivatives that are designated in a qualified hedging relationship.

Nondesignated Hedges

The Company has interest rate swaps that are not designated in qualifying hedging relationships.  Derivatives not designated as hedges are not speculative and result from a service the Company provides to certain loan customers, which the Company began offering during the fourth quarter of 2011.  The Company executes interest rate swaps with commercial banking customers to facilitate their respective risk management strategies.  Those interest rate swaps are simultaneously hedged by offsetting interest rate swaps that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions.  As the interest rate swaps associated with this program do not meet the strict hedge accounting requirements, changes in the fair value of both the customer swaps and the offsetting swaps are recognized directly in earnings.  As of September 30, 2014, the Company had 27 interest rate swaps totaling $127.9 million in notional amount with commercial customers, and 27 interest rate swaps with the same notional amount with third parties related to this program.  As of December 31, 2013, the Company had 24 interest rate swaps totaling $114.0 million in notional amount with commercial customers, and 24 interest rate swaps with the same notional amount with third parties related to this program.  In addition, seven interest rate swaps were added as a result of certain loans acquired in the Valley Bank transaction.  Valley’s program did not include back to back swaps with the customer; there is only a swap with a counterparty.  At September 30, 2014, the notional amount of these swaps was $7.8 million.  During the three months ended September 30, 2014 and 2013, the Company recognized a net gain of $10,000 and a net loss of $125,000, respectively, in noninterest income related to changes in the fair value of these swaps.  During the nine months ended September 30, 2014 and 2013, the Company recognized a net loss of $223,000 and a net gain of $283,000, respectively, in noninterest income related to changes in the fair value of these swaps.

Cash Flow Hedges

As a strategy to maintain acceptable levels of exposure to the risk of changes in future cash flows due to interest rate fluctuations, the Company entered into two interest rate cap agreements for a portion of its floating rate debt associated with its trust preferred securities.  The agreement with a notional amount of $25 million states that the Company will pay interest on its trust preferred debt in accordance with the original debt terms at a rate of 3-month LIBOR + 1.60%.  Should interest rates rise above a certain threshold, the counterparty will reimburse the Company for interest paid such that the Company will have an effective interest rate on that portion of its trust preferred securities no higher than 2.37%.  The second agreement with a notional amount of $5 million states that the Company will pay interest on its trust preferred debt in accordance with the original debt terms at a rate of 3-month LIBOR + 1.40%.  Should interest rates rise above a certain threshold, the counterparty will reimburse the Company for interest paid such that the Company will have an effective interest rate on that portion of its trust preferred securities no higher than 2.17%.  The agreements were effective on August 1, 2013 and July 1, 2013, respectively, and each has a term of four years.

The effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings.  Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings.

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The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Consolidated Statements of Financial Condition:

	Location in	Fair Value
	Consolidated Statements	September 30,		December 31,
	of Financial Condition	2014		2013
		(In Thousands)
Derivatives designated as
hedging instruments
Interest rate caps	Prepaid expenses and other assets	$	538	$	685
Total derivatives designated
as hedging instruments		$	538	$	685
Derivatives not designated
as hedging instruments
Asset Derivatives
Interest rate products	Prepaid expenses and other assets	$	1,512	$	1,859
Total derivatives not designated
as hedging instruments		$	1,512	$	1,859
Liability Derivatives
Interest rate products	Accrued expenses and other liabilities	$	1,489	$	1,613
Total derivatives not designated
as hedging instruments		$	1,489	$	1,613

The following table presents the effect of derivative instruments on the statements of comprehensive income for the three and nine months ended September 30, 2014 and 2013:

	Amount of Gain (Loss) Recognized in OCI
Cash Flow Hedges	Three Months Ended September 30,
	2014		2013
	(In Thousands)
Interest rate cap	$	53	$	(45	)

	Amount of Gain (Loss) Recognized in OCI
Cash Flow Hedges	Nine Months Ended September 30,
	2014			2013
	(In Thousands)
Interest rate cap	$	(90	)	$	(45	)

Agreements with Derivative Counterparties

The Company has agreements with its derivative counterparties.  If the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations.  If the Bank fails to maintain its status as a well-capitalized institution, then the counterparty could terminate the derivative positions and the Company would be required to settle its obligations under the agreements.  Similarly, the Company could be required to settle its obligations under certain of its agreements if certain regulatory events occurred, such as the issuance of a formal directive, or if the Company’s credit rating is downgraded below a specified level.

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As of September 30, 2014, the termination value of derivatives in a net liability position, which included accrued interest but excluded any adjustment for nonperformance risk, related to these agreements was $820,000.  The Company has minimum collateral posting thresholds with its derivative counterparties.  The Company’s activity with its derivative counterparties had previously met the level in which the minimum collateral posting thresholds take effect and the Company had posted $1.3 million of collateral to satisfy the agreements at September 30, 2014.  If the Company had breached any of these provisions at September 30, 2014, it could have been required to settle its obligations under the agreements at the termination value.

NOTE 16: FDIC-ASSISTED ACQUISITION

On June 20, 2014, Great Southern Bank entered into a purchase and assumption agreement with the FDIC to purchase a substantial portion of the loans and investment securities, as well as certain other assets, and assume all of the deposits, as well as certain other liabilities, of Valley Bank (“Valley”), a full-service bank headquartered in Moline, IL, with significant operations in Iowa.  The provisional fair values of the assets acquired and liabilities assumed in the transaction were as follows:

	June 20,
	2014
	(In Thousands)
Cash	$	2,729
Due from banks		106,680
Cash and cash equivalents		109,409
Investment securities		88,513
Loans receivable, net of discount on loans purchased of $30,102		165,098
Accrued interest receivable		1,004
Premises		10,850
Core deposit intangible		2,800
Other assets		1,060
Total assets acquired		378,734
Liabilities
Demand and savings deposits		186,902
Time deposits		179,125
Total deposits		366,027
Securities sold under reverse repurchase agreements with customers		567
Accounts payable		561
Accrued interest payable		182
Advances from borrowers for taxes and insurance		592
Total liabilities assumed		367,929
Gain recognized on business acquisition	$	10,805

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Under the terms of the Purchase and Assumption Agreement, the FDIC agreed to transfer net assets to Great Southern at a discount of $37.5 million to compensate Great Southern for estimated losses related to the loans acquired.  No premium was paid to the FDIC for the deposits, resulting in a net purchase discount of $37.5 million.  Details related to the transfer are as follows:

	June 20,
	2014
	(In Thousands)
Net liabilities as determined by the FDIC	$	(21,897	)
Cash transferred by the FDIC		59,394
Discount per Purchase and Assumption Agreement		37,497
Purchase accounting adjustments
Loans		(28,088	)
Deposits		(399	)
Investments		(1,005	)
Core deposit intangible		2,800
Gain recognized on business acquisition	$	10,805

The acquisition of the net assets of Valley was determined to constitute a business acquisition in accordance with FASB ASC 805.  FASB ASC 805 allows a measurement period of up to one year to adjust initial fair value estimates as of the acquisition date.  Therefore, provisional measurements of assets acquired and liabilities assumed were recorded on a preliminary basis at fair value on the date of acquisition.  Based upon the preliminary acquisition date fair values of the net assets acquired, no goodwill was recorded.  The transaction resulted in a preliminary bargain purchase gain of $10.8 million for the three months ended June 30, 2014.  The transaction also resulted in the recording of a deferred tax liability in the initial amount of $3.6 million.

The carrying amount of assets related to the Valley Bank transaction at June 20, 2014 (the acquisition date), consisted of impaired loans required to be accounted for in accordance with FASB ASC 310-30 and other loans not subject to the specific criteria of FASB ASC 310-30, but accounted for under the guidance of FASB ASC 310-30 (FASB ASC 310-30 by Policy Loans) as shown in the following table:

			FASB ASC
	FASB		310-30
	ASC		by
	310-30		Policy
	Loans		Loans			Total
	(In Thousands)
Loans	$	3,920	$	161,178	$	165,098

On the acquisition date, the preliminary estimate of the contractually required payments receivable for all FASB ASC 310-30 loans acquired was $5.7 million, the cash flows expected to be collected were $4.0 million including interest, and the estimated fair value of the loans was $3.9 million.  These amounts were determined based upon the estimated remaining life of the underlying loans, which include the effects of estimated prepayments.  At June 20, 2014, a majority of these loans were valued based on the liquidation value of the underlying collateral, because the expected cash flows were primarily based on the liquidation of underlying collateral and the timing and amount of the cash flows could not be reasonably estimated.

On the acquisition date, the preliminary estimate of the contractually required payments receivable for all FASB ASC 310-30 by Policy Loans acquired in the acquisition was $187.4 million, of which $28.4 million of cash flows were not expected to be collected, and the estimated fair value of the loans was $161.2 million.  A majority of these loans were valued as of their acquisition dates based on the liquidation value of the underlying collateral, because the expected cash flows were primarily based on the liquidation of underlying collateral and the timing and amount of the cash flows could not be reasonably estimated.

At September 30, 2014, the Company has finalized its initial analysis of these loans without adjustments to the preliminary estimated recorded carrying values.

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The amount of the estimated cash flows expected to be received from the acquired loan pools in excess of the fair values recorded for the loan pools is referred to as the accretable yield.  The accretable yield is recognized as interest income over the estimated lives of the loans.  The initial accretable yield recorded for Valley was $23.0 million.  The amount accreted to income during the three and nine months ended September 30, 2014 was $2.1 million and $2.2 million, respectively.  The net remaining accretable yield at September 30, 2014 was $20.7 million.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

Forward-looking Statements

When used in this Quarterly Report on Form 10-Q and in other documents filed or furnished by 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) non-interest expense reductions from the Great Southern banking center consolidation might be less than anticipated and the costs of the consolidation and impairment of the value of the affected premises might be greater than expected; (ii) expected cost savings, synergies and other benefits from the Company’s merger and acquisition activities, including but not limited to the recently completed Valley Bank FDIC-assisted transaction, might not be realized within the anticipated time frames or at all, the amount of the gain the Company ultimately recognizes from the recently completed Valley Bank FDIC-assisted transaction might be materially different from the preliminary gain recorded, and costs or difficulties relating to integration matters, including but not limited to customer and employee retention, might be greater than expected; (iii) changes in economic conditions, either nationally or in the Company’s market areas; (iv) fluctuations in interest rates; (v) 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; (vi) the possibility of other-than-temporary impairments of securities held in the Company’s securities portfolio; (vii) the Company’s ability to access cost-effective funding; (viii) fluctuations in real estate values and both residential and commercial real estate market conditions; (ix) demand for loans and deposits in the Company’s market areas; (x) legislative or regulatory changes that adversely affect the Company’s business, including, without limitation, the Dodd-Frank Wall Street Reform and Consumer Protection Act and its implementing regulations, and the overdraft protection regulations and customers’ responses thereto; (xi) monetary and fiscal policies of the Federal Reserve Board and the U.S. Government and other governmental initiatives affecting the financial services industry; (xii) results of examinations of the Company and Great Southern by their regulators, including the possibility that the regulators may, among other things, require the Company to increase its allowance for loan losses or to write-down assets; (xiii) the uncertainties arising from the Company’s participation in the Small Business Lending Fund program, including uncertainties concerning the potential future redemption by us of the U.S. Treasury’s preferred stock investment under the program, including the timing of, regulatory approvals for, and conditions placed upon, any such redemption; (xiv) costs and effects of litigation, including settlements and judgments; and (xv) 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.

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

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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.

Additional discussion of the allowance for loan losses is included in "Item 1. Business - Allowances for Losses on Loans and Foreclosed Assets." 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 have to 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. For the periods included in the financial statements contained in this report, management's overall methodology for evaluating the allowance for loan losses has not changed significantly.

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 and Indemnification Asset

The Company considers that the determination of the carrying value of loans acquired in the FDIC-assisted transactions and the carrying value of the related FDIC indemnification assets involve a high degree of judgment and complexity. The carrying value of the acquired loans and the FDIC indemnification assets reflect management’s best ongoing estimates of the amounts to be realized on each of these assets. The Company determined initial fair value accounting estimates of the assumed assets and liabilities in accordance with FASB ASC 805, Business Combinations. However, the amount that the Company realizes on these 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 should not incur any significant losses related to these assets. To the extent the actual values realized for the acquired loans are different from the estimates, the indemnification asset will generally be impacted in an offsetting manner due to the loss sharing support from the FDIC.  Subsequent to the initial valuation, the Company continues to monitor identified loan pools and related loss sharing assets 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 8 “Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets” included in Item 1 for additional information regarding the TeamBank, Vantus Bank, Sun Security Bank, InterBank and Valley Bank FDIC-assisted transactions.

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 September 30, 2014, the Company has 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 amount 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. Intangible assets that are not amortized will be tested for impairment at least annually by comparing the fair values of those assets to their carrying values. At September 30, 2014, goodwill consisted of $1.2 million at the Bank reporting unit.  Goodwill increased $790,000 during the nine months ended September 30, 2014,

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due to the acquisition of certain loans, deposits and other assets of Boulevard Bank.  Other identifiable intangible assets that are subject to amortization are amortized on a straight-line basis over a period of seven years. At September 30, 2014, the amortizable intangible assets consisted of core deposit intangibles of $6.8 million, including $2.7 million related to the Valley Bank transaction in June 2014.  These amortizable intangible assets are reviewed for impairment if circumstances indicate their value may not be recoverable based on a comparison of fair value.

While the Company believes no impairment existed at September 30, 2014, 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.

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.

The previous economic downturn elevated unemployment levels and negatively impacted consumer confidence.  It also had a detrimental impact on industry-wide performance nationally as well as the Company's Midwest market areas.  Since 2012, improvement in several economic indicators have been noted, including increasing consumer confidence levels, increased economic activity and a continued decline in unemployment levels.

The national unemployment rate decreased from 6.7% as of December 2013 to 5.9% in September 2014.  Unemployment levels as of September 2014 decreased from the December 2013 levels in all but two of the states in which Great Southern has offices.  All but two states boasted unemployment levels lower or equal to the national unemployment rate.  Unemployment rates as of September 2014 follow: Missouri at 6.3%, Arkansas at 6.2%, Kansas at 4.8%, Iowa at 4.6%, Nebraska at 3.6%, Minnesota at 4.1%, Oklahoma at 4.7% and Texas at 5.2%.  Four of these eight states had unemployment rates among the eleven lowest in the country.  Of the larger metropolitan areas in which Great Southern does business (based on September 2014 information), the St. Louis market area continues to carry the highest level of unemployment at 6.3%, which is a decrease from the 6.6% rate reported as of December 2013. The unemployment rate at 5.1% for the Springfield market area was well below national and state unemployment averages.  Metropolitan areas in Iowa and Nebraska boasted unemployment levels ranging from 2.8% - 4.4%, ranking them among the lowest unemployment levels in the nation. 

Annualized, inflation-adjusted GDP growth settled at 4.6% in the second quarter of 2014, rebounding from a negative first quarter (which was attributed partially to adverse weather conditions).  The growth exceeded market expectation, particularly considering international headlines.  The ABA’s Economic Advisory Committee, a council of 14 chief economists from large banking organizations, has forecasted real GDP rising 3% for the remainder of 2014, with the unemployment rate trending lower.  The improvement in economic factors has allowed policy makers to scale back on economic stimuli put in place in past years to combat financial turmoil.  The Federal Reserve completed its bond purchase program in October 2014 and we believe that increases in short-term interest rates could begin around the middle of 2015.

Consumer confidence continues to contribute heavily to GDP growth with consumer spending gaining momentum based on July and August retail sales. Consumer confidence rebounded in October 2014 based on a more favorable assessment of the current job market and business conditions with the Consumer Sentiment index survey published by Thomson Reuters/University of Michigan indicating levels exceeding analysts’ expectations and marking the highest level since July 2007.

Sales of new single-family houses reached a six-year high in September, hitting an annual pace of 467,000 units.  New home sales in September were 0.2% above the pace of revised August sales.  The Midwest region saw the largest improvement at 12.3%.

The median sales price of new houses sold in September 2014 was $259,000; the average sales price was $313,200.  The seasonally adjusted estimate of new houses for sale at the end of September was 207,000 which represented a supply of 5.3 months at the current sales rate.

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Existing-home sales rose 2.4% in September 2014 to a seasonally adjusted rate of 5.17 million units annually, according to the National Association of Realtors.  National sales were at their highest pace of the year but remain 1.7% below last year’s level.  In the Midwest, existing home sales declined 5.6% to a level of 1.17 million units in September reflecting a 4.9% decline from September 2013.   The median price in the Midwest was $165,100, up 4.9% from a year ago.  Overall, pending home sales rose nationally in September 2014 reflecting a 1% increase from the same time frame in 2013.

The 30-year fixed mortgage rate averaged 3.97% during the week of October 12 – 18, 2014, its lowest level since June 2013. 

Permit activity continues to be constrained at least partially due to smaller builders’ limited access to credit, builder concerns about the re-emergence of entry-level consumers to the market in the face of student debt and tighter credit underwriting standards and a general decline in affordability and purchase power over the last year. While tight inventories will help to sustain price growth, it also limits turnover and could further erode affordability. Without a stronger response from home builders, consumers may struggle with options and affordability if income growth cannot compensate. For our market areas, permit activity annualized through September 2014 indicates a potential increase of 10% over 2013 levels.  These numbers may fluctuate significantly based on a variety of factors.

The performance of commercial real estate markets also improved substantially in the Company’s market areas as shown by increased real estate sales activity and financing of those activities. According to real estate services firm CoStar Group, retail, office and industrial types of commercial real estate properties continue to show improvement in occupancy, absorption and rental income, both nationally and in our market areas.

While current economic indicators for the Midwest show improvement in employment, housing starts and prices, commercial real estate occupancy, absorption and rental income, our management will continue to closely monitor regional, national and global economic conditions as these could have significant impacts on our market areas.

General

The profitability of the Company and, more specifically, the profitability of its primary subsidiary, Great Southern Bank (the "Bank"), depends 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 loan 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.

In the nine months ended September 30, 2014, Great Southern's total assets increased $349.2 million, or 9.8%, from $3.56 billion at December 31, 2013, to $3.91 billion at September 30, 2014. Full details of the current period changes in total assets are provided in the “Comparison of Financial Condition at September 30, 2014 and December 31, 2013” section of this Quarterly Report on Form 10-Q. 

Loans.  In the nine months ended September 30, 2014, net loans increased $481.8 million, or 19.8%, from $2.44 billion at December 31, 2013, to $2.92 billion at September 30, 2014.  Partially offsetting the increases in loans were decreases of $40.7 million in the FDIC-covered loan portfolios.  The net carrying value of the loans acquired in the Valley Bank transaction (acquired non-covered loans) was $152.5 million at September 30, 2014.  Excluding acquired covered loans, acquired non-covered loans and mortgage loans held for sale, total loans increased $367.7 million from December 31, 2013 to September 30, 2014, with increases in several loan types.  The increase was primarily due to the Valley Bank acquisition and loan growth in our existing banking center network, as well as loans originated through our new commercial loan production offices in Tulsa, Okla., and Dallas, Texas.  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, we cannot be assured that our loan growth will match or exceed the level of increases achieved in this period or prior years.  The Company's strategy continues to be focused on maintaining credit risk and interest rate risk at appropriate levels.

Loan growth has occurred in several loan types and has come from most of Great Southern’s primary lending locations, including Springfield, St. Louis, Kansas City, Des Moines, Omaha and Minneapolis.  The lending offices in Dallas and Tulsa have now been open for several months and are generating new loans as well.  Net loan balances have increased primarily in the areas of commercial real estate, commercial construction and consumer loans.  Generally, the Company considers these types of 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, and has established certain minimum underwriting standards to assure portfolio quality.  For commercial real estate and construction loans, these standards and procedures include, but are not limited to, an analysis of the borrower’s financial condition, collateral, repayment ability, verification of liquid assets and credit history as required by loan type.  In addition, geographic diversity of collateral, lower loan-to-value ratios and limitations on speculative construction projects help to mitigate overall risk in these loans.  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.  Underwriting standards also include loan-to-value ratios which vary depending on collateral type, debt service coverage ratios or debt payment to income ratios, where applicable, credit histories, use of guaranties and other recommended terms

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relating to equity requirements, amortization, and maturity. Great Southern’s loan committee reviews and approves all new loan originations in excess of lender approval authorities. Consumer loans are primarily secured by used motor vehicles and these loans are also subject to certain minimum underwriting standards to assure portfolio quality. Great Southern’s consumer underwriting and pricing standards have been fairly consistent over the past several years. 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. Although creditworthiness of the applicant is of primary consideration, the underwriting process also includes a comparison of the value of the security, if any, in relation to the proposed loan amount. See “ITEM 1. BUSINESS – Lending Activities – General, – Commercial Real Estate and Construction Lending, and – Consumer Lending” in the Company’s December 31, 2013 Annual Report on Form 10-K.

While our policy allows us to lend up to 90% of the appraised value on single-family properties, originations of loans with loan-to-value ratios at those levels are minimal. When they are made at those levels, private mortgage insurance is typically required for loan amounts above the 80% level unless our analysis determines minimal additional risk to be involved; therefore, these loans are not considered to have more risk to us than other residential loans.  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 September 30, 2014 and December 31, 2013, an estimated 0.3% and 0.4%, respectively, of total owner occupied one- to four-family residential loans had loan-to-value ratios above 100% at origination.  At September 30, 2014 and December 31, 2013, an estimated 1.8% and 0.5%, respectively, of total non-owner occupied one- to four-family residential loans had loan-to-value ratios above 100% at origination.

At September 30, 2014, troubled debt restructurings totaled $52.1 million, or 1.8% of total loans, down $2.0 million from $54.1 million, or 2.3% of total loans, at December 31, 2013.  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.  While the types of concessions made have not changed as a result of the economic recession, the number of concessions granted has increased as reflected in the continued high level of troubled debt restructurings.  Generally, the total dollar amount of new troubled debt restructurings has been less in 2013 and 2014 than it was in the years 2008 through 2012.  During the three months ended September 30, 2014, no loans were restructured into multiple new loans.  During the nine months ended September 30, 2014, two loans totaling $337,000 were each restructured into multiple new loans.  During the year ended December 31, 2013, four loans totaling $3.5 million were each restructured into multiple new loans.  For further information on troubled debt restructurings, see Note 7 of the Notes to Consolidated Financial Statements contained in this report.

The loss sharing agreements with the FDIC are subject to limitations on the types of losses covered and the length of time losses are covered, and are conditioned upon the Bank complying with its requirements in the agreements with the FDIC, including requirements regarding servicing and other loan administration matters.  The loss sharing agreements extend for ten years for single family real estate loans and for five years for other loans.  At September 30, 2014, approximately four and one half years remained on the loss sharing agreement for single family real estate loans acquired from TeamBank and the remaining loans had an estimated average life of two to ten years.  At September 30, 2014, approximately five years remained on the loss sharing agreement for single family real estate loans acquired from Vantus Bank and the remaining loans had an estimated average life of three to twelve years.  At September 30, 2014, approximately seven years remained on the loss sharing agreement for single family real estate loans acquired from Sun Security Bank and the remaining loans had an estimated average life of four to twelve years.  At September 30, 2014, approximately seven and one half years remained on the loss sharing agreement for single family real estate loans acquired from InterBank and the remaining loans had an estimated average life of six to thirteen years.  The loss sharing agreement for non-single-family loans acquired from TeamBank ended on March 31, 2014.  Any additional losses subsequent to that date in the non-single-family TeamBank portfolio are not be eligible for loss sharing coverage.  The remaining loans in the portfolio had an estimated average life of two to seven years and had a carrying value of $28.3 million at September 30, 2014.  The loss sharing agreement for non-single-family loans acquired from Vantus Bank ended on September 30, 2014.  Going forward, any additional losses in the non-single-family Vantus Bank portfolio will not be eligible for loss sharing coverage.  The remaining loans in the portfolio had an estimated average life of one to seven years and had a carrying value of $23.5 million at September 30, 2014.  At September 30, 2014, approximately two years remained on the loss sharing agreement for non-single-family loans acquired from Sun Security Bank and the remaining loans had an estimated average life of one to two years.  At September 30, 2014, approximately two and one half years remained on the loss sharing agreement for non-single-family loans acquired from InterBank and the remaining loans had an estimated average life of two to four years.  While the expected repayments for certain of the acquired loans extend beyond the terms of the loss sharing agreements, the Bank has identified and will continue to identify problem loans and will make every effort to resolve them within the time limits of the agreements.  The Company may sell any loans remaining at the end of the loss sharing agreement subject to the approval of the FDIC.  Acquired loan pools are currently included in the analysis and estimation of the allowance for loan losses.  However, when the loss sharing agreements end, the allowance for loan losses related to any acquired loans retained in the portfolio may need to increase if additional weakness or losses are determined to be in the portfolio subsequent to the end of the loss sharing agreements.  The loss sharing agreements and their related limitations are described in detail in Note 8 of the Notes to Consolidated Financial Statements contained in this report. 

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.  

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Available-for-sale Securities.  In the nine months ended September 30, 2014, Great Southern's available-for-sale securities decreased $130.1 million, or 23.4%, from $555.3 million at December 31, 2013, to $425.2 million at September 30, 2014.  The decrease was primarily due to the sale of the Company’s Small Business Administration loan pools securities and other mortgage-backed securities during the period and normal monthly payments received related to the portfolio of mortgage-backed securities.  The Small Business Administration securities were sold at a gain of $569,000.  The Valley Bank securities acquired in June 2014 were sold in July 2014 at a gain of approximately $175,000.

Cash and Cash Equivalents.  Great Southern had cash and cash equivalents of $221.4 million at September 30, 2014, a decrease of $6.5 million, or 2.9%, from $227.9 million at December 31, 2013.  The decrease in cash and cash equivalents was primarily due to the repayment of $130 million of Federal Home Loan Bank (FHLBank) advances and structured repurchase agreements and the origination of new loans. Offsetting these decreases were increases of $109 million of cash and cash equivalents received in the Valley Bank FDIC-assisted acquisition in June 2014, $80 million of cash received related to the Boulevard Bank transaction in March 2014, and proceeds received from the sale of certain of the Company’s investment securities during the period.

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 nine months ended September 30, 2014, total deposit balances increased $262.5 million, or 9.4%.  Approximately $366 million of deposits were acquired in the FDIC-assisted acquisition of Valley Bank in June 2014.  Approximately $92 million of deposits were acquired in the Boulevard Bank transaction in March 2014.  Transaction account balances increased $131.9 million to $1.95 billion at September 30, 2014, up from $1.81 billion at December 31, 2013, while retail certificates of deposit increased $70.0 million to $937.6 million at September 30, 2014, up from $867.6 million at December 31, 2013.  In addition, at September 30, 2014 and December 31, 2013, Bank customer deposits totaling $37.0 million and $76.3 million, respectively, were part of the CDARS program which allows Bank customers to maintain balances in an insured manner that would otherwise exceed the FDIC deposit insurance limit. The FDIC counts these deposits as brokered, but these are deposit accounts that we generate with customers in our local markets.  Brokered deposits were $150 million at September 30, 2014, an increase of $100 million from $50 million at December 31, 2013.  The Company elected to increase brokered deposits to fund a portion of its loan growth during the period.

While deposits acquired during the nine months ended September 30, 2014, totaled $458 million, total deposit balances increased $262 million during this same period.  Deposits obtained in the Valley Bank transaction totaling $114 million included certificates of deposit generated through internet bulletin boards.  The Company was allowed to reduce the rate paid on these deposits and did so.  In turn, the customer was allowed to withdraw these funds without penalty.  Approximately $80 million of these deposits were withdrawn through September 30, 2014.  Additionally, deposit balances have decreased as the Company has elected to reduce interest rates on certain types of certificates of deposit, as well as certain types of NOW and money market accounts, including accounts with collateralized deposit balances.

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.  Because the Federal Funds rate is already very low, there may be a negative impact on the Company’s net interest income due to the Company’s inability to lower its funding costs significantly in the current low interest rate environment, although interest rates on assets may decline further.  The level of competition for deposits in our markets is high. While it is our goal to gain deposit market share, particularly checking accounts, in our branch footprint, we cannot be assured of this in future periods.  In addition, while we have been generally lowering our deposit rates over the past several quarters, increasing rates paid on deposits can attract deposits if needed; however, this 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. 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.

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 portion of our loan portfolio is tied to the "prime rate" and adjusts immediately when this rate adjusts (subject to the effect of loan interest rate floors, 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 may be impacted by changes in the cash flows expected to be received from acquired loan pools.  As described in Note 8 of the Notes to the Consolidated

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Financial Statements contained in this report, the Company’s evaluation of cash flows expected to be received from acquired loan pools is on-going and increases in cash flow expectations are recognized as increases in accretable yield through interest income.  Decreases in cash flow expectations are 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. The FRB last changed interest rates on December 16, 2008. Great Southern has a significant portfolio of loans which are tied to a "prime rate" of interest. Most of these loans are tied to some national index of "prime," while some are indexed to "Great Southern prime." The Company has elected to leave its “Great Southern prime rate” of interest at 5.00%. This does not affect a large number of customers, as a majority of the loans indexed to “Great Southern prime” are already at interest rate floors which are provided for in individual loan documents. But for the interest rate floors, 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 which generally adjust immediately as the Federal Funds rate adjusts. Loans at their floor rates are subject to the risk that borrowers will seek to refinance elsewhere at the lower market rate, however.  Because the Federal Funds rate is already very low, there may also be a negative impact on the Company's net interest income due to the Company's inability to lower its funding costs significantly in the current environment, although interest rates on assets may decline further. Conversely, interest rate increases would normally result in increased interest rates on our prime-based loans.  The interest rate floors in effect may limit the immediate increase in interest rates on these loans, until such time as rates rise above the floors.  However, the Company may have to increase rates paid on deposits to maintain deposit balances and pay higher rates on borrowings.  The impact of the low rate environment on our net interest margin in future periods is expected to be fairly neutral.  As our time deposits mature in future periods, may be able to reduce rates somewhat as they renew.  However, any margin gained by these rate reductions is likely to be offset by reduced yields from our investment securities and our existing loan portfolio as payments are made and the proceeds are potentially reinvested at lower rates. Interest rates on adjustable rate loans may reset lower according to their contractual terms and new loans may be originated at lower market rates.  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.”

The negative impact of declining loan interest rates has been mitigated by the positive effects of the Company’s loans which have interest rate floors. At September 30, 2014, the Company had a portfolio (excluding the loans acquired in the FDIC-assisted transactions) of prime-based loans totaling approximately $504 million with rates that change immediately with changes to the prime rate of interest.  Of those loans, $475 million also had interest rate floors. These floors were at varying rates, with $15 million of these loans having floor rates of 7.0% or greater and another $251 million of these loans having floor rates between 5.0% and 7.0%. In addition, $209 million of these loans have floor rates between 2.75% and 5.0%.  At September 30, 2014, all of these loans were at their floor rates.  At September 30, 2014, the Company had a portfolio (excluding the loans acquired in the FDIC-assisted transactions) of GSB prime-based loans totaling approximately $215 million with rates that change immediately with changes to the GSB prime rate of interest.  Of those loans, $202 million also had interest rate floors.  At September 30, 2014, all of these loans were at their floor rates.  The loan yield for the total loan portfolio was approximately 153 basis points and 185 basis points higher than the national "prime rate of interest" at September 30, 2014 and December 31, 2013, respectively, partly because of these interest rate floors. While interest rate floors have had an overall positive effect on the Company’s results during this period, they do subject the Company to the risk that borrowers will elect to refinance their loans with other lenders.  To the extent economic conditions improve, the risk that borrowers will seek to refinance their loans increases.

Non-Interest Income and 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, accretion income (net of amortization) related to the FDIC-assisted acquisitions, late charges and prepayment fees on loans, gains on sales of loans and available-for-sale investments and other general operating income.  In 2014 and 2013, increases in the cash flows expected to be collected from the FDIC-covered loan portfolios resulted in amortization (expense) recorded relating to reductions of expected reimbursements under the loss sharing agreements with the FDIC, which are recorded as indemnification assets.  Non-interest income may also be affected by the Company's interest rate hedging activities, if the Company chooses to implement hedges.  See Note 15 “Derivatives and Hedging Activities” in the Notes to Consolidated Financial Statements included in Item 1 of this Quarterly Report on Form 10-Q for additional information regarding the Bank’s hedging activities.

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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 and Nine Months Ended September 30, 2014 and 2013” section of this Quarterly Report on Form 10-Q.

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.

Significant Legislation Impacting the Financial Services Industry. On July 21, 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 implements far-reaching changes across the financial regulatory landscape, including provisions that, among other things, centralize responsibility for consumer financial protection by creating a new agency, the Consumer Financial Protection Bureau, with broad rulemaking authority for a wide range of consumer protection laws that apply to all banks, require new capital rules (discussed below), change the assessment base for federal deposit insurance, repeal the federal prohibitions on the payment of interest on demand deposits, amend the account balance limit for federal deposit insurance protection, and increase the authority of the Federal Reserve Board to examine the Company and its non-bank subsidiaries.

Many aspects of the Dodd-Frank Act are subject to rulemaking and will take effect over several years, making it difficult to anticipate the overall financial impact on the Company and the financial services industry more generally. Provisions in the legislation that affect deposit insurance assessments, and payment of interest on demand deposits could increase the costs associated with deposits. Provisions in the legislation that require revisions to the capital requirements of the Company and the Bank could require the Company and the Bank to seek additional sources of capital in the future.

A provision of the Dodd-Frank Act, commonly referred to as the “Durbin Amendment,” directed the FRB to analyze the debit card payments system and fix the interchange rates based upon their estimate of actual costs. The FRB has established the interchange rate for all debit transactions for issuers with over $10 billion in assets, effective October 1, 2011, at $0.21 per transaction. An additional five basis points of the transaction amount and an additional $0.01 may be collected by the issuer for fraud prevention and recovery, provided the issuer performs certain actions. Although the Bank is currently exempt from the provisions of the rule on the basis of asset size, there is some uncertainty about the long-term impact there will be on the interchange rates for issuers below the $10 billion level of assets.

New Capital Rules. The federal banking agencies have adopted new regulatory capital rules that substantially amend the risk-based capital rules applicable to the Bank and the Company. The new rules would 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 new rules is January 1, 2015, and, for certain provisions, various phase-in periods and later effective dates apply. The chief features of the new rules are summarized below.

The new 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 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 new rules include a capital conservation buffer, under which a banking organization must have capital more than 2.5% above each of its minimum risk-based capital ratios in order to avoid restrictions on paying dividends, engaging in share repurchases, and paying certain discretionary bonuses.

Effective January 1, 2015, the new rules also revise 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 new prompt corrective action requirements, insured depository institutions would be required to meet the following in order to qualify as “well capitalized:” (i) a common equity Tier 1 risk-based capital ratio of at least 6.5%; (ii) a Tier 1

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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 at least 5%.

Basel III also contains provisions on liquidity including complex criteria establishing a liquidity coverage ratio (“LCR”) and net stable funding ratio (“NSFR”). The purpose of the LCR is to ensure that a bank maintains adequate unencumbered, high quality liquid assets to meet its liquidity needs for 30 days under a severe liquidity stress scenario. The purpose of the NSFR is to promote more medium and long-term funding of assets and activities, using a one-year horizon. The federal banking agencies published proposed regulations on these provisions of Basel III on October 24, 2012. As proposed, these regulations will not apply to a bank holding company that has less than $50 billion of total consolidated assets and is not internationally active.

Business Initiatives

On June 20, 2014, Great Southern Bank entered into a purchase and assumption agreement (with no loss sharing agreement) with the Federal Deposit Insurance Corporation to acquire certain loans and other assets and assume all of the deposits of Valley Bank, a full-service bank headquartered in Moline, Ill., with significant operations in Iowa. The Company converted the Valley Bank operational systems into Great Southern’s systems on October 24, 2014, which allowed all Great Southern and former Valley Bank customers to conduct business at any banking center throughout the Great Southern six-state retail franchise. Upon completion of the operational conversion, back office operations were consolidated. At the time of the acquisition, Valley Bank operated 13 locations – six locations in the Quad Cities market area and seven in central Iowa, primarily in the Des Moines market area. In September, the Company closed two former Valley Bank locations – one in Moline, Ill., and one in Altoona, Iowa. On October 27, 2014, a new banking center in Ames, Iowa was opened, replacing the previously leased former Valley Banking office. The new Ames location at 402 Lincoln Way provides much better access and visibility.

Other banking center network initiatives include the following:

· In September 2014, two banking centers were closed - one in Lamar, Mo., and one in Johnston, Iowa.  Both of these offices were leased and were underutilized.  Customer accounts have been moved to other Great Southern locations.

· Construction of a full-service banking center in Columbia, Mo., is underway.  The new banking center site is located at 3200 S. Providence Road and is expected to open late in the first quarter of 2015.

· The Company recently purchased a 20,000-square-foot former bank office building in Leawood, Johnson County, Kan., a suburb of the Kansas City metropolitan market area. Scheduled to be open for business in mid-2015, the office will house the Kansas City commercial lending group, currently located in nearby Overland Park, Kan., and a retail banking center.  Additional space in the building is leased to tenants unrelated to the Company.

To enhance customer service, the Company is currently implementing “instant issue” technology in its banking center network so that customers can conveniently receive a fully activated debit card at the time of their visit. Well over half of Great Southern banking centers now have instant issue capabilities. The project is expected to be complete by the end of 2014.

Comparison of Financial Condition at September 30, 2014 and December 31, 2013

During the nine months ended September 30, 2014, the Company’s total assets increased by $349.2 million to $3.91 billion.  The majority of the increase was attributable to the FDIC-assisted acquisition of Valley Bank and an increase in loans originated by the Bank, partially offset by a reduction in available-for-sale investment securities.

Net loans increased $481.8 million from December 31, 2013, to $2.92 billion at September 30, 2014.  Excluding acquired covered loans, acquired non-covered loans and mortgage loans held for sale, total loans increased $367.7 million from December 31, 2013, to September 30, 2014, with increases primarily in the areas of commercial real estate loans, construction loans, consumer loans, commercial business loans and other residential loans.  Partially offsetting these increases were decreases in net loans acquired in the 2009, 2011 and 2012 FDIC-assisted transactions of $40.7 million, or 10.5%.  The net carrying value of the loans acquired in the Valley transaction was $152.5 million

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at September 30, 2014.  The Company's strategy continues to be focused on maintaining credit risk and interest rate risk at appropriate levels given the current credit and economic environments. 

The Company's available-for-sale securities decreased $130.1 million compared to December 31, 2013.  The decrease was due to the sale of the Company’s Small Business Administration loan pools securities and certain mortgage-backed securities during the period and normal monthly payments received related to the portfolio of mortgage-backed securities.  The Small Business Administration securities were sold at a gain of $569,000.  The Valley securities acquired in June 2014 were sold in July 2014 at a gain of approximately $175,000.

The FDIC indemnification asset decreased $21.1 million from December 31, 2013, partially due to the billing and collection of realized losses from the FDIC and primarily due to estimated improved cash flows to be collected from the loan obligors, resulting in reductions in payments expected to be received from the FDIC.  The expected cash flows are further discussed in Note 8 of the Notes to Consolidated Financial Statements.

Total liabilities increased $320.8 million from $3.18 billion at December 31, 2013 to $3.50 billion at September 30, 2014.  The increase was primarily attributable to increases in deposits and Federal Home Loan Bank advances, offset by decreases in structured repurchase agreements.  Total deposits increased $262.5 million from December 31, 2013.  The increases were primarily due to deposits acquired in the FDIC-assisted acquisition of Valley Bank in June 2014 and the acquisition of deposits from Boulevard Bank in March 2014.  Transaction account balances increased $131.9 million to $1.95 billion at September 30, 2014, up from $1.81 billion at December 31, 2013, while retail certificates of deposit increased $70.0 million to $937.6 million at September 30, 2014, up from $867.6 million at December 31, 2013.  In addition, at September 30, 2014 and December 31, 2013, Bank customer deposits totaling $37.0 million and $76.3 million, respectively, were part of the CDARS program which allows Bank customers to maintain balances in an insured manner that would otherwise exceed the FDIC deposit insurance limit. The FDIC counts these deposits as brokered, but these are deposit accounts that we generate with customers in our local markets. The Company decreased interest rates offered on CDARS customer deposits during the nine months ended September 30, 2014.  Brokered deposits were $150 million at September 30, 2014, an increase of $100 million from $50 million at December 31, 2013.  The Company elected to increase brokered deposits to fund a portion of its loan growth during the period.

Federal Home Loan Bank advances increased $63.9 million from $126.8 million at December 31, 2013 to $190.7 million at September 30, 2014.  The increase was due to an additional $149 million of short-term borrowings from the Federal Home Loan Bank in the second and third quarters of 2014, which were used for liquidity purposes related to the Valley transaction and to fund the Bank’s loan growth, partially offset by $80 million of higher-rate long-term advances which were repaid by the Company in June of 2014.

Structured repurchase agreements decreased $50 million, from $50 million at December 31, 2013, to $0 at September 30, 2014, as the Company repaid these borrowings in June of 2014.

Securities sold under reverse repurchase agreements with customers increased $36.8 million from December 31, 2013, to September 30, 2014.  These balances fluctuate over time based on customer demand for this product. 

Total stockholders' equity increased $28.4 million from $380.7 million at December 31, 2013 to $409.1 million at September 30, 2014.  The Company recorded net income of $31.5 million for the nine months ended September 30, 2014, and common and preferred dividends declared were $8.2 million.  Accumulated other comprehensive income increased $4.5 million due to increases in the fair value of available-for-sale investment securities.  In addition, total stockholders’ equity increased $1.2 million due to stock option exercises and decreased $512,000 due to re-purchases of the Company’s common stock.

Results of Operations and Comparison for the Three and Nine Months Ended September 30, 2014 and 2013

General

Net income was $11.6 million for the three months ended September 30, 2014 compared to net income of $8.4 million for the three months ended September 30, 2013. This increase of $3.2 million, or 37.3%, was primarily due to an increase in net interest income of $5.6 million, or 14.7%, a decrease in provision for loan losses of $1.7 million, or 64.7%, and an increase in non-interest income of $849,000, or 91.4%, partially offset by an increase in non-interest expense of $3.2 million, or 12.4%, and an increase in income tax expense of $1.8 million, or 86.3%.  Net income

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available to common stockholders was $11.4 million and $8.3 million for the three months ended September 30, 2014 and 2013, respectively.

Net income was $31.5 million for the nine months ended September 30, 2014 compared to net income of $25.1 million for the nine months ended September 30, 2013. This increase of $6.4 million, or 25.6%, was primarily due to a decrease in provision for loan losses of $10.5 million, or 71.9%, an increase in non-interest income of $7.2 million, or 116%, and an increase in net interest income of $2.9 million, or 2.5%, partially offset by an increase in non-interest expense of $10.9 million, or 13.8%, and an increase in income tax expense of $3.3 million, or 47.6%.  Net income available to common stockholders was $31.0 million and $24.6 million for the nine months ended September 30, 2014 and 2013, respectively.

Total Interest Income

Total interest income increased $4.6 million, or 10.7%, during the three months ended September 30, 2014 compared to the three months ended September 30, 2013.  The increase was due to a $4.9 million increase in interest income on loans, partially offset by a $273,000 decrease in interest income on investments and other interest-earning assets.  Interest income on loans increased for the three months ended September 30, 2014, due to higher average balances on loans, partially offset by lower average rates of interest.  Total interest income increased $430,000, or 0.3%, during the nine months ended September 30, 2014 compared to the nine months ended September 30, 2013.  The increase was due to a $3.4 million increase in interest income on loans, partially offset by a $3.0 million decrease in interest income on investments and other interest-earning assets.  Interest income on loans increased for the nine months ended September 30, 2014, due to higher average balances on loans, partially offset by lower average rates of interest.  Interest income from investment securities and other interest-earning assets decreased during the three and nine months ended September 30, 2014 compared to the same periods in 2013 primarily due to lower average balances. The lower average balances of investments were primarily due to the sale of the Company’s Small Business Administration loan pools securities, and as a result of management’s decision to not reinvest mortgage-backed securities’ monthly cash flows back into investments, but to utilize the proceeds to fund loan growth.  Prepayments on the mortgages underlying these securities resulted in amortization of premiums which also reduced yields.  In addition, for the 2014 three month period, the reduction in average balances on investments was due to the sale of certain mortgage-backed securities.

Interest Income – Loans

During the three months ended September 30, 2014 compared to the three months ended September 30, 2013, interest income on loans increased due to higher average balances, partially offset by lower average interest rates.

Interest income increased $8.8 million as the result of higher average loan balances, which increased from $2.37 billion during the three months ended September 30, 2013, to $2.93 billion during the three months ended September 30, 2014.  The higher average balances were primarily due to growth in the commercial real estate loans, commercial business loans, construction loans, other residential loans and consumer loans categories.  A portion of this loan growth resulted from the Company acquiring $165.1 million in loans as part of the Valley FDIC-assisted transaction on June 20, 2014, the balance of which were $152.5 million at September 30, 2014.

Interest income decreased $4.0 million as a result of lower average interest rates on loans.  The average yield on loans decreased from 6.70% during the three months ended September 30, 2013, to 6.08% during the three months ended September 30, 2014.  This decrease was due to lower overall loan rates, partially offset by a slightly higher amount of accretion income in the current year period compared to the prior year period resulting from the increases in expected cash flows to be received from the FDIC-acquired loan pools as previously discussed in Note 8 of the Notes to Consolidated Financial Statements.  On an on-going basis, the Company estimates the cash flows expected to be collected from the acquired loan pools. This cash flows estimate has increased, based on the payment histories and reduced loss expectations of the loan pools, resulting in adjustments to be spread on a level-yield basis over the remaining expected lives of the loan pools. The increases in expected cash flows also reduced the amount of expected reimbursements under the loss sharing agreements with the FDIC, which are recorded as indemnification assets. Therefore, the expected indemnification assets have also been reduced, resulting in adjustments to be amortized on a comparable basis over the remainder of the loss sharing agreements or the remaining expected life of the loan pools, whichever is shorter.  For the three months ended September 30, 2014 and 2013, the adjustments increased interest income by $8.8 million and $8.4 million, respectively, and decreased non-interest income by $7.4 million and $7.3 million, respectively.  The net impact to pre-tax income was $1.4 million and $1.1 million for the three months ended September 30, 2014 and 2013, respectively.  As of September 30, 2014, the remaining accretable yield adjustment that

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will affect interest income is $29.6 million and the remaining adjustment to the indemnification assets, including the effects of the clawback liability related to InterBank, that will affect non-interest income (expense) is $(26.0 million).  Of the remaining adjustments, we expect to recognize $7.2 million of interest income and $(6.0) million of non-interest income (expense) in the remainder of 2014.  Additional adjustments may be recorded in future periods from the FDIC-assisted transactions, as the Company continues to estimate expected cash flows from the acquired loan pools.  Apart from the yield accretion, the average yield on loans was 4.89% for the three months ended September 30, 2014, down from 5.30% for the three months ended September 30, 2013, as a result of loan pay-offs and normal amortization of higher-rate loans and new loans that were made at current lower market rates.

During the nine months ended September 30, 2014 compared to the nine months ended September 30, 2013, interest income on loans increased due to higher average balances, partially offset by decreases due to lower average interest rates.

Interest income increased $15.3 million as the result of higher average loan balances, which increased from $2.39 billion during the nine months ended September 30, 2013, to $2.70 billion during the nine months ended September 30, 2014.  The higher average balances were primarily due to increases in commercial real estate loans, commercial business loans, construction loans, other residential loans and consumer loans.  A portion of this loan growth resulted from the Company acquiring $165.1 million in loans as part of the Valley FDIC-assisted transaction on June 20, 2014, the balance of which were $152.5 million at September 30, 2014.

Partially offsetting the increase in interest income described above, interest income decreased $11.8 million as a result of lower average interest rates on loans.  The average yield on loans decreased from 6.84% during the nine months ended September 30, 2013, to 6.22% during the nine months ended September 30, 2014.  This decrease was due to a reduction in overall loan rates and a decrease in additional yield accretion recognized in conjunction with the fair value of the loan pools acquired in the FDIC-assisted transactions as discussed above for the three months ended September 30, 2014 and as previously discussed in Note 8 of the Notes to Consolidated Financial Statements.  The adjustments increased interest income by $25.8 million and decreased non-interest income by $21.9 million during the nine months ended September 30, 2014, for a net impact of $3.9 million to pre-tax income.  The adjustments increased interest income by $26.5 million and decreased non-interest income by $22.5 million during the nine months ended September 30, 2013, for a net impact of $4.0 million to pre-tax income.  Apart from the yield accretion, the average yield on loans was 4.94% for the nine months ended September 30, 2014, down from 5.36% for the nine months ended September 30, 2013 for reasons discussed above.

Interest Income – Investments and Other Interest-earning Assets

Interest income on investments and other interest-earning assets decreased in the three months ended September 30, 2014 compared to the three months ended September 30, 2013.  Interest income decreased $871,000 as a result of a decrease in average balances from $667.9 million during the three months ended September 30, 2013, to $486.0 million during the three months ended September 30, 2014.  Average balances of securities decreased primarily due to the sale of the Company’s Small Business Administration loan pools securities and sales of other investment securities in previous periods of 2014 and the normal monthly payments received on the portfolio of mortgage-backed securities, with proceeds being used to fund new loan originations.  Interest income increased $643,000 due to an increase in average interest rates from 1.68% during the three months ended September 30, 2013, to 2.12% during the three months ended September 30, 2014.

Interest income on investments and other interest-earning assets decreased in the nine months ended September 30, 2014 compared to the nine months ended September 30, 2013. Interest income decreased $3.7 million as a result of a decrease in average balances from $763.1 million during the nine months ended September 30, 2013, to $528.8 million during the nine months ended September 30, 2014.  Interest income increased $740,000 as a result of an increase in average interest rates from 1.98% during the nine months ended September 30, 2013, to 2.12% during the nine months ended September 30, 2014.  The reasons for these changes in the comparable nine-month periods are the same as those described previously for the comparable three-month periods.

The Company’s interest-earning deposits and non-interest-earning cash equivalents currently earn very low or no yield and therefore negatively impact the Company’s net interest margin. At September 30, 2014, the Company had cash and cash equivalents of $221.4 million compared to $227.9 million at December 31, 2013.  See "Net Interest Income" for additional information on the impact of this interest activity.

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Total Interest Expense

Total interest expense decreased $1.1 million, or 23.1%, during the three months ended September 30, 2014, when compared with the three months ended September 30, 2013, due to a decrease in interest expense on FHLBank advances of $544,000, or 54.1%, and a decrease in interest expense on short-term borrowings and repurchase agreements of $574,000, or 97.8%.

Total interest expense decreased $2.5 million, or 17.0%, during the nine months ended September 30, 2014, when compared with the nine months ended September 30, 2013, due to a decrease in interest expense on deposits of $1.3 million, or 13.7%, a decrease in interest expense on FHLBank advances of $522,000, or 17.6%, and a decrease in interest expense on short-term borrowings and repurchase agreements of $676,000, or 38.5%.

Interest Expense – Deposits

Interest expense on demand deposits increased $71,000 due to an increase in average balances from $1.34 billion during the three months ended September 30, 2013, to $1.47 billion during the three months ended September 30, 2014.  The increase in average balances of interest-bearing demand deposits was primarily a result of the demand deposits acquired in the Valley transaction, which occurred on June 20, 2014.  The average balance of non-interest-bearing demand deposit accounts increased $21.2 million, from $523.6 million for the three months ended September 30, 2013 to $544.8 million for the three months ended September 30, 2014.  Interest expense on demand deposits were unaffected due to average rates of interest that remained unchanged during the 2014 and 2013 three month periods.

Interest expense on demand deposits decreased $349,000 due to a decrease in average rates from 0.25% during the nine months ended September 30, 2013, to 0.22% during the nine months ended September 30, 2014.  Interest expense on demand deposits decreased $153,000 due to a decrease in average balances from $1.52 billion during the nine months ended September 30, 2013, to $1.44 billion during the nine months ended September 30, 2014.  Average interest rates decreased due to lower overall market rates of interest in the 2014 period and because the Company continued to pay lower rates in line with the market during the nine months ended September 30, 2014 when compared to the same period in 2013.

Interest expense on time deposits decreased $127,000 as a result of a decrease in average rates of interest from 0.81% during the three months ended September 30, 2013, to 0.76% during the three months ended September 30, 2014 due to a reduction in market rates of interest.  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.  Interest expense on time deposits increased $110,000 due to an increase in average balances of time deposits from $1.03 billion during the three months ended September 30, 2013, to $1.09 billion during the three months ended September 30, 2014.  The increase in time deposit balances was primarily due to the deposits acquired in the Valley transaction on June 20, 2014.

Interest expense on time deposits decreased $450,000 due to a decrease in average balances of time deposits from $1.10 billion during the nine months ended September 30, 2013, to $1.02 billion during the nine months ended September 30, 2014.  The decrease in time deposit balances was primarily due to some customers choosing not to renew their deposits with us upon maturity due to lower rates offered by the Company.  Also contributing to the decrease was the decrease in CDARS deposits of $40.6 million compared to September 30, 2013.  These decreases were offset by the increase in average balances during the nine months ended September 30, 2014 due to the deposits acquired in the Valley transaction.  Interest expense on time deposits decreased $362,000 due to a decrease in average rates from 0.82% during the nine months ended September 30, 2013, to 0.78% during the nine months ended September 30, 2014.  The reasons for the changes in average interest rates in the comparable nine-month period is the same as those described previously for the comparable three-month period.

Interest Expense – FHLBank Advances, Short-term Borrowings and Structured Repo Borrowings and Subordinated Debentures Issued to Capital Trusts

During the three months ended September 30, 2014 compared to the three months ended September 30, 2013, interest expense on FHLBank advances decreased due to lower average rates of interest, partially offset by higher average balances.  Interest expense on FHLBank advances decreased $976,000 due to a decrease in average interest rates from 3.08% in the three months ended September 30, 2013, to 0.85% in the three months ended September 30, 2014.  The

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significant decrease in the average rate was due to the repayment of $80 million of the Company’s long-term higher-rate FHLBank advances during June 2014.  As of September 30, 2014, $149 million of the Company’s $191 million of total FHLBank advances are short-term advances with very low interest rates.  Partially offsetting this decrease was an increase in interest expense on FHLBank advances of $432,000 due to an increase in average balances from $129.5 million during the three months ended September 30, 2013, to $214.3 million during the three months ended September 30, 2014. This increase was primarily due to additional short-term FHLBank advances obtained by the Company during the three months ended September 30, 2014, to fund loan growth and for other short term funding needs.

During the nine months ended September 30, 2014 compared to the nine months ended September 30, 2013, interest expense on FHLBank advances decreased due to lower average rates of interest, partially offset by higher average balances.  Interest expense on FHLBank advances decreased $1.1 million due to a decrease in average interest rates from 3.11% in the nine months ended September 30, 2013, to 2.06% in the nine months ended September 30, 2014.  Interest expense on FHLBank advances increased $624,000 due to an increase in average balances from $127.7 million during the nine months ended September 30, 2013, to $158.9 million during the nine months ended September 30, 2014.  The reasons for these changes in the comparable nine-month periods are the same as those described previously for the comparable three-month periods.

Interest expense on short-term and structured repo borrowings decreased $449,000 due to a decrease in average rates on short-term borrowings from 1.06% in the three months ended September 30, 2013, to 0.03% in the three months ended September 30, 2014.  Interest expense on short-term and structured repo borrowings decreased $125,000 due to a decrease in average balances from $220.6 million during the three months ended September 30, 2013, to $161.2 million during the three months ended September 30, 2014.  The decrease in balances of short-term borrowings in the three month period was primarily due to the repayment by the Company of $50 million of structured repurchase agreements at the end of June 2014.  As there were none of the higher-rate structured repurchase agreements during the three-month period, the average rate went down because the interest expense was all related to the lower-rate securities sold under repurchase agreements with customers.

Interest expense on short-term and structured repo borrowings decreased $355,000 due to a decrease in average balances from $245.4 million during the nine months ended September 30, 2013, to $189.8 million during the nine months ended September 30, 2014.  Interest expense on short-term and structured repo borrowings decreased $321,000 due to a decrease in average rates on short-term borrowings from 0.96% in the nine months ended September 30, 2013, to 0.76% in the nine months ended September 30, 2014.  The reasons for these changes in the comparable nine-month periods are the same as those described previously for the comparable three-month periods.

During the three months and nine months ended September 30, 2014, compared to the three and nine months ended September 30, 2013, interest expense on subordinated debentures issued to capital trusts were almost unchanged.  Average interest rates were 1.81% in the three months ended September 30, 2013, compared to 1.83% in the three months ended September 30, 2014.  Average interest rates were 1.82% in the nine months ended September 30, 2013 compared to 1.81% in the nine months ended September 30, 2014.  These are variable-rate debentures which bear interest at an average rate of three-month LIBOR plus 1.57%, adjusting quarterly.

Net Interest Income

Net interest income for the three months ended September 30, 2014 increased $5.6 million to $44.1 million compared to $38.5 million for the three months ended September 30, 2013. Net interest margin was 4.91% in the three months ended September 30, 2014, compared to 4.64% in the three months ended September 30, 2013, an increase of 27 basis points, or 5.8%.  In both three-month periods, the Company’s margin was positively impacted by the increases in expected cash flows to be received from the FDIC-acquired loan pools and the resulting increase to accretable yield which were previously discussed in Note 8 of the Notes to Consolidated Financial Statements.The positive impact of these changes on the three months ended September 30, 2014 and 2013 were increases in interest income of $8.8 million and $8.4 million, respectively, and increases in net interest margin of 98 basis points and 101 basis points, respectively.  Excluding the positive impact of the additional yield accretion, net interest margin increased 30 basis points when compared to the year-ago quarter.  The increase was primarily due to an increase in interest income on loans due to higher average loan balances and a decrease in interest expense on FHLBank advances and short-term borrowings, due to the payoff of FHLBank advances and structured repurchase agreements, as discussed in the June 30, 2014 Quarterly Report on Form 10-Q.  In addition, during 2013 and the first nine months of 2014, market rates on checking and savings deposits remained very low and retail time deposits renewed at somewhat lower rates of interest.

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The positive impact from lower deposit rates has continued to diminish as market rates for such deposits are no longer declining. The Company has also experienced decreases in yields on loans and investments, excluding the yield accretion income discussed above. Existing loans continue to repay, and in many cases new loans are originated at rates which are lower than the rates on those repaying loans and may be lower than existing average portfolio rates.

The Company's overall average interest rate spread increased 30 basis points, or 6.6%, from 4.53% during the three months ended September 30, 2013, to 4.83% during the three months ended September 30, 2014. The gross change was due to an 11 basis point increase in the weighted average yield on interest-earning assets and a 19 basis point decrease in the weighted average rate paid on interest-bearing liabilities. In comparing the two periods, the yield on loans decreased 62 basis points while the yield on investment securities and other interest-earning assets increased 44 basis points. The rate paid on deposits decreased two basis points, the rate paid on short-term borrowings decreased 103 basis points, the rate paid on FHLBank advances decreased 223 basis points, and the rate paid on subordinated debentures issued to capital trusts increased two basis points.

Net interest income for the nine months ended September 30, 2014 increased $2.9 million to $122.0 million compared to $119.1 million for the nine months ended September 30, 2013.  Net interest margin was 4.75% in the nine months ended September 30, 2014, compared to 4.60% in the nine months ended September 30, 2013, an increase of 15 basis points, or 3.3%.  In both nine-month periods, the Company’s margin was positively impacted by the increases in expected cash flows to be received from the FDIC-acquired loan pools and the resulting increase to accretable yield which were previously discussed in Note 8 of the Notes to Consolidated Financial Statements.The positive impact of these changes on the nine months ended September 30, 2014 and 2013 were increases in interest income of $25.8 million and $26.5 million, respectively, and increases in net interest margin of 101 basis points and 103 basis points, respectively.  Excluding the positive impact of the additional yield accretion, net interest margin increased 17 basis points when compared to the year-ago period.  The reasons for these changes in the comparable nine-month periods are the same as those described previously for the comparable three-month periods.

The Company's overall interest rate spread increased 14 basis points, or 3.1%, from 4.51% during the nine months ended September 30, 2013, to 4.65% during the nine months ended September 30, 2014. The gross change was due to a seven basis point increase in the weighted average yield on interest-earning assets, and a seven basis point decrease in the weighted average rate paid on interest-bearing liabilities.  In comparing the two periods, the yield on loans decreased 62 basis points while the yield on investment securities and other interest-earning assets increased 14 basis points.  The rate paid on deposits decreased four basis points, the rate paid on FHLBank advances decreased 105 basis points, the rate paid on short-term borrowings decreased 20 basis points and the rate paid on subordinated debentures issued to capital trusts decreased one basis point.

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

Provision for Loan Losses and Allowance for Loan Losses

Management records a provision for loan losses in an amount it believes 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.  Based on the Company’s current assessment of these factors and their expected impact on the loan portfolio, management believes that provision expenses and net charge-offs for 2014 will likely continue to be less than those for 2013.  However, 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.

Weak economic conditions, 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 long ago established various controls in an attempt to limit future losses, such as a watch list of possible problem loans, documented loan administration policies and a 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, 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.

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The provision for loan losses for the three months ended September 30, 2014, decreased $1.7 million to $945,000 when compared with the three months ended September 30, 2013.  The provision for loan losses for the nine months ended September 30, 2014, decreased $10.5 million to $4.1 million when compared with the nine months ended September 30, 2013.  At September 30, 2014, the allowance for loan losses was $38.1 million, a decrease of $2.0 million from December 31, 2013.  Total net charge-offs were $946,000 and $3.4 million for the three months ended September 30, 2014 and 2013, respectively.  Two relationships made up $438,000 of the net charge-off total for the three months ended September 30, 2014.  Total net charge-offs were $6.1 million and $15.8 million for the nine months ended September 30, 2014 and 2013, respectively.  The decrease in net charge-offs and provision for loan losses in the three and nine months ended September 30, 2014, were consistent with our expectations, as indicated in previous filings.  General market conditions, and more specifically, real estate absorption rates and unique circumstances related to individual borrowers and projects also contributed to the level of provisions and charge-offs.  As properties were categorized as potential problem loans, non-performing loans or foreclosed assets, evaluations were made of the values of these assets with corresponding charge-offs as appropriate.

Loans acquired in the 2009, 2011 and 2012 FDIC-assisted transactions are covered by loss sharing agreements between the FDIC and Great Southern Bank which afford Great Southern Bank at least 80% protection from losses in the acquired portfolio of loans.  The FDIC loss sharing agreements are subject to limitations on the types of losses covered and the length of time losses are covered and are conditioned upon the Bank complying with its requirements in the agreements with the FDIC.  These limitations are described in detail in Note 8 of the Notes to Consolidated Financial Statements.  The 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 dates.  These loan pools are 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 Bank portfolio, with most focus being placed on those loan pools which include the larger loan relationships and those loan pools which exhibit higher risk characteristics.  Review of the acquired loan portfolio also includes meetings with customers, review of financial information and collateral valuations to determine if any additional losses are apparent.  Former Valley Bank loans are accounted for in pools and were recorded at their fair value at the time of the acquisition as of June 20, 2014; therefore, these loan pools are analyzed rather than the individual loans.

The loss sharing agreement for the non-single-family portion of the loans acquired in the TeamBank transaction ended on March 31, 2014.  Any additional losses in that non-single-family portfolio will not be eligible for loss sharing coverage. At this time, the Company does not expect any material losses in this non-single-family loan portfolio, which had a carrying value of $28.3 million at September 30, 2014.

The loss sharing agreement for the non-single-family portion of the loans acquired in the Vantus Bank transaction ended on September 30, 2014.  Going forward, any additional losses in that non-single-family portfolio will not be eligible for loss sharing coverage. At this time, the Company does not expect any material losses in this non single-family loan portfolio, which had a carrying value of $23.5 million at September 30, 2014.

The Bank’s allowance for loan losses as a percentage of total loans, excluding loans covered by the FDIC loss sharing agreements, was 1.43%, 1.92% and 2.01% at September 30, 2014, December 31, 2013, and September 30, 2013, respectively. Management considers the allowance for loan losses adequate to cover losses inherent in the Company’s loan portfolio at September 30, 2014, based on recent reviews of the Company’s loan portfolio and current economic conditions. If economic conditions were to deteriorate or management’s assessment of the loan portfolio were to change, it is possible that additional loan loss provisions would be required, thereby adversely affecting future results of operations and financial condition.

Non-performing Assets

Former TeamBank (portion of loans still covered by loss sharing agreement), Vantus Bank, Sun Security Bank and InterBank non-performing assets, including foreclosed assets, are not included in the totals or in the discussion of non-performing loans, potential problem loans and foreclosed assets below due to the respective loss sharing agreements with the FDIC, which cover at least 80% of principal losses that may be incurred in these portfolios for the applicable terms under the agreements.  At September 30, 2014, there were no material non-performing assets that were previously covered, and are now not covered, under the TeamBank non-single-family loss sharing agreement.Former Valley Bank loans are also excluded from the totals and the discussion of non-performing loans, potential problem loans and foreclosed assets below, although they are not covered by a loss sharing agreement.  Former Valley Bank

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loans are accounted for in pools and were recorded at their fair value at the time of the acquisition as of June 20, 2014; therefore, these loan pools are analyzed rather than the individual loans.  In addition, FDIC-supported TeamBank, Vantus Bank, Sun Security Bank and InterBank assets were initially recorded at their estimated fair values as of their acquisition dates of March 20, 2009, September 4, 2009, October 7, 2011 and April 27, 2012, respectively.  The overall performance of the FDIC-covered loan pools acquired in 2009, 2011 and 2012 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 that occur from time to time, and other factors specific to a borrower’s circumstances, the level of non-performing assets will fluctuate.  Non-performing assets, excluding FDIC-covered non-performing assets and non-covered acquired assets, at September 30, 2014, were $47.1 million, a decrease of $15.2 million from $62.3 million at December 31, 2013.  Non-performing assets, excluding FDIC-covered non-performing assets and non-covered acquired assets, as a percentage of total assets were 1.21% at September 30, 2014, compared to 1.75% at December 31, 2013.

Compared to December 31, 2013, non-performing loans decreased $7.9 million to $12.0 million and foreclosed assets decreased $7.3 million to $35.1 million.  Non-performing one-to four-family residential loans comprised $4.9 million, or 41.1%, of the total $12.0 million of non-performing loans at September 30, 2014, an increase of $588,000 from December 31, 2013.  Non-performing commercial real estate loans comprised $3.0 million, or 24.6%, of total non-performing loans at September 30, 2014, a decrease of $3.2 million from December 31, 2013.    Non-performing construction and land development loans comprised $1.7 million, or 14.2%, of total non-performing loans at September 30, 2014, an increase of $503,000 from December 31, 2013.  Non-performing commercial business loans decreased $5.6 million in the nine months ended September 30, 2014, and were $1.6 million, or 13.6%, of total non-performing loans at September 30, 2014.

Non-performing Loans.  Activity in the non-performing loans category during the nine months ended September 30, 2014 was as follows:

	Beginning Balance, January 1		Additions to Non- Performing		Removed from Non- Performing			Transfers to Potential Problem Loans			Transfers to Foreclosed Assets			Charge- Offs			Payments			Ending Balance, September 30
	(In Thousands)
One- to four-family construction	$	—	$	—	$	—		$	—		$	—		$	—		$	—		$	—
Subdivision construction		871		2,748		—			—			(688	)		(1,037	)		(448	)		1,446
Land development		338		102		—			—			(65	)		(80	)		(29	)		266
Commercial construction		—		—		—			—			—			—			—			—
One- to four-family residential		4,361		5,171		(76	)		(546	)		(2,075	)		(790	)		(1,096	)		4,949
Other residential		—		—		—			—			—			—			—			—
Commercial real estate		6,205		2,838		(1,200	)		—			—			(442	)		(4,434	)		2,967
Commercial business		7,231		336		(2,715	)		—			—			(1,974	)		(1,246	)		1,632
Consumer		900		735		(273	)		(52	)		(28	)		(130	)		(371	)		781
Total	$	19,906	$	11,930	$	(4,264	)	$	(598	)	$	(2,856	)	$	(4,453	)	$	(7,624	)	$	12,041

At September 30, 2014, the non-performing one- to four-family residential category included 59 loans, 24 of which were added during the quarter.  Of the 24 one- to four-family residential loans added during the quarter, 14 of them were to two borrowers, and were transferred from potential problem loans to non-performing loans during the quarter.  The non-performing commercial real estate category included eight loans, four of which were added during the quarter.  The largest relationship in this category, which was added in a previous quarter, totaled $1.9 million, or 64.7%, of the total category, and is collateralized by a theater property in Branson, Mo.  This category had $4.0 million in payments on two relationships during the quarter.  The properties associated with these relationships were sold during the quarter.  The non-performing commercial business category included eight loans, one of which was added during the quarter.  The largest relationship in this category, which was added in 2010, totaled $1.2 million, or 73.8% of the total category, and is collateralized by an assignment of annual assessments generated by a Community Improvement District for the associated real estate.  The non-performing subdivision construction category included five loans, all of which were added during the current quarter.  The largest relationship in this category totaled $943,000, or 65.2% of the total category, and is collateralized by property in the Kansas City, Mo., area.

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Potential Problem Loans.  Compared to December 31, 2013, potential problem loans decreased $5.9 million, or 21.9%. This decrease was due to $7.2 million in loans being removed from potential problem loans due to improvements in the credits, $5.0 million in loans transferred to the non-performing category, $907,000 in charge-offs, $417,000 in loans transferred to foreclosed assets, and $423,000 in payments from customers, partially offset by the addition of $8.0 million of loans 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.  Activity in the potential problem loans category during the nine months ended September 30, 2014, was as follows:

	Beginning Balance, January 1		Additions to Potential Problem		Removed from Potential Problem			Transfers to Non- Performing			Transfers to Foreclosed Assets			Charge- Offs			Payments			Ending Balance, September 30
	(In Thousands)
One- to four-family construction	$	—	$	—	$	—		$	—		$	—		$	—		$	—		$	—
Subdivision construction		2,201		864		—			(1,806	)		—			(500	)		(24	)		735
Land development		10,857		—		(5,000	)		—			—			—			—			5,857
Commercial construction		—		—		—			—			—			—			—			—
One- to four-family residential		2,193		2,208		(250	)		(2,340	)		—			—			(52	)		1,759
Other residential		1,956		—		—			—			—			—			—			1,956
Commercial real estate		8,737		4,557		(1,905	)		(598	)		(417	)		(381	)		(317	)		9,676
Commercial business		860		231		(43	)		(225	)		—			—			—			823
Consumer		183		145		—			(6	)		—			(26	)		(30	)		266
Total	$	26,987	$	8,005	$	(7,198	)	$	(4,975	)	$	(417	)	$	(907	)	$	(423	)	$	21,072

At September 30, 2014, the commercial real estate category of potential problem loans included seven loans, one of which was added during the current quarter.  The largest relationship in this category, which was added during a previous quarter, had a balance of $4.9 million, or 50.2% of the total category.  The relationship is collateralized by properties located near Branson, Mo. The land development category of potential problem loans included three loans, all of which were added during previous quarters.  The largest relationship in this category totaled $3.8 million, or 65.6% of the total category, and is collateralized by property in the Branson, Mo. area.  The one- to four-family residential category of potential problem loans included 19 loans, one of which was added during the current quarter.  Eleven one-to four-family residential loans were transferred from potential problem loans to non-performing loans during the current quarter, nine of which were to the same borrower.  The other residential category of potential problem loans included one loan which was added in a previous quarter, and is collateralized by properties located in the Branson, Mo., area.  The commercial business category of potential problem loans included five loans, all of which were added in previous quarters.  The largest relationship in this category had a balance of $660,000, or 80.2% of the total category, and is collateralized primarily by automobiles.  The subdivision construction category of potential problem loans included four loans, all of which were added during previous quarters.  The largest relationship in this category had a balance of $250,000, or 34.2% of the total category, and is collateralized by property in southwest Missouri.

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Foreclosed Assets.  Of the total $43.8 million of other real estate owned at September 30, 2014, $6.7 million represents the fair value of foreclosed assets covered by FDIC loss sharing agreements and $2.0 million represents properties which were not acquired through foreclosure. The foreclosed assets covered by FDIC loss sharing agreements and the properties not acquired through foreclosure are not included in the following table and discussion of foreclosed assets.  Because sales of foreclosed properties exceeded additions, total foreclosed assets decreased.  Activity in foreclosed assets during the nine months ended September 30, 2014, was as follows:

	Beginning Balance, January 1		Additions		ORE Sales			Capitalized Costs		ORE Write- Downs			Ending Balance, September 30
	(In Thousands)
One- to four-family construction	$	—	$	—	$	—		$	—	$	—		$	—
Subdivision construction		11,652		688		(2,545	)		—		(17	)		9,778
Land development		18,920		74		(270	)		—		(972	)		17,752
Commercial construction		—		—		—			—		—			—
One- to four-family residential		744		2,218		(1,349	)		—		(49	)		1,564
Other residential		5,900		—		(2,419	)		96		—			3,577
Commercial real estate		4,135		417		(2,773	)		—		—			1,779
Commercial business		77		—		(4	)		—		(14	)		59
Consumer		969		2,357		(2,719	)		—		(42	)		565
Total	$	42,397	$	5,754	$	(12,079	)	$	96	$	(1,094	)	$	35,074

At September 30, 2014, the land development category of foreclosed assets included 33 properties, the largest of which was located in northwest Arkansas and had a balance of $2.3 million, or 12.9% of the total category.  Of the total dollar amount in the land development category of foreclosed assets, 41.7% and 34.3% was located in northwest Arkansas and in the Branson, Mo., area, respectively, including the largest property previously mentioned.  The subdivision construction category of foreclosed assets included 31 properties, the largest of which was located in the St. Louis, Mo. metropolitan area and had a balance of $2.8 million, or 28.5% of the total category.  Of the total dollar amount in the subdivision construction category of foreclosed assets, 20.2% and 13.4% is located in Branson, Mo. and Springfield, Mo., respectively. The commercial real estate category of foreclosed assets included seven properties, the largest of which was located in the Branson, Mo., area and had a balance of $691,000, or 38.9% of the total category.  There were $2.3 million in sales of the commercial real estate category of foreclosed assets during the three months ended September 30, 2014, which included $1.4 million from the sale of a mixed use facility in St. Louis, Mo., $520,000 from the sale of a retail center in the Springfield, Mo., area, and $400,000 from the sale of a former restaurant building in northwest Arkansas.  The other residential category of foreclosed assets included 14 properties, 11 of which were all part of the same condominium community, which was located in Branson, Mo. and had a balance of $2.1 million, or 58.1% of the total category.  Of the total dollar amount in the other residential category of foreclosed assets, 80.4% is located in the Branson, Mo., area, including the largest properties previously mentioned.

Non-interest Income

For the three months ended September 30, 2014, non-interest income increased $849,000 to $1.8 million when compared to the three months ended September 30, 2013, primarily as a result of the following items:

Service charges and ATM fees:  Service charges and ATM fees increased $439,000 compared to the prior year period, primarily due to an increase in fee income from the additional accounts acquired in the Valley Bank transaction in June 2014.

Gains on sales of single-family loans:Gains on sales of single-family loans increased $364,000 compared to the prior year period.  $217,000 of this increase was related to the single-family loans acquired in the Valley Bank acquisition and subsequently sold in the secondary market.  The remaining increase was due to an increase in originations of fixed-rate loans in the 2014 period.  Fixed rate loans originated are subsequently sold in the secondary market.

Net realized gains on sales of available-for-sale securities:Gains on sales of available-for-sale securities increased $121,000 compared to the prior year period.  This was primarily due to the sale of the mortgage-backed securities and collateralized mortgage obligations acquired in the Valley Bank acquisition in July 2014, which produced a gain of $175,000.  In addition, the Company sold several mortgage-backed securities in August 2014, which produced a gain of $52,000.

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Partially offsetting the increase in non-interest income was a change in the following item:

Amortization of income related to business acquisitions:  The net amortization expense related to business acquisitions was $6.5 million for the three months ended September 30, 2014, compared to $6.3 million for the three months ended September 30, 2013.  The amortization expense for the three months ended September 30, 2014, was made up of the following items:  $7.1 million of amortization expense related to the changes in cash flows expected to be collected from the FDIC-covered loan portfolios and $447,000 of amortization of the clawback liability.  Partially offsetting the expense was income from the accretion of the discount related to the indemnification assets for all of the acquisitions of $453,000 and $185,000 of other loss share income items.  Also partially offsetting the expense was income from the reversal of the impairment of the indemnification asset for Vantus Bank of $350,000, as that portion of the original impairment is now expected to be collected from the FDIC.

For the nine months ended September 30, 2014, non-interest income increased $7.2 million to $13.3 million when compared to the three months ended September 30, 2013, primarily as a result of the following items:

Initial gain recognized on business acquisition:The Company recognized a preliminary one-time gain of $10.8 million (pre-tax) on the FDIC-assisted acquisition of Valley Bank, which occurred on June 20, 2014.

Net realized gains on sales of available-for-sale securities:Gains on sales of available-for-sale securities increased $722,000 compared to the prior year period.  This was primarily due to the sale of all of the Company’s Small Business Administration securities in June 2014, which produced a gain of $569,000, and the sale of the acquired Valley Bank securities in July 2014 as mentioned above.

Partially offsetting the increase in non-interest income was a change in the following items:

Amortization of income related to business acquisitions:  The net amortization expense related to business acquisitions was $20.1 million for the nine months ended September 30, 2014, compared to $17.9 million for the nine months ended September 30, 2013.  The amortization expense for the nine months ended September 30, 2014, was made up of the following items:  $21.2 million of amortization expense related to the changes in cash flows expected to be collected from the FDIC-covered loan portfolios, $1.2 million of amortization of the clawback liability and $152,000 of impairment of the indemnification asset for Vantus Bank.  The impairment was recorded because the Company does not expect resolution of certain items related to commercial foreclosed assets prior to the expiration of the non-single-family loss sharing agreement for Vantus Bank.  Offsetting the expense was income from the accretion of the discount related to the indemnification assets for all of the acquisitions of $1.9 million and $604,000 of other loss share income items.

Gains on sales of single-family loans:Gains on sales of single-family loans decreased $1.5 million compared to the prior year period.  This was due to a decrease in originations of fixed-rate loans due to higher fixed rates being offered on these loans in the 2014 period which resulted in fewer loans being originated to refinance existing debt.  Fixed rate loans originated are subsequently sold in the secondary market.  The decrease occurred in the first six months of the year and was offset by an increase in gains on sales of single-family loans during the three months ended September 30, 2014, as discussed above.

Other Income:  Other income decreased $551,000 compared to the prior year period primarily due to unusual income received in the 2013 period which was not repeated in the current year period.  In the 2013 period the Company received a one-time payment from MasterCard of approximately $480,000.

Change in interest rate swap fair value:  The Company recorded expense of $(223,000) during the 2014 period due to the decrease in the interest rate swap fair value related to its matched book interest rate derivatives program.  This compares to income of $283,000 recorded during the nine months ended September 30, 2013.

Non-interest Expense

For the three months ended September 30, 2014, non-interest expense increased $3.2 million to $29.4 million, when compared to the three months ended September 30, 2013, primarily as a result of the following items:

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Valley Bank acquisition expenses:  The Company incurred approximately $2.3 million of additional non-interest expenses during the three months related to the FDIC-assisted acquisition of Valley Bank.  Those expenses included approximately $1.0 million of compensation expense, approximately $450,000 of net computer and equipment expense, approximately $279,000 of net occupancy expense, approximately $115,000 of travel, meals and other expenses related to the integration of operations and various other expenses.  We expect that a portion of these expenses will not recur in future periods.

Other operating expenses: Other operating expenses increased $275,000, to $2.1 million, in the three months ended September 30, 2014 compared to the prior year period primarily due to an increase in certain costs to originate consumer and mortgage loans of approximately $146,000 and an increase in amortization of intangible assets of $100,000.  The increase in amortization was due to the amortization of the core deposit intangible related to the Valley acquisition.

For the nine months ended September 30, 2014, non-interest expense increased $10.9 million to $89.7 million when compared to the nine months ended September 30, 2013, primarily as a result of the following items:

Other operating expenses: Other operating expenses increased $7.9 million, to $13.6 million, in the nine months ended September 30, 2014 compared to the prior year period primarily due to $7.4 million in prepayment penalties paid as the Company elected to repay $130 million of its FHLBank advances and structured repo borrowings prior to their maturity during the three months ended June 30, 2014.

Valley Bank acquisition expenses:  The Company incurred approximately $2.9 million of additional non-interest expenses during the nine month period related to the FDIC-assisted acquisition of Valley Bank.  Those expenses included approximately $1.3 million of compensation expense, approximately $450,000 of net computer and equipment expense, approximately $313,000 of net occupancy expense, approximately $156,000 of legal, audit and other professional fees expense, approximately $239,000 of travel, meals and other expenses related to due diligence for the transaction and integration issues and various other expenses.  We expect that a portion of these expenses will not recur in future periods.

The Company’s efficiency ratio for the three months ended September 30, 2014, was 64.07% compared to 66.40% for the same period in 2013.  The efficiency ratio for the nine months ended September 30, 2014, was 66.25% compared to 62.89% for the same period in 2013.  The improvement in the ratio in the 2014 three month period was primarily due to the increase in net interest income, partially offset by increases in non-interest expense.  The increase in the ratio in the 2014 nine month period was primarily due to the early repayment of certain borrowings in June 2014 and the increase in non-interest expense related to the June 2014 Valley Bank acquisition, partially offset by increases in non-interest income resulting from the initial gain recognized on the Valley Bank acquisition.  The Company’s ratio of non-interest expense to average assets increased from 2.85% and 2.72% for the three and nine months ended September 30, 2013, respectively, to 2.99% and 3.15% for the three and nine months ended September 30, 2014, respectively.  The increase in the current nine month period ratio was primarily due to the increase in other operating expenses in the 2014 period compared to the 2013 period due to the penalties paid for prepayment of borrowings and other non-interest expenses related to the Valley Bank acquisition.  Average assets for the three months ended September 30, 2014, increased $261 million, or 7.1%, from the three months ended September 30, 2013.  The increase was primarily due to the Valley Bank acquisition in June 2014, and organic loan growth, partially offset by decreases in investment securities.  Average assets for the nine months ended September 30, 2014, decreased $67 million, or 1.7%, from the nine months ended September 30, 2013.  The decrease in average assets in the nine month period was primarily due to decreases in investment securities, interest earning deposits at the Federal Reserve Bank and FDIC indemnification assets, offset by increases in loans due to acquisitions and organic loan growth.

Provision for Income Taxes

In the three months ended March 31, 2014, the Company elected to early-adopt FASB ASU No. 2014-01, which amends FASB ASC Topic 323, Investments – Equity Method and Joint Ventures. This Update impacts the Company’s accounting for investments in flow-through limited liability entities which manage or invest in affordable housing projects that qualify for the low-income housing tax credit. The amendments in the Update permit reporting entities to make an accounting policy election to account for their investments in qualified affordable housing projects using the proportional amortization method if certain conditions are met. Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense (benefit).

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The Company has significant investments in such qualified affordable housing projects that meet the required conditions.  The Company’s adoption of this Update did not result in any material impact on the Company’s financial position or results of operations, except that the investment amortization expense, which previously was included in Other Non-interest Expense in the Consolidated Statements of Income, is now included in Provision for Income Taxes in the Consolidated Statements of Income presented.  For the three and nine months ended September 30, 2013, $1.0 million and $2.9 million, respectively, was moved from Other Noninterest Expense to Provision for Income Taxes.  As a result, there was no change in Net Income for the periods covered in this release.  In addition, there was no cumulative effect adjustment to Retained Earnings.

For the three and nine months ended September 30, 2014, the Company's effective tax rate was 25.4% and 24.4%, respectively, which was lower than the statutory federal tax rate of 35%, due primarily to the effects of the tax credits utilized and to tax-exempt investments and tax-exempt loans which reduced the Company’s effective tax rate.  In future periods, the Company expects its effective tax rate typically will be 20-25% of pre-tax net income, assuming it continues to maintain or increase its use of investment tax credits. The Company’s effective tax rate may fluctuate 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 pretax income.  At this time, the Company expects to utilize a larger amount of tax credits in 2014 than it did in 2013; however, the Company also expects to have a higher level of pretax income in 2014 compared to 2013.

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.  Fees included in interest income were $1.0 million and $851,000 for the three months ended September 30, 2014 and 2013, respectively.  Fees included in interest income were $2.2 million and $2.5 million for the nine months ended September 30, 2014 and 2013, respectively.  Tax-exempt income was not calculated on a tax equivalent basis. The table does not reflect any effect of income taxes.

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	September 30, 2014(2)			Three Months Ended September 30, 2014							Three Months Ended September 30, 2013
	Yield/ Rate			Average Balance			Interest		Yield/ Rate		Average Balance			Interest		Yield/ Rate
				(Dollars in thousands)
Interest-earning assets:
Loans receivable:
One- to four-family residential		4.63	%	$	550,479		$	11,353	8.18	%	$	461,892		$	8,434	7.24	%
Other residential		4.57			388,799			5,462	5.57			285,040			5,754	8.01
Commercial real estate		4.46			932,658			12,129	5.16			817,080			12,401	6.02
Construction		4.33			274,951			3,550	5.12			210,072			3,303	6.24
Commercial business		4.73			307,914			4,168	5.37			248,826			3,850	6.14
Other loans		5.29			428,946			7,625	7.05			303,776			5,695	7.44
Industrial revenue bonds (1)		5.47			47,633			661	5.50			45,333			650	5.68
Total loans receivable		4.78			2,931,380			44,948	6.08			2,372,019			40,087	6.70
Investment securities (1)		2.97			486,040			2,592	2.12			667,950			2,820	1.68
Other interest-earning assets		0.24			148,228			67	0.18			246,708			112	0.18
Total interest-earning assets		4.39			3,565,648			47,607	5.30			3,286,677			43,019	5.19
Non-interest-earning assets:
Cash and cash equivalents					101,239							90,021
Other non-earning assets					266,846							295,593
Total assets				$	3,933,733						$	3,672,291
Interest-bearing liabilities:
Interest-bearing demand and savings		0.19		$	1,467,364			789	0.21		$	1,336,049			710	0.21
Time deposits		0.77			1,090,111			2,095	0.76			1,034,460			2,112	0.81
Total deposits		0.44			2,557,475			2,884	0.45			2,370,509			2,822	0.47
Short-term borrowings and structured     repurchase agreements		0.03			161,178			13	0.03			220,645			587	1.06
Subordinated debentures issued to capital trusts		1.81			30,929			143	1.83			30,929			141	1.81
FHLB advances		0.91			214,282			461	0.85			129,488			1,005	3.08
Total interest-bearing liabilities		0.51			2,963,864			3,501	0.47			2,751,571			4,555	0.66
Non-interest-bearing liabilities:
Demand deposits					544,760							523,578
Other liabilities					18,397							19,689
Total liabilities					3,527,021							3,294,838
Stockholders’ equity					406,712							377,453
Total liabilities and stockholders’ equity				$	3,933,733						$	3,672,291
Net interest income:
Interest rate spread		3.88%					$	44,106	4.83	%				$	38,464	4.53	%
Net interest margin*									4.91	%						4.64	%
Average interest-earning assets to     average interest-bearing liabilities					120.3	%						119.4	%

_____________________
*	Defined as the Company’s net interest income divided by total interest-earning assets.

(1)

Of the total average balances of investment securities, average tax-exempt investment securities were $88.4 million and $77.9 million for the three months ended September 30, 2014 and 2013, respectively. In addition, average tax-exempt loans and industrial revenue bonds were $39.0 million and $37.3 million for the three months ended September 30, 2014 and 2013, respectively. Interest income on tax-exempt assets included in this table was $1.4 million and $1.2 million for the three months ended September 30, 2014 and 2013, respectively. Interest income net of disallowed interest expense related to tax-exempt assets was $1.4 million and $1.2 million for the three months ended September 30, 2014 and 2013, respectively.

(2)

The yield/rate on loans at September 30, 2014 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 September 30, 2014.

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	September 30, 2014(2)			Nine Months Ended September 30, 2014							Nine Months Ended September 30, 2013
	Yield/ Rate			Average Balance			Interest		Yield/ Rate		Average Balance			Interest		Yield/ Rate
				(Dollars in thousands)
Interest-earning assets:
Loans receivable:
One- to four-family residential		4.63	%	$	483,101		$	30,709	8.50	%	$	481,032		$	25,835	7.18	%
Other residential		4.57			367,907			16,013	5.82			302,603			17,948	7.93
Commercial real estate		4.46			902,867			35,851	5.31			803,493			37,432	6.23
Construction		4.33			239,563			8,782	4.90			208,669			11,523	7.38
Commercial business		4.73			287,639			11,634	5.41			248,865			11,118	5.97
Other loans		5.29			375,048			20,736	7.39			291,406			16,184	7.43
Industrial revenue bonds (1)		5.47			46,771			1,944	5.56			51,766			2,186	5.65
Total loans receivable		4.78			2,702,896			125,669	6.22			2,387,834			122,226	6.84
Investment securities (1)		2.97			528,794			8,367	2.12			763,143			11,291	1.98
Other interest-earning assets		0.24			201,414			250	0.17			313,402			339	0.14
Total interest-earning assets		4.39			3,433,104			134,286	5.23			3,464,379			133,856	5.16
Non-interest-earning assets:
Cash and cash equivalents					93,901							87,585
Other non-earning assets					266,184							308,303
Total assets				$	3,793,189						$	3,860,267
Interest-bearing liabilities:
Interest-bearing demand and savings		0.19		$	1,438,496			2,364	0.22		$	1,523,320			2,866	0.25
Time deposits		0.77			1,019,743			5,933	0.78			1,095,145			6,745	0.82
Total deposits		0.44			2,458,239			8,297	0.45			2,618,465			9,611	0.49
Short-term borrowings and structured     repurchase agreements		0.03			189,845			1,082	0.76			245,351			1,758	0.96
Subordinated debentures issued to capital trusts		1.81			30,929			418	1.81			30,929			421	1.82
FHLB advances		0.91			158,919			2,446	2.06			127,650			2,968	3.11
Total interest-bearing liabilities		0.51			2,837,932			12,243	0.58			3,022,395			14,758	0.65
Non-interest-bearing liabilities:
Demand deposits					537,436							439,076
Other liabilities					20,093							20,856
Total liabilities					3,395,461							3,482,327
Stockholders’ equity					397,728							377,940
Total liabilities and stockholders’ equity				$	3,793,189						$	3,860,267
Net interest income:
Interest rate spread		3.88%					$	122,043	4.65	%				$	119,098	4.51	%
Net interest margin*									4.75	%						4.60	%
Average interest-earning assets to     average interest-bearing liabilities					121.0	%						114.6	%

_____________________
*	Defined as the Company’s net interest income divided by total interest-earning assets.

(1)

Of the total average balances of investment securities, average tax-exempt investment securities were $88.5 million and $79.3 million for the nine months ended September 30, 2014 and 2013, respectively. In addition, average tax-exempt loans and industrial revenue bonds were $38.6 million and $38.6 million for the nine months ended September 30, 2014 and 2013, respectively. Interest income on tax-exempt assets included in this table was $4.0 million and $3.8 million for the nine months ended September 30, 2014 and 2013, respectively. Interest income net of disallowed interest expense related to tax-exempt assets was $3.9 million and $3.6 million for the nine months ended September 30, 2014 and 2013, respectively.

(2)

The yield/rate on loans at September 30, 2014 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 nine months ended September 30, 2014.

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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 September 30,
	2014 vs. 2013
	Increase (Decrease) Due to
							Total Increase (Decrease)
	Rate			Volume
	(Dollars in thousands)
Interest-earning assets:
Loans receivable	$	(3,963	)	$	8,824		$	4,861
Investment securities		643			(871	)		(228	)
Other interest-earning assets		—			(45	)		(45	)
Total interest-earning assets		(3,320	)		7,908			4,588
Interest-bearing liabilities:
Demand deposits		8			71			79
Time deposits		(127	)		110			(17	)
Total deposits		(119	)		181			62
Short-term borrowings and structured repo		(449	)		(125	)		(574	)
Subordinated debentures issued to capital trust		2			—			2
FHLBank advances		(976	)		432			(544	)
Total interest-bearing liabilities		(1,542	)		488			(1,054	)
Net interest income	$	(1,778	)	$	7,420		$	5,642

	Nine Months Ended September 30,
	2014 vs. 2013
	Increase (Decrease) Due to
							Total Increase (Decrease)
	Rate			Volume
	(Dollars in thousands)
Interest-earning assets:
Loans receivable	$	(11,812	)	$	15,255		$	3,443
Investment securities		740			(3,664	)		(2,924	)
Other interest-earning assets		45			(134	)		(89	)
Total interest-earning assets		(11,027	)		11,457			430
Interest-bearing liabilities:
Demand deposits		(349	)		(153	)		(502	)
Time deposits		(362	)		(450	)		(812	)
Total deposits		(711	)		(603	)		(1,314	)
Short-term borrowings and structured repo		(321	)		(355	)		(676	)
Subordinated debentures issued to capital trust		(3	)		—			(3	)
FHLBank advances		(1,146	)		624			(522	)
Total interest-bearing liabilities		(2,181	)		(334	)		(2,515	)
Net interest income	$	(8,846	)	$	11,791		$	2,945

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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. The Company manages its ability to generate liquidity primarily through liability funding in such a way that it believes it maintains overall liquidity sufficient to satisfy its depositors' requirements and meet its customers' credit needs. At September 30, 2014, the Company had commitments of approximately $194.4 million to fund loan originations, $430.9 million of unused lines of credit and unadvanced loans, and $24.2 million of outstanding letters of credit.

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 September 30, 2014, the Company had these available secured lines and on-balance sheet liquidity:

Federal Home Loan Bank line	$491.2 million
Federal Reserve Bank line	$545.3 million
Cash and cash equivalents	$221.4 million
Unpledged securities	$84.5 million

Statements of Cash Flows. During both the nine months ended September 30, 2014 and 2013, the Company had positive cash flows from operating activities and investing activities.  Cash flows from financing activities were negative for both the nine months ended September 30, 2014 and the nine months ended September 30, 2013.

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, impairments of investment securities, gains on sales of investment securities 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 $34.0 million and $69.2 million during the nine months ended September 30, 2014 and 2013, respectively.

During the nine months ended September 30, 2014 and 2013, respectively, investing activities provided cash of $107.0 million and $212.5 million primarily due to the repayment of investment securities and sale of investment securities, partially offset by the net increase in loans for each of the nine-month periods.  In the 2014 period, the Company received cash of $80.0 million related to the Boulevard Bank transaction and $109.4 million related to the Valley Bank transaction.

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, changes in short-term borrowings, and changes in structured repurchase agreements, as well as dividend payments to stockholders.  Financing activities used cash of $147.5 million and $346.0 million during the nine months ended September 30, 2014 and 2013, respectively. Financing activities in the future are expected to primarily include changes in deposits, changes in FHLBank advances, changes in short-term borrowings and dividend payments 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.

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At September 30, 2014, the Company's total stockholders' equity was $409.1 million, or 10.5% of total assets. At September 30, 2014, common stockholders' equity was $351.1 million, or 9.0% of total assets, equivalent to a book value of $25.62 per common share. Total stockholders’ equity at December 31, 2013, was $380.7 million, or 10.7% of total assets. At December 31, 2013, common stockholders' equity was $322.8 million, or 9.1% of total assets, equivalent to a book value of $23.60 per common share.

At September 30, 2014, the Company’s tangible common equity to total assets ratio was 8.8%, compared to 8.9% at December 31, 2013. The Company’s tangible common equity to total risk-weighted assets ratio was 11.2% at September 30, 2014, compared to 12.3% at December 31, 2013.

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. Guidelines require banks to have a minimum Tier 1 risk-based capital ratio, as defined, of 4.00%, a minimum total risk-based capital ratio of 8.00%, and a minimum 4.00% Tier 1 leverage ratio. To be considered "well capitalized," banks must have a minimum Tier 1 risk-based capital ratio, as defined, of 6.00%, a minimum total risk-based capital ratio of 10.00%, and a minimum Tier 1 leverage ratio of 5.00%. On September 30, 2014, the Bank's Tier 1 risk-based capital ratio was 12.0%, total risk-based capital ratio was 13.3% and the Tier 1 leverage ratio was 9.4%. As of September 30, 2014, the Bank was "well capitalized" as defined by the Federal banking agencies' capital-related regulations. The Federal Reserve Board has established capital regulations for bank holding companies that generally parallel the capital regulations for banks. On September 30, 2014, the Company's Tier 1 risk-based capital ratio was 13.8%, total risk-based capital ratio was 15.1% and the Tier 1 leverage ratio was 10.8%. As of September 30, 2014, the Company was "well capitalized" under the capital ratios described above.  These ratios are the current capital requirements.  As discussed above in “Effect of Federal Laws and Regulations,” the Company and the Bank will be subject to new capital requirements due to the changes from “Basel III,” for which the provisions become effective beginning January 1, 2015.

On August 18, 2011, the Company entered into a Small Business Lending Fund-Securities Purchase Agreement (“Purchase Agreement”) with the Secretary of the Treasury, pursuant to which the Company sold 57,943 shares of the Company’s Senior Non-Cumulative Perpetual Preferred Stock, Series A (the “SBLF Preferred Stock”), to the Secretary of the Treasury for a purchase price of $57,943,000.  The SBLF Preferred Stock was issued pursuant to Treasury’s SBLF program, a $30 billion fund established under the Small Business Jobs Act of 2010 that was created to encourage lending to small businesses by providing Tier 1 capital to qualified community banks and holding companies with assets of less than $10 billion.  As required by the Purchase Agreement, the proceeds from the sale of the SBLF Preferred Stock were used to redeem the 58,000 shares of preferred stock, previously issued to the Treasury pursuant to the TARP Capital Purchase Program (the “CPP”), at a redemption price of $58.0 million plus the accrued dividends owed on the preferred shares.

The SBLF Preferred Stock qualifies as Tier 1 capital.  The holder of the SBLF Preferred Stock is entitled to receive non-cumulative dividends, payable quarterly, on each January 1, April 1, July 1 and October 1.  The dividend rate, as a percentage of the liquidation amount, can fluctuate between one percent (1%) and five percent (5%) per annum on a quarterly basis during the first 10 quarters during which the SBLF Preferred Stock is outstanding, based upon changes in the level of “Qualified Small Business Lending” or “QSBL” (as defined in the Purchase Agreement) by the Bank over the adjusted baseline level calculated under the terms of the SBLF Preferred Stock ($201.4 million).  Based upon the increase in the Bank’s level of QSBL over the adjusted baseline level, the dividend rate has been 1.0%.  For the tenth calendar quarter through four and one half years after issuance, the dividend rate will be fixed at between one percent (1%) and seven percent (7%) based upon the level of qualifying loans.  The Company has now reached the tenth calendar quarter and the dividend rate will be 1.0% until four and one half years after the issuance, which is March 2016.  After four and one half years from issuance, the dividend rate will increase to 9% (including a quarterly lending incentive fee of 0.5%).

The SBLF Preferred Stock is non-voting, except in limited circumstances.  In the event that the Company misses five dividend payments, whether or not consecutive, the holder of the SBLF Preferred Stock will have the right, but not the obligation, to appoint a representative as an observer on the Company’s Board of Directors.  In the event that the Company misses six dividend payments, whether or not consecutive, and if the then outstanding aggregate liquidation amount of the SBLF Preferred Stock is at least $25,000,000, then the holder of the SBLF Preferred Stock will have the right to designate two directors to the Board of Directors of the Company.

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The SBLF Preferred Stock may be redeemed at any time at the Company’s option, at a redemption price of 100% of the liquidation amount plus accrued but unpaid dividends to the date of redemption for the current period, subject to the approval of its federal banking regulator.

Dividends. During the three months ended September 30, 2014, the Company declared a common stock cash dividend of $0.20 per share, or 24% of net income per diluted common share for that three month period, and paid a common stock cash dividend of $0.20 per share (which was declared in June 2014).  During the three months ended September 30, 2013, the Company declared a common stock cash dividend of $0.18 per share, or 30% of net income per diluted common share for that three month period, and paid a common stock cash dividend of $0.18 per share (which was declared in March 2013).  During the nine months ended September 30, 2014, the Company declared common stock cash dividends of $0.60 per share, or 27% of net income per diluted common share for that nine month period, and paid common stock cash dividends of $0.38 per share.  During the nine months ended September 30, 2013, the Company declared common stock cash dividends of $0.54 per share, or 30% of net income per diluted common share for that nine month period, and paid common stock cash dividends of $0.36 per share.  The Board of Directors meets regularly to consider the level and the timing of dividend payments.  The $0.20 per share dividend declared but unpaid as of September 30, 2014, was paid to stockholders on October 10, 2014.  In addition, the Company paid preferred dividends as described below.

The terms of the SBLF Preferred Stock impose limits on the ability of the Company to pay dividends and repurchase shares of common stock. Under the terms of the SBLF Preferred Stock, no repurchases may be effected, and no dividends may be declared or paid on preferred shares ranking pari passu with the SBLF Preferred Stock, junior preferred shares, or other junior securities (including the common stock) during the current quarter and for the next three quarters following the failure to declare and pay dividends on the SBLF Preferred Stock, except that, in any such quarter in which the dividend is paid, dividend payments on shares ranking pari passu may be paid to the extent necessary to avoid any resulting material covenant breach.

Under the terms of the SBLF Preferred Stock, the Company may only declare and pay a dividend on the common stock or other stock junior to the SBLF Preferred Stock, or repurchase shares of any such class or series of stock, if, after payment of such dividend, or after giving effect to such repurchase, (i) the dollar amount of the Company’s Tier 1 Capital would be at least equal to the “Tier 1 Dividend Threshold” and (ii) full dividends on all outstanding shares of SBLF Preferred Stock for the most recently completed dividend period have been or are contemporaneously declared and paid.  As of September 30, 2014, we satisfied this condition.

The “Tier 1 Dividend Threshold” means 90% of $272.7 million, which was the Company’s consolidated Tier 1 capital as of September 30, 2011, less the $58 million in TARP preferred stock then-outstanding and repaid on August 18, 2011, plus the $58 million in SBLF Preferred Stock issued and minus the net loan charge-offs by the Bank since August 18, 2011.  The Tier 1 Dividend Threshold is subject to reduction, beginning on the first day of the eleventh dividend period following the date of issuance of the SBLF Preferred Stock, by $5.8 million (ten percent of the aggregate liquidation amount of the SBLF Preferred Stock initially issued, without regard to any subsequent partial redemptions) for each one percent increase in qualified small business lending from the adjusted baseline level under the terms of the SBLF preferred stock (i.e., $249.7 million) to the ninth dividend period.

Common Stock Repurchases and Issuances. The Company has been in various buy-back programs since May 1990. Our ability to repurchase common stock  is currently limited, but allowed, under the terms of the SBLF preferred stock as noted above, under “-Dividends” and was previously generally precluded due to our participation in the CPP beginning in December 2008.  During the three months ended September 30, 2014, the Company repurchased 1,000 shares of its common stock at an average price of $31.05 per share.  During the three months ended September 30, 2013, the Company did not repurchase any shares of its common stock.  During the nine months ended September 30, 2014, the Company repurchased 18,000 shares of its common stock at an average price of $28.45 per share.  During the nine months ended September 30, 2013, the Company did not repurchase any shares of its common stock.  During the three months ended September 30, 2014, the Company issued 23,270 shares of stock at an average price of $30.59 per share to cover stock option exercises.  During the three months ended September 30, 2013, the Company issued 41,927 shares of stock at an average price of $20.10 per share to cover stock option exercises.  During the nine months ended September 30, 2014, the Company issued 51,241 shares of stock at an average price of $27.50 per share to cover stock option exercises.  During the nine months ended September 30, 2013, the Company issued 69,371 shares of stock at an average price of $19.75 per share to cover stock option exercises.

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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.

On April 21, 2014, Great Southern reiterated that it will consider repurchasing its shares of common stock, from time to time in the open market or through privately negotiated transactions, pursuant to its existing repurchase plan.  There are 378,562 remaining shares authorized to be repurchased under this plan.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Asset and Liability Management and Market Risk

A principal operating objective of the Company is to produce stable earnings by achieving a favorable interest rate spread that can be sustained during fluctuations in prevailing interest rates. The Company has sought to reduce its exposure to adverse changes in interest rates by attempting to achieve a closer match between the periods in which its interest-bearing liabilities and interest-earning assets can be expected to reprice through the origination of adjustable-rate mortgages and loans with shorter terms to maturity and the purchase of other shorter term interest-earning assets.

Our Risk When Interest Rates Change

The rates of interest we earn on assets and pay on liabilities generally are established contractually for a period of time. Market interest rates change over time. Accordingly, our results of operations, like those of other financial institutions, are impacted by changes in interest rates and the interest rate sensitivity of our assets and liabilities. The risk associated with changes in interest rates and our ability to adapt to these changes is known as interest rate risk and is our most significant market risk.

How We Measure the Risk to Us Associated with Interest Rate Changes

In an attempt to manage our exposure to changes in interest rates and comply with applicable regulations, we monitor Great Southern's interest rate risk. In monitoring interest rate risk we regularly analyze and manage assets and liabilities based on their payment streams and interest rates, the timing of their maturities and their sensitivity to actual or potential changes in market interest rates.

The ability to maximize net interest income is largely dependent upon the achievement of a positive interest rate spread that can be sustained despite fluctuations in prevailing interest rates. Interest rate sensitivity is a measure of the difference between amounts of interest-earning assets and interest-bearing liabilities which either reprice or mature within a given period of time. The difference, or the interest rate repricing "gap," provides an indication of the extent to which an institution's interest rate spread will be affected by changes in interest rates. A gap is considered positive when the amount of interest-rate sensitive assets exceeds the amount of interest-rate sensitive liabilities repricing during the same period, and is considered negative when the amount of interest-rate sensitive liabilities exceeds the amount of interest-rate sensitive assets during the same period. Generally, during a period of rising interest rates, a negative gap within shorter repricing periods would adversely affect net interest income, while a positive gap within shorter repricing periods would result in an increase in net interest income. During a period of falling interest rates, the opposite would be true. As of September 30, 2014, Great Southern's internal 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 would 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 materially 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.  The effects of interest rate changes, if any, are expected to be more impacting to net interest income in the 12 to 36 months following a rate change.  In June 2014, $130 million of fixed rate borrowings were repaid.  Excess liquidity and proceeds from the sale of certain investment securities were used to fund these repayments.  The results of our net interest income modeling were not materially affected by these transactions.  As the Federal Funds rate is now very low, the Company’s interest rate floors have been reached on most of its “prime rate” loans. As discussed under “-General-Net Interest Income and Interest Rate Risk Management,” at September 30,

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2014 and December 31, 2013, there were $475 million and $502 million, respectively, of adjustable rate loans which were tied to a national prime rate of interest which had interest rate floors.  In addition, Great Southern has elected to leave its “Great Southern Prime Rate” at 5.00% for those loans that are indexed to “Great Southern Prime” rather than a national prime rate of interest. At September 30, 2014 and December 31, 2013, there were $215 million and $248 million, respectively, of loans indexed to “Great Southern Prime.”  While these interest rate floors and, to a lesser extent, the utilization of the “Great Southern Prime” rate have helped keep the rate on our loan portfolio higher in this very low interest rate environment, they will also reduce the positive effect to our loan rates when market interest rates, specifically the “prime rate,” begin to increase. The interest rate on these loans will not increase until the loan floors are reached. Also, a significant portion of our retail certificates of deposit mature in the next twelve months and we expect that they will be replaced with new certificates of deposit at somewhat lower interest rates in some cases.

Interest rate risk exposure estimates (the sensitivity gap) are not exact measures of an institution's actual interest rate risk. They are only indicators of interest rate risk exposure produced in a simplified modeling environment designed to allow management to gauge the Bank's sensitivity to changes in interest rates. They do not necessarily indicate the impact of general interest rate movements on the Bank's net interest income because the repricing of certain categories of assets and liabilities is subject to competitive and other factors beyond the Bank's control. As a result, certain assets and liabilities indicated as maturing or otherwise repricing within a stated period may in fact mature or reprice at different times and in different amounts and cause a change, which potentially could be material, in the Bank's interest rate risk.

In order to minimize the potential for adverse effects of material and prolonged increases and decreases in interest rates on Great Southern's results of operations, Great Southern has adopted asset and liability management policies to better match the maturities and repricing terms of Great Southern's interest-earning assets and interest-bearing liabilities. Management recommends and the Board of Directors sets the asset and liability policies of Great Southern which are implemented by the asset and liability committee. The asset and liability committee is chaired by the Chief Financial Officer and is comprised of members of Great Southern's senior management. The purpose of the asset and liability committee is to communicate, coordinate and control asset/liability management consistent with Great Southern's business plan and board-approved policies. The asset and liability committee establishes and monitors the volume and mix of assets and funding sources taking into account relative costs and spreads, interest rate sensitivity and liquidity needs. The objectives are to manage assets and funding sources to produce results that are consistent with liquidity, capital adequacy, growth, risk and profitability goals. The asset and liability committee meets on a monthly basis to review, among other things, economic conditions and interest rate outlook, current and projected liquidity needs and capital positions and anticipated changes in the volume and mix of assets and liabilities. At each meeting, the asset and liability committee recommends appropriate strategy changes based on this review. The Chief Financial Officer or his designee is responsible for reviewing and reporting on the effects of the policy implementations and strategies to the Board of Directors at their monthly meetings.

In order to manage its assets and liabilities and achieve the desired liquidity, credit quality, interest rate risk, profitability and capital targets, Great Southern has focused its strategies on originating adjustable rate loans, and managing its deposits and borrowings to establish stable relationships with both retail customers and wholesale funding sources.

At times, depending on the level of general interest rates, the relationship between long- and short-term interest rates, market conditions and competitive factors, we may determine to increase our interest rate risk position somewhat in order to maintain or increase our net interest margin.

The asset and liability committee regularly reviews interest rate risk by forecasting the impact of alternative interest rate environments on net interest income and market value of portfolio equity, which is defined as the net present value of an institution's existing assets, liabilities and off-balance sheet instruments, and evaluating such impacts against the maximum potential changes in net interest income and market value of portfolio equity that are authorized by the Board of Directors of Great Southern.

In the normal course of business, the Company may use derivative financial instruments (primarily interest rate swaps) from time to time to assist in its interest rate risk management.  In the fourth quarter of 2011, the Company began executing interest rate swaps with commercial banking customers to facilitate their respective risk management strategies.  Those interest rate swaps are simultaneously hedged by offsetting interest rate swaps that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions.  Because the interest rate swaps associated with this program do not meet the strict hedge accounting requirements,

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changes in the fair value of both the customer swaps and the offsetting swaps are recognized directly in earnings. These interest rate derivatives result from a service provided to certain qualifying customers and, therefore, are not used to manage interest rate risk in the Company’s assets or liabilities. The Company manages a matched book with respect to its derivative instruments in order to minimize its net risk exposure resulting from such transactions.

In 2013, the Company entered into two interest rate cap agreements related to its floating rate debt associated with its trust preferred securities.  The agreements provide that the counterparty will reimburse the Company if interest rates rise above a certain threshold, thus creating a cap on the effective interest rate paid by the Company.  These agreements are classified as hedging instruments, and the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings.

For further information on derivatives and hedging activities, see Note 15 of the Notes to Consolidated Financial Statements contained in this report.

ITEM 4. CONTROLS AND PROCEDURES

We maintain a system of disclosure controls and procedures (as defined in Rule 13(a)-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act")) that is designed to provide reasonable assurance that information required to be disclosed by us in the reports that we file under the Exchange Act is recorded, processed, summarized and reported accurately and within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate. An evaluation of our disclosure controls and procedures was carried out as of September 30, 2014, under the supervision and with the participation of our principal executive officer, principal financial officer and several other members of our senior management. Our principal executive officer and principal financial officer concluded that, as of September 30, 2014, our disclosure controls and procedures were effective in ensuring that the information we are required to disclose in the reports we file or submit under the Act is (i) accumulated and communicated to our management (including the principal executive officer and principal financial officer) to allow timely decisions regarding required disclosure, and (ii) recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms.

There were no changes in our internal control over financial reporting (as defined in Rule 13(a)-15(f) under the Act) that occurred during the quarter ended September 30, 2014, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We do not expect that our internal control over financial reporting will prevent all errors and all fraud. A control procedure, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control procedure are met. Because of the inherent limitations in all control procedures, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns in controls or procedures can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any control procedure also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.  Because of the inherent limitations in a cost-effective control procedure, misstatements due to error or fraud may occur and not be detected.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

In the normal course of business, the Company and its subsidiaries are subject to pending and threatened legal actions, some of which seek substantial relief or damages.  While the ultimate outcome of such legal proceedings cannot be predicted with certainty, after reviewing pending and threatened litigation with counsel, management believes at this time that, except as noted below, the outcome of such litigation will not have a material adverse effect on the Company’s business, financial condition or results of operations.

79

On November 22, 2010, a suit was filed against the Bank in the Circuit Court of Greene County, Missouri by a customer alleging that the fees associated with the Bank’s automated overdraft program in connection with its debit cards and ATM cards constitute unlawful interest in violation of Missouri’s usury laws.  The Court has certified a class of Bank customers who have paid overdraft fees on their checking accounts pursuant to the Bank’s automated overdraft program.  The Bank intends to contest this case vigorously.  At this stage of the litigation, it is not possible for management of the Bank to determine the probability of a material adverse outcome or reasonably estimate the amount of any potential loss.

Item 1A. Risk Factors

There have been no material changes to the risk factors set forth in Part I, Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2013.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On November 15, 2006, the Company's Board of Directors authorized management to repurchase up to 700,000 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.  From the date we issued our CPP Preferred Stock (December 5, 2008) until the date we redeemed it in connection with our issuance of the SBLF Preferred Stock (August 18, 2011), we were generally precluded from purchasing shares of the Company’s stock without the Treasury's consent.  Our participation in the SBLF program does not preclude us from purchasing shares of the Company’s stock, provided that after giving effect to such purchase, (i) the dollar amount of the Company’s Tier 1 capital would be at least equal to the “Tier 1 Dividend Threshold” under the terms of the SBLF Preferred Stock and (ii) full dividends on all outstanding shares of SBLF Preferred Stock for the most recently completed dividend period have been or are contemporaneously declared and paid, as described under “Part I. Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Capital Resources.”

On April 21, 2014, Great Southern reiterated that it will consider repurchasing its shares of common stock, from time to time in the open market or through privately negotiated transactions, pursuant to its existing repurchase plan.

Shares purchased during the three months ended September 30, 2014, are indicated below.

	Total Number of Shares Purchased		Average Price Per Share		Total Number of Shares Purchased As Part of Publicly Announced Plan		Maximum Number of Shares that May Yet Be Purchased Under the Plan(1)
July 1, 2014 – July 31, 2014		---	$	----		---		379,562
August 1, 2014 – August 31, 2014		1,000	$	31.05		1,000		378,562
September 1, 2014 – September 30, 2014		---	$	----		---		378,562
		1,000	$	31.05		1,000

_______________________
(1)	Amount represents the number of shares available to be repurchased under the November 2006 plan as of the last calendar day of the month shown.

80

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable

Item 5. Other Information

None.

Item 6. Exhibits and Financial Statement Schedules

a)	Exhibits
	See Exhibit Index.

81

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Great Southern Bancorp, Inc.
	Registrant
Date: November 10, 2014	/s/ Joseph W. Turner
	Joseph W. Turner President and Chief Executive Officer (Principal Executive Officer)
Date: November 10, 2014	/s/ Rex A. Copeland
	Rex A. Copeland Treasurer (Principal Financial and Accounting Officer)

82

EXHIBIT INDEX

Exhibit No.		Description
(2)	Plan of acquisition, reorganization, arrangement, liquidation, or succession
	(i)	The Purchase and Assumption Agreement, dated as of March 20, 2009, among Federal Deposit Insurance Corporation, Receiver of TeamBank, N.A., Paola, Kansas, Federal Deposit Insurance Corporation and Great Southern Bank, previously filed with the Commission (File no. 000-18082) as Exhibit 2.1 to the Registrant's Current Report on Form 8-K filed on March 26, 2011 is incorporated herein by reference as Exhibit 2.1(i).
	(ii)	The Purchase and Assumption Agreement, dated as of September 4, 2009, among Federal Deposit Insurance Corporation, Receiver of Vantus Bank, Sioux City, Iowa, Federal Deposit Insurance Corporation and Great Southern Bank, previously filed with the Commission (File no. 000-18082) as Exhibit 2.1 to the Registrant's Current Report on Form 8-K filed on September 11, 2011 is incorporated herein by reference as Exhibit 2.1(ii).
	(iii)	The Purchase and Assumption Agreement, dated as of October 7, 2011, among Federal Deposit Insurance Corporation, Receiver of Sun Security Bank, Ellington, Missouri, Federal Deposit Insurance Corporation and Great Southern Bank, previously filed with the Commission (File no. 000-18082) as Exhibit 2.1(iii) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2013 is incorporated herein by reference as Exhibit 2(iii).
	(iv)	The Purchase and Assumption Agreement, dated as of April 27, 2013, among Federal Deposit Insurance Corporation, Receiver of Inter Savings Bank, FSB, Maple Grove, Minnesota, Federal Deposit Insurance Corporation and Great Southern Bank, previously filed with the Commission (File no. 000-18082) as Exhibit 2.1(iv) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2011 is incorporated herein by reference as Exhibit 2(iv).
	(v)	The Purchase and Assumption Agreement All Deposits, dated as of June 20, 2014, among Federal Deposit Insurance Corporation, Receiver of Valley Bank, Moline, Illinois, Federal Deposit Insurance Corporation and Great Southern Bank, previously filed with the Commission (File no. 000-18082) as Exhibit 2.1(v) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2014 is incorporated herein by reference as Exhibit 2(v).
(3)	Articles of incorporation and Bylaws
	(i)	The Registrant's Charter previously filed with the Commission as Appendix D to the Registrant's Definitive Proxy Statement on Schedule 14A filed on March 31, 2004 (File No. 000-18082), is incorporated herein by reference as Exhibit 3.1.
	(iA)	The Articles Supplementary to the Registrant's Charter setting forth the terms of the Registrant's Senior Non-Cumulative Perpetual Preferred Stock, Series A, previously filed with the Commission (File no. 000-18082) as Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed on August 18, 2011, are incorporated herein by reference as Exhibit 3(i).
	(ii)	The Registrant's Bylaws, previously filed with the Commission (File no. 000-18082) as Exhibit 3(ii) to the Registrant's Current Report on Form 8-K filed on October 23, 2007, is incorporated herein by reference as Exhibit 3.2.
(4)	Instruments defining the rights of security holders, including indentures
	The Company hereby agrees to furnish the SEC upon request, copies of the instruments defining the rights of the holders of each issue of the Registrant's long-term debt.

83

(9)	Voting trust agreement
	Inapplicable.
(10)	Material contracts
	The Registrant's 1997 Stock Option and Incentive Plan previously filed with the Commission (File no. 000-18082) as Annex A to the Registrant's Definitive Proxy Statement on Schedule 14A filed on September 18, 1997 is incorporated herein by reference as Exhibit 10.1.
	The Registrant's 2003 Stock Option and Incentive Plan previously filed with the Commission (File No. 000-18082) as Annex A to the Registrant's Definitive Proxy Statement on Schedule 14A filed on April 14, 2003, is incorporated herein by reference as Exhibit 10.2.
	The employment agreement dated September 18, 2002 between the Registrant and William V. Turner previously filed with the Commission (File no. 000-18082) as Exhibit 10.2 to the Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2003, is incorporated herein by reference as Exhibit 10.3.
	The employment agreement dated September 18, 2002 between the Registrant and Joseph W. Turner previously filed with the Commission (File no. 000-18082) as Exhibit 10.4 to the Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2003, is incorporated herein by reference as Exhibit 10.4.
	The form of incentive stock option agreement under the Registrant's 2003 Stock Option and Incentive Plan previously filed with the Commission as Exhibit 10.1 to the Registrant's Current Report on Form 8-K (File no. 000-18082) filed on February 24, 2005 is incorporated herein by reference as Exhibit 10.5.
	The form of non-qualified stock option agreement under the Registrant's 2003 Stock Option and Incentive Plan previously filed with the Commission as Exhibit 10.2 to the Registrant's Current Report on Form 8-K (File no. 000-18082) filed on February 24, 2005 is incorporated herein by reference as Exhibit 10.6.
	A description of the current salary and bonus arrangements for 2014 for the Registrant's named executive officers previously filed with the Commission as Exhibit 10.7 to the Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2013 is incorporated herein by reference as Exhibit 10.7.
	A description of the current fee arrangements for the Registrant's directors previously filed with the Commission as Exhibit 10.8 to the Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2013 is incorporated herein by reference as Exhibit 10.8.
	Small Business Lending Fund – Securities Purchase Agreement, dated August 18, 2011, between the Registrant and the Secretary of the United States Department of the Treasury, previously filed with the Commission as Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on August 18, 2011, is incorporated herein by reference as Exhibit 10.9.
	The Registrant's 2013 Equity Incentive Plan previously filed with the Commission (File No. 000-18082) as Annex A to the Registrant's Definitive Proxy Statement on Schedule 14A filed on April 4, 2013, is incorporated herein by reference as Exhibit 10.10.
	The form of incentive stock option award agreement under the Registrant's 2013 Equity Incentive Plan previously filed with the Commission as Exhibit 10.2 to the Registrant's Registration Statement on Form S-8 (File no. 333-189497) filed on June 20, 2013 is incorporated herein by reference as Exhibit 10.11.

84

	The form of non-qualified stock option award agreement under the Registrant's 2013 Equity Incentive Plan previously filed with the Commission as Exhibit 10.3 to the Registrant's Registration Statement on Form S-8 (File no. 333-189497) filed on June 20, 2013 is incorporated herein by reference as Exhibit 10.12.
	The form of stock appreciation right award agreement under the Registrant's 2013 Equity Incentive Plan previously filed with the Commission as Exhibit 10.4 to the Registrant's Registration Statement on Form S-8 (File no. 333-189497) filed on June 20, 2013 is incorporated herein by reference as Exhibit 10.13.
	The form of restricted stock award agreement under the Registrant's 2013 Equity Incentive Plan previously filed with the Commission as Exhibit 10.5 to the Registrant's Registration Statement on Form S-8 (File no. 333-189497) filed on June 20, 2013 is incorporated herein by reference as Exhibit 10.14.
(11)	Statement re computation of per share earnings
	Included in Note 5 to the Consolidated Financial Statements.
(15)	Letter re unaudited interim financial information
	Inapplicable.
(18)	Letter re change in accounting principles
	Inapplicable.
(19)	Report furnished to securityholders.
	Inapplicable.
(22)	Published report regarding matters submitted to vote of security holders
	Inapplicable.
(23)	Consents of experts and counsel
	Inapplicable.
(24)	Power of attorney
	None.
(31.1)	Rule 13a-14(a) Certification of Chief Executive Officer
	Attached as Exhibit 31.1
(31.2)	Rule 13a-14(a) Certification of Treasurer
	Attached as Exhibit 31.2
(32)	Certification pursuant to Section 906 of Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)
	Attached as Exhibit 32.

85

(99)	Additional Exhibits
	None.
(101)	Attached as Exhibit 101 are the following financial statements from the Great Southern Bancorp, Inc. Quarterly Report on Form 10-Q for the quarter ended September 30, 2014, formatted in Extensive Business Reporting Language (XBRL): (i) consolidated statements of financial condition, (ii) consolidated statements of income, (iii) consolidated statements of cash flows and (iv) the notes to consolidated financial statements.

86

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Joseph W. Turner, certify that: 1.           I have reviewed this quarterly report on Form 10-Q of Great Southern Bancorp, Inc.; 2.           Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3.           Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4.           The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	a)           designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b)           designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c)           evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d)           disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.           The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)           all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b)           any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 10, 2014

/s/ Joseph W. Turner                                      

Joseph W. Turner

President and Chief Executive Officer

EX-31.1

Exhibit 31.2

CERTIFICATIONS

I, Rex A. Copeland, certify that: 1.           I have reviewed this quarterly report on Form 10-Q of Great Southern Bancorp, Inc.; 2.           Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3.           Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4.           The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	a)           designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b)           designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c)           evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d)           disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.           The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	a)           all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b)           any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 10, 2014

/s/ Rex A. Copeland                              

Rex A. Copeland

Treasurer

EX-32

Exhibit 32

SECTION 1350 CERTIFICATIONS

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the undersigned hereby certifies in his capacity as an officer of GREAT SOUTHERN BANCORP, INC. (the "Company") that the quarterly report of the Company on Form 10-Q for the quarter ended September 30, 2014 fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods presented in the financial statements included in such report.

Dated: November 10, 2014	/s/ Joseph W. Turner                                                                            Joseph W. Turner  President and Chief Executive Officer
Dated: November 10, 2014	/s/ Rex A. Copeland                                                                              Rex A. Copeland  Treasurer

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Valley Bank FDIC Indemnification Asset Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Valley Bank FDIC Indemnification Asset Policy

Valley Bank Loans and Foreclosed Assets.  The following table presents the balances of the loans and discount related to the Valley Bank transaction at September 30, 2014.  Gross loan balances (due from the borrower) were reduced approximately $14.1 million since the transaction date because of $12.3 million of repayments by the borrower and $1.8 million of charge-offs to customer loan balances.  The Valley Bank transaction did not include a loss sharing agreement; however, the loans were recorded at a discount, which is accreted to yield over the life of the loans. 

XML

Note 14: Fair Value Measurement: Schedule Of Mortgage Servicing Rights Reconciliation (Details) (Mortgage Servicing Rights, USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Mortgage Servicing Rights
Fair Value Mortgage Servicing Rights	$ 196	$ 246	$ 211	$ 152
Servicing Asset at Fair Value, Additions	28	32	81	224
Amortization of Mortgage Servicing Rights (MSRs)	(35)	(42)	(103)	(140)
Fair Value Mortgage Servicing Rights	$ 189	$ 236	$ 189	$ 236

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of Impact of Adjustments of Acquired Loans on Financial Results (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Impact of Adjustments of Acquired Loans on Financial Results

The impact of adjustments on the Company’s financial results is shown below:

	Three Months Ended		Three Months Ended
	September 30, 2014		September 30, 2013
(In Thousands, Except Per Share Data
and Basis Points Data)
Impact on net interest income/
net interest margin (in basis points)	$8,848	98 bps	$8,412	101 bps
Non-interest income	(7,438)		(7,310)
Net impact to pre-tax income	$1,410		$1,102
Net impact net of taxes	$917		$716
Impact to diluted earnings per common share	$0.07		$0.05

	Nine Months Ended		Nine Months Ended
	September 30, 2014		September 30, 2013
(In Thousands, Except Per Share Data
and Basis Points Data)
Impact on net interest income/
net interest margin (in basis points)	$25,836	101 bps	$26,508	103 bps
Non-interest income	(21,915)		(22,529)
Net impact to pre-tax income	$3,921		$3,979
Net impact net of taxes	$2,549		$2,586
Impact to diluted earnings per common share	$0.19		$0.19

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Note 7: Loans and Allowance For Loan Losses: Schedule of Loans (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Loans

	September 30,	December 31,
	2014	2013
(In Thousands)
One- to four-family residential construction	$43,386	$34,662
Subdivision construction	35,344	40,409
Land development	48,581	57,841
Commercial construction	361,971	184,019
Owner occupied one- to four-family residential	78,984	89,133
Non-owner occupied one- to four-family residential	143,414	145,908
Commercial real estate	872,294	780,690
Other residential	353,225	325,599
Commercial business	349,387	315,269
Industrial revenue bonds	42,941	42,230
Consumer auto	274,250	134,717
Consumer other	78,676	82,260
Home equity lines of credit	61,152	58,283
FDIC-supported loans, net of discounts (TeamBank)	15,294	49,862
Acquired non-covered loans, net of discounts (TeamBank)	28,341	--
FDIC-supported loans, net of discounts (Vantus Bank)	43,653	57,920
FDIC-supported loans, net of discounts (Sun Security Bank)	54,394	64,843
FDIC-supported loans, net of discounts (InterBank)	203,787	213,539
Acquired loans not covered by FDIC loss sharing agreements, net of
discounts (Valley Bank)  (“acquired non-covered loans”)	152,497	--
	3,241,571	2,677,184
Undisbursed portion of loans in process	(279,435)	(194,544)
Allowance for loan losses	(38,081)	(40,116)
Deferred loan fees and gains, net	(2,745)	(2,994)
	$2,921,310	$2,439,530
Weighted average interest rate	4.78%	5.10%

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Note 16: FDIC-assisted Acquisition: Schedule of Certain Assets and Liabilities Acquired (Details) (Valley Bank, USD $) In Thousands, unless otherwise specified	Jun. 20, 2014
Assets | Cash
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	$ 2,729
Assets | Due From Banks
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	106,680
Assets | Cash and Cash Equivalents
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	109,409
Assets | Securities Investment
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	88,513
Assets | Loans Receivable Net
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	165,098	[1]
Assets | Accrued Interest Receivable
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	1,004
Assets | Property, Plant and Equipment
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	10,850
Assets | Core Deposits
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	2,800
Assets | Other Assets
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	1,060
Assets | Total Assets Acquired
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	378,734
Liabilities | Demand Deposits
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	186,902
Liabilities | Bank Time Deposits
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	179,125
Liabilities | Deposits
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	366,027
Liabilities | Repurchase Agreements
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	567
Liabilities | Accounts Payable
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	561
Liabilities | Accrued Interest Payable
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	182
Liabilities | Advances From Borrowers For Taxes And Insurance
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	592
Liabilities | Total Liabilities Assumed
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	367,929
Liabilities | Gain Recognized On Business Acquisition
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	$ 10,805

[1] Net of discount on loans purchased of $30,102.

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Note 14: Fair Value Measurement: Fair Value, Assets and Liabilities Measured on Nonrecurring Basis (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Fair Value, Assets and Liabilities Measured on Nonrecurring Basis

		Fair Value Measurements Using
		Quoted prices
		in active
		markets	Other	Significant
		for identical	observable	unobservable
		assets	inputs	inputs
	Fair value	(Level 1)	(Level 2)	(Level 3)
(In Thousands)
September 30, 2014
Impaired loans
One- to four-family residential construction	$--	$--	$--	$--
Subdivision construction	275	--	--	275
Land development	3,952	--	--	3,952
Owner occupied one- to four-family        residential	1,505	--	--	1,505
Non-owner occupied one- to four-family residential	954	--	--	954
Commercial real estate	5,343	--	--	5,343
Other residential	--	--	--	--
Commercial business	317	--	--	317
Consumer auto	46	--	--	46
Consumer other	411	--	--	411
Home equity lines of credit	239	--	--	239
Total impaired loans	$13,042	$--	$--	$13,042
Foreclosed assets held for sale	$1,887	$--	$--	$1,887
December 31, 2013
Impaired loans
One- to four-family residential construction	$--	$--	$--	$--
Subdivision construction	145	--	--	145
Land development	1,474	--	--	1,474
Owner occupied one- to four-family residential	349	--	--	349
Non-owner occupied one- to four-family residential	388	--	--	388
Commercial real estate	5,224	--	--	5,224
Other residential	1,440	--	--	1,440
Commercial business	61	--	--	61
Consumer auto	19	--	--	19
Consumer other	275	--	--	275
Home equity lines of credit	70	--	--	70
Total impaired loans	$9,445	$--	$--	$9,445
Foreclosed assets held for sale	$2,169	$--	$--	$2,169

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of TeamBank FDIC Indemnification Asset (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of TeamBank FDIC Indemnification Asset

	September 30, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$46,222	$169
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(2,061)	--
Original estimated fair value of assets, net of activity since
acquisition date	(43,635)	(156)
Expected loss remaining	526	13
Assumed loss sharing recovery percentage	83%	77%
Estimated loss sharing value	438	10
Indemnification asset to be amortized resulting from
change in expected losses	327	--
Accretable discount on FDIC indemnification asset	--	--
FDIC indemnification asset	$765	$10

	December 31, 2013
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$53,553	$664
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(2,882)	--
Original estimated fair value of assets, net of activity since
acquisition date	(49,862)	(647)
Expected loss remaining	809	17
Assumed loss sharing recovery percentage	82%	76%
Estimated loss sharing value	665	13
Indemnification asset to be amortized resulting from
change in expected losses	593	--
Accretable discount on FDIC indemnification asset	(10)	--
FDIC indemnification asset	$1,248	$13

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Note 5: Earnings Per Share: Schedule of Earnings Per Share, Basic and Diluted (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Details
Weighted Average Number of Shares Outstanding, Basic	13,696	13,647	13,693	13,634
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS	$ 11,445	$ 8,294	$ 31,027	$ 24,621
BASIC EARNINGS PER COMMON SHARE	$ 0.84	$ 0.61	$ 2.27	$ 1.81
Weighted Average Number of Shares Outstanding, Diluted	13,696	13,647	13,693	13,634
Net effect of dilutive stock options and warrants based on treasury stock method using average market price	89	58	75	58
Diluted shares	13,785	13,705	13,768	13,692
Net Income (Loss) Available to Common Stockholders, Diluted	$ 11,445	$ 8,294	$ 31,027	$ 24,621
DILUTED EARNINGS PER COMMON SHARE	$ 0.83	$ 0.61	$ 2.25	$ 1.80

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of Valley Bank Acquired Loans and Foreclosed Assets (Details) (Valley Bank Loans, USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Jun. 20, 2014
Valley Bank Loans
Initial basis for loss sharing determination, net of activity since acquisition date	$ 179,065	$ 193,186
Non-credit premium (discount), net of activity since acquisition date	1,752	2,015
Original estimated fair value of assets, net of activity since acquisition date	(152,497)	(165,098)
Expected loss remaining	$ 28,320	$ 30,103

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Note 6: Investment Securities: Other Than Temporary Impairment Credit Losses Recognized in Earnings (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Other Than Temporary Impairment Credit Losses Recognized in Earnings

The following table provides information about debt securities for which only a credit loss was recognized in income and other losses are recorded in other comprehensive income.

	Accumulated
	Credit Losses
(In Thousands)
Credit losses on debt securities held
January 1, 2013	$4,176
Additions related to other-than-temporary losses not previously recognized	--
Additions related to increases in credit losses on debt securities for which
other-than-temporary impairment losses were previously recognized	--
Reductions due to final principal payments	(4,176)
September 30, 2013	$--

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: InterBank Business Combination Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

InterBank Business Combination Policy

On April 27, 2012, Great Southern Bank entered into a purchase and assumption agreement with loss share with the FDIC to assume all of the deposits and acquire certain assets of Inter Savings Bank, FSB (“InterBank”), a full service bank headquartered in Maple Grove, Minnesota. 

The loans and foreclosed assets purchased in the InterBank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the FDIC agreed to cover 80% of the losses on the loans (excluding approximately $60,000 of consumer loans) and foreclosed assets purchased subject to certain limitations.  Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by Great Southern.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A premium was recorded in conjunction with the fair value of the acquired loans and the amount amortized to yield during the three and nine months ended September 30, 2014 was $133,000 and $417,000, respectively.  The amount amortized to yield during the three and nine months ended September 30, 2013 was $155,000 and $485,000, respectively.

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Note 5: Earnings Per Share: Options to Purchase Common Stock (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Details
Options to purchase shares of common stock outstanding not included in computation of diluted earnings per share because exercise price greater than average market price	118,600	304,630	232,735	304,630

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Note 15: Derivatives and Hedging Activities: Nondesignated Hedges (Details) (Interest Rate Swap, Not Designated as Hedging Instrument, Commercial customers, USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Interest Rate Swap | Not Designated as Hedging Instrument | Commercial customers
Derivative, Notional Amount	$ 127,900	$ 114,000

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Note 15: Derivatives and Hedging Activities: Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss)

The following table presents the effect of derivative instruments on the statements of comprehensive income for the three and nine months ended September 30, 2014 and 2013: 

	Amount of Gain (Loss) Recognized in OCI
	Three Months Ended September 30
Cash Flow Hedges	2014	2013
(In Thousdans)
Interest rate cap	$                   53	$(45)

	Amount of Gain (Loss) Recognized in OCI
	Nine Months Ended September 30
Cash Flow Hedges	2014	2013
(In Thousands)
Interest rate cap	$(90)	$(45)

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Note 7: Loans and Allowance For Loan Losses: Schedule of Loans (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Loans Receivable	$ 3,241,571	$ 2,677,184
Loans Receivable weighted average interest rate	4.78%	5.10%
One To Four Family Residential Construction
Loans Receivable	43,386	34,662
Subdivision Construction
Loans Receivable	35,344	40,409
Land Development
Loans Receivable	48,581	57,841
Commercial Construction
Loans Receivable	361,971	184,019
Owner Occupied One To Four Family Residential
Loans Receivable	78,984	89,133
Non-Owner Occupied One To Four Family Residential
Loans Receivable	143,414	145,908
Commercial Real Estate
Loans Receivable	872,294	780,690
Other Residential
Loans Receivable	353,225	325,599
Commercial Business
Loans Receivable	349,387	315,269
Industrial Revenue Bonds
Loans Receivable	42,941	42,230
Consumer Loans Auto Financing Receivable
Loans Receivable	274,250	134,717
Consumer Other Financing Receivable
Loans Receivable	78,676	82,260
Home Equity Line of Credit
Loans Receivable	61,152	58,283
FDIC Supported Loans Net Of Discounts TeamBank
Loans Receivable	15,294	49,862
Acquired loans not covered by FDIC loss sharing agreements, net of discounts (TeamBank)
Loans Receivable	28,341
FDIC Supported Loans Net Of Discounts Vantus Bank
Loans Receivable	43,653	57,920
FDIC Supported Loans Net Of Discounts Sun Security Bank
Loans Receivable	54,394	64,843
FDIC Supported Loans Net Of Discounts InterBank
Loans Receivable	203,787	213,539
Acquired loans not covered by FDIC loss sharing agreements, net of discounts (Valley Bank)
Loans Receivable	152,497
Undisbursed Portion Of Loans In Process
Loans Receivable	(279,435)	(194,544)
Allowance for Loans and Leases Receivable
Loans Receivable	(38,081)	(40,116)
Deferred Loan Fees And Gains, Net
Loans Receivable	(2,745)	(2,994)
Loans Receivable
Loans Receivable	$ 2,921,310	$ 2,439,530

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of Sun Security Bank FDIC Indemnification Asset (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Sun Security Bank FDIC Indemnification Asset

	September 30, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$62,722	$2,598
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(3,540)	--
Original estimated fair value of assets, net of activity since
acquisition date	(54,394)	(1,521)
Expected loss remaining	4,788	1,077
Assumed loss sharing recovery percentage	66%	80%
Estimated loss sharing value	3,173	862
Indemnification asset to be amortized resulting from
change in expected losses	2,827	--
Accretable discount on FDIC indemnification asset	(363)	(63)
FDIC indemnification asset	$5,637	$799

	December 31, 2013
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$78,524	$3,582
Non-credit premium/(discount), net of activity since acquisition date	(105)	--
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(5,062)	--
Original estimated fair value of assets, net of activity since
acquisition date	(64,843)	(2,193)
Expected loss remaining	8,514	1,389
Assumed loss sharing recovery percentage	70%	80%
Estimated loss sharing value	5,974	1,111
Indemnification asset to be amortized resulting from
change in expected losses	4,049	--
Accretable discount on FDIC indemnification asset	(680)	(93)
FDIC indemnification asset	$9,343	$1,018

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Note 11: Advances From Federal Home Loan Bank: Federal Home Loan Bank, Advances (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Federal Home Loan Bank advances	$ 190,664	$ 126,757
Due in 2014
Federal Home Loan Bank advances	149,015	2,315
Federal Home Loan Bank, Advances, Weighted Average Interest Rate	0.21%	1.02%
Due in 2015
Federal Home Loan Bank advances	10,065	10,065
Federal Home Loan Bank, Advances, Weighted Average Interest Rate	3.87%	3.87%
Due in 2016
Federal Home Loan Bank advances	70	25,070
Federal Home Loan Bank, Advances, Weighted Average Interest Rate	5.06%	3.81%
Due in 2017
Federal Home Loan Bank advances	30,825	85,825
Federal Home Loan Bank, Advances, Weighted Average Interest Rate	3.20%	3.92%
Due in 2018
Federal Home Loan Bank advances	81	81
Federal Home Loan Bank, Advances, Weighted Average Interest Rate	5.06%	5.06%
Due in 2019 and thereafter
Federal Home Loan Bank advances	529	529
Federal Home Loan Bank, Advances, Weighted Average Interest Rate	5.51%	5.51%
Federal Home Loan Bank Advances, Gross
Federal Home Loan Bank advances	190,585	123,885
Federal Home Loan Bank, Advances, Weighted Average Interest Rate	0.91%	3.85%
Federal Home Loan Bank Advances Unamortized Fair Value Adjustment
Federal Home Loan Bank advances	79	2,872
Federal Home Loan Bank Advances, Net
Federal Home Loan Bank advances	$ 190,664	$ 126,757

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Note 16: FDIC-assisted Acquisition: Schedule of Acquired Loans Performing and Nonperforming (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Acquired Loans Performing and Nonperforming

		FASB ASC
	FASB	310-30
	ASC	by
	310-30	Policy
	Loans	Loans	Total
(In Thousands)
Loans	$3,920	$161,178	$165,098

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Note 6: Investment Securities: Gain Loss on Investments Policy: Gross Gains and Losses on Sales of Available for Sale Securities (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Details
Available-for-sale Securities, Gross Realized Gains	$ 656	$ 644	$ 1,300	$ 795
Available-for-sale Securities, Gross Realized Losses	$ 335	$ 534	$ 335	$ 554

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Note 6: Investment Securities: Schedule of Held-to-maturity Securities (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Held-to-maturity securities fair value	$ 505	$ 912
US States and Political Subdivisions Debt Securities
Held to Maturity Securities Amortized Cost	450	805
Held to Maturity Securities Gross Unrealized Gains	55	107
Held-to-maturity securities fair value	$ 505	$ 912
Held to Maturity Securities Tax Equivalent Yield	7.37%	7.37%

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Note 6: Investment Securities: Other Than Temporary Impairment Credit Losses Recognized in Earnings (Details) (Credit Losses Recognized On Investments, USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013
Credit Losses Recognized On Investments
Other than Temporary Impairment, Credit Losses Recognized in Earnings, Credit Losses on Debt Securities Held, Beginning Balance	$ 4,176
Other than Temporary Impairment, Credit Losses Recognized in Earnings, Reductions, Securities Sold	$ (4,176)

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Note 2: Nature of Operations and Operating Segments (Details)	3 Months Ended
	Sep. 30, 2014
Details
Segment Reporting, Additional Information about Entity's Reportable Segments	The operating results of this segment are regularly reviewed by management to make decisions about resource allocations and to assess performance. Selected information is not presented separately for the Company’s reportable segment, as there is no material difference between that information and the corresponding information in the consolidated financial statements

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Note 14: Fair Value Measurement: Schedule Of Financial Instruments Fair Value (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule Of Financial Instruments Fair Value

		September 30, 2014				December 31, 2013
	Carrying		Fair	Hierarchy	Carrying		Fair	Hierarchy
	Amount		Value	Level	Amount		Value	Level
(In Thousands)
Financial assets
Cash and cash equivalents	$221,386		$221,386	1	$227,925		$227,925	1
Held-to-maturity securities	450		505	2	805		912	2
Mortgage loans held for sale	30,361		30,361	2	7,239		7,239	2
Loans, net of allowance for loan losses	2,921,310		2,931,098	3	2,439,530		2,442,917	3
Accrued interest receivable	11,214		11,214	3	11,408		11,408	3
Investment in FHLB stock	12,013		12,013	3	9,822		9,822	3
Financial liabilities
Deposits	3,071,170		3,076,464	3	2,808,626		2,813,779	3
FHLB advances	190,664		193,004	3	126,757		131,281	3
Short-term borrowings	172,983		172,983	3	136,109		136,109	3
Structured repurchase agreements	--		--	3	50,000		53,485	3
Subordinated debentures	30,929		30,929	3	30,929		30,929	3
Accrued interest payable	1,024		1,024	3	1,099		1,099	3
Unrecognized financial instruments (net of
contractual value)
Commitments to originate loans	--		--	3	--		--	3
Letters of credit	31		31	3	76		76	3
Lines of credit	--		--	3	--		--	3

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Note 2: Nature of Operations and Operating Segments: Segment Reporting, Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Segment Reporting, Policy

The Company’s banking operation is its only reportable segment.  The banking operation 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 through attracting deposits from the general public, accepting brokered deposits and borrowing from the Federal Home Loan Bank and others

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Note 7: Loans and Allowance For Loan Losses: Schedule of Financing Receivables NonAccrual Status (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Financing Receivables NonAccrual Status

Nonaccruing loans (excluding FDIC-supported loans, net of discount and acquired non-covered loans, net of discount) are summarized as follows:

	September 30,	December 31,
	2014	2013
(In Thousands)
One- to four-family residential construction	$223	$--
Subdivision construction	1,223	871
Land development	265	338
Commercial construction	--	--
Owner occupied one- to four-family residential	1,446	2,803
Non-owner occupied one- to four-family residential	2,997	703
Commercial real estate	2,968	6,205
Other residential	--	--
Commercial business	1,632	5,208
Industrial revenue bonds	--	2,023
Consumer auto	131	168
Consumer other	405	475
Home equity lines of credit	337	504
Total	$11,627	$19,298

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Note 6: Investment Securities: Schedule of Held-to-maturity Securities (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Held-to-maturity Securities

	September 30, 2014
		Gross	Gross		Tax
	Amortized	Unrealized	Unrealized	Fair	Equivalent
	Cost	Gains	Losses	Value	Yield
(In Thousands)
HELD-TO-MATURITY SECURITIES:
States and political subdivisions	$450	$55	$--	$505	7.37%

	December 31, 2013
		Gross	Gross		Tax
	Amortized	Unrealized	Unrealized	Fair	Equivalent
	Cost	Gains	Losses	Value	Yield
(In Thousands)
HELD-TO-MATURITY SECURITIES:
States and political subdivisions	$805	$107	$--	$912	7.37%

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Note 16: FDIC-assisted Acquisition: Schedule of FDIC Agreed Upon Transfer of Net Assets (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of FDIC Agreed Upon Transfer of Net Assets

	June 20,
	2014
(In Thousands)
Net liabilities as determined by the FDIC	$(21,897)
Cash transferred by the FDIC	59,394
Discount per Purchase and Assumption Agreement	37,497
Purchase accounting adjustments
Loans	(28,088)
Deposits	(399)
Investments	(1,005)
Core deposit intangible	2,800
Gain recognized on business acquisition	$10,805

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Note 7: Loans and Allowance For Loan Losses: Troubled Debt Restructurings Returned to Accrual Status (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2014
Troubled Debt Restructurings Returned to Accrual Status	$ 1,400	$ 2,100
Commercial Real Estate
Troubled Debt Restructurings Returned to Accrual Status	1,400	1,500
Consumer
Troubled Debt Restructurings Returned to Accrual Status	6	6
Residential Mortgage
Troubled Debt Restructurings Returned to Accrual Status		$ 591

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Sun Security Bank Indemnification Asset (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Sun Security Bank Indemnification Asset

Sun Security Bank Loans, Foreclosed Assets and Indemnification Asset.  The following tables present the balances of the FDIC indemnification asset related to the Sun Security Bank transaction at September 30, 2014 and December 31, 2013.  Gross loan balances (due from the borrower) were reduced approximately $171.7 million since the transaction date because of $112.8 million of repayments from borrowers, $27.6 million in transfers to foreclosed assets and $31.3 million of charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

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Note 7: Loans and Allowance For Loan Losses: Schedule of Impaired Loans (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Impaired Loans

Impaired loans (excluding FDIC-supported loans, net of discount and acquired non-covered loans, net of discount), are summarized as follows:

	September 30, 2014
		Unpaid
	Recorded	Principal	Specific
	Balance	Balance	Allowance
(In Thousands)
One- to four-family residential construction	$--	$--	$--
Subdivision construction	2,304	4,716	373
Land development	7,791	8,224	1,514
Commercial construction	--	--	--
Owner occupied one- to four-family residential	4,366	5,064	517
Non-owner occupied one- to four-family residential	4,614	4,837	450
Commercial real estate	28,899	30,210	1,736
Other residential	10,203	10,203	--
Commercial business	2,150	2,173	596
Industrial revenue bonds	2,976	4,288	--
Consumer auto	175	227	26
Consumer other	635	764	95
Home equity lines of credit	446	473	77
Total	$64,559	$71,179	$5,384

	Three Months Ended		Nine Months Ended
	September 30, 2014		September 30, 2014
	Average		Average
	Investment	Interest	Investment	Interest
	in Impaired	Income	in Impaired	Income
	Loans	Recognized	Loans	Recognized
(In Thousands)
One- to four-family residential construction	$121	$--	$59	$--
Subdivision construction	2,207	8	2,549	38
Land development	7,650	70	10,403	213
Commercial construction	--	--	--	--
Owner occupied one- to four-family residential	4,665	56	5,100	168
Non-owner occupied one- to four-family residential	4,550	53	4,137	163
Commercial real estate	29,531	298	30,204	988
Other residential	10,304	86	10,665	296
Commercial business	2,163	31	2,657	99
Industrial revenue bonds	3,362	192	2,998	192
Consumer auto	216	4	182	11
Consumer other	678	15	690	57
Home equity lines of credit	415	6	461	20
Total	$65,862	$819	$70,105	$2,245

	At or for the Year Ended December 31, 2013
				Average
		Unpaid		Investment	Interest
	Recorded	Principal	Specific	in Impaired	Income
	Balance	Balance	Allowance	Loans	Recognized
(In Thousands)
One- to four-family residential construction	$--	$--	$--	$36	$--
Subdivision construction	3,502	3,531	1,659	3,315	163
Land development	12,628	13,042	473	13,389	560
Commercial construction	--	--	--	--	--
Owner occupied one- to four-family residential	5,802	6,117	593	5,101	251
Non-owner occupied one- to four-family residential	3,751	4,003	249	4,797	195
Commercial real estate	31,591	34,032	90	42,242	1,632
Other residential	10,983	10,983	--	13,837	434
Commercial business	6,057	6,077	4,162	6,821	179
Industrial revenue bonds	2,698	2,778	--	2,700	27
Consumer auto	216	231	32	145	16
Consumer other	604	700	91	630	63
Home equity lines of credit	569	706	95	391	38
Total	$78,401	$82,200	$7,444	$93,404	$3,558

	September 30, 2013
		Unpaid
	Recorded	Principal	Specific
	Balance	Balance	Allowance
(In Thousands)
One- to four-family residential construction	$--	$--	$--
Subdivision construction	3,785	3,896	851
Land development	15,444	15,848	2,192
Commercial construction	--	--	--
Owner occupied one- to four-family residential	5,174	5,393	430
Non-owner occupied one- to four-family residential	4,351	5,233	369
Commercial real estate	40,981	42,507	2,416
Other residential	11,367	11,367	169
Commercial business	6,138	6,140	1,512
Industrial revenue bonds	2,698	2,778	--
Consumer auto	184	228	28
Consumer other	595	664	89
Home equity lines of credit	410	424	91
Total	$91,127	$94,478	$8,147

	Three Months Ended		Nine Months Ended
	September 30, 2013		September 30, 2013
	Average		Average
	Investment	Interest	Investment	Interest
	in Impaired	Income	in Impaired	Income
	Loans	Recognized	Loans	Recognized
(In Thousands)
One- to four-family residential construction	$48	$--	$48	$5
Subdivision construction	4,062	34	3,206	140
Land development	15,573	111	13,025	477
Commercial construction	--	--	--	--
Owner occupied one- to four-family residential	5,035	60	4,899	176
Non-owner occupied one- to four-family residential	4,832	12	5,112	173
Commercial real estate	40,792	506	44,374	1,246
Other residential	11,444	136	14,895	353
Commercial business	6,274	86	7,074	161
Industrial revenue bonds	2,698	--	2,701	14
Consumer auto	153	7	130	11
Consumer other	593	12	639	44
Home equity lines of credit	333	10	316	20
Total	$91,837	$974	$96,419	$2,820

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Note 14: Fair Value Measurement: Schedule of Interest Rate Derivative Assets (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Interest Rate Derivative Assets

	Interest Rate Derivative Asset
	2014	2013
(In Thousands)
Balance, July 1	$1,722	$1,379
Change in fair value through earnings	(210)	182
Balance, September 30	$1,512	$1,561

	Interest Rate Derivative Asset
	2014	2013
(In Thousands)
Balance, January 1	$1,859	$2,112
Change in fair value through earnings	(347)	(551)
Balance, September 30	$1,512	$1,561

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Note 14: Fair Value Measurement: Fair Value, Assets Measured on Recurring Basis (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
US Government Agencies Debt Securities
Fair Value Measured on Recurring Basis	$ 18,937	$ 17,255
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises
Fair Value Measured on Recurring Basis	276,627	367,578
US States and Political Subdivisions Debt Securities
Fair Value Measured on Recurring Basis	126,547	122,724
Equity Securities
Fair Value Measured on Recurring Basis	3,045	2,869
Mortgage Servicing Rights
Fair Value Measured on Recurring Basis	189	211
Interest Rate Swap Asset
Fair Value Measured on Recurring Basis	2,050	2,544
Interest Rate Swap Liability
Fair Value Measured on Recurring Basis	(1,489)	(1,613)
Small Business Administration Loan Pools
Fair Value Measured on Recurring Basis		44,855
Fair Value, Inputs, Level 2 | US Government Agencies Debt Securities
Fair Value Measured on Recurring Basis	18,937	17,255
Fair Value, Inputs, Level 2 | Mortgage-backed Securities, Issued by US Government Sponsored Enterprises
Fair Value Measured on Recurring Basis	276,627	367,578
Fair Value, Inputs, Level 2 | US States and Political Subdivisions Debt Securities
Fair Value Measured on Recurring Basis	126,547	122,724
Fair Value, Inputs, Level 2 | Equity Securities
Fair Value Measured on Recurring Basis	3,045	2,869
Fair Value, Inputs, Level 2 | Small Business Administration Loan Pools
Fair Value Measured on Recurring Basis		44,855
Fair Value, Inputs, Level 3 | Mortgage Servicing Rights
Fair Value Measured on Recurring Basis	189	211
Fair Value, Inputs, Level 3 | Interest Rate Swap Asset
Fair Value Measured on Recurring Basis	2,050	2,544
Fair Value, Inputs, Level 3 | Interest Rate Swap Liability
Fair Value Measured on Recurring Basis	$ (1,489)	$ (1,613)

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Note 9: Other Real Estate Owned: Schedule of Major Classifications of Foreclosed Assets (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Major Classifications of Foreclosed Assets

Major classifications of other real estate owned were as follows:

	September 30,	December 31,
	2014	2013
(In Thousands)
Foreclosed assets held for sale
One- to four-family construction	$--	$--
Subdivision construction	9,778	11,652
Land development	17,752	16,788
Commercial construction	--	2,132
One- to four-family residential	1,564	744
Other residential	3,577	5,900
Commercial real estate	1,779	4,135
Commercial business	59	77
Consumer	565	969
	35,074	42,397
FDIC-supported foreclosed assets, net of discounts	6,668	9,006
Foreclosed assets held for sale, net	41,742	51,403
Other real estate owned not acquired through
foreclosure	2,020	2,111
Other real estate owned	$43,762	$53,514

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Note 6: Investment Securities: Schedule of Amounts Reclassified out of Accumulated Other Comprehensive Income (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Amounts Reclassified out of Accumulated Other Comprehensive Income

	Amounts Reclassified from
	Other Comprehensive Income
	Three Months Ended September 30,		Affected Line Item in
(In Thousands)	2014	2013	the Statements of Income
Unrealized gains (losses) on available-			Net realized gains on available-
for-sale securities	$321	$110	for-sale securities
Income Taxes	(112)	(38)	(Total reclassified amount before tax) Provision for income taxes
Total reclassifications out of accumulated
other comprehensive income	$209	$72

	Amounts Reclassified from
	Other Comprehensive Income
	Nine Months Ended September 30,		Affected Line Item in the
	2014	2013	Statements of Income
(In Thousands)
Unrealized gains (losses) on available-			Net realized gains on available-
for-sale securities	$963	$241	for-sale securities
Income Taxes	(337)	(84)	(Total reclassified amount before tax) Provision for income taxes
Total reclassifications out of accumulated
other comprehensive income	$626	$157

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Note 2: Nature of Operations and Operating Segments

3 Months Ended

Sep. 30, 2014

Notes

Note 2: Nature of Operations and Operating Segments

NOTE 2: NATURE OF OPERATIONS AND OPERATING SEGMENTS

The Company operates as a one-bank holding company.  The Company’s business primarily consists of the operations of Great Southern Bank (the “Bank”), which provides a full range of financial services to customers primarily located in Missouri, Iowa, Kansas, Minnesota, Nebraska and Arkansas.  In addition, the Company operates commercial loan production offices in Dallas, Texas and Tulsa, Oklahoma.  The Company and the Bank are subject to the regulation of certain federal and state agencies and undergo periodic examinations by those regulatory agencies.

The Company’s banking operation is its only reportable segment.  The banking operation 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 through attracting deposits from the general public, accepting brokered deposits and borrowing from the Federal Home Loan Bank and others

.  The operating results of this segment are regularly reviewed by management to make decisions about resource allocations and to assess performance.  Selected information is not presented separately for the Company’s reportable segment, as there is no material difference between that information and the corresponding information in the consolidated financial statements.

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Note 14: Fair Value Measurement: Fair Value, Assets and Liabilities Measured on Nonrecurring Basis (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Impaired Loans | Subdivision Construction
Assets, Fair Value Disclosure, Nonrecurring	$ 275	$ 145
Impaired Loans | Land Development
Assets, Fair Value Disclosure, Nonrecurring	3,952	1,474
Impaired Loans | Owner Occupied One To Four Family Residential
Assets, Fair Value Disclosure, Nonrecurring	1,505	349
Impaired Loans | Non-Owner Occupied One To Four Family Residential
Assets, Fair Value Disclosure, Nonrecurring	954	388
Impaired Loans | Commercial Real Estate
Assets, Fair Value Disclosure, Nonrecurring	5,343	5,224
Impaired Loans | Other Residential
Assets, Fair Value Disclosure, Nonrecurring		1,440
Impaired Loans | Commercial Business
Assets, Fair Value Disclosure, Nonrecurring	317	61
Impaired Loans | Consumer Loans Auto Financing Receivable
Assets, Fair Value Disclosure, Nonrecurring	46	19
Impaired Loans | Consumer Other Financing Receivable
Assets, Fair Value Disclosure, Nonrecurring	411	275
Impaired Loans | Home Equity Line of Credit
Assets, Fair Value Disclosure, Nonrecurring	239	70
Impaired Loans | Total Impaired Loans
Assets, Fair Value Disclosure, Nonrecurring	13,042	9,445
Foreclosed Assets Held For Sale
Assets, Fair Value Disclosure, Nonrecurring	1,887	2,169
Fair Value, Inputs, Level 3 | Impaired Loans | Subdivision Construction
Assets, Fair Value Disclosure, Nonrecurring	275	145
Fair Value, Inputs, Level 3 | Impaired Loans | Land Development
Assets, Fair Value Disclosure, Nonrecurring	3,952	1,474
Fair Value, Inputs, Level 3 | Impaired Loans | Owner Occupied One To Four Family Residential
Assets, Fair Value Disclosure, Nonrecurring	1,505	349
Fair Value, Inputs, Level 3 | Impaired Loans | Non-Owner Occupied One To Four Family Residential
Assets, Fair Value Disclosure, Nonrecurring	954	388
Fair Value, Inputs, Level 3 | Impaired Loans | Commercial Real Estate
Assets, Fair Value Disclosure, Nonrecurring	5,343	5,224
Fair Value, Inputs, Level 3 | Impaired Loans | Other Residential
Assets, Fair Value Disclosure, Nonrecurring		1,440
Fair Value, Inputs, Level 3 | Impaired Loans | Commercial Business
Assets, Fair Value Disclosure, Nonrecurring	317	61
Fair Value, Inputs, Level 3 | Impaired Loans | Consumer Loans Auto Financing Receivable
Assets, Fair Value Disclosure, Nonrecurring	46	19
Fair Value, Inputs, Level 3 | Impaired Loans | Consumer Other Financing Receivable
Assets, Fair Value Disclosure, Nonrecurring	411	275
Fair Value, Inputs, Level 3 | Impaired Loans | Home Equity Line of Credit
Assets, Fair Value Disclosure, Nonrecurring	239	70
Fair Value, Inputs, Level 3 | Impaired Loans | Total Impaired Loans
Assets, Fair Value Disclosure, Nonrecurring	13,042	9,445
Fair Value, Inputs, Level 3 | Foreclosed Assets Held For Sale
Assets, Fair Value Disclosure, Nonrecurring	$ 1,887	$ 2,169

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Note 9: Other Real Estate Owned: Schedule of Expenses Applicable to Foreclosed Assets (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Expenses Applicable to Foreclosed Assets

	Three Months Ended September 30,
	2014	2013
(In Thousands)
Net (gain) loss on sales of foreclosed assets	$126	$27
Valuation write-downs	158	258
Operating expenses, net of rental income	698	783
	$982	$1,068

	Nine Months Ended September 30,
	2014	2013
(In Thousands)
Net (gain) loss on sales of foreclosed assets	$72	$(255)
Valuation write-downs	1,357	1,313
Operating expenses, net of rental income	1,744	2,420
	$3,173	$3,478

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Note 6: Investment Securities: Schedule of Maturity of Available for Sale Securities (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Maturity of Available for Sale Securities

The amortized cost and fair value of available-for-sale securities at September 30, 2014, by contractual maturity, are shown below.  Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized	Fair
	Cost	Value
(In Thousands)
One year or less	$110	$111
After one through five years	1,472	1,486
After five through ten years	7,504	7,794
After ten years	130,974	136,093
Securities not due on a single maturity date	273,358	276,627
Equity securities	847	3,045
	$414,265	$425,156

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Note 7: Loans and Allowance For Loan Losses: Loan Portfolio Credit quality internal Grading System Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Loan Portfolio Credit quality internal Grading System Policy

The Company reviews the credit quality of its loan portfolio using an internal grading system that classifies loans as “Satisfactory,” “Watch,” “Special Mention,” “Substandard” and “Doubtful.”  Substandard loans are characterized by the distinct possibility that the Bank will sustain some loss if certain deficiencies are not corrected.  Doubtful loans are those having all the weaknesses inherent to those classified Substandard with the added characteristics that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.  Special mention loans possess potential weaknesses that deserve management’s close attention but do not expose the Bank to a degree of risk that warrants substandard classification.  Loans classified as watch are being monitored because of indications of potential weaknesses or deficiencies that may require future classification as special mention or substandard.  Loans not meeting any of the criteria previously described are considered satisfactory.  The FDIC-covered loans are evaluated using this internal grading system.  These loans are accounted for in pools and are currently substantially covered through loss sharing agreements with the FDIC.  Minimal adverse classification in the loan pools was identified as of September 30, 2014 and December 31, 2013, respectively.  The acquired non-covered loans are also evaluated using this internal grading system.  These loans are accounted for in pools and minimal adverse classification in the loan pools was identified as of September 30, 2014.  See Note 8 for further discussion of the acquired loan pools and loss sharing agreements.  The loan grading system is presented by loan class below:

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Note 6: Investment Securities: Gain Loss on Investments Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Gain Loss on Investments Policy

Gross gains of $656,000 and $1.3 million and gross losses of $335,000 and $335,000 resulting from sales of available-for-sale securities were realized for the three and nine months ended September 30, 2014, respectively.  Gross gains of $644,000 and $795,000 and gross losses of $534,000 and $554,000 resulting from sales of available-for-sale securities were realized for the three and nine months ended September 30, 2013, respectively.  Gains and losses on sales of securities are determined on the specific-identification method.

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of TeamBank FDIC Indemnification Asset (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
TeamBank Loans
Initial basis for loss sharing determination, net of activity since acquisition date	$ 46,222	$ 53,553
Reclassification from nonaccretable discount to accretable discount due to change in expected losses (net of accretion to date)	(2,061)	(2,882)
Original estimated fair value of assets, net of activity since acquisition date	(43,635)	(49,862)
Expected loss remaining	526	809
Assumed loss sharing recovery percentage	83.00%	82.00%
Estimated loss sharing value	438	665
Indemnification assets to be amortized resulting from change in expected losses	327	593
Accretable discount on FDIC indemnification asset		(10)
FDIC Indemnification Asset, Total	765	1,248
TeamBank Foreclosed Assets
Initial basis for loss sharing determination, net of activity since acquisition date	169	664
Original estimated fair value of assets, net of activity since acquisition date	(156)	(647)
Expected loss remaining	13	17
Assumed loss sharing recovery percentage	77.00%	76.00%
Estimated loss sharing value	10	13
FDIC Indemnification Asset, Total	$ 10	$ 13

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of Vantus Bank FDIC Indemnification Asset (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Vantus Bank FDIC Indemnification Asset

	September 30, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$44,877	$1,205
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(456)	--
Original estimated fair value of assets, net of activity since
acquisition date	(43,653)	(1,015)
Expected loss remaining	768	190
Assumed loss sharing recovery percentage	74%	--%
Estimated loss sharing value(1)	566	--
Indemnification asset to be amortized resulting from
change in expected losses	278	--
Accretable discount on FDIC indemnification asset	--	--
FDIC indemnification asset	$844	$--

(1) Includes $153,000 impairment of indemnification asset for foreclosed assets.  Resolution of certain items related to commercial foreclosed assets did not occur prior to the expiration of the non-single-family loss sharing agreement for Vantus Bank on September 30, 2014. 

	December 31, 2013
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$60,011	$1,986
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(1,202)	--
Original estimated fair value of assets, net of activity since
acquisition date	(57,920)	(1,092)
Expected loss remaining	889	894
Assumed loss sharing recovery percentage	78%	80%
Estimated loss sharing value	690	716
Indemnification asset to be amortized resulting from
change in expected losses	919	--
Accretable discount on FDIC indemnification asset	(32)	--
FDIC indemnification asset	$1,577	$716

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Note 6: Investment Securities: Schedule of Held to Maturity Securities by Maturity (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Held to Maturity Securities by Maturity

The held-to-maturity securities at September 30, 2014, by contractual maturity, are shown below.  Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized	Fair
	Cost	Value
(In Thousands)
After one through five years	$450	$505

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: TeamBank Business Combination Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

TeamBank Business Combination Policy

On March 20, 2009, Great Southern Bank entered into a purchase and assumption agreement with loss share with the Federal Deposit Insurance Corporation (FDIC) to assume all of the deposits (excluding brokered deposits) and acquire certain assets of TeamBank, N.A., a full service commercial bank headquartered in Paola, Kansas. 

The loans, commitments and foreclosed assets purchased in the TeamBank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the Bank shares in the losses on assets covered under the agreement (referred to as covered assets). On losses up to $115.0 million, the FDIC agreed to reimburse the Bank for 80% of the losses. On losses exceeding $115.0 million, the FDIC agreed to reimburse the Bank for 95% of the losses.  Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by the Bank.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans, which five-year period ended March 31, 2014.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A discount was recorded in conjunction with the fair value of the acquired loans and the amount accreted to yield during the three and nine months ended September 30, 2014 was $-0-.  The amount accreted to yield during the three and nine months ended September 30, 2013 was $0 and $134,000, respectively.

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Vantus Bank Business Combination Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Vantus Bank Business Combination Policy

On September 4, 2009, Great Southern Bank entered into a purchase and assumption agreement with loss share with the FDIC to assume all of the deposits and acquire certain assets of Vantus Bank, a full service thrift headquartered in Sioux City, Iowa. 

The loans, commitments and foreclosed assets purchased in the Vantus Bank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the Bank shares in the losses on assets covered under the agreement (referred to as covered assets). On losses up to $102.0 million, the FDIC agreed to reimburse the Bank for 80% of the losses. On losses exceeding $102.0 million, the FDIC agreed to reimburse the Bank for 95% of the losses. Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by the Bank.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans, which five year period ended on September 30, 2014.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A discount was recorded in conjunction with the fair value of the acquired loans and the amount accreted to yield during the three and nine months ended September 30, 2014 was $-0-.  The amount accreted to yield during the three and nine months ended September 30, 2013 was $19,000 and $99,000, respectively. 

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Note 1: Basis of Presentation

3 Months Ended

Sep. 30, 2014

Notes

Note 1: Basis of Presentation

NOTE 1: BASIS OF PRESENTATION

The accompanying unaudited interim consolidated financial statements of Great Southern Bancorp, Inc. (the "Company" or "Great Southern") have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The financial statements presented herein reflect all adjustments which are, in the opinion of management, necessary to fairly present the financial condition, results of operations and cash flows of the Company for the periods presented. Those adjustments consist only of normal recurring adjustments. Operating results for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the full year. The consolidated statement of financial condition of the Company as of December 31, 2013, has been derived from the audited consolidated statement of financial condition of the Company as of that date.   Certain prior period amounts have been reclassified to conform to the current period presentation.  These reclassifications had no effect on net income.

Certain information and note disclosures normally included in the Company's annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for 2013 filed with the Securities and Exchange Commission.

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Sun Security Bank Business Combination Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Sun Security Bank Business Combination Policy

On October 7, 2011, Great Southern Bank entered into a purchase and assumption agreement with loss share with the FDIC to assume all of the deposits and acquire certain assets of Sun Security Bank, a full service bank headquartered in Ellington, Missouri. 

The loans and foreclosed assets purchased in the Sun Security Bank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the FDIC agreed to cover 80% of the losses on the loans (excluding approximately $4 million of consumer loans) and foreclosed assets purchased subject to certain limitations.  Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by Great Southern.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A discount was recorded in conjunction with the fair value of the acquired loans and the amount accreted to yield during the three and nine months ended September 30, 2014 was $0 and $105,000, respectively.  The amount accreted to yield during the three and nine months ended September 30, 2013 was $210,000 and $827,000, respectively. 

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Note 6: Investment Securities: Schedule of Held to Maturity Securities by Maturity (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014
Details
Held-to-maturity Securities, Debt Maturities, after One Through Five Years, Net Carrying Amount	$ 450
Held-to-maturity Securities, Debt Maturities, Year Two Through Five, Fair Value	$ 505

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Note 14: Fair Value Measurement: Schedule of Rate Cap Derivative Asset Designated as Hedging Instrument (Details) (Interest Rate Cap Derivative Asset Designated As HedgingI nstrument, USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Interest Rate Cap Derivative Asset Designated As HedgingI nstrument
DerivativeAssetDesignatedAsHedgingInstrumentFairValue1	$ 462		$ 685
DerivativeAssetDesignatedAsHedgingInstrumentAdditions		738		738
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Inputs Reconciliation, Gain (Loss) Included in Other Comprehensive Income (Loss)	76	(69)	(147)	(69)
DerivativeAssetDesignatedAsHedgingInstrumentFairValue1	$ 538	$ 669	$ 538	$ 669

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Note 5: Earnings Per Share: Schedule of Earnings Per Share, Basic and Diluted (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Earnings Per Share, Basic and Diluted

	Three Months Ended September 30,
	2014	2013
(In Thousands, Except Per Share Data)
Basic:
Average shares outstanding	13,696	13,647
Net income available to common stockholders	$11,445	$8,294
Per common share amount	$0.84	$0.61
Diluted:
Average shares outstanding	13,696	13,647
Net effect of dilutive stock options – based on the treasury
stock method using average market price	89	58
Diluted shares	13,785	13,705
Net income available to common stockholders	$11,445	$8,294
Per common share amount	$0.83	$0.61

	Nine Months Ended September 30,
	2014	2013
(In Thousands, Except Per Share Data)
Basic:
Average shares outstanding	13,693	13,634
Net income available to common stockholders	$31,027	$24,621
Per share amount	$2.27	$1.81
Diluted:
Average shares outstanding	13,693	13,634
Net effect of dilutive stock options – based on the treasury
stock method using average market price	75	58
Diluted shares	13,768	13,692
Net income available to common stockholders	$31,027	$24,621
Per share amount	$2.25	$1.80

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Note 7: Loans and Allowance For Loan Losses: Troubled Debt Restructurings on Financing Receivables (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Troubled Debt Restructurings on Financing Receivables

	Three Months Ended September 30, 2014
				Total
	Interest Only	Term	Combination	Modification
(In Thousands)
Mortgage loans on real estate:
One -to four- family residential	$308	$--	$--	$308
One -to four- family residential
construction	--	--	223	223
Commercial business	--	243	--	243
Consumer	--	6	--	6
	$308	$249	$223	$780

	Nine Months Ended September 30, 2014
				Total
	Interest Only	Term	Combination	Modification
(In Thousands)
Mortgage loans on real estate:
Subdivision construction	$--	$250	$--	$250
One -to four- family residential
construction	--	--	223	223
One -to four- family residential	308	386	--	694
Commercial real estate	506	1,929	--	2,435
Commercial business	--	1,881	--	1,881
Industrial revenue bonds	--	1,150	--	1,150
Consumer	--	59	--	59
	$814	$5,655	$223	$6,692

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Note 15: Derivatives and Hedging Activities: Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location

	Location in	Fair Value
	Consolidated Statements	September 30,	December 31,
	of Financial Condition	2014	2013
(In Thousands)
Derivatives designated as
hedging instruments
Interest rate caps	Prepaid expenses and other assets	$538	$685
Total derivatives designated
as hedging instruments		$538	$685
Derivatives not designated
as hedging instruments
Asset Derivatives
Interest rate products	Prepaid expenses and other assets	$1,512	$1,859
Total derivatives not designated
as hedging instruments		$1,512	$1,859
Liability Derivatives
Interest rate products	Accrued expenses and other liabilities	$1,489	$1,613
Total derivatives not designated
as hedging instruments		$1,489	$1,613

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GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES -- CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (September 30, 2014 figures unaudited) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Statements of Financial Condition
Cash	$ 94,682	$ 96,167
Interest-bearing deposits in other financial institutions	126,704	131,758
Cash and cash equivalents	221,386	227,925
Available-for-sale securities	425,156	555,281
Held-to-maturity securities	450	805
Mortgage loans held for sale	30,361	7,239
Loans receivable, net	2,921,310	2,439,530
FDIC indemnification asset	51,603	72,705
Interest receivable	11,214	11,408
Prepaid expenses and other assets	63,334	72,904
Other real estate owned, net	43,762	53,514
Premises and equipment, net	120,891	104,534
Goodwill and other intangible assets	7,945	4,583
Investment in Federal Home Loan Bank stock	12,013	9,822
Total Assets	3,909,425	3,560,250
Liabilities:
Deposits	3,071,170	2,808,626
Federal Home Loan Bank advances	190,664	126,757
Securities sold under reverse repurchase agreements with customers	171,828	134,981
Short-term borrowings	1,155	1,128
Structured repurchase agreements		50,000
Subordinated debentures issued to capital trusts	30,929	30,929
Accrued interest payable	1,024	1,099
Advances from borrowers for taxes and insurance	7,744	3,721
Accounts payable and accrued expenses	22,258	18,502
Current and deferred income tax liability	3,603	3,809
Total Liabilities	3,500,375	3,179,552
Capital stock
Serial preferred stock	57,943	57,943
Common stock	137	137
Additional paid-in capital	21,486	19,567
Retained earnings	322,529	300,589
Accumulated other comprehensive income	6,955	2,462
Total Stockholders' Equity	409,050	380,698
Total Liabilities and Stockholders' Equity	$ 3,909,425	$ 3,560,250

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Note 6: Investment Securities: Schedule of Gross Unrealized Losses and Estimated Fair Value of Investments (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Gross Unrealized Losses and Estimated Fair Value of Investments

The following table shows the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at September 30, 2014 and December 31, 2013:

	September 30, 2014
	Less than 12 Months		12 Months or More		Total
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
Description of Securities	Value	Losses	Value	Losses	Value	Losses
(In Thousands)
U.S. government agencies	$--	$--	$20,000	$(1,063)	$20,000	$(1,063)
Mortgage-backed securities	51,442	(514)	46,054	(719)	97,496	(1,233)
State and political
subdivisions	2,561	(8)	11,393	(218)	13,954	(226)
	$54,003	$(522)	$77,447	$(2,000)	$131,450	$(2,522)

	December 31, 2013
	Less than 12 Months		12 Months or More		Total
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
Description of Securities	Value	Losses	Value	Losses	Value	Losses
(In Thousands)
U.S. government agencies	$20,000	$(2,745)	$--	$--	$20,000	$(2,745)
Mortgage-backed securities	127,901	(1,871)	39,255	(395)	167,156	(2,266)
State and political
subdivisions	50,401	(1,938)	--	--	50,401	(1,938)
	$198,302	$(6,554)	$39,255	$(395)	$237,557	$(6,949)

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Note 7: Loans and Allowance For Loan Losses: Loans Modified in Troubled Debt Restructurings by Segment (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended
	Sep. 30, 2014	Dec. 31, 2013
Troubled Debt Restructurings Accruing Interest	$ 47,400	$ 49,600
Substandard
Troubled Debt Restructurings	19,800	22,100
Construction And Land Development
Troubled Debt Restructured Loans and Impaired	8,600	10,900
Single Family And Multi-Family Residential Mortgage Loans
Troubled Debt Restructured Loans and Impaired	15,600
Commercial Real Estate
Troubled Debt Restructured Loans and Impaired	23,900	24,800
Commercial Business
Troubled Debt Restructured Loans and Impaired	3,700	1,500
Consumer
Troubled Debt Restructured Loans and Impaired	250	310
Single Family And Multi-Family Residential
Troubled Debt Restructured Loans and Impaired		$ 16,600

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Note 14: Fair Value Measurement: Schedule of Interest Rate Derivative Assets (Details) (Interest Rate Derivative Asset, USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Interest Rate Derivative Asset
Derivative Asset	$ 1,722	$ 1,379	$ 1,859	$ 2,112
Change in Unrealized Gain (Loss) on Fair Value Hedging Instruments	(210)	182	(347)	(551)
Derivative Asset	$ 1,512	$ 1,561	$ 1,512	$ 1,561

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GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES -- CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (Parentheticals) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Statements of Comprehensive Income
Tax effect of unrealized appreciation (depreciation) on available-for-sale securities, taxes (credit)	$ 127	$ (2,812)	$ 2,805	$ (6,863)
Tax effect non-credit component of unrealized gain (loss) on available-for-sale debt securities for which a portion of an other-than-temporary impairment has been recognized, taxes (credit)			0	(20)
Tax effect reclassification adjustment for gains included in net income, taxes (credit)	(112)	(38)	(337)	(84)
Tax effect of change in fair value of cash flow hedge, taxes (credit)	$ (29)	$ (24)	$ (67)	$ (24)

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Note 7: Loans and Allowance For Loan Losses: Impaired Loans Specific Valuation Allowance (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Details
Impaired Loans With Specific Valuation Allowance	$ 25,100	$ 18,000
Impaired Loans Valuation Allowance	$ 5,400	$ 7,400

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of Valley Bank Acquired Loans and Foreclosed Assets (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Valley Bank Acquired Loans and Foreclosed Assets

	September 30, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis, net of activity since acquisition date	$179,065	$--
Non-credit premium/(discount), net of activity since acquisition date	1,752	--
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	--	--
Original estimated fair value of assets, net of activity since
acquisition date	(152,497)	--
Expected loss remaining	$28,320	$--

	June 20, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis	$193,186	$--
Non-credit premium/(discount)	2,015	--
Original estimated fair value of assets	(165,098)	--
Expected loss remaining	$30,103	$--

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of Impact of Adjustments of Acquired Loans on Financial Results (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Details
Impact of acquired loan pools on net interest income	$ 8,848	$ 8,412	$ 25,836	$ 26,508
Impact of acquired loan pools on net interest margin (in basis points)	98	101	101	103
Impact of acquired loan pools on non-interest income	(7,438)	(7,310)	(21,915)	(22,529)
Net impact of acquired loan pools to pre-tax income	1,410	1,102	3,921	3,979
Net impact of acquired loan pools to net of taxes	$ 917	$ 716	$ 2,549	$ 2,586
Impact of acquired loan pools to diluted earnings per common share	$ 0.07	$ 0.05	$ 0.19	$ 0.19

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: TeamBank FDIC Indemnification Asset Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

TeamBank FDIC Indemnification Asset Policy

TeamBank Loans, Foreclosed Assets and Indemnification Asset.  The following tables present the balances of the FDIC indemnification asset related to the TeamBank transaction at September 30, 2014 and December 31, 2013. Gross loan balances (due from the borrower) were reduced approximately $389.9 million since the transaction date because of $256.1 million of repayments from borrowers, $61.6 million in transfers to foreclosed assets and $72.2 million in charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

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Note 14: Fair Value Measurement: Fair Value, Assets Measured on Recurring Basis (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Fair Value, Assets Measured on Recurring Basis

		Fair value measurements using
		Quoted prices
		in active
		markets	Other	Significant
		for identical	observable	unobservable
		assets	inputs	inputs
	Fair value	(Level 1)	(Level 2)	(Level 3)
(In Thousands)
September 30, 2014
U.S. government agencies	$18,937	$--	$18,937	$--
Mortgage-backed securities	276,627	--	276,627	--
States and political subdivisions	126,547	--	126,547	--
Equity securities	3,045	--	3,045	--
Mortgage servicing rights	189	--	--	189
Interest rate derivative asset	2,050	--	--	2,050
Interest rate derivative liability	(1,489)	--	--	(1,489)
December 31, 2013
U.S. government agencies	$17,255	$--	$17,255	$--
Mortgage-backed securities	367,578	--	367,578	--
Small Business Administration loan pools	44,855	--	44,855	--
States and political subdivisions	122,724	--	122,724	--
Equity securities	2,869	--	2,869	--
Mortgage servicing rights	211	--	--	211
Interest rate derivative asset	2,544	--	--	2,544
Interest rate derivative liability	(1,613)	--	--	(1,613)

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Note 15: Derivatives and Hedging Activities

3 Months Ended

Sep. 30, 2014

Notes

Note 15: Derivatives and Hedging Activities

NOTE 15:  DERIVATIVES AND HEDGING ACTIVITIES

Risk Management Objective of Using Derivatives

The Company is exposed to certain risks arising from both its business operations and economic conditions.  The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities.  The Company manages economic risks, including interest rate, liquidity and credit risk, primarily by managing the amount, sources and duration of its assets and liabilities.  In the normal course of business, the Company may use derivative financial instruments (primarily interest rate swaps) from time to time to assist in its interest rate risk management.  The Company has interest rate derivatives that result from a service provided to certain qualifying loan customers that are not used to manage interest rate risk in the Company’s assets or liabilities and are not designated in a qualifying hedging relationship.  The Company manages a matched book with respect to its derivative instruments in order to minimize its net risk exposure resulting from such transactions.  In addition, the Company has interest rate derivatives that are designated in a qualified hedging relationship. 

Nondesignated Hedges

The Company has interest rate swaps that are not designated in qualifying hedging relationships.  Derivatives not designated as hedges are not speculative and result from a service the Company provides to certain loan customers, which the Company began offering during the fourth quarter of 2011.  The Company executes interest rate swaps with commercial banking customers to facilitate their respective risk management strategies.  Those interest rate swaps are simultaneously hedged by offsetting interest rate swaps that the Company executes with a third party, such that the Company minimizes its net risk exposure resulting from such transactions.  As the interest rate swaps associated with this program do not meet the strict hedge accounting requirements, changes in the fair value of both the customer swaps and the offsetting swaps are recognized directly in earnings.  As of September 30, 2014, the Company had 27 interest rate swaps totaling $127.9 million in notional amount with commercial customers, and 27 interest rate swaps with the same notional amount with third parties related to this program.  As of December 31, 2013, the Company had 24 interest rate swaps totaling $114.0 million in notional amount with commercial customers, and 24 interest rate swaps with the same notional amount with third parties related to this program.  In addition, seven interest rate swaps were added as a result of certain loans acquired in the Valley Bank transaction.  Valley’s program did not include back to back swaps with the customer; there is only a swap with a counterparty.  At September 30, 2014, the notional amount of these swaps was $7.8 million.  During the three months ended September 30, 2014 and 2013, the Company recognized a net gain of $10,000 and a net loss of $125,000, respectively, in noninterest income related to changes in the fair value of these swaps.  During the nine months ended September 30, 2014 and 2013, the Company recognized a net loss of $223,000 and a net gain of $283,000, respectively, in noninterest income related to changes in the fair value of these swaps. 

Cash Flow Hedges

As a strategy to maintain acceptable levels of exposure to the risk of changes in future cash flows due to interest rate fluctuations, the Company entered into two interest rate cap agreements for a portion of its floating rate debt associated with its trust preferred securities.  The agreement with a notional amount of $25 million states that the Company will pay interest on its trust preferred debt in accordance with the original debt terms at a rate of 3-month LIBOR + 1.60%.  Should interest rates rise above a certain threshold, the counterparty will reimburse the Company for interest paid such that the Company will have an effective interest rate on that portion of its trust preferred securities no higher than 2.37%.  The second agreement with a notional amount of $5 million states that the Company will pay interest on its trust preferred debt in accordance with the original debt terms at a rate of 3-month LIBOR + 1.40%.  Should interest rates rise above a certain threshold, the counterparty will reimburse the Company for interest paid such that the Company will have an effective interest rate on that portion of its trust preferred securities no higher than 2.17%.  The agreements were effective on August 1, 2013 and July 1, 2013, respectively, and each has a term of four years. 

The effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings.  Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings.

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Consolidated Statements of Financial Condition:

	Location in	Fair Value
	Consolidated Statements	September 30,	December 31,
	of Financial Condition	2014	2013
(In Thousands)
Derivatives designated as
hedging instruments
Interest rate caps	Prepaid expenses and other assets	$538	$685
Total derivatives designated
as hedging instruments		$538	$685
Derivatives not designated
as hedging instruments
Asset Derivatives
Interest rate products	Prepaid expenses and other assets	$1,512	$1,859
Total derivatives not designated
as hedging instruments		$1,512	$1,859
Liability Derivatives
Interest rate products	Accrued expenses and other liabilities	$1,489	$1,613
Total derivatives not designated
as hedging instruments		$1,489	$1,613

The following table presents the effect of derivative instruments on the statements of comprehensive income for the three and nine months ended September 30, 2014 and 2013: 

	Amount of Gain (Loss) Recognized in OCI
	Three Months Ended September 30
Cash Flow Hedges	2014	2013
(In Thousdans)
Interest rate cap	$                   53	$(45)

	Amount of Gain (Loss) Recognized in OCI
	Nine Months Ended September 30
Cash Flow Hedges	2014	2013
(In Thousands)
Interest rate cap	$(90)	$(45)

Agreements with Derivative Counterparties

The Company has agreements with its derivative counterparties.  If the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its derivative obligations.  If the Bank fails to maintain its status as a well-capitalized institution, then the counterparty could terminate the derivative positions and the Company would be required to settle its obligations under the agreements.  Similarly, the Company could be required to settle its obligations under certain of its agreements if certain regulatory events occurred, such as the issuance of a formal directive, or if the Company’s credit rating is downgraded below a specified level.

As of September 30, 2014, the termination value of derivatives in a net liability position, which included accrued interest but excluded any adjustment for nonperformance risk, related to these agreements was $820,000.  The Company has minimum collateral posting thresholds with its derivative counterparties.  The Company’s activity with its derivative counterparties had previously met the level in which the minimum collateral posting thresholds take effect and the Company had posted $1.3 million of collateral to satisfy the agreements at September 30, 2014.  If the Company had breached any of these provisions at September 30, 2014, it could have been required to settle its obligations under the agreements at the termination value.

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Vantus Bank Indemnification Asset Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Vantus Bank Indemnification Asset Policy

Vantus Bank Loans, Foreclosed Assets and Indemnification Asset.  The following tables present the balances of the FDIC indemnification asset related to the Vantus Bank transaction at September 30, 2014 and December 31, 2013. Gross loan balances (due from the borrower) were reduced approximately $286.7 million since the transaction date because of $240.6 million of repayments from borrowers, $16.5 million in transfers to foreclosed assets and $29.6 million in charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

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Note 7: Loans and Allowance For Loan Losses (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Satisfactory | One To Four Family Residential Construction
Loan Portfolio Internal Grading System Classification	$ 43,163	$ 34,364
Satisfactory | Subdivision Construction
Loan Portfolio Internal Grading System Classification	33,310	36,524
Satisfactory | Land Development
Loan Portfolio Internal Grading System Classification	37,514	45,606
Satisfactory | Commercial Construction
Loan Portfolio Internal Grading System Classification	361,971	184,019
Satisfactory | Owner Occupied One To Four Family Residential
Loan Portfolio Internal Grading System Classification	76,166	84,931
Satisfactory | Non-Owner Occupied One To Four Family Residential
Loan Portfolio Internal Grading System Classification	139,070	137,003
Satisfactory | Commercial Real Estate
Loan Portfolio Internal Grading System Classification	808,064	727,668
Satisfactory | Other Residential
Loan Portfolio Internal Grading System Classification	341,224	311,320
Satisfactory | Commercial Business
Loan Portfolio Internal Grading System Classification	347,691	307,540
Satisfactory | Industrial Revenue Bonds
Loan Portfolio Internal Grading System Classification	41,114	39,532
Satisfactory | Consumer Loans Auto Financing Receivable
Loan Portfolio Internal Grading System Classification	274,079	134,516
Satisfactory | Consumer Other Financing Receivable
Loan Portfolio Internal Grading System Classification	78,149	81,769
Satisfactory | Home Equity Line of Credit
Loan Portfolio Internal Grading System Classification	60,707	57,713
Satisfactory | FDIC Supported Loans Net Of Discounts TeamBank
Loan Portfolio Internal Grading System Classification	15,275	49,702
Satisfactory | Acquired non-covered loans, net of discounts (TeamBank)
Loan Portfolio Internal Grading System Classification	28,333
Satisfactory | FDIC Supported Loans Net Of Discounts Vantus Bank
Loan Portfolio Internal Grading System Classification	43,252	57,290
Satisfactory | FDIC Supported Loans Net Of Discounts Sun Security Bank
Loan Portfolio Internal Grading System Classification	53,859	63,360
Satisfactory | FDIC Supported Loans Net Of Discounts InterBank
Loan Portfolio Internal Grading System Classification	202,904	213,539
Satisfactory | Acquired loans not covered by FDIC loss sharing agreements, net of discounts (Valley Bank)
Loan Portfolio Internal Grading System Classification	152,497
Satisfactory | Loans Receivable
Loan Portfolio Internal Grading System Classification	3,138,342	2,566,396
Watch | One To Four Family Residential Construction
Loan Portfolio Internal Grading System Classification		298
Watch | Subdivision Construction
Loan Portfolio Internal Grading System Classification	21	706
Watch | Land Development
Loan Portfolio Internal Grading System Classification	5,000	1,148
Watch | Owner Occupied One To Four Family Residential
Loan Portfolio Internal Grading System Classification	611	503
Watch | Non-Owner Occupied One To Four Family Residential
Loan Portfolio Internal Grading System Classification	350	6,718
Watch | Commercial Real Estate
Loan Portfolio Internal Grading System Classification	51,967	37,937
Watch | Other Residential
Loan Portfolio Internal Grading System Classification	10,045	12,323
Watch | Commercial Business
Loan Portfolio Internal Grading System Classification	446	1,803
Watch | Industrial Revenue Bonds
Loan Portfolio Internal Grading System Classification	622	675
Watch | Consumer Other Financing Receivable
Loan Portfolio Internal Grading System Classification	4	6
Watch | Loans Receivable
Loan Portfolio Internal Grading System Classification	69,066	62,117
Substandard | One To Four Family Residential Construction
Loan Portfolio Internal Grading System Classification	223
Substandard | Subdivision Construction
Loan Portfolio Internal Grading System Classification	2,013	3,179
Substandard | Land Development
Loan Portfolio Internal Grading System Classification	6,067	11,087
Substandard | Owner Occupied One To Four Family Residential
Loan Portfolio Internal Grading System Classification	2,207	3,699
Substandard | Non-Owner Occupied One To Four Family Residential
Loan Portfolio Internal Grading System Classification	3,994	2,187
Substandard | Commercial Real Estate
Loan Portfolio Internal Grading System Classification	12,263	15,085
Substandard | Other Residential
Loan Portfolio Internal Grading System Classification	1,956	1,956
Substandard | Commercial Business
Loan Portfolio Internal Grading System Classification	1,250	3,528
Substandard | Industrial Revenue Bonds
Loan Portfolio Internal Grading System Classification	1,205	2,023
Substandard | Consumer Loans Auto Financing Receivable
Loan Portfolio Internal Grading System Classification	171	201
Substandard | Consumer Other Financing Receivable
Loan Portfolio Internal Grading System Classification	523	485
Substandard | Home Equity Line of Credit
Loan Portfolio Internal Grading System Classification	445	570
Substandard | FDIC Supported Loans Net Of Discounts TeamBank
Loan Portfolio Internal Grading System Classification	19	160
Substandard | Acquired non-covered loans, net of discounts (TeamBank)
Loan Portfolio Internal Grading System Classification	8
Substandard | FDIC Supported Loans Net Of Discounts Vantus Bank
Loan Portfolio Internal Grading System Classification	401	630
Substandard | FDIC Supported Loans Net Of Discounts Sun Security Bank
Loan Portfolio Internal Grading System Classification	535	1,483
Substandard | FDIC Supported Loans Net Of Discounts InterBank
Loan Portfolio Internal Grading System Classification	883
Substandard | Loans Receivable
Loan Portfolio Internal Grading System Classification	34,163	46,273
Doubtful | Commercial Business
Loan Portfolio Internal Grading System Classification		2,398
Doubtful | Loans Receivable
Loan Portfolio Internal Grading System Classification		2,398
Total For Portfolio | One To Four Family Residential Construction
Loan Portfolio Internal Grading System Classification	43,386	34,662
Total For Portfolio | Subdivision Construction
Loan Portfolio Internal Grading System Classification	35,344	40,409
Total For Portfolio | Land Development
Loan Portfolio Internal Grading System Classification	48,581	57,841
Total For Portfolio | Commercial Construction
Loan Portfolio Internal Grading System Classification	361,971	184,019
Total For Portfolio | Owner Occupied One To Four Family Residential
Loan Portfolio Internal Grading System Classification	78,984	89,133
Total For Portfolio | Non-Owner Occupied One To Four Family Residential
Loan Portfolio Internal Grading System Classification	143,414	145,908
Total For Portfolio | Commercial Real Estate
Loan Portfolio Internal Grading System Classification	872,294	780,690
Total For Portfolio | Other Residential
Loan Portfolio Internal Grading System Classification	353,225	325,599
Total For Portfolio | Commercial Business
Loan Portfolio Internal Grading System Classification	349,387	315,269
Total For Portfolio | Industrial Revenue Bonds
Loan Portfolio Internal Grading System Classification	42,941	42,230
Total For Portfolio | Consumer Loans Auto Financing Receivable
Loan Portfolio Internal Grading System Classification	274,250	134,717
Total For Portfolio | Consumer Other Financing Receivable
Loan Portfolio Internal Grading System Classification	78,676	82,260
Total For Portfolio | Home Equity Line of Credit
Loan Portfolio Internal Grading System Classification	61,152	58,283
Total For Portfolio | FDIC Supported Loans Net Of Discounts TeamBank
Loan Portfolio Internal Grading System Classification	15,294	49,862
Total For Portfolio | Acquired non-covered loans, net of discounts (TeamBank)
Loan Portfolio Internal Grading System Classification	28,341
Total For Portfolio | FDIC Supported Loans Net Of Discounts Vantus Bank
Loan Portfolio Internal Grading System Classification	43,653	57,920
Total For Portfolio | FDIC Supported Loans Net Of Discounts Sun Security Bank
Loan Portfolio Internal Grading System Classification	54,394	64,843
Total For Portfolio | FDIC Supported Loans Net Of Discounts InterBank
Loan Portfolio Internal Grading System Classification	203,787	213,539
Total For Portfolio | Acquired loans not covered by FDIC loss sharing agreements, net of discounts (Valley Bank)
Loan Portfolio Internal Grading System Classification	152,497
Total For Portfolio | Loans Receivable
Loan Portfolio Internal Grading System Classification	$ 3,241,571	$ 2,677,184

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Note 16: FDIC-assisted Acquisition: Schedule of Acquired Loans Performing and Nonperforming (Details) (Valley Bank, AcquiredLoansMember, USD $) In Thousands, unless otherwise specified	3 Months Ended
	Sep. 30, 2014
Valley Bank | AcquiredLoansMember
Acquired Performing Loans	$ 3,920
Acquired Nonperforming Loans	161,178
Total Acquired Loans	$ 165,098

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Note 1: Basis of Presentation: Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies

The accompanying unaudited interim consolidated financial statements of Great Southern Bancorp, Inc. (the "Company" or "Great Southern") have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The financial statements presented herein reflect all adjustments which are, in the opinion of management, necessary to fairly present the financial condition, results of operations and cash flows of the Company for the periods presented. Those adjustments consist only of normal recurring adjustments. Operating results for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the full year. The consolidated statement of financial condition of the Company as of December 31, 2013, has been derived from the audited consolidated statement of financial condition of the Company as of that date.   Certain prior period amounts have been reclassified to conform to the current period presentation.  These reclassifications had no effect on net income.

Certain information and note disclosures normally included in the Company's annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for 2013 filed with the Securities and Exchange Commission.

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Note 14: Fair Value Measurement: Schedule of Rate Cap Derivative Asset Designated as Hedging Instrument (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Rate Cap Derivative Asset Designated as Hedging Instrument

	Interest Rate Cap Derivative Asset Designated as Hedging Instrument
	2014	2013
(In Thousands)
Balance, July 1	$462	$--
Additions	--	738
Change in fair value through other
comprehensive income	76	(69)
Balance, September 30	$538	$669

	Interest Rate Cap Derivative Asset Designated as Hedging Instrument
	2014	2013
(In Thousands)
Balance, January 1	$685	$--
Additions	--	738
Change in fair value through other
comprehensive income	(147)	(69)
Balance, September 30	$538	$669

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Note 10: Deposits (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014		Dec. 31, 2013
Deposits	$ 3,071,170		$ 2,808,626
Non-Interest Bearing Demand Deposits
Deposits	521,705		522,805
Interest Bearing Demand And Savings Deposits
Deposits	1,424,881	[1]	1,291,879	[1]
Total Deposits
Deposits	3,071,170		2,808,626
Bank Time Deposits | 0.00% - 0.99%
Deposits	802,532		669,698
Bank Time Deposits | 1.00% - 1.99%
Deposits	245,047		251,118
Bank Time Deposits | 2.00% - 2.99%
Deposits	65,449		61,042
Bank Time Deposits | 3.00% - 3.99%
Deposits	9,424		9,413
Bank Time Deposits | 4.00% - 4.99%
Deposits	1,712		1,852
Bank Time Deposits | 5% and above
Deposits	420		819
Bank Time Deposits | Total Time Deposits
Deposits	$ 1,124,584	[2]	$ 993,942	[2]

[1] (0.19% - 0.20%)

[2] (0.77% - 0.69%)

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GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES -- CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 31,462	$ 25,056
Proceeds from sales of loans held for sale	101,872	184,382
Originations of loans held for sale	(122,252)	(171,035)
Items not requiring (providing) cash:
Depreciation	6,410	5,971
Amortization of other assets	2,385	5,421
Compensation expense for stock option grants	409	333
Provision for loan losses	4,099	14,573
Net gains on loan sales	(2,700)	(4,236)
Net gains on sale of available-for-sale investment securities	(963)	(241)
Net gains on sale of premises and equipment	(46)	(10)
Loss on sale of foreclosed assets	1,360	1,823
Initial gain recognized on business acquisition	10,805	0
Amortization of deferred income, premiums, discounts and fair value adjustments	17,023	22,518
(Gain) loss on derivative interest rate products	223	(284)
Deferred income taxes	(4,370)	(13,625)
Changes in:
Interest receivable	1,232	1,823
Prepaid expenses and other assets	4,187	(8,339)
Accounts payable and accrued expenses	2,685	4,376
Income taxes refundable/payable	1,744	668
Net cash provided by operating activities	33,955	69,174
CASH FLOWS FROM INVESTING ACTIVITIES
Net increase in loans	(243,837)	(19,044)
Purchase of loans	(73,244)	(20,388)
Cash received from acquisitions	189,437
Cash received from FDIC loss sharing reimbursements	7,532	24,583
Purchase of premises and equipment	(11,598)	(9,761)
Proceeds from sale of premises and equipment	198	1,275
Proceeds from sale of foreclosed assets	17,661	35,973
Capitalized costs on foreclosed assets	(95)	(291)
Proceeds from sales of available-for-sale investment securities	179,204	108,485
Proceeds from maturing investment securities	110
Proceeds from called investment securities	6,235	4,160
Principal reductions on mortgage-backed securities	78,228	179,710
Purchase of available-for-sale securities	(40,661)	(92,425)
Redemption (purchase) of Federal Home Loan Bank stock	(2,191)	240
Net cash provided by investing activities	106,979	212,517
CASH FLOWS FROM FINANCING ACTIVITIES
Net decrease in certificates of deposit	(89,219)	(163,327)
Net decrease in checking and savings deposits	(106,924)	(136,191)
Proceeds from Federal Home Loan Bank advances	2,517,000	1,980
Repayments of Federal Home Loan Bank advances	(2,450,300)	(246)
Net increase (decrease) in short-term borrowings	36,307	(44,625)
Repayments of structured repurchase agreements	(50,000)	(3,000)
Advances from borrowers for taxes and insurance	3,395	3,660
Dividends paid	(8,371)	(5,361)
Purchase of company stock	(512)
Stock options exercised	1,151	1,092
Net cash used in financing activities	(147,473)	(346,018)
DECREASE IN CASH AND CASH EQUIVALENTS	(6,539)	(64,327)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	227,925	404,141
CASH AND CASH EQUIVALENTS, END OF PERIOD	$ 221,386	$ 339,814

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GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES - CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Parentheticals) (USD $) In Thousands, except Share data, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Statements of Financial Condition
Held-to-maturity securities fair value	$ 505	$ 912
Allowance for loan losses	$ 38,081	$ 40,116
Preferred stock par value	$ 0.01	$ 0.01
Preferred stock authorized shares	1,000,000	1,000,000
Preferred stock issued shares	57,943	57,943
Preferred stock shares outstanding	57,943	57,943
Common stock par value	$ 0.01	$ 0.01
Common stock shares authorized	20,000,000	20,000,000
Common stock shares issued	13,706,950	13,673,709
Common stock shares outstanding	13,706,950	13,673,709

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Note 10: Deposits

3 Months Ended

Sep. 30, 2014

Notes

Note 10: Deposits

NOTE 10: DEPOSITS

	September 30,	December 31,
	2014	2013
(In Thousands)
Time Deposits:
0.00% - 0.99%	$802,532	$669,698
1.00% - 1.99%	245,047	251,118
2.00% - 2.99%	65,449	61,042
3.00% - 3.99%	9,424	9,413
4.00% - 4.99%	1,712	1,852
5.00% and above	420	819
Total time deposits (0.77% - 0.69%)	1,124,584	993,942
Non-interest-bearing demand deposits	521,705	522,805
Interest-bearing demand and savings deposits (0.19% - 0.20%)	1,424,881	1,291,879
Total Deposits	$3,071,170	$2,808,626

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of InterBank FDIC Indemnification Asset (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014		Dec. 31, 2013
InterBank Loans
Initial basis for loss sharing determination, net of activity since acquisition date	$ 254,427		$ 284,975
Non-credit premium (discount), net of activity since acquisition date	1,488		1,905
Reclassification from nonaccretable discount to accretable discount due to change in expected losses (net of accretion to date)	(23,518)		(21,218)
Original estimated fair value of assets, net of activity since acquisition date	(203,787)		(213,539)
Expected loss remaining	28,610		52,123
Assumed loss sharing recovery percentage	82.00%		82.00%
Estimated loss sharing value	23,444	[1]	42,654
FDIC loss share clawback	3,793		2,893
Indemnification assets to be amortized resulting from change in expected losses	18,814		16,974
Accretable discount on FDIC indemnification asset	(3,350)		(4,874)
FDIC Indemnification Asset, Total	42,701		57,647
InterBank Foreclosed Assets
Initial basis for loss sharing determination, net of activity since acquisition date	5,076		6,543
Original estimated fair value of assets, net of activity since acquisition date	(3,976)		(5,073)
Expected loss remaining	1,100		1,470
Assumed loss sharing recovery percentage	80.00%		80.00%
Estimated loss sharing value	880	[1]	1,176
Accretable discount on FDIC indemnification asset	(33)		(33)
FDIC Indemnification Asset, Total	$ 847		$ 1,143

[1] Includes $400,000 impairment of indemnification asset for loans

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Note 7: Loans and Allowance For Loan Losses: Schedule of Impaired Loans (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013
One To Four Family Residential Construction
Impaired Financing Receivable, Average Recorded Investment	$ 121	$ 48	$ 59	$ 48	$ 36
Impaired Financing Receivable Interest Income Recognized				5
Subdivision Construction
Impaired Financing Receivable, Recorded Investment	2,304	3,785	2,304	3,785	3,502
Impaired Financing Receivable, Unpaid Principal Balance	4,716	3,896	4,716	3,896	3,531
Impaired Financing Receivable, Related Allowance	373	851	373	851	1,659
Impaired Financing Receivable, Average Recorded Investment	2,207	4,062	2,549	3,206	3,315
Impaired Financing Receivable Interest Income Recognized	8	34	38	140	163
Land Development
Impaired Financing Receivable, Recorded Investment	7,791	15,444	7,791	15,444	12,628
Impaired Financing Receivable, Unpaid Principal Balance	8,224	15,848	8,224	15,848	13,042
Impaired Financing Receivable, Related Allowance	1,514	2,192	1,514	2,192	473
Impaired Financing Receivable, Average Recorded Investment	7,650	15,573	10,403	13,025	13,389
Impaired Financing Receivable Interest Income Recognized	70	111	213	477	560
Owner Occupied One To Four Family Residential
Impaired Financing Receivable, Recorded Investment	4,366	5,174	4,366	5,174	5,802
Impaired Financing Receivable, Unpaid Principal Balance	5,064	5,393	5,064	5,393	6,117
Impaired Financing Receivable, Related Allowance	517	430	517	430	593
Impaired Financing Receivable, Average Recorded Investment	4,665	5,035	5,100	4,899	5,101
Impaired Financing Receivable Interest Income Recognized	56	60	168	176	251
Non-Owner Occupied One To Four Family Residential
Impaired Financing Receivable, Recorded Investment	4,614	4,351	4,614	4,351	3,751
Impaired Financing Receivable, Unpaid Principal Balance	4,837	5,233	4,837	5,233	4,003
Impaired Financing Receivable, Related Allowance	450	369	450	369	249
Impaired Financing Receivable, Average Recorded Investment	4,550	4,832	4,137	5,112	4,797
Impaired Financing Receivable Interest Income Recognized	53	12	163	173	195
Commercial Real Estate
Impaired Financing Receivable, Recorded Investment	28,899	40,981	28,899	40,981	31,591
Impaired Financing Receivable, Unpaid Principal Balance	30,210	42,507	30,210	42,507	34,032
Impaired Financing Receivable, Related Allowance	1,736	2,416	1,736	2,416	90
Impaired Financing Receivable, Average Recorded Investment	29,531	40,792	30,204	44,374	42,242
Impaired Financing Receivable Interest Income Recognized	298	506	988	1,246	1,632
Other Residential
Impaired Financing Receivable, Recorded Investment	10,203	11,367	10,203	11,367	10,983
Impaired Financing Receivable, Unpaid Principal Balance	10,203	11,367	10,203	11,367	10,983
Impaired Financing Receivable, Related Allowance		169		169
Impaired Financing Receivable, Average Recorded Investment	10,304	11,444	10,665	14,895	13,837
Impaired Financing Receivable Interest Income Recognized	86	136	296	353	434
Commercial Business
Impaired Financing Receivable, Recorded Investment	2,150	6,138	2,150	6,138	6,057
Impaired Financing Receivable, Unpaid Principal Balance	2,173	6,140	2,173	6,140	6,077
Impaired Financing Receivable, Related Allowance	596	1,512	596	1,512	4,162
Impaired Financing Receivable, Average Recorded Investment	2,163	6,274	2,657	7,074	6,821
Impaired Financing Receivable Interest Income Recognized	31	86	99	161	179
Industrial Revenue Bonds
Impaired Financing Receivable, Recorded Investment	2,976	2,698	2,976	2,698	2,698
Impaired Financing Receivable, Unpaid Principal Balance	4,288	2,778	4,288	2,778	2,778
Impaired Financing Receivable, Average Recorded Investment	3,362	2,698	2,998	2,701	2,700
Impaired Financing Receivable Interest Income Recognized	192		192	14	27
Consumer Loans Auto Financing Receivable
Impaired Financing Receivable, Recorded Investment	175	184	175	184	216
Impaired Financing Receivable, Unpaid Principal Balance	227	228	227	228	231
Impaired Financing Receivable, Related Allowance	26	28	26	28	32
Impaired Financing Receivable, Average Recorded Investment	216	153	182	130	145
Impaired Financing Receivable Interest Income Recognized	4	7	11	11	16
Consumer Other Financing Receivable
Impaired Financing Receivable, Recorded Investment	635	595	635	595	604
Impaired Financing Receivable, Unpaid Principal Balance	764	664	764	664	700
Impaired Financing Receivable, Related Allowance	95	89	95	89	91
Impaired Financing Receivable, Average Recorded Investment	678	593	690	639	630
Impaired Financing Receivable Interest Income Recognized	15	12	57	44	63
Home Equity Line of Credit
Impaired Financing Receivable, Recorded Investment	446	410	446	410	569
Impaired Financing Receivable, Unpaid Principal Balance	473	424	473	424	706
Impaired Financing Receivable, Related Allowance	77	91	77	91	95
Impaired Financing Receivable, Average Recorded Investment	415	333	461	316	391
Impaired Financing Receivable Interest Income Recognized	6	10	20	20	38
Loans Receivable Impaired
Impaired Financing Receivable, Recorded Investment	64,559		64,559
Impaired Financing Receivable, Unpaid Principal Balance	71,179		71,179
Impaired Financing Receivable, Related Allowance	5,384		5,384
Impaired Financing Receivable, Average Recorded Investment	65,862		70,105
Impaired Financing Receivable Interest Income Recognized	819		2,245
Total Impaired Loans
Impaired Financing Receivable, Recorded Investment		91,127		91,127	78,401
Impaired Financing Receivable, Unpaid Principal Balance		94,478		94,478	82,200
Impaired Financing Receivable, Related Allowance		8,147		8,147	7,444
Impaired Financing Receivable, Average Recorded Investment		91,837		96,419	93,404
Impaired Financing Receivable Interest Income Recognized		$ 974		$ 2,820	$ 3,558

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Note 7: Loans and Allowance For Loan Losses: Schedule of Financing Receivables NonAccrual Status (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
One To Four Family Residential Construction
Loans Receivable Nonaccrual	$ 223
Subdivision Construction
Loans Receivable Nonaccrual	1,223	871
Land Development
Loans Receivable Nonaccrual	265	338
Owner Occupied One To Four Family Residential
Loans Receivable Nonaccrual	1,446	2,803
Non-Owner Occupied One To Four Family Residential
Loans Receivable Nonaccrual	2,997	703
Commercial Real Estate
Loans Receivable Nonaccrual	2,968	6,205
Commercial Business
Loans Receivable Nonaccrual	1,632	5,208
Industrial Revenue Bonds
Loans Receivable Nonaccrual		2,023
Consumer Loans Auto Financing Receivable
Loans Receivable Nonaccrual	131	168
Consumer Other Financing Receivable
Loans Receivable Nonaccrual	405	475
Home Equity Line of Credit
Loans Receivable Nonaccrual	337	504
Loans Receivable Nonaccrual
Loans Receivable Nonaccrual	$ 11,627	$ 19,298

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Note 16: FDIC-assisted Acquisition: Schedule of FDIC Agreed Upon Transfer of Net Assets (Details) (Valley Bank, USD $) In Thousands, unless otherwise specified	Jun. 20, 2014
Net liabilities as determined by the FDIC	$ (21,897)
Cash transferred by the FDIC	59,394
Discount per Purchase and Assumption Agreement	37,497
Core Deposit Intangible	2,800
Gain Recognized on Business Acquisition	10,805
Purchase Accounting Adjustments
Bank Loans	(28,088)
Deposits Assets	(399)
Investments	$ (1,005)

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Note 15: Derivatives and Hedging Activities: Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Total derivatives designated as hedging instruments	$ 538	$ 685
Asset Derivative Fair Value
Total derivatives not designated as hedging instruments	1,512	1,859
Liability Derivative Fair Value
Total derivatives not designated as hedging instruments	$ 1,489	$ 1,613

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Document and Entity Information	3 Months Ended
	Sep. 30, 2014	Nov. 06, 2014
Document and Entity Information:
Entity Registrant Name	Great Southern Bancorp Inc
Document Type	10-Q
Document Period End Date	Sep. 30, 2014
Amendment Flag	false
Entity Central Index Key	0000854560
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		13,727,671
Entity Filer Category	Accelerated Filer
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q3

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Note 11: Advances From Federal Home Loan Bank

3 Months Ended

Sep. 30, 2014

Notes

Note 11: Advances From Federal Home Loan Bank

NOTE 11: ADVANCES FROM FEDERAL HOME LOAN BANK

Advances from the Federal Home Loan Bank at September 30, 2014 and December 31, 2013 consisted of the following:

	September 30, 2014		December 31, 2013
		Weighted		Weighted
		Average		Average
		Interest		Interest
Due In	Amount	Rate	Amount	Rate
(In Thousands)
2014	$149,015	0.21%	$2,315	1.02%
2015	10,065	3.87	10,065	3.87
2016	70	5.06	25,070	3.81
2017	30,825	3.20	85,825	3.92
2018	81	5.06	81	5.06
2019 and thereafter	529	5.51	529	5.51
	190,585	0.91	123,885	3.85
Unamortized fair value adjustment	79		2,872
	$190,664		$126,757

Included in the Bank’s FHLB advances at September 30, 2014 and December 31, 2013, was a $10.0 million advance with a maturity date of October 26, 2015.  The interest rate on this advance is 3.86%.  The advance has a call provision that allows the Federal Home Loan Bank of Topeka to call the advance quarterly.

Included in the Bank’s FHLB advances at September 30, 2014 and December 31, 2013, was a $30.0 million advance with a maturity date of November 24, 2017.  The interest rate on this advance is 3.20%.  The advance has a call provision that allows the Federal Home Loan Bank of Des Moines to call the advance quarterly.

Included in the Bank’s FHLB advances at December 31, 2013, was a $25.0 million advance with a maturity date of December 7, 2016.  The interest rate on this advance was 3.81%.  This advance was repaid by the Bank in June 2014.

Included in the Bank’s FHLB advances at December 31, 2013, was a $30.0 million advance with a maturity date of March 29, 2017.  The interest rate on this advance was 4.07%.  This advance was repaid by the Bank in June 2014.

Included in the Bank’s FHLB advances at December 31, 2013, was a $25.0 million advance with a maturity date of June 20, 2017.  The interest rate on this advance was 4.57%.  This advance was repaid by the Bank in June 2014.

The Company prepaid $80 million of its Federal Home Loan Bank advances and $50 million of structured repurchase agreements (see Note 12) in the nine months ended September 30, 2014 as part of a strategy to utilize the Bank’s liquidity and improve net interest margin.  As a result, the Company incurred one-time prepayment penalties totaling $7.4 million, which were included in other operating expenses. 

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Note 6: Investment Securities: Schedule of Available-for-sale Securities Reconciliation (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended
	Sep. 30, 2014	Dec. 31, 2013
Available-for-sale Securities, Amortized Cost Basis	$ 414,265
Available-for-sale Securities Fair Value	425,156
US Government Agencies Debt Securities
Available-for-sale Securities, Amortized Cost Basis	20,000	20,000
Available-for-sale Debt Securities, Gross Unrealized Loss	1,063	2,745
Available-for-sale Securities Fair Value	18,937	17,255
Available for Sale Securities Tax Equivalent Yield	2.00%	2.00%
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises
Available-for-sale Securities, Amortized Cost Basis	273,358	365,020
Available-for-sale Debt Securities Gross Unrealized Gain	4,502	4,824
Available-for-sale Debt Securities, Gross Unrealized Loss	1,233	2,266
Available-for-sale Securities Fair Value	276,627	367,578
Available for Sale Securities Tax Equivalent Yield	2.02%	2.04%
US States and Political Subdivisions Debt Securities
Available-for-sale Securities, Amortized Cost Basis	120,060	122,113
Available-for-sale Debt Securities Gross Unrealized Gain	6,713	2,549
Available-for-sale Debt Securities, Gross Unrealized Loss	226	1,938
Available-for-sale Securities Fair Value	126,547	122,724
Available for Sale Securities Tax Equivalent Yield	5.37%	5.47%
Equity Securities
Available-for-sale Securities, Amortized Cost Basis	847	847
Available-for-sale Debt Securities Gross Unrealized Gain	2,198	2,022
Available-for-sale Securities Fair Value	3,045	2,869
Available-for-sale Securities
Available-for-sale Securities, Amortized Cost Basis	414,265	551,441
Available-for-sale Debt Securities Gross Unrealized Gain	13,413	10,789
Available-for-sale Debt Securities, Gross Unrealized Loss	2,522	6,949
Available-for-sale Securities Fair Value	425,156	555,281
Available for Sale Securities Tax Equivalent Yield	2.98%	2.74%
Small Business Administration Loan Pools
Available-for-sale Securities, Amortized Cost Basis		43,461
Available-for-sale Debt Securities Gross Unrealized Gain		1,394
Available-for-sale Securities Fair Value		$ 44,855
Available for Sale Securities Tax Equivalent Yield		1.34%

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Note 7: Loans and Allowance For Loan Losses: Schedule of Loans Receivable by Aging Analysis (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
One To Four Family Residential Construction
Loans Over 90 Days Past Due	$ 223
Loans Total Past Due	223
Loans Current	43,163	34,662
Total Loans Receivable	43,386	34,662
Subdivision Construction
Loans Over 90 Days Past Due	1,223	871
Loans Total Past Due	1,223	871
Loans Current	34,121	39,538
Total Loans Receivable	35,344	40,409
Land Development
Loans 30 to 59 Days Past Due		145
Loans 60 to 89 Days Past Due		38
Loans Over 90 Days Past Due	265	338
Loans Total Past Due	265	521
Loans Current	48,316	57,320
Total Loans Receivable	48,581	57,841
Commercial Construction
Loans Current	361,971	184,019
Total Loans Receivable	361,971	184,019
Owner Occupied One To Four Family Residential
Loans 30 to 59 Days Past Due	184	1,233
Loans 60 to 89 Days Past Due	565	344
Loans Over 90 Days Past Due	1,616	3,014
Loans Total Past Due	2,365	4,591
Loans Current	76,619	84,542
Total Loans Receivable	78,984	89,133
Total Loans Greater Than 90 Days and Still Accruing	170	211
Non-Owner Occupied One To Four Family Residential
Loans 30 to 59 Days Past Due		1,562
Loans 60 to 89 Days Past Due	168	171
Loans Over 90 Days Past Due	2,997	843
Loans Total Past Due	3,165	2,576
Loans Current	140,249	143,332
Total Loans Receivable	143,414	145,908
Total Loans Greater Than 90 Days and Still Accruing		140
Commercial Real Estate
Loans 30 to 59 Days Past Due		2,856
Loans 60 to 89 Days Past Due	59	131
Loans Over 90 Days Past Due	2,968	6,205
Loans Total Past Due	3,027	9,192
Loans Current	869,267	771,498
Total Loans Receivable	872,294	780,690
Other Residential
Loans Current	353,225	325,599
Total Loans Receivable	353,225	325,599
Commercial Business
Loans 30 to 59 Days Past Due	21	17
Loans 60 to 89 Days Past Due	13	19
Loans Over 90 Days Past Due	427	5,208
Loans Total Past Due	461	5,244
Loans Current	348,926	310,025
Total Loans Receivable	349,387	315,269
Industrial Revenue Bonds
Loans Over 90 Days Past Due	1,205	2,023
Loans Total Past Due	1,205	2,023
Loans Current	41,736	40,207
Total Loans Receivable	42,941	42,230
Consumer Loans Auto Financing Receivable
Loans 30 to 59 Days Past Due	144	955
Loans 60 to 89 Days Past Due	1,331	127
Loans Over 90 Days Past Due	131	168
Loans Total Past Due	1,606	1,250
Loans Current	272,644	133,467
Total Loans Receivable	274,250	134,717
Consumer Other Financing Receivable
Loans 30 to 59 Days Past Due	168	1,258
Loans 60 to 89 Days Past Due	1,025	333
Loans Over 90 Days Past Due	649	732
Loans Total Past Due	1,842	2,323
Loans Current	76,834	79,937
Total Loans Receivable	78,676	82,260
Total Loans Greater Than 90 Days and Still Accruing	244	257
Home Equity Line of Credit
Loans 30 to 59 Days Past Due	46	168
Loans 60 to 89 Days Past Due	404	16
Loans Over 90 Days Past Due	337	504
Loans Total Past Due	787	688
Loans Current	60,365	57,595
Total Loans Receivable	61,152	58,283
FDIC Supported Loans Net Of Discounts TeamBank
Loans 30 to 59 Days Past Due	65	414
Loans 60 to 89 Days Past Due	115	130
Loans Over 90 Days Past Due	415	1,396
Loans Total Past Due	595	1,940
Loans Current	14,699	47,922
Total Loans Receivable	15,294	49,862
Total Loans Greater Than 90 Days and Still Accruing		6
Acquired non-covered loans, net of discounts (TeamBank)
Loans Current	28,341
Total Loans Receivable	28,341
FDIC Supported Loans Net Of Discounts Vantus Bank
Loans 30 to 59 Days Past Due	85	675
Loans 60 to 89 Days Past Due	12	31
Loans Over 90 Days Past Due	1,022	2,356
Loans Total Past Due	1,119	3,062
Loans Current	42,534	54,858
Total Loans Receivable	43,653	57,920
Total Loans Greater Than 90 Days and Still Accruing	56	42
FDIC Supported Loans Net Of Discounts Sun Security Bank
Loans 30 to 59 Days Past Due	353	510
Loans 60 to 89 Days Past Due	149	121
Loans Over 90 Days Past Due	2,714	4,241
Loans Total Past Due	3,216	4,872
Loans Current	51,178	59,971
Total Loans Receivable	54,394	64,843
Total Loans Greater Than 90 Days and Still Accruing		147
FDIC Supported Loans Net Of Discounts InterBank
Loans 30 to 59 Days Past Due	696	6,024
Loans 60 to 89 Days Past Due	1,375	1,567
Loans Over 90 Days Past Due	14,731	16,768
Loans Total Past Due	16,802	24,359
Loans Current	186,985	189,180
Total Loans Receivable	203,787	213,539
Total Loans Greater Than 90 Days and Still Accruing		20
Acquired loans not covered by FDIC loss sharing agreements, net of discounts (Valley Bank)
Loans 30 to 59 Days Past Due	9,727
Loans 60 to 89 Days Past Due	2,716
Loans Over 90 Days Past Due	12,329
Loans Total Past Due	24,772
Loans Current	127,725
Total Loans Receivable	152,497
Total Including FDIC Supported Loans Net Of Discount and Acquired Non-Covered Loans
Loans 30 to 59 Days Past Due	11,489	15,817
Loans 60 to 89 Days Past Due	7,932	3,028
Loans Over 90 Days Past Due	43,252	44,667
Loans Total Past Due	62,673	63,512
Loans Current	3,278,898	2,613,672
Total Loans Receivable	3,241,571	2,677,184
Total Loans Greater Than 90 Days and Still Accruing	470	823
Less FDIC Supported Loans and Acquired Not Covered Loans, Net Of Discounts
Loans 30 to 59 Days Past Due	10,926
Loans 60 to 89 Days Past Due	4,367
Loans Over 90 Days Past Due	31,211
Loans Total Past Due	46,504
Loans Current	451,462
Total Loans Receivable	497,966
Total Loans Greater Than 90 Days and Still Accruing	56
Loans Receivable
Loans 30 to 59 Days Past Due	563	8,194
Loans 60 to 89 Days Past Due	3,565	1,179
Loans Over 90 Days Past Due	12,041	19,906
Loans Total Past Due	16,169	29,279
Loans Current	2,727,436	2,261,741
Total Loans Receivable	2,743,605	2,291,020
Total Loans Greater Than 90 Days and Still Accruing	414	608
Less FDIC Supported Loans Net Of Discounts
Loans 30 to 59 Days Past Due		7,623
Loans 60 to 89 Days Past Due		1,849
Loans Over 90 Days Past Due		24,761
Loans Total Past Due		34,233
Loans Current		351,931
Total Loans Receivable		386,164
Total Loans Greater Than 90 Days and Still Accruing		$ 215

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GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES -- CONSOLIDATED STATEMENTS OF INCOME (Unaudited -- September 30, 2013 figures retrospectively adjusted, see Note 3) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Statements of Income
Loans	$ 44,948	$ 40,087	$ 125,669	$ 122,226
Investment securities and other	2,659	2,932	8,617	11,630
TOTAL INTEREST INCOME	47,607	43,019	134,286	133,856
Deposits	2,884	2,822	8,297	9,611
Federal Home Loan Bank advances	461	1,005	2,446	2,968
Short-term borrowings and repurchase agreements	13	587	1,082	1,758
Interest expense on subordinated debentures issued to capital trusts	143	141	418	421
TOTAL INTEREST EXPENSE	3,501	4,555	12,243	14,758
NET INTEREST INCOME	44,106	38,464	122,043	119,098
PROVISION FOR LOAN LOSSES	945	2,677	4,099	14,573
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	43,161	35,787	117,944	104,525
Commissions	284	158	910	836
Service charges and ATM fees	5,168	4,729	14,064	13,800
Net realized gains on sales of loans	1,543	1,179	2,700	4,236
Net realized gains on sales of available-for-sale securities	321	110	963	241
Late charges and fees on loans	248	284	827	785
Gain (loss) on derivative interest rate products	10	(125)	(223)	283
Initial gain recognized on business acquisition	0	0	10,805	0
Accretion (amortization) of income/expense related to business acquisitions	(6,463)	(6,339)	(20,061)	(17,900)
Other non-interest income	667	933	3,347	3,898
TOTAL NON-INTEREST INCOME	1,778	929	13,332	6,179
Salaries and employee benefits	14,884	13,034	41,371	39,334
Net occupancy and equipment expense	6,172	5,216	16,786	15,451
Postage	935	790	2,572	2,454
Insurance	940	1,083	2,820	3,204
Advertising	522	433	1,690	1,599
Office supplies and printing	393	320	1,050	950
Telephone	695	679	2,112	2,169
Legal, audit and other professional fees	1,389	1,186	3,230	2,936
Expense on foreclosed assets	982	1,068	3,173	3,478
Partnership tax credit investment amortization	420	556	1,300	1,552
Other operating expenses	2,066	1,791	13,585	5,663
TOTAL NON-INTEREST EXPENSE	29,398	26,156	89,689	78,790
INCOME BEFORE INCOME TAXES	15,541	10,560	41,587	31,914
PROVISION FOR INCOME TAXES	3,951	2,121	10,125	6,858
NET INCOME	11,590	8,439	31,462	25,056
Preferred stock dividends	145	145	435	435
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$ 11,445	$ 8,294	$ 31,027	$ 24,621
BASIC EARNINGS PER COMMON SHARE	$ 0.84	$ 0.61	$ 2.27	$ 1.81
DILUTED EARNINGS PER COMMON SHARE	$ 0.83	$ 0.61	$ 2.25	$ 1.80
DIVIDENDS DECLARED PER COMMON SHARE	$ 0.20	$ 0.18	$ 0.60	$ 0.54

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Note 5: Earnings Per Share

3 Months Ended

Sep. 30, 2014

Notes

Note 5: Earnings Per Share

NOTE 5: EARNINGS PER SHARE

	Three Months Ended September 30,
	2014	2013
(In Thousands, Except Per Share Data)
Basic:
Average shares outstanding	13,696	13,647
Net income available to common stockholders	$11,445	$8,294
Per common share amount	$0.84	$0.61
Diluted:
Average shares outstanding	13,696	13,647
Net effect of dilutive stock options – based on the treasury
stock method using average market price	89	58
Diluted shares	13,785	13,705
Net income available to common stockholders	$11,445	$8,294
Per common share amount	$0.83	$0.61

	Nine Months Ended September 30,
	2014	2013
(In Thousands, Except Per Share Data)
Basic:
Average shares outstanding	13,693	13,634
Net income available to common stockholders	$31,027	$24,621
Per share amount	$2.27	$1.81
Diluted:
Average shares outstanding	13,693	13,634
Net effect of dilutive stock options – based on the treasury
stock method using average market price	75	58
Diluted shares	13,768	13,692
Net income available to common stockholders	$31,027	$24,621
Per share amount	$2.25	$1.80

Options to purchase 118,600 and 304,630 shares of common stock were outstanding at September 30, 2014 and 2013, respectively, but were not included in the computation of diluted earnings per common share for the three month periods because the options’ exercise prices were greater than the average market prices of the common shares for the three months ended September 30, 2014 and 2013, respectively.  Options to purchase 232,735 and 304,630 shares of common stock were outstanding at September 30, 2014 and 2013, respectively, but were not included in the computation of diluted earnings per common share for the nine month periods because the options’ exercise prices were greater than the average market prices of the common shares for the nine months ended September 30, 2014 and 2013, respectively. 

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Note 4: Stockholders' Equity

3 Months Ended

Sep. 30, 2014

Notes

Note 4: Stockholders' Equity

NOTE 4: STOCKHOLDERS' EQUITY

Previously, the Company's stockholders approved the Company's reincorporation to the State of Maryland. Under Maryland law, there is no concept of "Treasury Shares." Instead, shares purchased by the Company constitute authorized but unissued shares under Maryland law. Accounting principles generally accepted in the United States of America state that accounting for treasury stock shall conform to state law. The cost of shares purchased by the Company has been allocated to Common Stock and Retained Earnings balances.

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Note 16: FDIC-assisted Acquisition

3 Months Ended

Sep. 30, 2014

Notes

Note 16: FDIC-assisted Acquisition

NOTE 16: FDIC-ASSISTED ACQUISITION

On June 20, 2014, Great Southern Bank entered into a purchase and assumption agreement with the FDIC to purchase a substantial portion of the loans and investment securities, as well as certain other assets, and assume all of the deposits, as well as certain other liabilities, of Valley Bank (“Valley”), a full-service bank headquartered in Moline, IL, with significant operations in Iowa.  The provisional fair values of the assets acquired and liabilities assumed in the transaction were as follows:

	June 20,
	2014
(In Thousands)
Cash	$2,729
Due from banks	106,680
Cash and cash equivalents	109,409
Investment securities	88,513
Loans receivable, net of discount on loans purchased of $30,102	165,098
Accrued interest receivable	1,004
Premises	10,850
Core deposit intangible	2,800
Other assets	1,060
Total assets acquired	378,734
Liabilities
Demand and savings deposits	186,902
Time deposits	179,125
Total deposits	366,027
Securities sold under reverse repurchase agreements with customers	567
Accounts payable	561
Accrued interest payable	182
Advances from borrowers for taxes and insurance	592
Total liabilities assumed	367,929
Gain recognized on business acquisition	$10,805

Under the terms of the Purchase and Assumption Agreement, the FDIC agreed to transfer net assets to Great Southern at a discount of $37.5 million to compensate Great Southern for estimated losses related to the loans acquired.  No premium was paid to the FDIC for the deposits, resulting in a net purchase discount of $37.5 million.  Details related to the transfer are as follows:

	June 20,
	2014
(In Thousands)
Net liabilities as determined by the FDIC	$(21,897)
Cash transferred by the FDIC	59,394
Discount per Purchase and Assumption Agreement	37,497
Purchase accounting adjustments
Loans	(28,088)
Deposits	(399)
Investments	(1,005)
Core deposit intangible	2,800
Gain recognized on business acquisition	$10,805

The acquisition of the net assets of Valley was determined to constitute a business acquisition in accordance with FASB ASC 805.  FASB ASC 805 allows a measurement period of up to one year to adjust initial fair value estimates as of the acquisition date.  Therefore, provisional measurements of assets acquired and liabilities assumed were recorded on a preliminary basis at fair value on the date of acquisition.  Based upon the preliminary acquisition date fair values of the net assets acquired, no goodwill was recorded.  The transaction resulted in a preliminary bargain purchase gain of $10.8 million for the three and six months ended June 30, 2014.  The transaction also resulted in the recording of a deferred tax liability in the initial amount of $3.6 million. 

The carrying amount of assets related to the Valley Bank transaction at June 20, 2014 (the acquisition date), consisted of impaired loans required to be accounted for in accordance with FASB ASC 310-30 and other loans not subject to the specific criteria of FASB ASC 310-30, but accounted for under the guidance of FASB ASC 310-30 (FASB ASC 310-30 by Policy Loans) as shown in the following table:

		FASB ASC
	FASB	310-30
	ASC	by
	310-30	Policy
	Loans	Loans	Total
(In Thousands)
Loans	$3,920	$161,178	$165,098

On the acquisition date, the preliminary estimate of the contractually required payments receivable for all FASB ASC 310-30 loans acquired was $5.7 million, the cash flows expected to be collected were $4.0 million including interest, and the estimated fair value of the loans was $3.9 million.  These amounts were determined based upon the estimated remaining life of the underlying loans, which include the effects of estimated prepayments.  At June 20, 2014, a majority of these loans were valued based on the liquidation value of the underlying collateral, because the expected cash flows were primarily based on the liquidation of underlying collateral and the timing and amount of the cash flows could not be reasonably estimated.

On the acquisition date, the preliminary estimate of the contractually required payments receivable for all FASB ASC 310-30 by Policy Loans acquired in the acquisition was $187.4 million, of which $28.4 million of cash flows were not expected to be collected, and the estimated fair value of the loans was $161.2 million.  A majority of these loans were valued as of their acquisition dates based on the liquidation value of the underlying collateral, because the expected cash flows were primarily based on the liquidation of underlying collateral and the timing and amount of the cash flows could not be reasonably estimated. 

At September 30, 2014, the Company has finalized its initial analysis of these loans without adjustments to the preliminary estimated recorded carrying values.

The amount of the estimated cash flows expected to be received from the acquired loan pools in excess of the fair values recorded for the loan pools is referred to as the accretable yield.  The accretable yield is recognized as interest income over the estimated lives of the loans.  The initial accretable yield recorded for Valley was $23.0 million.  The amount accreted to income during the three and nine months ended September 30, 2014 was $2.1 million and $2.2 million, respectively.  The net remaining accretable yield at September 30, 2014 was $20.7 million. 

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Note 12: Structured Repurchase Agreements

3 Months Ended

Sep. 30, 2014

Notes

Note 12: Structured Repurchase Agreements

NOTE 12: STRUCTURED REPURCHASE AGREEMENTS

In September 2008, the Company entered into a structured repurchase borrowing transaction for a total of $50 million.  This borrowing bore interest at a fixed rate of 4.34%, was scheduled to mature September 15, 2015, and had a call provision that allowed the repurchase counterparty to call the borrowing quarterly.  The Company pledged investment securities to collateralize this borrowing.

In June 2014, the Company elected to repay this structured repurchase borrowing.

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Note 6: Investment Securities: Investments in Debt Securities Policy (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Details
Fair value investments reported less than historical cost	$ 131,500	$ 237,600
Fair value investments reported less than historical cost percentage of investment portfolio	30.90%	42.70%

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets

3 Months Ended

Sep. 30, 2014

Notes

Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets

NOTE 8: ACQUIRED LOANS, LOSS SHARING AGREEMENTS AND FDIC INDEMNIFICATION ASSETS

On March 20, 2009, Great Southern Bank entered into a purchase and assumption agreement with loss share with the Federal Deposit Insurance Corporation (FDIC) to assume all of the deposits (excluding brokered deposits) and acquire certain assets of TeamBank, N.A., a full service commercial bank headquartered in Paola, Kansas. 

The loans, commitments and foreclosed assets purchased in the TeamBank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the Bank shares in the losses on assets covered under the agreement (referred to as covered assets). On losses up to $115.0 million, the FDIC agreed to reimburse the Bank for 80% of the losses. On losses exceeding $115.0 million, the FDIC agreed to reimburse the Bank for 95% of the losses.  Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by the Bank.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans, which five-year period ended March 31, 2014.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A discount was recorded in conjunction with the fair value of the acquired loans and the amount accreted to yield during the three and nine months ended September 30, 2014 was $-0-.  The amount accreted to yield during the three and nine months ended September 30, 2013 was $0 and $134,000, respectively. 

On September 4, 2009, Great Southern Bank entered into a purchase and assumption agreement with loss share with the FDIC to assume all of the deposits and acquire certain assets of Vantus Bank, a full service thrift headquartered in Sioux City, Iowa. 

The loans, commitments and foreclosed assets purchased in the Vantus Bank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the Bank shares in the losses on assets covered under the agreement (referred to as covered assets). On losses up to $102.0 million, the FDIC agreed to reimburse the Bank for 80% of the losses. On losses exceeding $102.0 million, the FDIC agreed to reimburse the Bank for 95% of the losses. Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by the Bank.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans, which five year period ended on September 30, 2014.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A discount was recorded in conjunction with the fair value of the acquired loans and the amount accreted to yield during the three and nine months ended September 30, 2014 was $-0-.  The amount accreted to yield during the three and nine months ended September 30, 2013 was $19,000 and $99,000, respectively. 

On October 7, 2011, Great Southern Bank entered into a purchase and assumption agreement with loss share with the FDIC to assume all of the deposits and acquire certain assets of Sun Security Bank, a full service bank headquartered in Ellington, Missouri. 

The loans and foreclosed assets purchased in the Sun Security Bank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the FDIC agreed to cover 80% of the losses on the loans (excluding approximately $4 million of consumer loans) and foreclosed assets purchased subject to certain limitations.  Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by Great Southern.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A discount was recorded in conjunction with the fair value of the acquired loans and the amount accreted to yield during the three and nine months ended September 30, 2014 was $0 and $105,000, respectively.  The amount accreted to yield during the three and nine months ended September 30, 2013 was $210,000 and $827,000, respectively. 

On April 27, 2012, Great Southern Bank entered into a purchase and assumption agreement with loss share with the FDIC to assume all of the deposits and acquire certain assets of Inter Savings Bank, FSB (“InterBank”), a full service bank headquartered in Maple Grove, Minnesota. 

The loans and foreclosed assets purchased in the InterBank transaction are covered by a loss sharing agreement between the FDIC and Great Southern Bank.  Under the loss sharing agreement, the FDIC agreed to cover 80% of the losses on the loans (excluding approximately $60,000 of consumer loans) and foreclosed assets purchased subject to certain limitations.  Realized losses covered by the loss sharing agreement include loan contractual balances (and related unfunded commitments that were acquired), accrued interest on loans for up to 90 days, the book value of foreclosed real estate acquired, and certain direct costs, less cash or other consideration received by Great Southern.  This agreement extends for ten years for 1-4 family real estate loans and for five years for other loans.  The value of this loss sharing agreement was considered in determining fair values of loans and foreclosed assets acquired.  The loss sharing agreement is subject to the Bank following servicing procedures as specified in the agreement with the FDIC.  The expected reimbursements under the loss sharing agreement were recorded as an indemnification asset at their preliminary estimated fair value on the acquisition date.  Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded.  A premium was recorded in conjunction with the fair value of the acquired loans and the amount amortized to yield during the three and nine months ended September 30, 2014 was $133,000 and $417,000, respectively.  The amount amortized to yield during the three and nine months ended September 30, 2013 was $155,000 and $485,000, respectively.

On June 20, 2014, Great Southern Bank entered into a purchase and assumption agreement with the FDIC to purchase a substantial portion of the loans and investment securities, as well as certain other assets, and assume all of the deposits, as well as certain other liabilities, of Valley Bank (“Valley”), a full-service bank headquartered in Moline, Illinois, with significant operations in Iowa.  This transaction did not include a loss sharing agreement. 

Based upon the acquisition date fair values of the net assets acquired, no goodwill was recorded. A premium was recorded in conjunction with the fair value of the acquired loans and the amount amortized to yield during each of the three and nine months ended September 30, 2014 was $263,000. 

Fair Value and Expected Cash Flows.  At the time of these acquisitions, the Company determined the fair value of the loan portfolios based on several assumptions. Factors considered in the valuations were projected cash flows for the loans, type of loan and related collateral, classification status, fixed or variable interest rate, term of loan, current discount rates and whether or not the loan was amortizing. Loans were grouped together according to similar characteristics and were treated in the aggregate when applying various valuation techniques. Management also estimated the amount of credit losses that were expected to be realized for the loan portfolios. The discounted cash flow approach was used to value each pool of loans. For non-performing loans, fair value was estimated by calculating the present value of the recoverable cash flows using a discount rate based on comparable corporate bond rates. This valuation of the acquired loans is a significant component leading to the valuation of the loss sharing assets recorded. 

The amount of the estimated cash flows expected to be received from the acquired loan pools in excess of the fair values recorded for the loan pools is referred to as the accretable yield.  The accretable yield is recognized as interest income over the estimated lives of the loans.  The Company continues to evaluate the fair value of the loans including cash flows expected to be collected.  Increases in the Company’s cash flow expectations are recognized as increases to the accretable yield while decreases are recognized as impairments through the allowance for loan losses.  During the three and nine months ended September 30, 2014, increases in expected cash flows related to the acquired loan portfolios resulted in adjustments of $5.1 million and $25.0 million, respectively, to the accretable yield to be spread over the estimated remaining lives of the loans on a level-yield basis. During the three and nine months ended September 30, 2013, similar such adjustments totaling $11.9 million and $26.9 million, respectively, were made to the accretable yield.  The current year increases in expected cash flows also reduced the amount of expected reimbursements under the loss sharing agreements.  During the three and nine months ended September 30, 2014, this resulted in corresponding adjustments of $4.1 million and $20.0 million, respectively, to the indemnification assets to be amortized on a level-yield basis over the remainder of the loss sharing agreements or the remaining expected lives of the loan pools, whichever is shorter.  During the three and nine months ended September 30, 2013, corresponding adjustments of $9.4 million and $21.3 million, respectively, were made to the indemnification assets. 

Because these adjustments will be recognized over the remaining lives of the loan pools and the remainder of the loss sharing agreements, respectively, they will impact future periods as well.  The remaining accretable yield adjustment that will affect interest income is $29.6 million and the remaining adjustment to the indemnification assets, including the effects of the clawback liability related to Interbank, that will affect non-interest income (expense) is $(26.0) million.  Of the remaining adjustments, we expect to recognize $7.2 million of interest income and $(6.0) million of non-interest income (expense) in the remainder of 2014.  Additional adjustments may be recorded in future periods from the FDIC-assisted acquisitions, as the Company continues to estimate expected cash flows from the acquired loan pools.

The impact of adjustments on the Company’s financial results is shown below:

	Three Months Ended		Three Months Ended
	September 30, 2014		September 30, 2013
(In Thousands, Except Per Share Data
and Basis Points Data)
Impact on net interest income/
net interest margin (in basis points)	$8,848	98 bps	$8,412	101 bps
Non-interest income	(7,438)		(7,310)
Net impact to pre-tax income	$1,410		$1,102
Net impact net of taxes	$917		$716
Impact to diluted earnings per common share	$0.07		$0.05

	Nine Months Ended		Nine Months Ended
	September 30, 2014		September 30, 2013
(In Thousands, Except Per Share Data
and Basis Points Data)
Impact on net interest income/
net interest margin (in basis points)	$25,836	101 bps	$26,508	103 bps
Non-interest income	(21,915)		(22,529)
Net impact to pre-tax income	$3,921		$3,979
Net impact net of taxes	$2,549		$2,586
Impact to diluted earnings per common share	$0.19		$0.19

The loss sharing asset is measured separately from the loan portfolio because it is not contractually embedded in the loans and is not transferable with the loans should the Bank choose to dispose of them. Fair value was estimated using projected cash flows available for loss sharing based on the credit adjustments estimated for each loan pool (as discussed above) and the loss sharing percentages outlined in the Purchase and Assumption Agreement with the FDIC. These cash flows were discounted to reflect the uncertainty of the timing and receipt of the loss sharing reimbursement from the FDIC. The loss sharing asset is also separately measured from the related foreclosed real estate.

The loss sharing agreement on the InterBank transaction includes a clawback provision whereby if credit loss performance is better than certain pre-established thresholds, then a portion of the monetary benefit is shared with the FDIC.  The pre-established threshold for credit losses is $115.7 million for this transaction.  The monetary benefit required to be paid to the FDIC under the clawback provision, if any, will occur shortly after the termination of the loss sharing agreement, which in the case of InterBank is 10 years from the acquisition date.

At September 30, 2014 and December 31, 2013, the Bank’s internal estimate of credit performance was expected to be better than the threshold set by the FDIC in the loss sharing agreement.  Therefore, a separate clawback liability totaling $5.8 million and $3.7 million was recorded as of September 30, 2014 and December 31, 2013, respectively.  As changes in the fair values of the loans and foreclosed assets are determined due to changes in expected cash flows, changes in the amount of the clawback liability will occur.

TeamBank Loans, Foreclosed Assets and Indemnification Asset.  The following tables present the balances of the FDIC indemnification asset related to the TeamBank transaction at September 30, 2014 and December 31, 2013. Gross loan balances (due from the borrower) were reduced approximately $389.9 million since the transaction date because of $256.1 million of repayments from borrowers, $61.6 million in transfers to foreclosed assets and $72.2 million in charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

	September 30, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$46,222	$169
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(2,061)	--
Original estimated fair value of assets, net of activity since
acquisition date	(43,635)	(156)
Expected loss remaining	526	13
Assumed loss sharing recovery percentage	83%	77%
Estimated loss sharing value	438	10
Indemnification asset to be amortized resulting from
change in expected losses	327	--
Accretable discount on FDIC indemnification asset	--	--
FDIC indemnification asset	$765	$10

	December 31, 2013
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$53,553	$664
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(2,882)	--
Original estimated fair value of assets, net of activity since
acquisition date	(49,862)	(647)
Expected loss remaining	809	17
Assumed loss sharing recovery percentage	82%	76%
Estimated loss sharing value	665	13
Indemnification asset to be amortized resulting from
change in expected losses	593	--
Accretable discount on FDIC indemnification asset	(10)	--
FDIC indemnification asset	$1,248	$13

Vantus Bank Loans, Foreclosed Assets and Indemnification Asset.  The following tables present the balances of the FDIC indemnification asset related to the Vantus Bank transaction at September 30, 2014 and December 31, 2013. Gross loan balances (due from the borrower) were reduced approximately $286.7 million since the transaction date because of $240.6 million of repayments from borrowers, $16.5 million in transfers to foreclosed assets and $29.6 million in charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

	September 30, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$44,877	$1,205
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(456)	--
Original estimated fair value of assets, net of activity since
acquisition date	(43,653)	(1,015)
Expected loss remaining	768	190
Assumed loss sharing recovery percentage	74%	--%
Estimated loss sharing value(1)	566	--
Indemnification asset to be amortized resulting from
change in expected losses	278	--
Accretable discount on FDIC indemnification asset	--	--
FDIC indemnification asset	$844	$--

(1) Includes $153,000 impairment of indemnification asset for foreclosed assets.  Resolution of certain items related to commercial foreclosed assets did not occur prior to the expiration of the non-single-family loss sharing agreement for Vantus Bank on September 30, 2014. 

	December 31, 2013
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$60,011	$1,986
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(1,202)	--
Original estimated fair value of assets, net of activity since
acquisition date	(57,920)	(1,092)
Expected loss remaining	889	894
Assumed loss sharing recovery percentage	78%	80%
Estimated loss sharing value	690	716
Indemnification asset to be amortized resulting from
change in expected losses	919	--
Accretable discount on FDIC indemnification asset	(32)	--
FDIC indemnification asset	$1,577	$716

Sun Security Bank Loans, Foreclosed Assets and Indemnification Asset.  The following tables present the balances of the FDIC indemnification asset related to the Sun Security Bank transaction at September 30, 2014 and December 31, 2013.  Gross loan balances (due from the borrower) were reduced approximately $171.7 million since the transaction date because of $112.8 million of repayments from borrowers, $27.6 million in transfers to foreclosed assets and $31.3 million of charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

	September 30, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$62,722	$2,598
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(3,540)	--
Original estimated fair value of assets, net of activity since
acquisition date	(54,394)	(1,521)
Expected loss remaining	4,788	1,077
Assumed loss sharing recovery percentage	66%	80%
Estimated loss sharing value	3,173	862
Indemnification asset to be amortized resulting from
change in expected losses	2,827	--
Accretable discount on FDIC indemnification asset	(363)	(63)
FDIC indemnification asset	$5,637	$799

	December 31, 2013
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$78,524	$3,582
Non-credit premium/(discount), net of activity since acquisition date	(105)	--
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(5,062)	--
Original estimated fair value of assets, net of activity since
acquisition date	(64,843)	(2,193)
Expected loss remaining	8,514	1,389
Assumed loss sharing recovery percentage	70%	80%
Estimated loss sharing value	5,974	1,111
Indemnification asset to be amortized resulting from
change in expected losses	4,049	--
Accretable discount on FDIC indemnification asset	(680)	(93)
FDIC indemnification asset	$9,343	$1,018

InterBank Loans, Foreclosed Assets and Indemnification Asset.  The following table presents the balances of the FDIC indemnification asset related to the InterBank transaction at September 30, 2014.  Gross loan balances (due from the borrower) were reduced approximately $138.8 million since the transaction date because of $107.2 million of repayments by the borrower, $11.4 million in transfers to foreclosed assets and $20.2 million of charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

	September 30, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$254,427	$5,076
Non-credit premium/(discount), net of activity since acquisition date	1,488	--
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(23,518)	--
Original estimated fair value of assets, net of activity since
acquisition date	(203,787)	(3,976)
Expected loss remaining	28,610	1,100
Assumed loss sharing recovery percentage	82%	80%
Estimated loss sharing value(1)	23,444	880
FDIC loss share clawback	3,793	--
Indemnification asset to be amortized resulting from
change in expected losses	18,814	--
Accretable discount on FDIC indemnification asset	(3,350)	(33)
FDIC indemnification asset	$42,701	$847

(1)    Includes $400,000 impairment of indemnification asset for loans

	December 31, 2013
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$284,975	$6,543
Non-credit premium/(discount), net of activity since acquisition date	1,905	--
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(21,218)	--
Original estimated fair value of assets, net of activity since
acquisition date	(213,539)	(5,073)
Expected loss remaining	52,123	1,470
Assumed loss sharing recovery percentage	82%	80%
Estimated loss sharing value	42,654	1,176
FDIC loss share clawback	2,893	--
Indemnification asset to be amortized resulting from
change in expected losses	16,974	--
Accretable discount on FDIC indemnification asset	(4,874)	(33)
FDIC indemnification asset	$57,647	$1,143

Valley Bank Loans and Foreclosed Assets.  The following table presents the balances of the loans and discount related to the Valley Bank transaction at September 30, 2014.  Gross loan balances (due from the borrower) were reduced approximately $14.1 million since the transaction date because of $12.3 million of repayments by the borrower and $1.8 million of charge-offs to customer loan balances.  The Valley Bank transaction did not include a loss sharing agreement; however, the loans were recorded at a discount, which is accreted to yield over the life of the loans. 

	September 30, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis, net of activity since acquisition date	$179,065	$--
Non-credit premium/(discount), net of activity since acquisition date	1,752	--
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	--	--
Original estimated fair value of assets, net of activity since
acquisition date	(152,497)	--
Expected loss remaining	$28,320	$--

	June 20, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis	$193,186	$--
Non-credit premium/(discount)	2,015	--
Original estimated fair value of assets	(165,098)	--
Expected loss remaining	$30,103	$--

Changes in the accretable yield for acquired loan pools were as follows for the three months ended September 30, 2014 and 2013:

			Sun Security
	TeamBank	Vantus Bank	Bank	InterBank	Valley Bank
(In Thousands)
Balance, July 1, 2013	$8,610	$8,647	$10,055	$34,967	$--
Accretion	(1,450)	(1,832)	(4,795)	(7,034)	--
Reclassification from
nonaccretable yield(1)	1,109	(379)	5,293	7,774	--
Balance, September 30, 2013	$8,269	$6,436	$10,553	$35,707	$--
Balance July 1, 2014	$7,434	$4,578	$9,427	$41,108	$22,811
Accretion	(887)	(859)	(2,119)	(10,002)	(2,062)
Reclassification from
nonaccretable yield(1)	725	916	789	4,857	--
Balance, September 30, 2014	$7,272	$4,635	$8,097	$35,963	$20,749

(1)    Represents increases in estimated cash flows expected to be received from the acquired loan pools, primarily due to lower estimated credit losses.  The numbers also include changes in expected accretion of the loan pools for TeamBank, Vantus Bank, Sun Security Bank and InterBank for the three months ended September 30, 2014, totaling $522,000, $831,000, $139,000 and $707,000, respectively, and for the three months ended September 30, 2013, totaling $340,000, $0, $4.3 million and $7.3 million, respectively. There have not yet been any changes to the expected accretion of the loan pools for Valley Bank. 

Changes in the accretable yield for acquired loan pools were as follows for the nine months ended September 30, 2014 and 2013:

			Sun Security
	TeamBank	Vantus Bank	Bank	InterBank	Valley Bank
(In Thousands)
Balance, January 1, 2013	$12,128	$13,538	$11,259	$42,574	$--
Accretion	(7,050)	--	(13,021)	(20,423)	--
Reclassification from
nonaccretable yield(1)	3,191	390	12,315	13,556	--
Balance, September 30, 2013	$8,269	$6,436	$10,553	$35,707	$--
Balance January 1, 2014	$7,402	$5,725	$11,113	$40,095	$--
Additions	--	--	--	--	22,976
Accretion	(3,169)	(2,990)	(7,343)	(28,404)	(2,227)
Reclassification from
nonaccretable yield(1)	3,039	1,900	4,327	24,272	--
Balance, September 30, 2014	$7,272	$4,635	$8,097	$35,963	$20,749

(1)    Represents increases in estimated cash flows expected to be received from the acquired loan pools, primarily due to lower estimated credit losses.  The numbers also include changes in expected accretion of the loan pools for TeamBank, Vantus Bank, Sun Security Bank and InterBank for the nine months ended September 30, 2014, totaling $2.8 million, $1.8 million, $1.5 million and $2.4 million, respectively, and for the nine months ended September 30, 2013, totaling $2.5 million, $516,000, $9.0 million and $14.9 million, respectively.  There have not yet been any changes to the expected accretion of the loan pools for Valley Bank. 

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of Changes Accretable Yield for Acquired Loan Pools (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Changes Accretable Yield for Acquired Loan Pools

			Sun Security
	TeamBank	Vantus Bank	Bank	InterBank	Valley Bank
(In Thousands)
Balance, July 1, 2013	$8,610	$8,647	$10,055	$34,967	$--
Accretion	(1,450)	(1,832)	(4,795)	(7,034)	--
Reclassification from
nonaccretable yield(1)	1,109	(379)	5,293	7,774	--
Balance, September 30, 2013	$8,269	$6,436	$10,553	$35,707	$--
Balance July 1, 2014	$7,434	$4,578	$9,427	$41,108	$22,811
Accretion	(887)	(859)	(2,119)	(10,002)	(2,062)
Reclassification from
nonaccretable yield(1)	725	916	789	4,857	--
Balance, September 30, 2014	$7,272	$4,635	$8,097	$35,963	$20,749

(1)    Represents increases in estimated cash flows expected to be received from the acquired loan pools, primarily due to lower estimated credit losses.  The numbers also include changes in expected accretion of the loan pools for TeamBank, Vantus Bank, Sun Security Bank and InterBank for the three months ended September 30, 2014, totaling $522,000, $831,000, $139,000 and $707,000, respectively, and for the three months ended September 30, 2013, totaling $340,000, $0, $4.3 million and $7.3 million, respectively. There have not yet been any changes to the expected accretion of the loan pools for Valley Bank. 

Changes in the accretable yield for acquired loan pools were as follows for the nine months ended September 30, 2014 and 2013:

			Sun Security
	TeamBank	Vantus Bank	Bank	InterBank	Valley Bank
(In Thousands)
Balance, January 1, 2013	$12,128	$13,538	$11,259	$42,574	$--
Accretion	(7,050)	--	(13,021)	(20,423)	--
Reclassification from
nonaccretable yield(1)	3,191	390	12,315	13,556	--
Balance, September 30, 2013	$8,269	$6,436	$10,553	$35,707	$--
Balance January 1, 2014	$7,402	$5,725	$11,113	$40,095	$--
Additions	--	--	--	--	22,976
Accretion	(3,169)	(2,990)	(7,343)	(28,404)	(2,227)
Reclassification from
nonaccretable yield(1)	3,039	1,900	4,327	24,272	--
Balance, September 30, 2014	$7,272	$4,635	$8,097	$35,963	$20,749

(1)    Represents increases in estimated cash flows expected to be received from the acquired loan pools, primarily due to lower estimated credit losses.  The numbers also include changes in expected accretion of the loan pools for TeamBank, Vantus Bank, Sun Security Bank and InterBank for the nine months ended September 30, 2014, totaling $2.8 million, $1.8 million, $1.5 million and $2.4 million, respectively, and for the nine months ended September 30, 2013, totaling $2.5 million, $516,000, $9.0 million and $14.9 million, respectively.  There have not yet been any changes to the expected accretion of the loan pools for Valley Bank. 

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Note 13: Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Details
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent	35.00%	35.00%	35.00%	35.00%
Nontaxable Interest and Dividends	(3.10%)	(4.30%)	(3.30%)	(4.30%)
TaxCredits	(8.40%)	(12.20%)	(9.20%)	(11.10%)
State taxes	1.70%	3.00%	1.50%	2.10%
Other taxes	0.20%	(1.40%)	0.40%	(0.20%)
Tax percentage rate	25.40%	20.10%	24.40%	21.50%

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Note 6: Investment Securities

3 Months Ended

Sep. 30, 2014

Notes

Note 6: Investment Securities

NOTE 6: INVESTMENT SECURITIES

	September 30, 2014
		Gross	Gross		Tax
	Amortized	Unrealized	Unrealized	Fair	Equivalent
	Cost	Gains	Losses	Value	Yield
(In Thousands)
AVAILABLE-FOR-SALE SECURITIES:
U.S. government agencies	$20,000	$--	$1,063	$18,937	2.00%
Mortgage-backed securities	273,358	4,502	1,233	276,627	2.02
States and political subdivisions	120,060	6,713	226	126,547	5.37
Equity securities	847	2,198	--	3,045	--
	$414,265	$13,413	$2,522	$425,156	2.98%

	December 31, 2013
		Gross	Gross		Tax
	Amortized	Unrealized	Unrealized	Fair	Equivalent
	Cost	Gains	Losses	Value	Yield
(In Thousands)
AVAILABLE-FOR-SALE SECURITIES:
U.S. government agencies	$20,000	$--	$2,745	$17,255	2.00%
Mortgage-backed securities	365,020	4,824	2,266	367,578	2.04
Small Business Administration
loan pools	43,461	1,394	--	44,855	1.34
States and political subdivisions	122,113	2,549	1,938	122,724	5.47
Equity securities	847	2,022	--	2,869	--
	$551,441	$10,789	$6,949	$555,281	2.74%

	September 30, 2014
		Gross	Gross		Tax
	Amortized	Unrealized	Unrealized	Fair	Equivalent
	Cost	Gains	Losses	Value	Yield
(In Thousands)
HELD-TO-MATURITY SECURITIES:
States and political subdivisions	$450	$55	$--	$505	7.37%

	December 31, 2013
		Gross	Gross		Tax
	Amortized	Unrealized	Unrealized	Fair	Equivalent
	Cost	Gains	Losses	Value	Yield
(In Thousands)
HELD-TO-MATURITY SECURITIES:
States and political subdivisions	$805	$107	$--	$912	7.37%

The amortized cost and fair value of available-for-sale securities at September 30, 2014, by contractual maturity, are shown below.  Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized	Fair
	Cost	Value
(In Thousands)
One year or less	$110	$111
After one through five years	1,472	1,486
After five through ten years	7,504	7,794
After ten years	130,974	136,093
Securities not due on a single maturity date	273,358	276,627
Equity securities	847	3,045
	$414,265	$425,156

The held-to-maturity securities at September 30, 2014, by contractual maturity, are shown below.  Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized	Fair
	Cost	Value
(In Thousands)
After one through five years	$450	$505

Certain investments in debt securities are reported in the financial statements at an amount less than their historical cost. Total fair value of these investments at September 30, 2014 and December 31, 2013, respectively, was approximately $131.5 million and $237.6 million, which is approximately 30.9% and 42.7% of the Company’s available-for-sale and held-to-maturity investment portfolio, respectively.

Based on an evaluation of available evidence, including recent changes in market interest rates, credit rating information and information obtained from regulatory filings, management believes the declines in fair value for these debt securities are temporary at September 30, 2014.

The following table shows the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at September 30, 2014 and December 31, 2013:

	September 30, 2014
	Less than 12 Months		12 Months or More		Total
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
Description of Securities	Value	Losses	Value	Losses	Value	Losses
(In Thousands)
U.S. government agencies	$--	$--	$20,000	$(1,063)	$20,000	$(1,063)
Mortgage-backed securities	51,442	(514)	46,054	(719)	97,496	(1,233)
State and political
subdivisions	2,561	(8)	11,393	(218)	13,954	(226)
	$54,003	$(522)	$77,447	$(2,000)	$131,450	$(2,522)

	December 31, 2013
	Less than 12 Months		12 Months or More		Total
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
Description of Securities	Value	Losses	Value	Losses	Value	Losses
(In Thousands)
U.S. government agencies	$20,000	$(2,745)	$--	$--	$20,000	$(2,745)
Mortgage-backed securities	127,901	(1,871)	39,255	(395)	167,156	(2,266)
State and political
subdivisions	50,401	(1,938)	--	--	50,401	(1,938)
	$198,302	$(6,554)	$39,255	$(395)	$237,557	$(6,949)

Gross gains of $656,000 and $1.3 million and gross losses of $335,000 and $335,000 resulting from sales of available-for-sale securities were realized for the three and nine months ended September 30, 2014, respectively.  Gross gains of $644,000 and $795,000 and gross losses of $534,000 and $554,000 resulting from sales of available-for-sale securities were realized for the three and nine months ended September 30, 2013, respectively.  Gains and losses on sales of securities are determined on the specific-identification method.

Other-than-temporary Impairment.  Upon acquisition of a security, the Company decides whether it is within the scope of the accounting guidance for beneficial interests in securitized financial assets or will be evaluated for impairment under the accounting guidance for investments in debt and equity securities.

The accounting guidance for beneficial interests in securitized financial assets provides incremental impairment guidance for a subset of the debt securities within the scope of the guidance for investments in debt and equity securities.  For securities where the security is a beneficial interest in securitized financial assets, the Company uses the beneficial interests in securitized financial asset impairment model.  For securities where the security is not a beneficial interest in securitized financial assets, the Company uses the debt and equity securities impairment model.  The Company does not currently have securities within the scope of this guidance for beneficial interests in securitized financial assets.

The Company routinely conducts periodic reviews to identify and evaluate each investment security to determine whether an other-than-temporary impairment has occurred.  The Company considers the length of time a security has been in an unrealized loss position, the relative amount of the unrealized loss compared to the carrying value of the security, the type of security and other factors.  If certain criteria are met, the Company performs additional review and evaluation using observable market values or various inputs in economic models to determine if an unrealized loss is other-than-temporary.  The Company uses quoted market prices for marketable equity securities and uses broker pricing quotes based on observable inputs for equity investments that are not traded on a stock exchange.  For non-agency collateralized mortgage obligations, to determine if the unrealized loss is other-than-temporary, the Company projects total estimated defaults of the underlying assets (mortgages) and multiplies that calculated amount by an estimate of realizable value upon sale in the marketplace (severity) in order to determine the projected collateral loss.  The Company also evaluates any current credit enhancement underlying these securities to determine the impact on cash flows.  If the Company determines that a given security position will be subject to a write-down or loss, the Company records the expected credit loss as a charge to earnings.

During the three and nine months ended September 30, 2014, no securities were determined to have impairment that was other than temporary. 

Credit Losses Recognized on Investments.  Certain debt securities have experienced fair value deterioration due to credit losses, as well as due to other market factors, but are not otherwise other-than-temporarily impaired. 

The following table provides information about debt securities for which only a credit loss was recognized in income and other losses are recorded in other comprehensive income.

	Accumulated
	Credit Losses
(In Thousands)
Credit losses on debt securities held
January 1, 2013	$4,176
Additions related to other-than-temporary losses not previously recognized	--
Additions related to increases in credit losses on debt securities for which
other-than-temporary impairment losses were previously recognized	--
Reductions due to final principal payments	(4,176)
September 30, 2013	$--

Amounts Reclassified Out of Accumulated Other Comprehensive Income.  Amounts reclassified from accumulated other comprehensive income and the affected line items in the statements of income during the three and nine months ended September 30, 2014 and 2013, were as follows: 

	Amounts Reclassified from
	Other Comprehensive Income
	Three Months Ended September 30,		Affected Line Item in
(In Thousands)	2014	2013	the Statements of Income
Unrealized gains (losses) on available-			Net realized gains on available-
for-sale securities	$321	$110	for-sale securities
Income Taxes	(112)	(38)	(Total reclassified amount before tax) Provision for income taxes
Total reclassifications out of accumulated
other comprehensive income	$209	$72

	Amounts Reclassified from
	Other Comprehensive Income
	Nine Months Ended September 30,		Affected Line Item in the
	2014	2013	Statements of Income
(In Thousands)
Unrealized gains (losses) on available-			Net realized gains on available-
for-sale securities	$963	$241	for-sale securities
Income Taxes	(337)	(84)	(Total reclassified amount before tax) Provision for income taxes
Total reclassifications out of accumulated
other comprehensive income	$626	$157

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Note 7: Loans and Allowance For Loan Losses

3 Months Ended

Sep. 30, 2014

Notes

Note 7: Loans and Allowance For Loan Losses

NOTE 7: LOANS AND ALLOWANCE FOR LOAN LOSSES

	September 30,	December 31,
	2014	2013
(In Thousands)
One- to four-family residential construction	$43,386	$34,662
Subdivision construction	35,344	40,409
Land development	48,581	57,841
Commercial construction	361,971	184,019
Owner occupied one- to four-family residential	78,984	89,133
Non-owner occupied one- to four-family residential	143,414	145,908
Commercial real estate	872,294	780,690
Other residential	353,225	325,599
Commercial business	349,387	315,269
Industrial revenue bonds	42,941	42,230
Consumer auto	274,250	134,717
Consumer other	78,676	82,260
Home equity lines of credit	61,152	58,283
FDIC-supported loans, net of discounts (TeamBank)	15,294	49,862
Acquired non-covered loans, net of discounts (TeamBank)	28,341	--
FDIC-supported loans, net of discounts (Vantus Bank)	43,653	57,920
FDIC-supported loans, net of discounts (Sun Security Bank)	54,394	64,843
FDIC-supported loans, net of discounts (InterBank)	203,787	213,539
Acquired loans not covered by FDIC loss sharing agreements, net of
discounts (Valley Bank)  (“acquired non-covered loans”)	152,497	--
	3,241,571	2,677,184
Undisbursed portion of loans in process	(279,435)	(194,544)
Allowance for loan losses	(38,081)	(40,116)
Deferred loan fees and gains, net	(2,745)	(2,994)
	$2,921,310	$2,439,530
Weighted average interest rate	4.78%	5.10%

Classes of loans by aging were as follows:

	September 30, 2014
							Total Loans
			Past Due				> 90 Days
	30-59 Days	60-89 Days	90 Days	Total Past		Total Loans	Past Due and
	Past Due	Past Due	or More	Due	Current	Receivable	Still Accruing
(In Thousands)
One- to four-family
residential construction	$--	$--	$223	$223	$43,163	$43,386	$--
Subdivision construction	--	--	1,223	1,223	34,121	35,344	--
Land development	--	--	265	265	48,316	48,581	--
Commercial construction	--	--	--	--	361,971	361,971	--
Owner occupied one- to four-
family residential	184	565	1,616	2,365	76,619	78,984	170
Non-owner occupied one- to
four-family residential	--	168	2,997	3,165	140,249	143,414	--
Commercial real estate	--	59	2,968	3,027	869,267	872,294	--
Other residential	--	--	--	--	353,225	353,225	--
Commercial business	21	13	427	461	348,926	349,387	--
Industrial revenue bonds	--	--	1,205	1,205	41,736	42,941	--
Consumer auto	144	1,331	131	1,606	272,644	274,250	--
Consumer other	168	1,025	649	1,842	76,834	78,676	244
Home equity lines of credit	46	404	337	787	60,365	61,152	--
FDIC-supported loans, net of
discounts (TeamBank)	65	115	415	595	14,699	15,294	--
Acquired non-covered loans,
net of discounts
(TeamBank)	--	--	--	--	28,341	28,341	--
FDIC-supported loans, net of
discounts (Vantus Bank)	85	12	1,022	1,119	42,534	43,653	56
FDIC-supported loans,
net of discounts
(Sun Security Bank)	353	149	2,714	3,216	51,178	54,394	--
FDIC-supported loans,
net of discounts
(InterBank)	696	1,375	14,731	16,802	186,985	203,787	--
Acquired non-covered loans,
net of discounts
(Valley Bank)	9,727	2,716	12,329	24,772	127,725	152,497	--
	11,489	7,932	43,252	62,673	3,278,898	3,241,571	470
Less FDIC-supported loans,
and acquired non-covered
loans, net of discounts	10,926	4,367	31,211	46,504	451,462	497,966	56
Total	$563	$3,565	$12,041	$16,169	$2,727,436	$2,743,605	$414

	December 31, 2013
							Total Loans
			Past Due				> 90 Days
	30-59 Days	60-89 Days	90 Days	Total Past		Total Loans	Past Due and
	Past Due	Past Due	or More	Due	Current	Receivable	Still Accruing
(In Thousands)
One- to four-family
residential construction	$--	$--	$--	$--	$34,662	$34,662	$--
Subdivision construction	--	--	871	871	39,538	40,409	--
Land development	145	38	338	521	57,320	57,841	--
Commercial construction	--	--	--	--	184,019	184,019	--
Owner occupied one- to four-
family residential	1,233	344	3,014	4,591	84,542	89,133	211
Non-owner occupied one- to
four-family residential	1,562	171	843	2,576	143,332	145,908	140
Commercial real estate	2,856	131	6,205	9,192	771,498	780,690	--
Other residential	--	--	--	--	325,599	325,599	--
Commercial business	17	19	5,208	5,244	310,025	315,269	--
Industrial revenue bonds	--	--	2,023	2,023	40,207	42,230	--
Consumer auto	955	127	168	1,250	133,467	134,717	--
Consumer other	1,258	333	732	2,323	79,937	82,260	257
Home equity lines of credit	168	16	504	688	57,595	58,283	--
FDIC-supported loans, net of
discounts (TeamBank)	414	130	1,396	1,940	47,922	49,862	6
FDIC-supported loans, net of
discounts (Vantus Bank)	675	31	2,356	3,062	54,858	57,920	42
FDIC-supported loans,
net of discounts
(Sun Security Bank)	510	121	4,241	4,872	59,971	64,843	147
FDIC-supported loans, net of
discounts (InterBank)	6,024	1,567	16,768	24,359	189,180	213,539	20
	15,817	3,028	44,667	63,512	2,613,672	2,677,184	823
Less FDIC-supported loans,
net of discounts	7,623	1,849	24,761	34,233	351,931	386,164	215
Total	$8,194	$1,179	$19,906	$29,279	$2,261,741	$2,291,020	$608

Nonaccruing loans (excluding FDIC-supported loans, net of discount and acquired non-covered loans, net of discount) are summarized as follows:

	September 30,	December 31,
	2014	2013
(In Thousands)
One- to four-family residential construction	$223	$--
Subdivision construction	1,223	871
Land development	265	338
Commercial construction	--	--
Owner occupied one- to four-family residential	1,446	2,803
Non-owner occupied one- to four-family residential	2,997	703
Commercial real estate	2,968	6,205
Other residential	--	--
Commercial business	1,632	5,208
Industrial revenue bonds	--	2,023
Consumer auto	131	168
Consumer other	405	475
Home equity lines of credit	337	504
Total	$11,627	$19,298

The following table presents the activity in the allowance for loan losses by portfolio segment for the three and nine months ended September 30, 2014.  Also presented is the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of September 30, 2014:

	One- to Four-
	Family
	Residential and	Other	Commercial	Commercial	Commercial
	Construction	Residential	Real Estate	Construction	Business	Consumer	Total
(In Thousands)
Allowance for loan losses
Balance June 30, 2014	$5,073	$1,723	$16,476	$8,249	$2,582	$3,979	$38,082
Provision (benefit) charged to expense	(1,647)	545	2,838	(2,499)	632	1,076	945
Losses charged off	(106)	--	(520)	(1)	(50)	(1,107)	(1,784)
Recoveries	120	14	170	24	--	510	838
Balance September 30, 2014	$3,440	$2,282	$18,964	$5,773	$3,164	$4,458	$38,081
Balance January 1, 2014	$6,235	$2,678	$16,939	$4,464	$6,451	$3,349	$40,116
Provision (benefit) charged to expense	(1,280)	(423)	2,704	1,263	(619)	2,454	4,099
Losses charged off	(1,803)	(2)	(1,239)	(131)	(2,737)	(2,891)	(8,803)
Recoveries	288	29	560	177	69	1,546	2,669
Balance September 30, 2014	$3,440	$2,282	$18,964	$5,773	$3,164	$4,458	$38,081
Ending balance:
Individually evaluated for
impairment	$1,340	$--	$1,736	$1,514	$596	$198	$5,384
Collectively evaluated for
impairment	$2,100	$2,274	$16,800	$4,241	$2,559	$4,221	$32,195
Loans acquired and
accounted for under ASC
310-30	$--	$8	$428	$18	$9	$39	$502
Loans
Individually evaluated for
impairment	$11,284	$10,203	$28,899	$7,791	$5,126	$1,256	$64,559
Collectively evaluated for
impairment	$289,844	$343,022	$843,395	$402,761	$387,202	$412,822	$2,679,046
Loans acquired and
accounted for under ASC
310-30	$248,701	$54,594	$106,877	$20,084	$18,251	$49,459	$497,966

The following table presents the activity in the allowance for loan losses by portfolio segment for the three and nine months ended September 30, 2013:

	One- to Four-
	Family
	Residential and	Other	Commercial	Commercial	Commercial
	Construction	Residential	Real Estate	Construction	Business	Consumer	Total
(In Thousands)
Allowance for loan losses
Balance July 1, 2013	$6,125	$3,373	$16,419	$5,789	$5,664	$2,815	$40,185
Provision (benefit) charged to expense	(234)	(372)	1,474	1,291	(1,732)	2,250	2,677
Losses charged off	(847)	(201)	(608)	(346)	(1,303)	(2,215)	(5,520)
Recoveries	87	6	888	50	648	435	2,114
Balance September 30, 2013	$5,131	$2,806	$18,173	$6,784	$3,277	$3,285	$39,456
Balance January 1, 2013	$6,822	$4,327	$17,441	$3,938	$5,096	$3,025	$40,649
Provision (benefit) charged to expense	292	1,329	6,736	3,413	137	2,666	14,573
Losses charged off	(2,088)	(2,887)	(7,138)	(675)	(2,672)	(3,884)	(19,344)
Recoveries	105	37	1,134	108	716	1,478	3,578
Balance September 30, 2013	$5,131	$2,806	$18,173	$6,784	$3,277	$3,285	$39,456

The following table presents the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of December 31, 2013:

	One- to Four-
	Family
	Residential and	Other	Commercial	Commercial	Commercial
	Construction	Residential	Real Estate	Construction	Business	Consumer	Total
(In Thousands)
Allowance for loan losses
Individually evaluated for
impairment	$2,501	$--	$90	$473	$4,162	$218	$7,444
Collectively evaluated for
impairment	$3,734	$2,678	$16,845	$3,991	$2,287	$3,131	$32,666
Loans acquired and
accounted for under ASC
310-30	$--	$--	$4	$--	$2	$--	$6
Loans
Individually evaluated for
impairment	$13,055	$10,983	$31,591	$12,628	$8,755	$1,389	$78,401
Collectively evaluated for
impairment	$297,057	$314,616	$791,329	$229,232	$306,514	$273,871	$2,212,619
Loans acquired and
accounted for under ASC
310-30	$206,964	$35,095	$84,591	$6,989	$4,883	$47,642	$386,164

The portfolio segments used in the preceding two tables correspond to the loan classes used in all other tables in Note 7 as follows:

·         The one-to four-family residential and construction segment includes the one- to four-family residential construction, subdivision construction, owner occupied one- to four-family residential and non-owner occupied one- to four-family residential classes

·         The other residential segment corresponds to the other residential class

·         The commercial real estate segment includes the commercial real estate and industrial revenue bonds classes

·         The commercial construction segment includes the land development and commercial construction classes

·         The commercial business segment corresponds to the commercial business class

·         The consumer segment includes the consumer auto, consumer other and home equity lines of credit classes

A loan is considered impaired, in accordance with the impairment accounting guidance (FASB ASC 310-10-35-16), when based on current information and events, it is probable the Company will be unable to collect all amounts due from the borrower in accordance with the contractual terms of the loan. Impaired loans include not only nonperforming loans but also include loans modified in troubled debt restructurings where concessions have been granted to borrowers experiencing financial difficulties.

Impaired loans (excluding FDIC-supported loans, net of discount and acquired non-covered loans, net of discount), are summarized as follows:

	September 30, 2014
		Unpaid
	Recorded	Principal	Specific
	Balance	Balance	Allowance
(In Thousands)
One- to four-family residential construction	$--	$--	$--
Subdivision construction	2,304	4,716	373
Land development	7,791	8,224	1,514
Commercial construction	--	--	--
Owner occupied one- to four-family residential	4,366	5,064	517
Non-owner occupied one- to four-family residential	4,614	4,837	450
Commercial real estate	28,899	30,210	1,736
Other residential	10,203	10,203	--
Commercial business	2,150	2,173	596
Industrial revenue bonds	2,976	4,288	--
Consumer auto	175	227	26
Consumer other	635	764	95
Home equity lines of credit	446	473	77
Total	$64,559	$71,179	$5,384

	Three Months Ended		Nine Months Ended
	September 30, 2014		September 30, 2014
	Average		Average
	Investment	Interest	Investment	Interest
	in Impaired	Income	in Impaired	Income
	Loans	Recognized	Loans	Recognized
(In Thousands)
One- to four-family residential construction	$121	$--	$59	$--
Subdivision construction	2,207	8	2,549	38
Land development	7,650	70	10,403	213
Commercial construction	--	--	--	--
Owner occupied one- to four-family residential	4,665	56	5,100	168
Non-owner occupied one- to four-family residential	4,550	53	4,137	163
Commercial real estate	29,531	298	30,204	988
Other residential	10,304	86	10,665	296
Commercial business	2,163	31	2,657	99
Industrial revenue bonds	3,362	192	2,998	192
Consumer auto	216	4	182	11
Consumer other	678	15	690	57
Home equity lines of credit	415	6	461	20
Total	$65,862	$819	$70,105	$2,245

	At or for the Year Ended December 31, 2013
				Average
		Unpaid		Investment	Interest
	Recorded	Principal	Specific	in Impaired	Income
	Balance	Balance	Allowance	Loans	Recognized
(In Thousands)
One- to four-family residential construction	$--	$--	$--	$36	$--
Subdivision construction	3,502	3,531	1,659	3,315	163
Land development	12,628	13,042	473	13,389	560
Commercial construction	--	--	--	--	--
Owner occupied one- to four-family residential	5,802	6,117	593	5,101	251
Non-owner occupied one- to four-family residential	3,751	4,003	249	4,797	195
Commercial real estate	31,591	34,032	90	42,242	1,632
Other residential	10,983	10,983	--	13,837	434
Commercial business	6,057	6,077	4,162	6,821	179
Industrial revenue bonds	2,698	2,778	--	2,700	27
Consumer auto	216	231	32	145	16
Consumer other	604	700	91	630	63
Home equity lines of credit	569	706	95	391	38
Total	$78,401	$82,200	$7,444	$93,404	$3,558

	September 30, 2013
		Unpaid
	Recorded	Principal	Specific
	Balance	Balance	Allowance
(In Thousands)
One- to four-family residential construction	$--	$--	$--
Subdivision construction	3,785	3,896	851
Land development	15,444	15,848	2,192
Commercial construction	--	--	--
Owner occupied one- to four-family residential	5,174	5,393	430
Non-owner occupied one- to four-family residential	4,351	5,233	369
Commercial real estate	40,981	42,507	2,416
Other residential	11,367	11,367	169
Commercial business	6,138	6,140	1,512
Industrial revenue bonds	2,698	2,778	--
Consumer auto	184	228	28
Consumer other	595	664	89
Home equity lines of credit	410	424	91
Total	$91,127	$94,478	$8,147

	Three Months Ended		Nine Months Ended
	September 30, 2013		September 30, 2013
	Average		Average
	Investment	Interest	Investment	Interest
	in Impaired	Income	in Impaired	Income
	Loans	Recognized	Loans	Recognized
(In Thousands)
One- to four-family residential construction	$48	$--	$48	$5
Subdivision construction	4,062	34	3,206	140
Land development	15,573	111	13,025	477
Commercial construction	--	--	--	--
Owner occupied one- to four-family residential	5,035	60	4,899	176
Non-owner occupied one- to four-family residential	4,832	12	5,112	173
Commercial real estate	40,792	506	44,374	1,246
Other residential	11,444	136	14,895	353
Commercial business	6,274	86	7,074	161
Industrial revenue bonds	2,698	--	2,701	14
Consumer auto	153	7	130	11
Consumer other	593	12	639	44
Home equity lines of credit	333	10	316	20
Total	$91,837	$974	$96,419	$2,820

At September 30, 2014, $25.1 million of impaired loans had specific valuation allowances totaling $5.4 million.  At December 31, 2013, $18.0 million of impaired loans had specific valuation allowances totaling $7.4 million. 

Included in certain loan categories in the impaired loans are troubled debt restructurings that were classified as impaired. Troubled debt restructurings are loans that are modified by granting concessions to borrowers experiencing financial difficulties.  These concessions could include a reduction in the interest rate on the loan, payment extensions, forgiveness of principal, forbearance or other actions intended to maximize collection.  The types of concessions made are factored into the estimation of the allowance for loan losses for troubled debt restructurings primarily using a discounted cash flows or collateral adequacy approach.

The following tables present newly restructured loans during the three and nine months ended September 30, 2014 by type of modification:

	Three Months Ended September 30, 2014
				Total
	Interest Only	Term	Combination	Modification
(In Thousands)
Mortgage loans on real estate:
One -to four- family residential	$308	$--	$--	$308
One -to four- family residential
construction	--	--	223	223
Commercial business	--	243	--	243
Consumer	--	6	--	6
	$308	$249	$223	$780

	Nine Months Ended September 30, 2014
				Total
	Interest Only	Term	Combination	Modification
(In Thousands)
Mortgage loans on real estate:
Subdivision construction	$--	$250	$--	$250
One -to four- family residential
construction	--	--	223	223
One -to four- family residential	308	386	--	694
Commercial real estate	506	1,929	--	2,435
Commercial business	--	1,881	--	1,881
Industrial revenue bonds	--	1,150	--	1,150
Consumer	--	59	--	59
	$814	$5,655	$223	$6,692

At September 30, 2014, the Company had $52.1 million of loans that were modified in troubled debt restructurings and impaired, as follows:  $8.6 million of construction and land development loans, $15.6 million of single family and multi-family residential mortgage loans, $23.9 million of commercial real estate loans, $3.7 million of commercial business loans and $250,000 of consumer loans.  Of the total troubled debt restructurings at September 30, 2014, $47.4 million were accruing interest and $19.8 million were classified as substandard using the Company’s internal grading system, which is described below.  The Company had no troubled debt restructurings which were modified in the previous 12 months and subsequently defaulted during the nine months ended September 30, 2014.  When loans modified as troubled debt restructuring have subsequent payment defaults, the defaults are factored into the determination of the allowance for loan losses to ensure specific valuation allowances reflect amounts considered uncollectible.  At December 31, 2013, the Company had $10.9 million of construction and land development loans, $16.6 million of single family and multi-family residential mortgage loans, $24.8 million of commercial real estate loans, $1.5 million of commercial business loans and $310,000 of consumer loans that were modified in troubled debt restructurings and impaired.  Of the troubled debt restructurings totaling $54.1 million at December 31, 2013, $49.6 million were accruing interest and $22.1 million were classified as substandard using the Company’s internal grading system. 

During the three months ended September 30, 2014, loans designated as troubled debt restructurings totaling $1.4 million met the criteria for placement back on accrual status.  The $1.4 million was made up of $1.4 million of commercial real estate loans and $6,000 of consumer loans.  During the nine months ended September 30, 2014, loans designated as troubled debt restructurings totaling $2.1 million met the criteria for placement back on accrual status.  The $2.1 million was made up of $1.5 million of commercial real estate loans, $591,000 of residential mortgage loans and $6,000 of consumer loans.

The Company reviews the credit quality of its loan portfolio using an internal grading system that classifies loans as “Satisfactory,” “Watch,” “Special Mention,” “Substandard” and “Doubtful.”  Substandard loans are characterized by the distinct possibility that the Bank will sustain some loss if certain deficiencies are not corrected.  Doubtful loans are those having all the weaknesses inherent to those classified Substandard with the added characteristics that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.  Special mention loans possess potential weaknesses that deserve management’s close attention but do not expose the Bank to a degree of risk that warrants substandard classification.  Loans classified as watch are being monitored because of indications of potential weaknesses or deficiencies that may require future classification as special mention or substandard.  Loans not meeting any of the criteria previously described are considered satisfactory.  The FDIC-covered loans are evaluated using this internal grading system.  These loans are accounted for in pools and are currently substantially covered through loss sharing agreements with the FDIC.  Minimal adverse classification in the loan pools was identified as of September 30, 2014 and December 31, 2013, respectively.  The acquired non-covered loans are also evaluated using this internal grading system.  These loans are accounted for in pools and minimal adverse classification in the loan pools was identified as of September 30, 2014.  See Note 8 for further discussion of the acquired loan pools and loss sharing agreements.  The loan grading system is presented by loan class below:

		September 30, 2014
			Special
	Satisfactory	Watch	Mention	Substandard	Doubtful	Total
(In Thousands)
One- to four-family residential
construction	$43,163	$--	$--	$223	$--	$43,386
Subdivision construction	33,310	21	--	2,013	--	35,344
Land development	37,514	5,000	--	6,067	--	48,581
Commercial construction	361,971	--	--	--	--	361,971
Owner occupied one- to four-
family residential	76,166	611	--	2,207	--	78,984
Non-owner occupied one- to four-
family residential	139,070	350	--	3,994	--	143,414
Commercial real estate	808,064	51,967	--	12,263	--	872,294
Other residential	341,224	10,045	--	1,956	--	353,225
Commercial business	347,691	446	--	1,250	--	349,387
Industrial revenue bonds	41,114	622	--	1,205	--	42,941
Consumer auto	274,079	--	--	171	--	274,250
Consumer other	78,149	4	--	523	--	78,676
Home equity lines of credit	60,707	--	--	445	--	61,152
FDIC-supported loans, net of
discounts (TeamBank)	15,275	--	--	19	--	15,294
Acquired non--covered loans, net
of discounts (TeamBank)	28,333	--	--	8	--	28,341
FDIC-supported loans, net of
discounts (Vantus Bank)	43,252	--	--	401	--	43,653
FDIC-supported loans, net of
discounts (Sun Security Bank)	53,859	--	--	535	--	54,394
FDIC-supported loans, net of
discounts (InterBank)	202,904	--	--	883	--	203,787
Acquired non-covered loans,
net of discounts (Valley Bank)	152,497	--	--	--	--	152,497
Total	$3,138,342	$69,066	$--	$34,163	$--	$3,241,571

		December 31, 2013
			Special
	Satisfactory	Watch	Mention	Substandard	Doubtful	Total
(In Thousands)
One- to four-family residential
construction	$34,364	$298	$--	$--	$--	$34,662
Subdivision construction	36,524	706	--	3,179	--	40,409
Land development	45,606	1,148	--	11,087	--	57,841
Commercial construction	184,019	--	--	--	--	184,019
Owner occupied one- to four-
family residential	84,931	503	--	3,699	--	89,133
Non-owner occupied one- to four-
family residential	137,003	6,718	--	2,187	--	145,908
Commercial real estate	727,668	37,937	--	15,085	--	780,690
Other residential	311,320	12,323	--	1,956	--	325,599
Commercial business	307,540	1,803	--	3,528	2,398	315,269
Industrial revenue bonds	39,532	675	--	2,023	--	42,230
Consumer auto	134,516	--	--	201	--	134,717
Consumer other	81,769	6	--	485	--	82,260
Home equity lines of credit	57,713	--	--	570	--	58,283
FDIC-supported loans, net of
Discounts (TeamBank)	49,702	--	--	160	--	49,862
FDIC-supported loans, net of
discounts (Vantus Bank)	57,290	--	--	630	--	57,920
FDIC-supported loans, net of
discounts (Sun Security Bank)	63,360	--	--	1,483	--	64,843
FDIC-supported loans, net of
discounts (InterBank)	213,539	--	--	--	--	213,539
Total	$2,566,396	$62,117	$--	$46,273	$2,398	$2,677,184

XML

Note 9: Other Real Estate Owned

3 Months Ended

Sep. 30, 2014

Notes

Note 9: Other Real Estate Owned

NOTE 9: OTHER REAL ESTATE OWNED

Major classifications of other real estate owned were as follows:

	September 30,	December 31,
	2014	2013
(In Thousands)
Foreclosed assets held for sale
One- to four-family construction	$--	$--
Subdivision construction	9,778	11,652
Land development	17,752	16,788
Commercial construction	--	2,132
One- to four-family residential	1,564	744
Other residential	3,577	5,900
Commercial real estate	1,779	4,135
Commercial business	59	77
Consumer	565	969
	35,074	42,397
FDIC-supported foreclosed assets, net of discounts	6,668	9,006
Foreclosed assets held for sale, net	41,742	51,403
Other real estate owned not acquired through
foreclosure	2,020	2,111
Other real estate owned	$43,762	$53,514

Other real estate owned not acquired through foreclosure includes 12 properties, 11 of which were branch locations that have been closed and are held for sale, and one of which is land which was acquired for a potential branch location. 

Expenses applicable to foreclosed assets included the following:

	Three Months Ended September 30,
	2014	2013
(In Thousands)
Net (gain) loss on sales of foreclosed assets	$126	$27
Valuation write-downs	158	258
Operating expenses, net of rental income	698	783
	$982	$1,068

	Nine Months Ended September 30,
	2014	2013
(In Thousands)
Net (gain) loss on sales of foreclosed assets	$72	$(255)
Valuation write-downs	1,357	1,313
Operating expenses, net of rental income	1,744	2,420
	$3,173	$3,478

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Note 13: Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Effective Income Tax Rate Reconciliation

	Three Months Ended September 30,
	2014	2013
Tax at statutory rate	35.0%	35.0%
Nontaxable interest and dividends	(3.1)	(4.3)
Tax credits	(8.4)	(12.2)
State taxes	1.7	3.0
Other	0.2	(1.4)
	25.4%	20.1%

	Nine Months Ended September 30,
	2014	2013
Tax at statutory rate	35.0%	35.0%
Nontaxable interest and dividends	(3.3)	(4.3)
Tax credits	(9.2)	(11.1)
State taxes	1.5	2.1
Other	0.4	(0.2)
	24.4%	21.5%

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Note 15: Derivatives and Hedging Activities: Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss) (Details) (Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges, Interest Rate Cap, USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges | Interest Rate Cap
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net	$ 53	$ (45)	$ (90)	$ (45)

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Note 6: Investment Securities: Schedule of Gross Unrealized Losses and Estimated Fair Value of Investments (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended
	Sep. 30, 2014	Dec. 31, 2013
Total Unrealized Losses And Estimated Fair Value
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	$ 54,003	$ 198,302
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Loss	(522)	(6,554)
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	77,447	39,255
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Loss	(2,000)	(395)
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	131,450	237,557
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Loss	(2,522)	(6,949)
US Government Agencies Debt Securities
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value		20,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Loss		(2,745)
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	20,000
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Loss	(1,063)
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	20,000	20,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Loss	(1,063)	(2,745)
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	51,442	127,901
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Loss	(514)	(1,871)
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	46,054	39,255
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Loss	(719)	(395)
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	97,496	167,156
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Loss	(1,233)	(2,266)
US States and Political Subdivisions Debt Securities
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	2,561	50,401
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Loss	(8)	(1,938)
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value	11,393
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Loss	(218)
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	13,954	50,401
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Loss	$ (226)	$ (1,938)

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Note 14: Fair Value Measurement: Schedule Of Mortgage Servicing Rights Reconciliation (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule Of Mortgage Servicing Rights Reconciliation

	Mortgage Servicing Rights
	2014	2013
(In Thousands)
Balance, July 1	$196	$246
Additions	28	32
Amortization	(35)	(42)
Balance, September 30	$189	$236

	Mortgage Servicing Rights
	2014	2013
(In Thousands)
Balance, January 1	$211	$152
Additions	81	224
Amortization	(103)	(140)
Balance, September 30	$189	$236

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of Sun Security Bank FDIC Indemnification Asset (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Sun Security Bank Loans
Initial basis for loss sharing determination, net of activity since acquisition date	$ 62,722	$ 78,524
Reclassification from nonaccretable discount to accretable discount due to change in expected losses (net of accretion to date)	(3,540)	(5,062)
Original estimated fair value of assets, net of activity since acquisition date	(54,394)	(64,843)
Expected loss remaining	4,788	8,514
Assumed loss sharing recovery percentage	66.00%	70.00%
Estimated loss sharing value	3,173	5,974
Indemnification assets to be amortized resulting from change in expected losses	2,827	4,049
Accretable discount on FDIC indemnification asset	(363)	(680)
FDIC Indemnification Asset, Total	5,637	9,343
Non-credit premium (discount), net of activity since acquisition date		(105)
Sun Security Bank Foreclosed Assets
Initial basis for loss sharing determination, net of activity since acquisition date	2,598	3,582
Original estimated fair value of assets, net of activity since acquisition date	(1,521)	(2,193)
Expected loss remaining	1,077	1,389
Assumed loss sharing recovery percentage	80.00%	80.00%
Estimated loss sharing value	862	1,111
Accretable discount on FDIC indemnification asset	(63)	(93)
FDIC Indemnification Asset, Total	$ 799	$ 1,018

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Note 11: Advances From Federal Home Loan Bank: Federal Home Loan Bank, Advances (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Federal Home Loan Bank, Advances

	September 30, 2014		December 31, 2013
		Weighted		Weighted
		Average		Average
		Interest		Interest
Due In	Amount	Rate	Amount	Rate
(In Thousands)
2014	$149,015	0.21%	$2,315	1.02%
2015	10,065	3.87	10,065	3.87
2016	70	5.06	25,070	3.81
2017	30,825	3.20	85,825	3.92
2018	81	5.06	81	5.06
2019 and thereafter	529	5.51	529	5.51
	190,585	0.91	123,885	3.85
Unamortized fair value adjustment	79		2,872
	$190,664		$126,757

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Note 7: Loans and Allowance For Loan Losses: Schedule of Balance in Allowance for Loan Losses Based on Portfolio Segment and Impairment (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013	Dec. 31, 2013
Provision for loan losses	$ 945	$ 2,677	$ 4,099	$ 14,573
Provision for loan losses	945	2,677	4,099	14,573
One To Four Family Residential Construction
Provision for Loan Losses Expensed	(1,647)	(234)	(1,280)	292
Financing Receivable, Allowance for Credit Losses, Write-downs	(106)	(847)	(1,803)	(2,088)
Allowance for Doubtful Accounts Receivable, Recoveries	120	87	288	105
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment	1,340		1,340		2,501
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	2,100		2,100		3,734
Financing Receivable, Individually Evaluated for Impairment	11,284		11,284		13,055
Financing Receivable, Collectively Evaluated for Impairment	289,844		289,844		297,057
Financing Receivable, Acquired with Deteriorated Credit Quality	248,701		248,701		206,964
One To Four Family Residential Construction | Beginning of period
Provision for loan losses	5,073	6,125	6,235	6,822
Provision for loan losses	5,073	6,125	6,235	6,822
One To Four Family Residential Construction | End of period
Provision for loan losses	3,440	5,131	3,440	5,131
Provision for loan losses	3,440	5,131	3,440	5,131
Other Residential
Provision for Loan Losses Expensed	545	(372)	(423)	1,329
Financing Receivable, Allowance for Credit Losses, Write-downs		(201)	(2)	(2,887)
Allowance for Doubtful Accounts Receivable, Recoveries	14	6	29	37
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	2,274		2,274		2,678
Financing Receivable, Allowance for Credit Losses, Acquired with Deteriorated Credit Quality	8		8
Financing Receivable, Individually Evaluated for Impairment	10,203		10,203		10,983
Financing Receivable, Collectively Evaluated for Impairment	343,022		343,022		314,616
Financing Receivable, Acquired with Deteriorated Credit Quality	54,594		54,594		35,095
Other Residential | Beginning of period
Provision for loan losses	1,723	3,373	2,678	4,327
Provision for loan losses	1,723	3,373	2,678	4,327
Other Residential | End of period
Provision for loan losses	2,282	2,806	2,282	2,806
Provision for loan losses	2,282	2,806	2,282	2,806
Commercial Real Estate
Provision for Loan Losses Expensed	2,838	1,474	2,704	6,736
Financing Receivable, Allowance for Credit Losses, Write-downs	(520)	(608)	(1,239)	(7,138)
Allowance for Doubtful Accounts Receivable, Recoveries	170	888	560	1,134
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment	1,736		1,736		90
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	16,800		16,800		16,845
Financing Receivable, Allowance for Credit Losses, Acquired with Deteriorated Credit Quality	428		428		4
Financing Receivable, Individually Evaluated for Impairment	28,899		28,899		31,591
Financing Receivable, Collectively Evaluated for Impairment	843,395		843,395		791,329
Financing Receivable, Acquired with Deteriorated Credit Quality	106,877		106,877		84,591
Commercial Real Estate | Beginning of period
Provision for loan losses	16,476	16,419	16,939	17,441
Provision for loan losses	16,476	16,419	16,939	17,441
Commercial Real Estate | End of period
Provision for loan losses	18,964	18,173	18,964	18,173
Provision for loan losses	18,964	18,173	18,964	18,173
Commercial Construction
Provision for Loan Losses Expensed	(2,499)	1,291	1,263	3,413
Financing Receivable, Allowance for Credit Losses, Write-downs	(1)	(346)	(131)	(675)
Allowance for Doubtful Accounts Receivable, Recoveries	24	50	177	108
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment	1,514		1,514		473
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	4,241		4,241		3,991
Financing Receivable, Allowance for Credit Losses, Acquired with Deteriorated Credit Quality	18		18
Financing Receivable, Individually Evaluated for Impairment	7,791		7,791		12,628
Financing Receivable, Collectively Evaluated for Impairment	402,761		402,761		229,232
Financing Receivable, Acquired with Deteriorated Credit Quality	20,084		20,084		6,989
Commercial Construction | Beginning of period
Provision for loan losses	8,249	5,789	4,464	3,938
Provision for loan losses	8,249	5,789	4,464	3,938
Commercial Construction | End of period
Provision for loan losses	5,773	6,784	5,773	6,784
Provision for loan losses	5,773	6,784	5,773	6,784
Commercial Business
Provision for Loan Losses Expensed	632	(1,732)	(619)	137
Financing Receivable, Allowance for Credit Losses, Write-downs	(50)	(1,303)	(2,737)	(2,672)
Allowance for Doubtful Accounts Receivable, Recoveries		648	69	716
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment	596		596		4,162
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	2,559		2,559		2,287
Financing Receivable, Allowance for Credit Losses, Acquired with Deteriorated Credit Quality	9		9		2
Financing Receivable, Individually Evaluated for Impairment	5,126		5,126		8,755
Financing Receivable, Collectively Evaluated for Impairment	387,202		387,202		306,514
Financing Receivable, Acquired with Deteriorated Credit Quality	18,251		18,251		4,883
Commercial Business | Beginning of period
Provision for loan losses	2,582	5,664	6,451	5,096
Provision for loan losses	2,582	5,664	6,451	5,096
Commercial Business | End of period
Provision for loan losses	3,164	3,277	3,164	3,277
Provision for loan losses	3,164	3,277	3,164	3,277
Consumer
Provision for Loan Losses Expensed	1,076	2,250	2,454	2,666
Financing Receivable, Allowance for Credit Losses, Write-downs	(1,107)	(2,215)	(2,891)	(3,884)
Allowance for Doubtful Accounts Receivable, Recoveries	510	435	1,546	1,478
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment	198		198		218
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	4,221		4,221		3,131
Financing Receivable, Allowance for Credit Losses, Acquired with Deteriorated Credit Quality	39		39
Financing Receivable, Individually Evaluated for Impairment	1,256		1,256		1,389
Financing Receivable, Collectively Evaluated for Impairment	412,822		412,822		273,871
Financing Receivable, Acquired with Deteriorated Credit Quality	49,459		49,459		47,642
Consumer | Beginning of period
Provision for loan losses	3,979	2,815	3,349	3,025
Provision for loan losses	3,979	2,815	3,349	3,025
Consumer | End of period
Provision for loan losses	4,458	3,285	4,458	3,285
Provision for loan losses	4,458	3,285	4,458	3,285
Loans Receivable
Provision for Loan Losses Expensed	945	2,677	4,099	14,573
Financing Receivable, Allowance for Credit Losses, Write-downs	(1,784)	(5,520)	(8,803)	(19,344)
Allowance for Doubtful Accounts Receivable, Recoveries	838	2,114	2,669	3,578
Financing Receivable, Allowance for Credit Losses, Individually Evaluated for Impairment	5,384		5,384		7,444
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	32,195		32,195		32,666
Financing Receivable, Allowance for Credit Losses, Acquired with Deteriorated Credit Quality	502		502		6
Financing Receivable, Individually Evaluated for Impairment	64,559		64,559		78,401
Financing Receivable, Collectively Evaluated for Impairment	2,679,046		2,679,046		2,212,619
Financing Receivable, Acquired with Deteriorated Credit Quality	497,966		497,966		386,164
Loans Receivable | Beginning of period
Provision for loan losses	38,082	40,185	40,116	40,649
Provision for loan losses	38,082	40,185	40,116	40,649
Loans Receivable | End of period
Provision for loan losses	38,081	39,456	38,081	39,456
Provision for loan losses	$ 38,081	$ 39,456	$ 38,081	$ 39,456

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Business Acquisition Fair Value and Expected Cash Flows Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Business Acquisition Fair Value and Expected Cash Flows Policy

Fair Value and Expected Cash Flows.  At the time of these acquisitions, the Company determined the fair value of the loan portfolios based on several assumptions. Factors considered in the valuations were projected cash flows for the loans, type of loan and related collateral, classification status, fixed or variable interest rate, term of loan, current discount rates and whether or not the loan was amortizing. Loans were grouped together according to similar characteristics and were treated in the aggregate when applying various valuation techniques. Management also estimated the amount of credit losses that were expected to be realized for the loan portfolios. The discounted cash flow approach was used to value each pool of loans. For non-performing loans, fair value was estimated by calculating the present value of the recoverable cash flows using a discount rate based on comparable corporate bond rates. This valuation of the acquired loans is a significant component leading to the valuation of the loss sharing assets recorded. 

The amount of the estimated cash flows expected to be received from the acquired loan pools in excess of the fair values recorded for the loan pools is referred to as the accretable yield.  The accretable yield is recognized as interest income over the estimated lives of the loans.  The Company continues to evaluate the fair value of the loans including cash flows expected to be collected.  Increases in the Company’s cash flow expectations are recognized as increases to the accretable yield while decreases are recognized as impairments through the allowance for loan losses.  During the three and nine months ended September 30, 2014, increases in expected cash flows related to the acquired loan portfolios resulted in adjustments of $5.1 million and $25.0 million, respectively, to the accretable yield to be spread over the estimated remaining lives of the loans on a level-yield basis. During the three and nine months ended September 30, 2013, similar such adjustments totaling $11.9 million and $26.9 million, respectively, were made to the accretable yield.  The current year increases in expected cash flows also reduced the amount of expected reimbursements under the loss sharing agreements.  During the three and nine months ended September 30, 2014, this resulted in corresponding adjustments of $4.1 million and $20.0 million, respectively, to the indemnification assets to be amortized on a level-yield basis over the remainder of the loss sharing agreements or the remaining expected lives of the loan pools, whichever is shorter.  During the three and nine months ended September 30, 2013, corresponding adjustments of $9.4 million and $21.3 million, respectively, were made to the indemnification assets. 

Because these adjustments will be recognized over the remaining lives of the loan pools and the remainder of the loss sharing agreements, respectively, they will impact future periods as well.  The remaining accretable yield adjustment that will affect interest income is $29.6 million and the remaining adjustment to the indemnification assets, including the effects of the clawback liability related to Interbank, that will affect non-interest income (expense) is $(26.0) million.  Of the remaining adjustments, we expect to recognize $7.2 million of interest income and $(6.0) million of non-interest income (expense) in the remainder of 2014.  Additional adjustments may be recorded in future periods from the FDIC-assisted acquisitions, as the Company continues to estimate expected cash flows from the acquired loan pools.

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Note 7: Loans and Allowance For Loan Losses: Schedule of Balance in Allowance for Loan Losses Based on Portfolio Segment and Impairment (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Balance in Allowance for Loan Losses Based on Portfolio Segment and Impairment

The following table presents the activity in the allowance for loan losses by portfolio segment for the three and nine months ended September 30, 2014.  Also presented is the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of September 30, 2014:

	One- to Four-
	Family
	Residential and	Other	Commercial	Commercial	Commercial
	Construction	Residential	Real Estate	Construction	Business	Consumer	Total
(In Thousands)
Allowance for loan losses
Balance June 30, 2014	$5,073	$1,723	$16,476	$8,249	$2,582	$3,979	$38,082
Provision (benefit) charged to expense	(1,647)	545	2,838	(2,499)	632	1,076	945
Losses charged off	(106)	--	(520)	(1)	(50)	(1,107)	(1,784)
Recoveries	120	14	170	24	--	510	838
Balance September 30, 2014	$3,440	$2,282	$18,964	$5,773	$3,164	$4,458	$38,081
Balance January 1, 2014	$6,235	$2,678	$16,939	$4,464	$6,451	$3,349	$40,116
Provision (benefit) charged to expense	(1,280)	(423)	2,704	1,263	(619)	2,454	4,099
Losses charged off	(1,803)	(2)	(1,239)	(131)	(2,737)	(2,891)	(8,803)
Recoveries	288	29	560	177	69	1,546	2,669
Balance September 30, 2014	$3,440	$2,282	$18,964	$5,773	$3,164	$4,458	$38,081
Ending balance:
Individually evaluated for
impairment	$1,340	$--	$1,736	$1,514	$596	$198	$5,384
Collectively evaluated for
impairment	$2,100	$2,274	$16,800	$4,241	$2,559	$4,221	$32,195
Loans acquired and
accounted for under ASC
310-30	$--	$8	$428	$18	$9	$39	$502
Loans
Individually evaluated for
impairment	$11,284	$10,203	$28,899	$7,791	$5,126	$1,256	$64,559
Collectively evaluated for
impairment	$289,844	$343,022	$843,395	$402,761	$387,202	$412,822	$2,679,046
Loans acquired and
accounted for under ASC
310-30	$248,701	$54,594	$106,877	$20,084	$18,251	$49,459	$497,966

The following table presents the activity in the allowance for loan losses by portfolio segment for the three and nine months ended September 30, 2013:

	One- to Four-
	Family
	Residential and	Other	Commercial	Commercial	Commercial
	Construction	Residential	Real Estate	Construction	Business	Consumer	Total
(In Thousands)
Allowance for loan losses
Balance July 1, 2013	$6,125	$3,373	$16,419	$5,789	$5,664	$2,815	$40,185
Provision (benefit) charged to expense	(234)	(372)	1,474	1,291	(1,732)	2,250	2,677
Losses charged off	(847)	(201)	(608)	(346)	(1,303)	(2,215)	(5,520)
Recoveries	87	6	888	50	648	435	2,114
Balance September 30, 2013	$5,131	$2,806	$18,173	$6,784	$3,277	$3,285	$39,456
Balance January 1, 2013	$6,822	$4,327	$17,441	$3,938	$5,096	$3,025	$40,649
Provision (benefit) charged to expense	292	1,329	6,736	3,413	137	2,666	14,573
Losses charged off	(2,088)	(2,887)	(7,138)	(675)	(2,672)	(3,884)	(19,344)
Recoveries	105	37	1,134	108	716	1,478	3,578
Balance September 30, 2013	$5,131	$2,806	$18,173	$6,784	$3,277	$3,285	$39,456

The following table presents the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of December 31, 2013:

	One- to Four-
	Family
	Residential and	Other	Commercial	Commercial	Commercial
	Construction	Residential	Real Estate	Construction	Business	Consumer	Total
(In Thousands)
Allowance for loan losses
Individually evaluated for
impairment	$2,501	$--	$90	$473	$4,162	$218	$7,444
Collectively evaluated for
impairment	$3,734	$2,678	$16,845	$3,991	$2,287	$3,131	$32,666
Loans acquired and
accounted for under ASC
310-30	$--	$--	$4	$--	$2	$--	$6
Loans
Individually evaluated for
impairment	$13,055	$10,983	$31,591	$12,628	$8,755	$1,389	$78,401
Collectively evaluated for
impairment	$297,057	$314,616	$791,329	$229,232	$306,514	$273,871	$2,212,619
Loans acquired and
accounted for under ASC
310-30	$206,964	$35,095	$84,591	$6,989	$4,883	$47,642	$386,164

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Note 14: Fair Value Measurement

3 Months Ended

Sep. 30, 2014

Notes

Note 14: Fair Value Measurement

NOTE 14: FAIR VALUE MEASUREMENT

ASC Topic 820, Fair Value Measurements, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.  Topic 820 also specifies a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.  The standard describes three levels of inputs that may be used to measure fair value:

·       Quoted prices in active markets for identical assets or liabilities (Level 1): Inputs that are quoted unadjusted prices in active markets for identical assets that the Company has the ability to access at the measurement date. An active market for the asset is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

·       Other observable inputs (Level 2): Inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity including quoted prices for similar assets, quoted prices for securities in inactive markets and inputs derived principally from or corroborated by observable market data by correlation or other means.

·       Significant unobservable inputs (Level 3): Inputs that reflect assumptions of a source independent of the reporting entity or the reporting entity's own assumptions that are supported by little or no market activity or observable inputs.

Financial instruments are broken down as follows by recurring or nonrecurring measurement status. Recurring assets are initially measured at fair value and are required to be remeasured at fair value in the financial statements at each reporting date. Assets measured on a nonrecurring basis are assets that, due to an event or circumstance, were required to be remeasured at fair value after initial recognition in the financial statements at some time during the reporting period.

 Recurring Measurements

		Fair value measurements using
		Quoted prices
		in active
		markets	Other	Significant
		for identical	observable	unobservable
		assets	inputs	inputs
	Fair value	(Level 1)	(Level 2)	(Level 3)
(In Thousands)
September 30, 2014
U.S. government agencies	$18,937	$--	$18,937	$--
Mortgage-backed securities	276,627	--	276,627	--
States and political subdivisions	126,547	--	126,547	--
Equity securities	3,045	--	3,045	--
Mortgage servicing rights	189	--	--	189
Interest rate derivative asset	2,050	--	--	2,050
Interest rate derivative liability	(1,489)	--	--	(1,489)
December 31, 2013
U.S. government agencies	$17,255	$--	$17,255	$--
Mortgage-backed securities	367,578	--	367,578	--
Small Business Administration loan pools	44,855	--	44,855	--
States and political subdivisions	122,724	--	122,724	--
Equity securities	2,869	--	2,869	--
Mortgage servicing rights	211	--	--	211
Interest rate derivative asset	2,544	--	--	2,544
Interest rate derivative liability	(1,613)	--	--	(1,613)

The following is a description of inputs and valuation methodologies used for assets recorded at fair value on a recurring basis and recognized in the accompanying statements of financial condition at September 30, 2014 and December 31, 2013, as well as the general classification of such assets pursuant to the valuation hierarchy.  There have been no significant changes in the valuation techniques during the three-month period ended September 30, 2014. 

Securities Available for Sale. Investment securities available for sale are recorded at fair value on a recurring basis. The fair values used by the Company are obtained from an independent pricing service, which represent either quoted market prices for the identical asset or fair values determined by pricing models, or other model-based valuation techniques, that consider observable market data, such as interest rate volatilities, LIBOR yield curve, credit spreads and prices from market makers and live trading systems.  Recurring Level 2 securities include U.S. government agency securities, mortgage-backed securities, Small Business Administration (SBA) loan pools, state and municipal bonds and equity securities. Inputs used for valuing Level 2 securities include observable data that may include dealer quotes, benchmark yields, market spreads, live trading levels and market consensus prepayment speeds, among other things. Additional inputs include indicative values derived from the independent pricing service’s proprietary computerized models.  There were no Recurring Level 3 securities at September 30, 2014 or December 31, 2013.

Mortgage Servicing Rights. Mortgage servicing rights do not trade in an active, open market with readily observable prices.  Accordingly, fair value is estimated using discounted cash flow models.  Due to the nature of the valuation inputs, mortgage servicing rights are classified within Level 3 of the hierarchy.

Interest Rate Swaps. Interest rate swaps are recorded at fair value on a recurring basis. The fair values used by the Company are obtained from an independent valuation service, and are based on prevailing observable market data, such as the LIBOR swap curves and Overnight Index Swap “OIS” curves, and derived from proprietary models based on well recognized financial principles and reasonable estimates about future market conditions (which may include assumptions and estimates that are not readily observable in the marketplace).  Included in the fair values are credit valuation adjustments which represent the consideration of credit risk (credit standing) of the counterparties to the transaction and the effect of any credit enhancements related to the transaction.  Certain inputs to the credit valuation models may be based on assumptions and best estimates that are not readily observable in the marketplace. 

The Company considers transfers between the levels of the hierarchy to be recognized at the end of related reporting periods.  From December 31, 2013 to September 30, 2014, no assets for which fair value is measured on a recurring basis transferred between any levels of the hierarchy.

Level 3 Reconciliation

The following is a reconciliation of the beginning and ending balances of recurring fair value measurements recognized in the accompanying balance sheet using significant unobservable (Level 3) inputs.

	Mortgage Servicing Rights
	2014	2013
(In Thousands)
Balance, July 1	$196	$246
Additions	28	32
Amortization	(35)	(42)
Balance, September 30	$189	$236

	Mortgage Servicing Rights
	2014	2013
(In Thousands)
Balance, January 1	$211	$152
Additions	81	224
Amortization	(103)	(140)
Balance, September 30	$189	$236

	Interest Rate Derivative Asset
	2014	2013
(In Thousands)
Balance, July 1	$1,722	$1,379
Change in fair value through earnings	(210)	182
Balance, September 30	$1,512	$1,561

	Interest Rate Derivative Asset
	2014	2013
(In Thousands)
Balance, January 1	$1,859	$2,112
Change in fair value through earnings	(347)	(551)
Balance, September 30	$1,512	$1,561

	Interest Rate Cap Derivative Asset Designated as Hedging Instrument
	2014	2013
(In Thousands)
Balance, July 1	$462	$--
Additions	--	738
Change in fair value through other
comprehensive income	76	(69)
Balance, September 30	$538	$669

	Interest Rate Cap Derivative Asset Designated as Hedging Instrument
	2014	2013
(In Thousands)
Balance, January 1	$685	$--
Additions	--	738
Change in fair value through other
comprehensive income	(147)	(69)
Balance, September 30	$538	$669

	Interest Rate Swap Liability
	2014	2013
(In Thousands)
Balance, July 1	$1,711	$1,019
Change in fair value through earnings	(222)	307
Balance, September 30	$1,489	$1,326

	Interest Rate Swap Liability
	2014	2013
(In Thousands)
Balance, January 1	$1,613	$2,160
Change in fair value through earnings	(124)	(834)
Balance, September 30	$1,489	$1,326

Nonrecurring Measurements

The following tables present the fair value measurements of assets measured at fair value during the periods presented on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at September 30, 2014 and December 31, 2013:

		Fair Value Measurements Using
		Quoted prices
		in active
		markets	Other	Significant
		for identical	observable	unobservable
		assets	inputs	inputs
	Fair value	(Level 1)	(Level 2)	(Level 3)
(In Thousands)
September 30, 2014
Impaired loans
One- to four-family residential construction	$--	$--	$--	$--
Subdivision construction	275	--	--	275
Land development	3,952	--	--	3,952
Owner occupied one- to four-family        residential	1,505	--	--	1,505
Non-owner occupied one- to four-family residential	954	--	--	954
Commercial real estate	5,343	--	--	5,343
Other residential	--	--	--	--
Commercial business	317	--	--	317
Consumer auto	46	--	--	46
Consumer other	411	--	--	411
Home equity lines of credit	239	--	--	239
Total impaired loans	$13,042	$--	$--	$13,042
Foreclosed assets held for sale	$1,887	$--	$--	$1,887
December 31, 2013
Impaired loans
One- to four-family residential construction	$--	$--	$--	$--
Subdivision construction	145	--	--	145
Land development	1,474	--	--	1,474
Owner occupied one- to four-family residential	349	--	--	349
Non-owner occupied one- to four-family residential	388	--	--	388
Commercial real estate	5,224	--	--	5,224
Other residential	1,440	--	--	1,440
Commercial business	61	--	--	61
Consumer auto	19	--	--	19
Consumer other	275	--	--	275
Home equity lines of credit	70	--	--	70
Total impaired loans	$9,445	$--	$--	$9,445
Foreclosed assets held for sale	$2,169	$--	$--	$2,169

The following is a description of valuation methodologies used for assets measured at fair value on a nonrecurring basis and recognized in the accompanying statements of financial condition, as well as the general classification of such assets pursuant to the valuation hierarchy.

Loans Held for Sale.  Mortgage loans held for sale are recorded at the lower of carrying value or fair value.  The fair value of mortgage loans held for sale is based on what secondary markets are currently offering for portfolios with similar characteristics.  As such, the Company classifies mortgage loans held for sale as Nonrecurring Level 2.  Write-downs to fair value typically do not occur as the Company generally enters into commitments to sell individual mortgage loans at the time the loan is originated to reduce market risk.  The Company typically does not have commercial loans held for sale.  At September 30, 2014 and December 31, 2013, the aggregate fair value of mortgage loans held for sale exceeded their cost.  Accordingly, no mortgage loans held for sale were marked down and reported at fair value.

 Impaired Loans.  A loan is considered to be impaired when it is probable that all of the principal and interest due may not be collected according to its contractual terms. Generally, when a loan is considered impaired, the amount of reserve required under FASB ASC 310, Receivables, is measured based on the fair value of the underlying collateral. The Company makes such measurements on all material loans deemed impaired using the fair value of the collateral for collateral dependent loans. The fair value of collateral used by the Company is determined by obtaining an observable market price or by obtaining an appraised value from an independent, licensed or certified appraiser, using observable market data. This data includes information such as selling price of similar properties and capitalization rates of similar properties sold within the market, expected future cash flows or earnings of the subject property based on current market expectations, and other relevant factors. All appraised values are adjusted for market-related trends based on the Company’s experience in sales and other appraisals of similar property types as well as estimated selling costs.  Each quarter management reviews all collateral dependent impaired loans on a loan-by-loan basis to determine whether updated appraisals are necessary based on loan performance, collateral type and guarantor support.  At times, the Company measures the fair value of collateral dependent impaired loans using appraisals with dates prior to one year from the date of review.  These appraisals are discounted by applying current, observable market data about similar property types such as sales contracts, estimations of value by individuals familiar with the market, other appraisals, sales or collateral assessments based on current market activity until updated appraisals are obtained.  Depending on the length of time since an appraisal was performed and the data provided through our reviews, these appraisals are typically discounted 10-40%.  The policy described above is the same for all types of collateral dependent impaired loans.

The Company records impaired loans as Nonrecurring Level 3. If a loan’s fair value as estimated by the Company is less than its carrying value, the Company either records a charge-off of the portion of the loan that exceeds the fair value or establishes a reserve within the allowance for loan losses specific to the loan.  Loans for which such charge-offs or reserves were recorded during the nine months ended September 30, 2014 or the year ended December 31, 2013, are shown in the table above (net of reserves). 

Foreclosed Assets Held for Sale.  Foreclosed assets held for sale are initially recorded at fair value less estimated cost to sell at the date of foreclosure.  Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less estimated cost to sell.  Foreclosed assets held for sale are classified as Level 3.  The foreclosed assets represented in the table above have been re-measured during the nine months ended September 30, 2014 or the year ended December 31, 2013, subsequent to their initial transfer to foreclosed assets.

The following disclosure relates to financial assets for which it is not practicable for the Company to estimate the fair value at September 30, 2014 and December 31, 2013.

FDIC Indemnification Asset: As part of the Purchase and Assumption Agreements, the Bank and the FDIC entered into loss sharing agreements. These agreements cover realized losses on loans and foreclosed real estate, subject to certain limitations which are more fully described in Note 8.

Under the TeamBank agreement, the FDIC agreed to reimburse the Bank for 80% of the first $115 million in realized losses and 95% for realized losses that exceed $115 million.  The indemnification asset was originally recorded at fair value on the acquisition date (March 20, 2009) and at September 30, 2014 and December 31, 2013, the carrying value was $775,000 and $1.3 million, respectively.

Under the Vantus Bank agreement, the FDIC agreed to reimburse the Bank for 80% of the first $102 million in realized losses and 95% for realized losses that exceed $102 million.  The indemnification asset was originally recorded at fair value on the acquisition date (September 4, 2009) and at September 30, 2014 and December 31, 2013, the carrying value of the FDIC indemnification asset was $844,000 and $2.3 million, respectively.

Under the Sun Security Bank agreement, the FDIC agreed to reimburse the Bank for 80% of realized losses.  The indemnification asset was originally recorded at fair value on the acquisition date (October 7, 2011) and at September 30, 2014 and December 31, 2013, the carrying value of the FDIC indemnification asset was $6.4 million and $10.4 million, respectively.

Under the InterBank agreement, the FDIC agreed to reimburse the Bank for 80% of realized losses.  The indemnification asset was originally recorded at fair value on the acquisition date (April 27, 2013) and at September 30, 2014 and December 31, 2013, the carrying value of the FDIC indemnification asset was $43.5 million and $58.8 million, respectively.

From the dates of acquisition, each of the four agreements extend ten years for 1-4 family real estate loans and five years for other loans.  The loss sharing assets are measured separately from the loan portfolios because they are not contractually embedded in the loans and are not transferable with the loans should the Bank choose to dispose of them.  Fair values on the acquisition dates were estimated using projected cash flows available for loss sharing based on the credit adjustments estimated for each loan pool and the loss sharing percentages.  These cash flows were discounted to reflect the uncertainty of the timing and receipt of the loss sharing reimbursements from the FDIC.  The loss sharing assets are also separately measured from the related foreclosed real estate.  Although the assets are contractual receivables from the FDIC, they do not have effective interest rates.  The Bank will collect the assets over the next several years.  The amount ultimately collected will depend on the timing and amount of collections and charge-offs on the acquired assets covered by the loss sharing agreements.  While the assets were recorded at their estimated fair values on the acquisition dates, it is not practicable to complete fair value analyses on a quarterly or annual basis.  Estimating the fair value of the FDIC indemnification asset would involve preparing fair value analyses of the entire portfolios of loans and foreclosed assets covered by the loss sharing agreements from all four acquisitions on a quarterly or annual basis.

Fair Value of Financial Instruments

The following methods were used to estimate the fair value of all other financial instruments recognized in the accompanying statements of financial condition at amounts other than fair value:

Cash and Cash Equivalents and Federal Home Loan Bank Stock. The carrying amount approximates fair value.

Loans and Interest Receivable.  The fair value of loans is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities.  Loans with similar characteristics are aggregated for purposes of the calculations.  The carrying amount of accrued interest receivable approximates its fair value.    

Deposits and Accrued Interest Payable.  The fair value of demand deposits and savings accounts is the amount payable on demand at the reporting date, i.e., their carrying amounts.  The fair value of fixed maturity certificates of deposit is estimated using a discounted cash flow calculation that applies the rates currently offered for deposits of similar remaining maturities.  The carrying amount of accrued interest payable approximates its fair value.

Federal Home Loan Bank Advances.  Rates currently available to the Company for debt with similar terms and remaining maturities are used to estimate fair value of existing advances.

Short-Term Borrowings.  The carrying amount approximates fair value.

Subordinated Debentures Issued to Capital Trusts.  The subordinated debentures have floating rates that reset quarterly.  The carrying amount of these debentures approximates their fair value.

Structured Repurchase Agreements.  Structured repurchase agreements are collateralized borrowings from a counterparty.  In addition to the principal amount owed, the counterparty also determines an amount that would be owed by either party in the event the agreement is terminated prior to maturity by the Company.  The fair values of the structured repurchase agreements are estimated based on the amount the Company would be required to pay to terminate the agreement at the reporting date.

Commitments to Originate Loans, Letters of Credit and Lines of Credit.  The fair value of commitments is estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present creditworthiness of the counterparties.  For fixed rate loan commitments, fair value also considers the difference between current levels of interest rates and the committed rates.  The fair value of letters of credit is based on fees currently charged for similar agreements or on the estimated cost to terminate them or otherwise settle the obligations with the counterparties at the reporting date.

The following table presents estimated fair values of the Company’s financial instruments.  The fair values of certain of these instruments were calculated by discounting expected cash flows, which method involves significant judgments by management and uncertainties.  Fair value is the estimated amount at which financial assets or liabilities could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.  Because no market exists for certain of these financial instruments and because management does not intend to sell these financial instruments, the Company does not know whether the fair values shown below represent values at which the respective financial instruments could be sold individually or in the aggregate.

		September 30, 2014				December 31, 2013
	Carrying		Fair	Hierarchy	Carrying		Fair	Hierarchy
	Amount		Value	Level	Amount		Value	Level
(In Thousands)
Financial assets
Cash and cash equivalents	$221,386		$221,386	1	$227,925		$227,925	1
Held-to-maturity securities	450		505	2	805		912	2
Mortgage loans held for sale	30,361		30,361	2	7,239		7,239	2
Loans, net of allowance for loan losses	2,921,310		2,931,098	3	2,439,530		2,442,917	3
Accrued interest receivable	11,214		11,214	3	11,408		11,408	3
Investment in FHLB stock	12,013		12,013	3	9,822		9,822	3
Financial liabilities
Deposits	3,071,170		3,076,464	3	2,808,626		2,813,779	3
FHLB advances	190,664		193,004	3	126,757		131,281	3
Short-term borrowings	172,983		172,983	3	136,109		136,109	3
Structured repurchase agreements	--		--	3	50,000		53,485	3
Subordinated debentures	30,929		30,929	3	30,929		30,929	3
Accrued interest payable	1,024		1,024	3	1,099		1,099	3
Unrecognized financial instruments (net of
contractual value)
Commitments to originate loans	--		--	3	--		--	3
Letters of credit	31		31	3	76		76	3
Lines of credit	--		--	3	--		--	3

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Note 14: Fair Value Measurement: Schedule of Interest Rate Swap Liability (Details) (Interest Rate Swap Liability, USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Interest Rate Swap Liability
Fair Value Interest Rate Swap Liabilities	$ 1,711	$ 1,019	$ 1,613	$ 2,160
Change in Unrealized Gain (Loss) on Fair Value Hedging Instruments	(222)	307	(124)	(834)
Fair Value Interest Rate Swap Liabilities	$ 1,489	$ 1,326	$ 1,489	$ 1,326

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Note 4: Stockholders' Equity: Stockholders Equity Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Stockholders Equity Policy

Previously, the Company's stockholders approved the Company's reincorporation to the State of Maryland. Under Maryland law, there is no concept of "Treasury Shares." Instead, shares purchased by the Company constitute authorized but unissued shares under Maryland law. Accounting principles generally accepted in the United States of America state that accounting for treasury stock shall conform to state law. The cost of shares purchased by the Company has been allocated to Common Stock and Retained Earnings balances.

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Note 7: Loans and Allowance For Loan Losses: Troubled Debt Restructurings on Financing Receivables (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	9 Months Ended
	Sep. 30, 2014	Sep. 30, 2014
Commercial Business
Troubled Debt Restructuring Loans Modified Term	$ 243	$ 1,881
Troubled Debt Restructurings Total Modifications	243	1,881
Consumer
Troubled Debt Restructuring Loans Modified Term	6	59
Troubled Debt Restructurings Total Modifications	6	59
Total Newly Restructured Loans
Troubled Debt Restructuring Loans Interest Only	308	814
Troubled Debt Restructuring Loans Modified Term	249	5,655
Troubled Debt Restructuring Loans Modified Combination	223	223
Troubled Debt Restructurings Total Modifications	780	6,692
Industrial Revenue Bonds
Troubled Debt Restructuring Loans Modified Term		1,150
Troubled Debt Restructurings Total Modifications		1,150
Mortgage Loans on Real Estate | One To Four Family Residential
Troubled Debt Restructuring Loans Interest Only	308	308
Troubled Debt Restructuring Loans Modified Term		386
Troubled Debt Restructurings Total Modifications	308	694
Mortgage Loans on Real Estate | One To Four Family Residential Construction
Troubled Debt Restructuring Loans Modified Combination	223	223
Troubled Debt Restructurings Total Modifications	223	223
Mortgage Loans on Real Estate | Subdivision Construction
Troubled Debt Restructuring Loans Modified Term		250
Troubled Debt Restructurings Total Modifications		250
Mortgage Loans on Real Estate | Commercial Real Estate
Troubled Debt Restructuring Loans Interest Only		506
Troubled Debt Restructuring Loans Modified Term		1,929
Troubled Debt Restructurings Total Modifications		$ 2,435

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Note 7: Loans and Allowance For Loan Losses: Schedule of Loans Receivable by Aging Analysis (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Loans Receivable by Aging Analysis

Classes of loans by aging were as follows:

	September 30, 2014
							Total Loans
			Past Due				> 90 Days
	30-59 Days	60-89 Days	90 Days	Total Past		Total Loans	Past Due and
	Past Due	Past Due	or More	Due	Current	Receivable	Still Accruing
(In Thousands)
One- to four-family
residential construction	$--	$--	$223	$223	$43,163	$43,386	$--
Subdivision construction	--	--	1,223	1,223	34,121	35,344	--
Land development	--	--	265	265	48,316	48,581	--
Commercial construction	--	--	--	--	361,971	361,971	--
Owner occupied one- to four-
family residential	184	565	1,616	2,365	76,619	78,984	170
Non-owner occupied one- to
four-family residential	--	168	2,997	3,165	140,249	143,414	--
Commercial real estate	--	59	2,968	3,027	869,267	872,294	--
Other residential	--	--	--	--	353,225	353,225	--
Commercial business	21	13	427	461	348,926	349,387	--
Industrial revenue bonds	--	--	1,205	1,205	41,736	42,941	--
Consumer auto	144	1,331	131	1,606	272,644	274,250	--
Consumer other	168	1,025	649	1,842	76,834	78,676	244
Home equity lines of credit	46	404	337	787	60,365	61,152	--
FDIC-supported loans, net of
discounts (TeamBank)	65	115	415	595	14,699	15,294	--
Acquired non-covered loans,
net of discounts
(TeamBank)	--	--	--	--	28,341	28,341	--
FDIC-supported loans, net of
discounts (Vantus Bank)	85	12	1,022	1,119	42,534	43,653	56
FDIC-supported loans,
net of discounts
(Sun Security Bank)	353	149	2,714	3,216	51,178	54,394	--
FDIC-supported loans,
net of discounts
(InterBank)	696	1,375	14,731	16,802	186,985	203,787	--
Acquired non-covered loans,
net of discounts
(Valley Bank)	9,727	2,716	12,329	24,772	127,725	152,497	--
	11,489	7,932	43,252	62,673	3,278,898	3,241,571	470
Less FDIC-supported loans,
and acquired non-covered
loans, net of discounts	10,926	4,367	31,211	46,504	451,462	497,966	56
Total	$563	$3,565	$12,041	$16,169	$2,727,436	$2,743,605	$414

	December 31, 2013
							Total Loans
			Past Due				> 90 Days
	30-59 Days	60-89 Days	90 Days	Total Past		Total Loans	Past Due and
	Past Due	Past Due	or More	Due	Current	Receivable	Still Accruing
(In Thousands)
One- to four-family
residential construction	$--	$--	$--	$--	$34,662	$34,662	$--
Subdivision construction	--	--	871	871	39,538	40,409	--
Land development	145	38	338	521	57,320	57,841	--
Commercial construction	--	--	--	--	184,019	184,019	--
Owner occupied one- to four-
family residential	1,233	344	3,014	4,591	84,542	89,133	211
Non-owner occupied one- to
four-family residential	1,562	171	843	2,576	143,332	145,908	140
Commercial real estate	2,856	131	6,205	9,192	771,498	780,690	--
Other residential	--	--	--	--	325,599	325,599	--
Commercial business	17	19	5,208	5,244	310,025	315,269	--
Industrial revenue bonds	--	--	2,023	2,023	40,207	42,230	--
Consumer auto	955	127	168	1,250	133,467	134,717	--
Consumer other	1,258	333	732	2,323	79,937	82,260	257
Home equity lines of credit	168	16	504	688	57,595	58,283	--
FDIC-supported loans, net of
discounts (TeamBank)	414	130	1,396	1,940	47,922	49,862	6
FDIC-supported loans, net of
discounts (Vantus Bank)	675	31	2,356	3,062	54,858	57,920	42
FDIC-supported loans,
net of discounts
(Sun Security Bank)	510	121	4,241	4,872	59,971	64,843	147
FDIC-supported loans, net of
discounts (InterBank)	6,024	1,567	16,768	24,359	189,180	213,539	20
	15,817	3,028	44,667	63,512	2,613,672	2,677,184	823
Less FDIC-supported loans,
net of discounts	7,623	1,849	24,761	34,233	351,931	386,164	215
Total	$8,194	$1,179	$19,906	$29,279	$2,261,741	$2,291,020	$608

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of Changes Accretable Yield for Acquired Loan Pools (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended				9 Months Ended
	Sep. 30, 2014		Sep. 30, 2013		Sep. 30, 2014		Sep. 30, 2013
TeamBank
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Accretion	$ (887)		$ (1,450)		$ (3,169)		$ (7,050)
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Reclassifications from Nonaccretable Difference	725	[1]	1,109	[1]	3,039	[2]	3,191	[2]
TeamBank | Beginning of period
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Period Increase (Decrease)	7,434		8,610		7,402		12,128
TeamBank | End of period
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Period Increase (Decrease)	7,272		8,269		7,272		8,269
Vantus Bank
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Accretion	(859)		(1,832)		(2,990)
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Reclassifications from Nonaccretable Difference	916	[1]	(379)	[1]	1,900	[2]	390	[2]
Vantus Bank | Beginning of period
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Period Increase (Decrease)	4,578		8,647		5,725		13,538
Vantus Bank | End of period
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Period Increase (Decrease)	4,635		6,436		4,635		6,436
Sun Security Bank
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Accretion	(2,119)		(4,795)		(7,343)		(13,021)
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Reclassifications from Nonaccretable Difference	789	[1]	5,293	[1]	4,327	[2]	12,315	[2]
Sun Security Bank | Beginning of period
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Period Increase (Decrease)	9,427		10,055		11,113		11,259
Sun Security Bank | End of period
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Period Increase (Decrease)	8,097		10,553		8,097		10,553
InterBank
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Accretion	(10,002)		(7,034)		(28,404)		(20,423)
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Reclassifications from Nonaccretable Difference	4,857	[1]	7,774	[1]	24,272	[2]	13,556	[2]
InterBank | Beginning of period
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Period Increase (Decrease)	41,108		34,967		40,095		42,574
InterBank | End of period
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Period Increase (Decrease)	35,963		35,707		35,963		35,707
Valley Bank
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Accretion	(2,062)				(2,227)
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Additions					22,976
Valley Bank | Beginning of period
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Period Increase (Decrease)	22,811
Valley Bank | End of period
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield, Period Increase (Decrease)	$ 20,749				$ 20,749

[1] Represents increases in estimated cash flows expected to be received from the acquired loan pools, primarily due to lower estimated credit losses. The numbers also include changes in expected accretion of the loan pools for TeamBank, Vantus Bank, Sun Security Bank and InterBank for the three months ended September 30, 2014, totaling $522,000, $831,000, $139,000 and $707,000, respectively, and for the three months ended September 30, 2013, totaling $340,000, $0, $4.3 million and $7.3 million, respectively. There have not yet been any changes to the expected accretion of the loan pools for Valley Bank.

[2] Represents increases in estimated cash flows expected to be received from the acquired loan pools, primarily due to lower estimated credit losses. The numbers also include changes in expected accretion of the loan pools for TeamBank, Vantus Bank, Sun Security Bank and InterBank for the nine months ended September 30, 2014, totaling $2.8 million, $1.8 million, $1.5 million and $2.4 million, respectively, and for the nine months ended September 30, 2013, totaling $2.5 million, $516,000, $9.0 million and $14.9 million, respectively. There have not yet been any changes to the expected accretion of the loan pools for Valley Bank.

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Note 6: Investment Securities: Schedule of Available-for-sale Securities Reconciliation (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Available-for-sale Securities Reconciliation

	September 30, 2014
		Gross	Gross		Tax
	Amortized	Unrealized	Unrealized	Fair	Equivalent
	Cost	Gains	Losses	Value	Yield
(In Thousands)
AVAILABLE-FOR-SALE SECURITIES:
U.S. government agencies	$20,000	$--	$1,063	$18,937	2.00%
Mortgage-backed securities	273,358	4,502	1,233	276,627	2.02
States and political subdivisions	120,060	6,713	226	126,547	5.37
Equity securities	847	2,198	--	3,045	--
	$414,265	$13,413	$2,522	$425,156	2.98%

	December 31, 2013
		Gross	Gross		Tax
	Amortized	Unrealized	Unrealized	Fair	Equivalent
	Cost	Gains	Losses	Value	Yield
(In Thousands)
AVAILABLE-FOR-SALE SECURITIES:
U.S. government agencies	$20,000	$--	$2,745	$17,255	2.00%
Mortgage-backed securities	365,020	4,824	2,266	367,578	2.04
Small Business Administration
loan pools	43,461	1,394	--	44,855	1.34
States and political subdivisions	122,113	2,549	1,938	122,724	5.47
Equity securities	847	2,022	--	2,869	--
	$551,441	$10,789	$6,949	$555,281	2.74%

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Note 9: Other Real Estate Owned: Schedule of Expenses Applicable to Foreclosed Assets (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Details
Loss (Gain) on Sales of Foreclosed Assets	$ 126	$ 27	$ 72	$ (255)
Valuation write-downs on foreclosed assets	158	258	1,357	1,313
Operating expenses, net of rental income	698	783	1,744	2,420
Total foreclosed assets expenses	$ 982	$ 1,068	$ 3,173	$ 3,478

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GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES -- CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Statements of Comprehensive Income
Net Income	$ 11,590	$ 8,439	$ 31,462	$ 25,056
Unrealized appreciation (depreciation) on available-for-sale securities, net	236	(5,221)	5,209	(12,745)
Non-credit component of unrealized gain (loss) on available-for-sale debt securities for which a portion of an other-than-temporary impairment has been recognized, net				(37)
Reclassification adjustment for gains included in net income, net	(209)	(72)	(626)	(157)
Change in fair value of cash flow hedge, net	53	(45)	(90)	(45)
Comprehensive Income	$ 11,670	$ 3,101	$ 35,955	$ 12,072

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Note 6: Investment Securities: Schedule of Amounts Reclassified out of Accumulated Other Comprehensive Income (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2014	Sep. 30, 2013
Reclassifications out of accumulated other comprehensive income	$ 209	$ 72	$ 626	$ 157
Amounts Reclassified From Other Comprehensive Income | Net Realized Gains On Sales Of Available For Sale Securities Total Reclassified Amount Before Tax
Available-for-sale Securities, Gross Unrealized Gain (Loss)	321	110	963	241
Amounts Reclassified From Other Comprehensive Income | Provision For Income Taxes
Available-for-sale Securities, Gross Unrealized Gain (Loss)	$ (112)	$ (38)	$ (337)	$ (84)

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Note 3: Recent Accounting Pronouncements

3 Months Ended

Sep. 30, 2014

Notes

Note 3: Recent Accounting Pronouncements

NOTE 3: RECENT ACCOUNTING PRONOUNCEMENTS

In January 2014, the FASB issued ASU No. 2014-01 to amend FASB ASC Topic 323, Investments – Equity Method and Joint Ventures.  The objective of this Update is to provide guidance on accounting for investments by a reporting entity in flow-through limited liability entities that manage or invest in affordable housing projects that qualify for the low-income housing tax credit.  The amendments in the Update permit reporting entities to make an accounting policy election to account for their investments in qualified affordable housing projects using the proportional amortization method if certain conditions are met.  Under the proportional amortization method, an entity amortizes the initial cost of the investment in proportion to the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense (benefit).  The Update would be effective for the Company beginning January 1, 2015; however, early adoption was permitted.  The Company elected to adopt this Update early, adopting it during the three months ended March 31, 2014.  There was no material impact on the Company’s financial position or results of operations, except that the investment amortization expense which was previously included in Other Noninterest Expense in the Consolidated Statements of Income was moved from Other Noninterest Expense to Provision for Income Taxes in the Consolidated Statements of Income.  For the three months ended September 30, 2013, $1.0 million was moved from Other Noninterest Expense to Provision for Income Taxes.  For the nine months ended September 30, 2013, $2.9 million was moved from Other Noninterest Expense to Provision for Income Taxes.  This had the effect of reducing Noninterest Expense and increasing Provision for Income Taxes, but did not have any impact on Net Income.

In January 2014, the FASB issued ASU No. 2014-04 to amend FASB ASC Topic 310, Receivables – Troubled Debt Restructurings by Creditors.  The objective of the amendments in this Update is to reduce diversity by clarifying when an in substance repossession or foreclosure occurs, that is, when a creditor should be considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan such that the loan receivable should be derecognized and the real estate property recognized.  The amendments in this Update clarify that an in substance repossession or foreclosure occurs, and a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan, upon either (1) the creditor obtaining legal title to the residential real estate property upon completion of a foreclosure or (2) the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. Additionally, the amendments require interim and annual disclosure of both (1) the amount of foreclosed residential real estate property held by the creditor and (2) the recorded investment in consumer mortgage loans collateralized by residential real estate property that are in the process of foreclosure according to local requirements of the applicable jurisdiction.  The Update will be effective for the Company beginning January 1, 2015, and is not expected to have a material impact on the Company’s financial position or results of operations. 

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 660): Summary and Amendments that Create Revenue from Contracts with Customers (Topic 606) and Other Assets and Deferred Costs--Contracts with Customers (Subtopic 340-40). The guidance in this update supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and most industry-specific guidance throughout the industry topics of the codification. For public companies, this update will be effective for interim and annual periods beginning after December 15, 2016 and early application is not permitted. The Company is currently assessing the impact that this guidance will have on its consolidated financial statements, but does not expect the guidance to have a material impact on the Company's financial position or results of operations.

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of InterBank FDIC Indemnification Asset (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of InterBank FDIC Indemnification Asset

	September 30, 2014
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$254,427	$5,076
Non-credit premium/(discount), net of activity since acquisition date	1,488	--
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(23,518)	--
Original estimated fair value of assets, net of activity since
acquisition date	(203,787)	(3,976)
Expected loss remaining	28,610	1,100
Assumed loss sharing recovery percentage	82%	80%
Estimated loss sharing value(1)	23,444	880
FDIC loss share clawback	3,793	--
Indemnification asset to be amortized resulting from
change in expected losses	18,814	--
Accretable discount on FDIC indemnification asset	(3,350)	(33)
FDIC indemnification asset	$42,701	$847

(1)    Includes $400,000 impairment of indemnification asset for loans

	December 31, 2013
		Foreclosed
	Loans	Assets
(In Thousands)
Initial basis for loss sharing determination,
net of activity since acquisition date	$284,975	$6,543
Non-credit premium/(discount), net of activity since acquisition date	1,905	--
Reclassification from nonaccretable discount to accretable discount
due to change in expected losses (net of accretion to date)	(21,218)	--
Original estimated fair value of assets, net of activity since
acquisition date	(213,539)	(5,073)
Expected loss remaining	52,123	1,470
Assumed loss sharing recovery percentage	82%	80%
Estimated loss sharing value	42,654	1,176
FDIC loss share clawback	2,893	--
Indemnification asset to be amortized resulting from
change in expected losses	16,974	--
Accretable discount on FDIC indemnification asset	(4,874)	(33)
FDIC indemnification asset	$57,647	$1,143

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Note 6: Investment Securities: Schedule of Maturity of Available for Sale Securities (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014
Details
Available-for-sale Securities, Debt Maturities, Next Twelve Months, Amortized Cost Basis	$ 110
Available-for-sale Securities, Debt Maturities, Next Twelve Months, Fair Value	111
Available-for-sale Securities, Debt Maturities, Year Two Through Five, Amortized Cost Basis	1,472
Available-for-sale Securities, Debt Maturities, Year Two Through Five, Fair Value	1,486
Available-for-sale Securities, Debt Maturities, Year Six Through Ten, Amortized Cost Basis	7,504
Available-for-sale Securities, Debt Maturities, Year Six Through Ten, Fair Value	7,794
Available-for-sale Securities, Debt Maturities, after Ten Years, Amortized Cost Basis	130,974
Available-for-sale Securities, Debt Maturities, after Ten Years, Fair Value	136,093
Available-for-sale Securities, Debt Maturities, without Single Maturity Date, Amortized Cost Basis	273,358
Available-for-sale Securities, Debt Maturities, without Single Maturity Date, Fair Value	276,627
Available for Sale Securities Equity Securities Amortized Cost	847
Available for Sale Securities Equity Securities Fair Value	3,045
Available-for-sale Securities, Amortized Cost Basis	414,265
Available-for-sale Securities Fair Value	$ 425,156

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Note 9: Other Real Estate Owned: Schedule of Major Classifications of Foreclosed Assets (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Other Real Estate Owned, Net	$ 43,762	$ 53,514
Foreclosed Assets Held For Sale | Subdivision Construction
Foreclosed Assets	9,778	11,652
Foreclosed Assets Held For Sale | Land Development
Foreclosed Assets	17,752	16,788
Foreclosed Assets Held For Sale | Commercial Construction
Foreclosed Assets		2,132
Foreclosed Assets Held For Sale | One To Four Family Residential
Foreclosed Assets	1,564	744
Foreclosed Assets Held For Sale | Other Residential
Foreclosed Assets	3,577	5,900
Foreclosed Assets Held For Sale | Commercial Real Estate
Foreclosed Assets	1,779	4,135
Foreclosed Assets Held For Sale | Commercial Business
Foreclosed Assets	59	77
Foreclosed Assets Held For Sale | Consumer
Foreclosed Assets	565	969
Foreclosed Assets Held For Sale | Foreclosed Assets Before FDIC Supported Foreclosed Assets
Foreclosed Assets	35,074	42,397
Foreclosed Assets Held For Sale | FDIC Supported Foreclosed Assets Net Of Discounts
Foreclosed Assets	6,668	9,006
Foreclosed Assets Held For Sale, Net
Foreclosed Assets	41,742	51,403
Other real estate owned not acquired through foreclosure
Other Real Estate Owned, Net	$ 2,020	$ 2,111

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Note 14: Fair Value Measurement: Schedule of Interest Rate Swap Liability (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Interest Rate Swap Liability

	Interest Rate Swap Liability
	2014	2013
(In Thousands)
Balance, July 1	$1,711	$1,019
Change in fair value through earnings	(222)	307
Balance, September 30	$1,489	$1,326

	Interest Rate Swap Liability
	2014	2013
(In Thousands)
Balance, January 1	$1,613	$2,160
Change in fair value through earnings	(124)	(834)
Balance, September 30	$1,489	$1,326

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Note 6: Investment Securities: Investments in Debt Securities Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

Investments in Debt Securities Policy

Certain investments in debt securities are reported in the financial statements at an amount less than their historical cost. Total fair value of these investments at September 30, 2014 and December 31, 2013, respectively, was approximately $131.5 million and $237.6 million, which is approximately 30.9% and 42.7% of the Company’s available-for-sale and held-to-maturity investment portfolio, respectively.

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Note 14: Fair Value Measurement: Schedule Of Financial Instruments Fair Value (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Dec. 31, 2013
Financial Assets | Cash and Cash Equivalents
Financial Instruments Owned Carrying Amount	$ 221,386	$ 227,925
Financial Instruments, Owned, at Fair Value	221,386	227,925
Fair Value by Fair Value Hierarchy Level	1	1
Financial Assets | Held-to-maturity Securities
Financial Instruments Owned Carrying Amount	450	805
Financial Instruments, Owned, at Fair Value	505	912
Fair Value by Fair Value Hierarchy Level	2	2
Financial Assets | Mortgage Loans Held For Sale
Financial Instruments Owned Carrying Amount	30,361	7,239
Financial Instruments, Owned, at Fair Value	30,361	7,239
Fair Value by Fair Value Hierarchy Level	2	2
Financial Assets | Loans Receivable
Financial Instruments Owned Carrying Amount	2,921,310	2,439,530
Financial Instruments, Owned, at Fair Value	2,931,098	2,442,917
Fair Value by Fair Value Hierarchy Level	3	3
Financial Assets | Accrued Interest Receivable
Financial Instruments Owned Carrying Amount	11,214	11,408
Financial Instruments, Owned, at Fair Value	11,214	11,408
Fair Value by Fair Value Hierarchy Level	3	3
Financial Assets | Investment in Federal Home Loan Bank Stock
Financial Instruments Owned Carrying Amount	12,013	9,822
Financial Instruments, Owned, at Fair Value	12,013	9,822
Fair Value by Fair Value Hierarchy Level	3	3
Financial Liabilities | Deposits
Financial Instruments Owned Carrying Amount	3,071,170	2,808,626
Financial Instruments, Owned, at Fair Value	3,076,464	2,813,779
Fair Value by Fair Value Hierarchy Level	3	3
Financial Liabilities | Federal Home Loan Bank Advances
Financial Instruments Owned Carrying Amount	190,664	126,757
Financial Instruments, Owned, at Fair Value	193,004	131,281
Fair Value by Fair Value Hierarchy Level	3	3
Financial Liabilities | Short-term Debt
Financial Instruments Owned Carrying Amount	172,983	136,109
Financial Instruments, Owned, at Fair Value	172,983	136,109
Fair Value by Fair Value Hierarchy Level	3	3
Financial Liabilities | Repurchase Agreements
Financial Instruments Owned Carrying Amount		50,000
Financial Instruments, Owned, at Fair Value		53,485
Fair Value by Fair Value Hierarchy Level	3	3
Financial Liabilities | Subordinated Debt
Financial Instruments Owned Carrying Amount	30,929	30,929
Financial Instruments, Owned, at Fair Value	30,929	30,929
Fair Value by Fair Value Hierarchy Level	3	3
Financial Liabilities | Accrued Interest Payable
Financial Instruments Owned Carrying Amount	1,024	1,099
Financial Instruments, Owned, at Fair Value	1,024	1,099
Fair Value by Fair Value Hierarchy Level	3	3
Unrecognized Financial Instruments Net Of Contractual Value | Loan Origination Commitments
Fair Value by Fair Value Hierarchy Level	3	3
Unrecognized Financial Instruments Net Of Contractual Value | Letter of Credit
Financial Instruments Owned Carrying Amount	31	76
Financial Instruments, Owned, at Fair Value	$ 31	$ 76
Fair Value by Fair Value Hierarchy Level	3	3
Unrecognized Financial Instruments Net Of Contractual Value | Line of Credit
Fair Value by Fair Value Hierarchy Level	3	3

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Note 16: FDIC-assisted Acquisition: Schedule of Certain Assets and Liabilities Acquired (Tables)

3 Months Ended

Sep. 30, 2014

Tables/Schedules

Schedule of Certain Assets and Liabilities Acquired

	June 20,
	2014
(In Thousands)
Cash	$2,729
Due from banks	106,680
Cash and cash equivalents	109,409
Investment securities	88,513
Loans receivable, net of discount on loans purchased of $30,102	165,098
Accrued interest receivable	1,004
Premises	10,850
Core deposit intangible	2,800
Other assets	1,060
Total assets acquired	378,734
Liabilities
Demand and savings deposits	186,902
Time deposits	179,125
Total deposits	366,027
Securities sold under reverse repurchase agreements with customers	567
Accounts payable	561
Accrued interest payable	182
Advances from borrowers for taxes and insurance	592
Total liabilities assumed	367,929
Gain recognized on business acquisition	$10,805

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: InterBank Indemnification Asset Policy (Policies)

3 Months Ended

Sep. 30, 2014

Policies

InterBank Indemnification Asset Policy

InterBank Loans, Foreclosed Assets and Indemnification Asset.  The following table presents the balances of the FDIC indemnification asset related to the InterBank transaction at September 30, 2014.  Gross loan balances (due from the borrower) were reduced approximately $138.8 million since the transaction date because of $107.2 million of repayments by the borrower, $11.4 million in transfers to foreclosed assets and $20.2 million of charge-offs to customer loan balances.  Based upon the collectability analyses performed during the acquisition, we expected certain levels of foreclosures and charge-offs and actual results have been better than our expectations.  As a result, cash flows expected to be received from the acquired loan pools have increased, resulting in adjustments that were made to the related accretable yield as described above.

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Note 13: Income Taxes

3 Months Ended

Sep. 30, 2014

Notes

Note 13: Income Taxes

NOTE 13: INCOME TAXES

Reconciliations of the Company’s effective tax rates to the statutory corporate tax rates were as follows:

	Three Months Ended September 30,
	2014	2013
Tax at statutory rate	35.0%	35.0%
Nontaxable interest and dividends	(3.1)	(4.3)
Tax credits	(8.4)	(12.2)
State taxes	1.7	3.0
Other	0.2	(1.4)
	25.4%	20.1%

	Nine Months Ended September 30,
	2014	2013
Tax at statutory rate	35.0%	35.0%
Nontaxable interest and dividends	(3.3)	(4.3)
Tax credits	(9.2)	(11.1)
State taxes	1.5	2.1
Other	0.4	(0.2)
	24.4%	21.5%

The Company and its consolidated subsidiaries have not been audited recently by the Internal Revenue Service (IRS) or the state taxing authorities with respect to income or franchise tax returns, and as such, tax years through December 31, 2005, have been closed without audit. The Company, through one of its subsidiaries, is a partner in two partnerships currently under IRS examination for 2006 and 2007. As a result, the Company’s 2006 and subsequent tax years remain open for examination. The IRS audits of the two partnerships are ongoing.  The IRS has raised questions about the validity of the allocation of a portion of the credits by one of the partnerships.  At this time, the Company believes that the partnership has sufficient technical support for its allocation position regarding these credits and that it is more likely than not these allocations will ultimately be sustained; therefore, a reserve for uncertain tax positions is not required.

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Note 8: Acquired Loans, Loss Sharing Agreements and FDIC Indemnification Assets: Schedule of Vantus Bank FDIC Indemnification Asset (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014		Dec. 31, 2013
Vantus Bank Loans
Initial basis for loss sharing determination, net of activity since acquisition date	$ 44,877		$ 60,011
Reclassification from nonaccretable discount to accretable discount due to change in expected losses (net of accretion to date)	(456)		(1,202)
Original estimated fair value of assets, net of activity since acquisition date	(43,653)		(57,920)
Expected loss remaining	768		889
Assumed loss sharing recovery percentage	74.00%		78.00%
Estimated loss sharing value	566	[1]	690
Indemnification assets to be amortized resulting from change in expected losses	278		919
Accretable discount on FDIC indemnification asset			(32)
FDIC Indemnification Asset, Total	844		1,577
Vantus Bank Foreclosed Assets
Initial basis for loss sharing determination, net of activity since acquisition date	1,205		1,986
Original estimated fair value of assets, net of activity since acquisition date	(1,015)		(1,092)
Expected loss remaining	190		894
Assumed loss sharing recovery percentage			80.00%
Estimated loss sharing value			716
FDIC Indemnification Asset, Total			$ 716

[1] Includes $153,000 impairment of indemnification asset for foreclosed assets. Resolution of certain items related to commercial foreclosed assets did not occur prior to the expiration of the non-single-family loss sharing agreement for Vantus Bank on September 30, 2014.