GSBC - Earnings call transcript Q4 2024 | Great Southern Bancorp, Inc.

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Operator

Good day, and thank you for standing by. Welcome to the Great Southern Bancorp, Inc. Fourth Quarter 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to turn the conference over to your speaker for today, Zack Mukewa. ahead. go Please

Unknown Executive

December thank Quarter and the joining Southern year Great results Good Earnings you Call. Fourth ending full and XXXX the discussing XXXX. Today, Bank's for afternoon, quarter for XX, we'll company's be

everyone are the Before call, during factors subject regarding company's to forward-looking to financial and made this future be various that events we may performance. like filings. begin, differ the I'd to remind statements of cause from These statements anticipated that statements or in results filings fourth and to could projected earnings these refer the those materially forward-looking disclosure assessments release actual quarter other public

Joining me now Chief I'll turn and today the call Turner; Joe. are and Joe over Officer, Copeland. CEO, Financial Rex to President

Joseph Turner

We our year Southern today our joining All strength model right. and solid economic appreciate for our and a Thanks, you our dynamic results, fourth business reinforcing was banking a earnings and commitment Zack, for execution. call. of XXXX to resilience Despite facing long-term Great progress environment, everyone. us Bancorp. and of delivered quarter afternoon, team the good

$XX.X we share. the million reported or $X.XX year, For a

period this and by slight represents the a from year, rising reflects While our deposits. during management funding decline it costs for heightened proactive competition prior a marked

September interest last $XX.X ended the an to or fourth quarter creating prioritize In of common continue reported X.XX% in improvement the XX year $X.XX These shareholders. results underscore per our and in from ability was for million Net value the we share. income adapt, margin for net our profitability of quarter, quarter and X.X% the quarter, diluted 'XX. X.XX% fourth reflecting

or X%, annualized assets up average is prior from on was common for Annualized equity ROE average year's slightly which X.XX%. quarter. return quarter the the was while return on

on points reduced average fourth common return basis release, were by equity As basis XX points. item. expense XXX impacted assets This noninterest financial earnings results did note in and return negatively annualized on by the nonrecurring quarter annualized expense we by average

shareholder we increase deliver strategy value Looking share in drive per value and our ability to results. to ahead, long-term book continuing confident are strong consistent and our while

by loans Our key way $XXX.X residential the for gross sustained growth, reflecting demand loan pipeline increasing loans was strong. the million. robust growth the loans for with led Multifamily year construction loan portfolio segments driven remain in while

selling muted Loan to in somewhat to previous payoffs rate were given interest due and borrowers the refinancing or 'XX projects compared sporadic years, environment. debt

please helpful link. loan mix For more Relations on our insights information provides the and loan presentation under quarterly geography. our The portfolio portfolio, presentation loan regarding Presentations refer about available our our type portfolio Investor to site by

Our loans period-end very the of nonperforming asset remained fell year, at end X.XX% assets the assets nonperforming quality of to total of loans X.XX%. with strong to

$X.X loss was million During for 'XX, than ended year. quarter our the provision XX, quarter credit expense same the higher last during December

million In In in of the a its XXXX loans of provision compared a negative its the 'XX. period company to expense provision outstanding 'XX. fourth same expense record provision the $X.X quarter, the unfunded compared of on expense QX provision portfolio on $X.X the quarter, $XXX,XXX did to the million recorded a of company during not fourth expense of loans

X.XX% prior XXXX. the fourth at credit for of the the of quarter year to Our was from XXX,XXX, it end quarter the same X.XX% XX/XX total as of at third fell in $XXX,XXX percentage The the loans at charge-offs a thing down total net and the losses for at 'XX allowance quarter. end stood

$XX million, million our stock or had we dividend. about the to also about so position, in repurchasing and capital by think. increasing course, $XX.X $XX $XX strengthened on our repurchasing strategically million, We I we stockholders' spent maybe downside equity while stock And think change our our our I of mark-to-market by million

So to capital management repurchases. us dividends our through our and share significant continued to value return shareholders enabled

we ahead consistently management focus taken and do. view balance of remains a our long-term our sustainable growth, have sheet on value Grade proven everything disciplined to shareholders. XXXX, At we we look X, As delivery for

excited As are a about the result, opportunities we ahead.

in We arise. are ability to also navigate that confident our challenges any may

Lastly, and I'd team our members continued like trust. thank shareholders for to their for dedication their our

Now financial Rex I'll to turn provide detail it more to our over on results.

Rex Copeland

quarter year. good our income and and start Thank provide I'll with here I'll financial into net the of you, the Joe, dive everyone. margin. some afternoon, for performance deeper full a metrics little interest and fourth

$XX.X of primarily X.X% the driven $XX.X For in as management third a delivered and income we in This by quarter compared yields million the X.X% of to million million, XXXX. was $XX.X from loan the a well higher funding quarter strategic as increase of XXXX and fourth quarter, improvement same income of net interest increase costs.

of increasing reflecting net the begun year, of For reflects impact totaled decline full slight a XXXX, have our income ongoing but costs continued $XXX.X deposit decline latter until part elevated now to interest decline. of the which the previous million, year. This compared to the X.X%

X.XX% quarter third in margin 'XX. of net in increased the quarter Our for the compared and same the X.XX% interest X.XX% period to to fourth last year

to stability margin despite sheet effectively manage and balance underscores Our our management challenging approach strategic the disciplined environment funding rate deposit to actions costs.

reflecting down of loan the the year for from interest significant costs. rose at year, increased the liabilities significantly see drive any to or X.XX% the X.XX%, X.XX%. of level yields net X to currently lower in Average We interest-bearing margin impact in X.XX% to margin elevated higher quarters. funding full the the coming the fourth to quarter catalyst XXXX, not while the For do X from stood cost

in a We their will expect than which of at lower first slightly maturing rates significant quarter we renew the rate. time deposits of current amount have XXXX,

lose the the third However, as the we quarter interest a will reminder, swap rate after of terminated of XXXX. benefit

benefit after interest continue income through from of quarter the to the interest will terminated quarters to $X which the cease. expect million We approximately X per realizing in swap income first XXXX,

time down XXXX, quarter. previous stability and from and the for the from was deposits. XX, checking, The closely which changes billion, reflect retail competitive December million driven interest-bearing $XX.X at deposit These growth. categories, we ensure decline multiple reductions deposits across to deposits, Total environment brokered were by monitor -- down $X.XX ongoing deposits including

Our and cash fill funding funding $X.XX totaling remains We future well access to $XXX.X strong. position address remain Federal and to liquidity reserve to cash through equivalents Loan additional in and With current the lines both needs. million and Home Bank billion. positioned

mature have maturities. We this they and to trend upcoming continue deposits brokered replaced expect for successfully as

deposits optimize time competitive. deposits as rising, rate were interest our higher to to We've rate actively cycle costs in we managed with the rate and remain long-term rates maturing funding lower time Earlier sources stability. support replaced

reflects important recent with in environment, time shift rate funding now are the us interest rate However, rates. reduce XXXX, in an deposits cuts with lower rate to overall costs. we higher replacing comparatively allowing This transition funding at maturing

have the in markets Federal cut Reserve's begun we -- XXXX, rates cost to rate deposit funding market decline anticipate which moving late ease somewhat forward. will following Time pressures

multifamily loan outstanding which increase growth construction net residential before, $X.XX $XXX and This in with year-over-year $XXX.X decrease over transition in mentioned in increasing construction strong $XXX.X X.X% driven including to to million total loans, a multifamily loans other primarily offset categories, projects billion by declines million or remained balances completion. As year-end. as growth loan million was at

construction, pipeline continued signaling Importantly, our loan particularly future in demand. quarter, expanded in the fourth

declined X.XX% $X.X before, Asset $X.X million quality previously but or XXXX. million year total year-end assets assets during nonperforming mentioned the to of somewhat at

little the the from credit million, for XXXX in we mentioned the $X.X $X.X levels We And for for were of for mentioned charge-off allowance bit year was the net year, a up then loans. already. the -- in and quarter And million X.XX% total XXXX. losses net charge-offs also

Foreclosed total asset foreclosed at for assets a single December real as of XXXX. little income expenses. the and more from million XXXX increased of on estate the asset $X real XXX% XX, A office estate noninterest bit accounted end balance

$XX.X totaled For year. the full the from prior unchanged year, million largely noninterest income

quarter, was decreased In year's $X.X sales gains loan partially million, by $XXX,XXX income by increased up and the compared other fourth net increase offset primarily on overdraft to prior noninterest fees. This the driven income, was quarter. fourth

for expenses million, were the with was consistent year On $XXX.X side, the which expense noninterest XXXX.

that fourth quarter, the million which million expenses noninterest $XX.X mentioned included expense was $X.X For the totaled previously.

in management areas. investment reflected cost item, and Excluding continued disciplined our operational that expenses and technology

rate. ended primarily company's due XX%, years rate and rates was 'XX and the utilization effective 'XX, rate effective the company's respectively. tax-exempt federal reduced XX, tax XX.X%, company's effective certain the loans, of These and statutory to and XX.X% investment the December were tax credits For which of the below the tax investments

credits and additional effective XXXX. future current combined primarily rate, to investment range portions tax company's due aforementioned began federal XX% in approximately that to in XX% is state we to from both the The periods, utilizing of tax expected

increased and equity $XX.X I'll declared perspective, dividends exercise option driven stockholders' by -- is partially total million equity, increase return. and XX% $XX.X in And net million income to assets. which year-end, with stock by million million adding cash million our capital stockholders' and million $XX.X by share cash at $XXX.X offset in $XX.X From repurchases. in represents to of primarily was our $XX.X a of This capital conclude

Our interest rate realized another losses decreased swaps $XX.X on investment securities stockholders' and in XXXX. million equity by

the at was year common tangible Our X.X%. of the end ratio equity

remarks. my this are At for questions. concludes we That time, ready now

Operator

line first today will Our be Liesch. Instructions] question Andrew the [Operator from coming of

Andrew Liesch

not a optimistic commentary it's to surprised rate Kind more funding. want little margin the and we that where of it's talk of of improvement saw just the couple you in CDs had that cuts, here. a Just on not given just cost

slightly could . benefit quarters maybe you next the bias do the be for swap before So rolls higher think the away? of couple

Rex Copeland

-- number. the said, really I big things going catalyst quarter that said a There's tremendously the couple from number we of with a I here, it. don't moving think like fourth see I know we on don't in

believe, probably a as we rate and should little those little of they a from loans the part for some reprice that do a volume higher maturities, will reprice it's benefit bit large have and will We a although bit of not lot we have most benefit, of reprice. CD should fixed

funding and not in the we whether It's a depend mix I or things that checking of runoff going and have any Andrew, think, nature. and lot, on to deposit noninterest-bearing

I've don't in I lot the a got frankly, big whole off but... that way, moving bias number a either know So

Andrew Liesch

this more quarter. what in accounts because savings it. improvement the for on some market accounts if nicely cuts there there's quarter like and and down curious came and guess the I locally with are Got I money market you with demand deposit any fourth interest-bearing in was seeing those last demand? rates competition

Joseph Turner

not mean, the other that from -- significantly some be it's fairly of that, remaining bit negotiated we the cuts some fairly I rate little, but there there's able that reduce. enough reduce those most banks market do to have in keeping reduce rates so across think Fed are markets able competitive. little higher. moving we done some to just We've each products little have and of been prudently be are of rates. our necessarily are normal -- the rates a may we not should think And And like a are every with or bit within additional bank to there, that I in but able they more rates. board, any additional rates a Absent our we I

been competition working dictating the of a rates that. have those We down little go of is some but a on slow kind bit,

Andrew Liesch

bonus Got for right. out on off a that $XX And question I point million million for helpful. around Is expenses here, or a jumping $X right quarter. then to if that you. in the just quick increases. look good and All That's the quarter take taxes first uptick second . merit maybe overall an the for some than right base? that seasonally and expense the at way accruals payroll the Is with quarter higher

Joseph Turner

the nothing called earnings that Yes. was we -- I release. else in in out there mean, that

reasonable. will also increase incentives year. then tax of of there's So that like have be normal on those beginning lot the an maybe a there that's we some we a of are But said, and and merit going And occur have annual -- things. to the I amount the lot matters of seasonal bonus fair people at think you be just a will -- payroll and

in flow as the there be quarter well. for things that some first So will will that

Operator

the DelMonte. Damon of [Operator be Instructions] question And coming our line from next will

Damon Del Monte

I hope well. you're all doing

it wanted was about loan I start little was unfunded Just growth. no off provision commitments. There to for this quarter, a for bit loans

of the So if the so? the could X next or you talk during little about quarters over how and a activity you that just see kind bit funding closing quarter wondering

Joseph Turner

about fund? talking unfunded how You're will the

Damon Del Monte

Yes. Yes, exactly.

Joseph Turner

$XX between generally, month. our million may think, $XX I unfunded be a funds million and

So so at but million there that fund, or of will close have to or be generally that we $XXX repayments it. level pretty will

a grow that XXXX. will necessarily So I don't know loan ton portfolio our in

we've is that little that, month, for at loans stuff we've recent of maybe a start while. that the pipeline that or more the won't least Joe, in But some may And at like the deals maybe more closed but clip or... quarters, some things of there couple recent every got stuff are X funding construction the funding they take

Rex Copeland

mean, like borrowers first. their equity I fund Yes. the have to

construction on most X we're takes our it maybe deals, on anything getting equity So equity enough borrowers funding months X that fund of we'll before their loan. to

Damon Del Monte

Got it.

Okay.

this So to 'XX over around had you least I I of you bit X% in X% you level that year, a last annualized net... at think guys do mean, growth. could -- mean get little

Joseph Turner

last year growth. think we about Yes. Damon, know, -- we to give mean don't that telling anything forward also as like in growth repayments will I we year. if -- and are people you aren't it where a that, there's loan you selling you I guidance portfolio this give . And projects or any I or loan as on big were don't in than different uptick But telling think depend refinancing projects things our things. just we early

So It on kind -- was how with as that before, they have of want guys people slow their in be right that. that. we of we you guys But know talked there now, But stuff something repayment if particularly view bit done I now. more XXXX, you like XXXX, any wasn't to get don't a on little depending that robust. for don't clarity right we mean may -- projects,

Damon Del Monte

you. Got

the to as kind circling And back then of far margin. as -- Okay.

mentioned, some kind pickup repricing . had the current what's would fixed between of the then fixed in rate levels? would on year. the Roughly, yields be way of be you that how loans Rex, course think I the about reprice much repricing? the those rate loans And during and of

Rex Copeland

don't that my breakdown really Some I on the a dollar off good of top be the repriced. of it will amount of head... have

Joseph Turner

and we know in well. do as it have I the the Damon, a that. And have do XX-K, Qs good table in on we

you're Okay, it's out a good of looking . for. not table in be it. what exactly should But there coming the beginning with March. at

Rex Copeland

repricing table year's want in coming if to there's each last there. you And at you tables, you of because a probably there's mostly the table a table look in to that X and repricing XX-K, look these years. reprice is what will maturity show at projected what is

Joseph Turner

sort it. the of on tells it reprice. will And what is you current rate estimate what and you . can

Rex Copeland

is it to and and will or be into reprice. a new rate back into put So funds that be loans loans, going either fixed some pay rate them loans. on those rate or stay off we'll variable it higher of will they'll the the just books Other their at them down take of pay put pieces and that

what be the where change hard would it's we those So tell to exactly funds. net place you depending rate on

is in think over -- say, overall X% be should its or something rate I the that it overall entirety on that would there. part, rate But for a probably I fixed portfolio is most little the

Joseph Turner

definitely should be positive. It

Operator

question the coming of line from And John will be Rodis. our next

John Rodis

most answered. up, Anything of my guess, side, asked But unusual questions line on I the item income the been other that fee . $XXX,XXX and $XXX,XXX, guess item? other just was I quarter. linked line in have

Joseph Turner

those Yes, wants cases, some those, had with of loan that. where an to some on a John, do a get upfront that do initiate and and have if I program we we we swap then customers. that the mentioned In we -- fee in think back-to-back we customer swaps that we there we do

about the was is lion's I fourth of the in And increase that so share $XXX,XXX, that believe. quarter

John Rodis

the I text see now. that in Okay.

that. about . Sorry

Joseph Turner

the all of part our something not a it's time. but business, that That's happens

John Rodis

Rex, the or more that Joe add color either X here can estate then to went property just that? other real you like Missouri anything any OREO, in market, And what

Joseph Turner

Yes. We've before, that covered haven't . we?

Rex Copeland

sure for if I but... can't have, remember we

Joseph Turner

it's Yes. office saying, in I Clayton. an property it's specifically mean well, in

a St. it. So And a Louis. not take strong, sell it's it's while strongest to in us decent to Clayton I office although going but little -- generally would property, think, the it's is probably John, is

John Rodis

Okay.

Have or Okay. not. yet probably you it marketed

Joseph Turner

trying around getting mean property flow huge fair not right figure now. the to I for arms Yes, it. out a to producing we're be best and we're the our to is hurry when time. going sell it. It's cash more market We're starting actually to us in

not at it's So problem all. a terrible

-- figuring it's right we're of little kind in should and trying So improve let this okay, out, a or the is to bit? strike we time wait things office

John Rodis

sense. market, it Clayton good right. you're No, makes Yes. a so is obviously

Operator

There the and are in ahead. call I Please go no go over back to Joseph to closing queue, turn questions would for and more Turner remarks. the like ahead

Joseph Turner

forward for to our much look first All quarter Thank out. come thanks very right. us, joining after we XXXX talking you results Well, and to you.

Operator

for conference Thank today's you joining call. all

now may disconnect. You

Great Southern Bancorp (GSBC) 22 Jan 252024 Q4 Earnings call transcript