UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934

For the Quarterly Period Ended September 30, 2020

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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)	(I.R.S. Employer Identification No.)
1451 E. Battlefield, Springfield, Missouri	65804
(Address of principal executive offices)	(Zip Code)
(417) 887-4400
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act.

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock,
par value $0.01 per share	GSBC	The NASDAQ Stock Market LLC

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 every Interactive Data file required to be submitted 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 such files). Yes/X/   No /  /

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

Large accelerated filer /  /	Accelerated filer /X/
Non-accelerated filer /  /	Smaller reporting company ☐
	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

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: 13,844,270 shares of common stock, par value $0.01 per share, outstanding at November 4, 2020.

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,
		2020		2019
	(Unaudited)
ASSETS
Cash	$	91,098	$	99,299
Interest-bearing deposits in other financial institutions		247,168		120,856
Cash and cash equivalents		338,266		220,155
Available-for-sale securities		445,940		374,175
Mortgage loans held for sale		23,973		9,242
Loans receivable, net of allowance for loan losses of $54,238 - September 2020; $40,294 - December 2019		4,413,764		4,153,982
Interest receivable		14,139		13,530
Prepaid expenses and other assets		44,671		74,984
Other real estate owned and repossessions, net		3,007		5,525
Premises and equipment, net		140,502		141,908
Goodwill and other intangible assets		7,232		8,098
Federal Home Loan Bank stock and other interest-earning assets		11,036		13,473
Current and deferred income taxes		480		-
Total Assets	$	5,443,010	$	5,015,072
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits	$	4,443,757	$	3,960,106
Securities sold under reverse repurchase agreements with customers		155,042		84,167
Short-term borrowings and other interest-bearing liabilities		1,218		228,157
Subordinated debentures issued to capital trust		25,774		25,774
Subordinated notes		148,217		74,276
Accrued interest payable		2,859		4,250
Advances from borrowers for taxes and insurance		11,841		7,484
Accrued expenses and other liabilities		29,659		24,904
Current and deferred income taxes		-		2,888
Total Liabilities		4,818,367		4,412,006
Commitments and Contingencies		-		-
Stockholders' Equity:
Capital stock
Serial preferred stock - $0.01 par value; authorized 1,000,000 shares; issued and outstanding September 2020 and December 2019 - - 0- shares		-		-
Common stock, $0.01 par value; authorized 20,000,000 shares; issued and outstanding September 2020 – 13,880,570 shares; December 2019 - 14,261,052 shares		139		143
Additional paid-in capital		34,539		33,510
Retained earnings		534,331		537,167
Accumulated other comprehensive income		55,634		32,246
Total Stockholders' Equity		624,643		603,066
Total Liabilities and Stockholders' Equity	$	5,443,010	$	5,015,072

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,
		2020		2019
		(Unaudited)
INTEREST INCOME
Loans	$	50,476	$	57,226
Investment securities and other		3,123		2,961
TOTAL INTEREST INCOME		53,599		60,187
INTEREST EXPENSE
Deposits		7,094		11,792
Short-term borrowings and repurchase agreements		8		1,123
Subordinated debentures issued to capital trust		128		253
Subordinated notes		2,201		1,095
TOTAL INTEREST EXPENSE		9,431		14,263
NET INTEREST INCOME		44,168		45,924
PROVISION FOR LOAN LOSSES		4,500		1,950
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES		39,668		43,974
NON-INTEREST INCOME
Commissions		318		173
Service charges, debit card and ATM fees		4,692		5,619
Net gains on loan sales		2,878		1,021
Late charges and fees on loans		352		364
Gain (loss) on derivative interest rate products		89		(101	)
Other income		1,137		1,579
TOTAL NON-INTEREST INCOME		9,466		8,655
NON-INTEREST EXPENSE
Salaries and employee benefits		18,701		15,827
Net occupancy and equipment expense		7,147		6,613
Postage		748		792
Insurance		753		339
Advertising		757		794
Office supplies and printing		271		258
Telephone		987		904
Legal, audit and other professional fees		582		681
Expense on other real estate and repossessions		199		603
Partnership tax credit investment amortization		-		91
Acquired deposit intangible asset amortization		289		289
Other operating expenses		1,554		1,534
TOTAL NON-INTEREST EXPENSE		31,988		28,725
INCOME BEFORE INCOME TAXES		17,146		23,904
PROVISION FOR INCOME TAXES		3,692		4,172
NET INCOME AND NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	13,454	$	19,732
Basic Earnings Per Common Share	$	0.96	$	1.39
Diluted Earnings Per Common Share	$	0.96	$	1.38
Dividends Declared Per Common Share	$	0.34	$	0.34

  See Notes to Consolidated Financial Statements

3

GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

		NINE MONTHS ENDED SEPTEMBER 30,
		2020			2019
		(Unaudited)
INTEREST INCOME
Loans	$	155,453		$	167,552
Investment securities and other		9,631			8,715
TOTAL INTEREST INCOME		165,084			176,267
INTEREST EXPENSE
Deposits		26,712			33,844
Short-term borrowings and repurchase agreements		667			2,904
Subordinated debentures issued to capital trust		511			787
Subordinated notes		4,633			3,283
TOTAL INTEREST EXPENSE		32,523			40,818
NET INTEREST INCOME		132,561			135,449
PROVISION FOR LOAN LOSSES		14,371			5,500
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES		118,190			129,949
NON-INTEREST INCOME
Commissions		760			670
Service charges, debit card and ATM fees		13,590			15,887
Net gains on loan sales		5,308			1,645
Late charges and fees on loans		1,175			1,066
Net realized gains on sales of available-for-sale securities		78			10
Loss on derivative interest rate products		(424	)		(169	)
Other income		4,606			4,154
TOTAL NON-INTEREST INCOME		25,093			23,263
NON-INTEREST EXPENSE
Salaries and employee benefits		53,699			46,895
Net occupancy and equipment expense		20,619			19,462
Postage		2,294			2,342
Insurance		1,668			1,667
Advertising		1,814			2,162
Office supplies and printing		806			743
Telephone		2,904			2,645
Legal, audit and other professional fees		1,844			2,023
Expense on other real estate and repossessions		946			1,642
Partnership tax credit investment amortization		-			274
Acquired deposit intangible asset amortization		866			902
Other operating expenses		4,691			4,845
TOTAL NON-INTEREST EXPENSE		92,151			85,602
INCOME BEFORE INCOME TAXES		51,132			67,610
PROVISION FOR INCOME TAXES		9,607			11,890
NET INCOME AND NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	41,525		$	55,720
Basic Earnings Per Common Share	$	2.94		$	3.93
Diluted Earnings Per Common Share	$	2.93		$	3.90
Dividends Declared Per Common Share	$	2.02		$	1.73

  See Notes to Consolidated Financial Statements

4

GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

	THREE MONTHS ENDED SEPTEMBER 30,
		2020				2019
	(Unaudited)
Net Income	$	13,454		$	19,732
Unrealized appreciation (depreciation) on available-for-sale securities, net of taxes (credit) of $(531) and $1,315, for 2020 and 2019, respectively		(1,796	)		4,452
Change in fair value of cash flow hedge, net of taxes of $0 and $1,318, for 2020 and 2019, respectively		-			4,461
Amortization of realized gain on termination of cash flow hedge, net of taxes (credit) of $467 and $0, for 2020 and 2019, respectively		(1,581	)		-
Comprehensive Income	$	10,077		$	28,645

	NINE MONTHS ENDED SEPTEMBER 30,
		2020				2019
	(Unaudited)
Net Income	$	41,525		$	55,720
Unrealized appreciation on available-for-sale securities, net of taxes of $4,482 and $3,732, for 2020 and 2019, respectively		15,177			12,642
Reclassification adjustment for gains included in net income, net of taxes (credit) of $18 and $2, for 2020 and 2019, respectively		(60	)		(8		)
Change in fair value of cash flow hedge, net of taxes of $3,519 and $5,549, for 2020 and 2019, respectively		11,914			18,789
Amortization of realized gain on termination of cash flow hedge, net of taxes (credit) of $(1,075) and $0, for 2020 and 2019, respectively		(3,643	)		-
Comprehensive Income	$	64,913		$	87,143

  See Notes to Consolidated Financial Statements

5

GREAT SOUTHERN BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except per share data)

		THREE MONTHS ENDED SEPTEMBER 30, 2019
								Accumulated
								Other
		Common		Additional		Retained		Comprehensive		Treasury
		Stock		Paid-in Capital		Earnings		Income (Loss)		Stock		Total
		(Unaudited)
Balance, June 30, 2019	$	142	$	31,603	$	508,427	$	32,137	$	-	$	572,309
Net income		-		-		19,732		-		-		19,732
Stock issued under Stock Option
Plan		-		482		-		-		167		649
Common dividends declared,		-		-		(4,833)		-		-		(4,833)
$0.34 per share
Other comprehensive gain		-		-		-		8,913		-		8,913
Reclassification of treasury stock
per Maryland law		-		-		167		-		(167)		-
Balance, September 30, 2019	$	142	$	32,085	$	523,493	$	41,050	$	-	$	596,770

		THREE MONTHS ENDED SEPTEMBER 30, 2020
								Accumulated
								Other
		Common		Additional		Retained		Comprehensive		Treasury
		Stock		Paid-in Capital		Earnings		Income (Loss)		Stock		Total
		(Unaudited)
Balance, June 30, 2020	$	141	$	34,230	$	533,346	$	59,011	$	-	$	626,728
Net income		-		-		13,454		-		-		13,454
Stock issued under Stock Option
Plan		-		309		-		-		37		346
Common dividends declared,		-		-		(4,790)		-		-		(4,790)
$0.34 per share
Other comprehensive loss		-		-		-		(3,377)		-		(3,377)
Purchase of the Company’s common stock		-		-		-		-		(7,718)		(7,718)
Reclassification of treasury stock
per Maryland law		(2)		-		(7,679)		-		7,681		-
Balance, September 30, 2020	$	139	$	34,539	$	534,331	$	55,634	$	-	$	624,643

  See Notes to Consolidated Financial Statements

6

		NINE MONTHS ENDED SEPTEMBER 30, 2019
								Accumulated
								Other
		Common		Additional		Retained		Comprehensive		Treasury
		Stock		Paid-in Capital		Earnings		Income (Loss)		Stock		Total
		(Unaudited)
Balance, January 1, 2019	$	142	$	30,121	$	492,087	$	9,627	$	-	$	531,977
Net income		-		-		55,720		-		-		55,720
Stock issued under Stock Option
Plan		-		1,964		-		-		1,059		3,023
Common dividends declared,		-		-		(24,524)		-		-		(24,524)
$1.39 per share
Purchase of the Company’s common stock		-		-		-		-		(849)		(849)
Other comprehensive gain		-		-		-		31,423		-		31,423
Reclassification of treasury stock
per Maryland law		-		-		210		-		(210)		-
Balance, September 30, 2019	$	142	$	32,085	$	523,493	$	41,050	$	-	$	596,770

		NINE MONTHS ENDED SEPTEMBER 30, 2020
								Accumulated
								Other
		Common		Additional		Retained		Comprehensive		Treasury
		Stock		Paid-in Capital		Earnings		Income (Loss)		Stock		Total
		(Unaudited)
Balance, January 1, 2020	$	143	$	33,510	$	537,167	$	32,246	$	-	$	603,066
Net income		-		-		41,525		-		-		41,525
Stock issued under Stock Option
Plan		-		1,029		-		-		133		1,162
Common dividends declared,		-		-		(28,631)		-		-		(28,631)
$2.02 per share
Other comprehensive gain		-		-		-		23,388		-		23,388
Purchase of the Company’s common stock		-		-		-		-		(15,867)		(15,867)
Reclassification of treasury stock
per Maryland law		(4)		-		(15,730)		-		15,734		-
Balance, September 30, 2020	$