Great Southern Bancorp, Inc. (GSBC) Q2 2024 Earnings Call Transcript
AInvestWednesday, Jul 17, 2024 8:09 pm ET
1min read
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Great Southern Bancorp, Inc. recently reported its second-quarter earnings for the period ending June 30, 2024, demonstrating resilience in a challenging economic climate. The company reported earnings of $1.45 per diluted common share, marking a slight decrease from the same period in 2023. However, excluding non-recurring items, earnings per share stood at $1.37, reflecting a steady performance. Despite the economic headwinds, Great Southern Bancorp's capital and liquidity positions remain strong, with a TCE ratio of 9.4% and total stockholders' equity of $568.8 million.

Operational Highlights and Financial Performance

Joe Turner, President and CEO, attributed the company's performance to modest increases in funding costs and significant competition for deposits, which affected loan origination volume. The company also saw a decrease in non-performing assets to 34 basis points, indicating a stable credit quality. The loan portfolio showed modest growth, primarily in the multifamily category, with an increase of about $44 million since the end of 2023. The loan pipeline decreased to $1.1 billion, with a focus on multifamily construction loans.

Rex Copeland, CFO, highlighted the impact of the terminated core banking system conversion project and compliance matters on the company's financials. Net interest income for the second quarter was $46.8 million, a decrease from the previous year, mainly due to the termination of an interest rate swap. The company's liquidity position remains robust, with about $2 billion in available secured funding lines and on-balance sheet liquidity.

Investor Inquiries and Strategic Direction

During the Q&A session, investors raised questions about the company's securities portfolio, short-term borrowings, and expenses related to the software provider's contract termination. The company responded by providing details on the securities purchase and the roll-off of short-term borrowings. Regarding expenses, the company anticipates a decline in non-recurring expenses related to the conversion and compliance matters. The company's current core software provider will continue to accommodate new products and services, ensuring a smooth transition.

Looking Ahead

Great Southern Bancorp's strong financial position and strategic initiatives bode well for its future. The company's focus on diversifying its loan portfolio and managing liquidity effectively positions it well for potential challenges and opportunities. As the company navigates the economic landscape, its commitment to maintaining a strong capital and liquidity position will be crucial in ensuring sustainable growth and shareholder value.

In conclusion, Great Southern Bancorp's second-quarter earnings call provided valuable insights into the company's financial health and strategic direction. The company's ability to navigate challenges and maintain a strong financial position underscores its resilience and commitment to delivering value to its stakeholders. As the company moves forward, its focus on innovation, operational efficiency, and financial discipline will be key drivers of its long-term success.

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