8-K: Great Southern Bancorp Posts Strong Q4, Full-Year 2025 Earnings

Great Southern Bancorp, Inc. reported preliminary fourth quarter and full-year 2025 earnings per diluted common share of $1.45 and $6.19, respectively, reflecting significant growth and improved asset quality.

Summary

• Preliminary earnings for the three months ended December 31, 2025, were $1.45 per diluted common share ($16.3 million net income), compared to $1.27 per diluted common share ($14.9 million net income) for the three months ended December 31, 2024.
• Full-year preliminary earnings for 2025 were $6.19 per diluted common share ($71.0 million net income), compared to $5.26 per diluted common share ($61.8 million net income) for 2024.
• Annualized net interest margin expanded to 3.70% in Q4 2025 from 3.49% in Q4 2024, and to 3.67% for the full year 2025 from 3.42% in 2024.
• Non-performing assets decreased by $1.5 million to $8.1 million (0.15% of total assets) at December 31, 2025, from $9.6 million (0.16% of total assets) at December 31, 2024.
• Total net loans decreased by $333.5 million, or 7.1%, to $4.36 billion at December 31, 2025, primarily due to decreases in other residential (multi-family) loans, construction loans, oneto four-family residential loans, and commercial business loans.
• Total deposits decreased by $122.8 million during 2025, with brokered deposits decreasing by $108.7 million and retail time deposits by $87.3 million in Q4 2025.
• The company repurchased 755,759 shares of its common stock at an average price of $58.35 during 2025, with 241,301 shares repurchased in Q4 2025 at an average price of $59.33.

Sentiment

Score: 8

Explanation: The company demonstrated strong earnings growth, significant net interest margin expansion, and improved asset quality metrics for both the quarter and full year 2025. While loan and deposit balances declined, management's disciplined approach to expense control and capital management, including share repurchases, contributed to robust profitability and a strong capital position. The non-recurrence of a prior litigation expense also boosted Q4 results. The outlook, while cautious about economic volatility, emphasizes continued strategic investment and value delivery.

Positives

• Q4 2025 diluted EPS increased 14.2% to $1.45 from $1.27 in Q4 2024.
• Full-year 2025 diluted EPS increased 17.7% to $6.19 from $5.26 in 2024.
• Net interest margin expanded to 3.70% in Q4 2025 (from 3.49% in Q4 2024) and to 3.67% for the full year 2025 (from 3.42% in 2024).
• Non-interest expense decreased by $947,000 to $36.0 million in Q4 2025, largely due to the non-recurrence of a $2.0 million litigation expense from Q4 2024.
• Asset quality improved, with non-performing assets decreasing by $1.5 million to $8.1 million (0.15% of total assets) at year-end 2025.
• Net charge-offs were negligible for both Q4 and the full year 2025, with net recoveries of $22,000 in Q4 2025.
• The company did not record a provision for credit losses on loans during 2025.
• Capital position remained strong, with stockholders' equity increasing by $36.6 million to $636.1 million, and the tangible common equity ratio improving to 11.2% from 9.9% at December 31, 2024.
• Share repurchases totaling 755,759 shares in 2025 and a regular quarterly cash dividend of $0.43 per common share demonstrate disciplined capital management and shareholder returns.

Negatives

• Net interest income decreased by $371,000 (0.7%) to $49.2 million in Q4 2025 compared to Q4 2024, primarily due to the completion of interest income recognition from a terminated interest rate swap.
• Total net loans decreased by $333.5 million (7.1%) to $4.36 billion at December 31, 2025, driven by significant loan repayments in multi-family, construction, one-to-four family residential, and commercial business portfolios.
• Total deposits decreased by $122.8 million during 2025, with brokered deposits decreasing by $108.7 million and retail time deposits by $87.3 million in Q4 2025.
• Net occupancy and equipment expenses increased by $1.2 million (13.9%) in Q4 2025, partly due to computer system upgrades, branch closure adjustments ($287,000), and seasonal expenses ($219,000).
• The company no longer benefits from the interest income generated by the previously-terminated interest rate swap, which contributed $2.047 million in Q4 2024 but only $134,000 in Q4 2025.

Risks

• Expected revenues, cost savings, earnings accretion, synergies, and other benefits from merger and acquisition activities might not be realized within anticipated time frames or at all, and integration costs or difficulties might be greater than expected.
• Changes in economic conditions, either nationally or in the company's market areas, could adversely affect financial performance.
• Fluctuations in interest rates, the effects of inflation, or a potential recession, whether caused by Federal Reserve actions or otherwise, pose risks.
• The impact of bank failures or adverse developments at other banks and related negative press about the banking industry in general could affect investor and depositor sentiment.
• Slower or negative economic growth caused by tariffs, changes in energy prices, supply chain disruptions, or other factors could occur.
• 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 credit losses.
• The possibility of realized or unrealized losses on securities held in the company's investment portfolio.
• The company's ability to access cost-effective funding and maintain sufficient liquidity.
• Fluctuations in real estate values and both residential and commercial real estate market conditions.
• The ability to adapt successfully to technological changes to meet customers' needs and developments in the marketplace.
• The possibility that security measures implemented might not be sufficient to mitigate the risk of a cyber-attack or cyber theft, and that such security measures might not protect against systems failures or interruptions.
• Legislative or regulatory changes that adversely affect the company's business.
• Changes in accounting policies and practices or accounting standards.
• Results of examinations by regulators, including the possibility that regulators may require the company to limit business activities, change its business mix, increase its allowance for credit losses, write-down assets, or increase capital levels, or affect its ability to borrow funds or maintain or increase deposits.
• Costs and effects of litigation, including settlements and judgments.
• Competition from other financial institutions.
• Natural disasters, war, terrorist activities, or civil unrest and their effects on economic and business environments.
• If challenging economic conditions persist or worsen, or if management's assessment of the loan portfolio changes, additional provisions for credit losses may be required, which could adversely impact the company's future financial performance.

Future Outlook

The company expects to continue investing in technology in 2026. Management anticipates its effective tax rate (combined federal and state) will be approximately 18.5% to 19.5% in future periods. Despite potential fluctuations in economic conditions and market interest rates, the company believes its conservative approach, sound balance sheet, and dedicated associates position it to continue delivering long-term value for stockholders.

Management Comments

• "Our fourth quarter and full year 2025 results reflect the sustained success of our core banking operations and our commitment to long-term tangible book value appreciation, despite a volatile economic environment."
• "Throughout the year, we remained focused on preserving net interest margin, protecting credit quality, controlling non-interest expense, and opportunistically repurchasing our stock."
• "Core performance remained solid during the quarter, supported by resilient net interest income, a steady net interest margin, continued moderation in funding costs, and disciplined asset-liability management."
• "Despite lower interest income, effective management of funding costs reduced interest expense and mostly offset the decrease in interest income."
• "Core deposits remained stable during the quarter, underscoring the strength of our customer relationships and the enduring value of our community banking franchise."
• "Loan production remained active during the quarter, though total net loans declined modestly due to heightened paydown and refinancing activity."
• "While we continue to be selective with loan originations, our pipeline of unfunded commitments remained solid, particularly within construction and commercial real estate lending."
• "Our credit discipline, emphasis on relationship-based lending, and conservative underwriting standards remain evident in our excellent asset quality metrics."
• "Non-performing assets were 0.15% of total assets at year-end 2025, and net charge-offs were negligible for both the fourth quarter and the full year. We did not record a provision for credit losses on loans during 2025."
• "Operating discipline remained a priority in the fourth quarter. Non-interest expense totaled approximately $36.0 million, in line with the prior-year quarter and the third quarter of 2025."
• "As we begin 2026, we remain focused on maintaining strong capital and liquidity positions, deploying capital thoughtfully, maintaining strong credit metrics, and supporting our customers and communities."
• "While economic conditions and market interest rate levels may fluctuate throughout 2026, we believe our conservative approach, sound balance sheet, and dedicated associates position Great Southern to continue delivering long-term value for our stockholders."

Industry Context

The banking industry is navigating a volatile economic environment characterized by fluctuating interest rates, with the Federal Reserve implementing rate cuts totaling 75 basis points in Q3 and Q4 2025. This has led to a decline in market interest rates, impacting loan yields and funding costs. Regional banks like Great Southern Bancorp are focusing on core banking operations, disciplined asset-liability management, and strategic investments in technology to enhance efficiency and customer experience amidst these conditions. The company's ability to expand net interest margin and maintain strong asset quality despite declining loan balances and deposits reflects a prudent approach in a competitive landscape.

Comparison to Industry Standards

• The filing does not provide specific comparable companies, projects, or results for direct industry comparison.
• Management's focus on "preserving net interest margin, protecting credit quality, controlling non-interest expense, and opportunistically repurchasing our stock" aligns with prudent banking strategies in a volatile economic environment.
• The net interest margin of 3.70% in Q4 2025 and strong asset quality metrics, with non-performing assets at 0.15% of total assets, suggest solid performance relative to general banking sector challenges, particularly given declining market interest rates.
• The tangible common equity ratio of 11.2% indicates a robust capital position, exceeding regulatory "well-capitalized" thresholds, which is a positive indicator of financial health compared to industry standards.

Corporate Governance

Legal Proceedings

• In Q4 2024, the company expensed $2.0 million due to developments related to a litigation/contract dispute matter, which did not recur in Q4 2025. No new litigation is mentioned.

Stakeholder Impact

• Shareholders: Positive impact through increased earnings, higher diluted EPS, expanded net interest margin, improved return on equity, share repurchases, and consistent cash dividends.
• Customers: Potential for improved online services and banking experience due to technology investments and new banking center designs. Some customers may be affected by branch consolidations.
• Employees: Strategic investment in personnel is mentioned, suggesting continued support and development.
• Creditors/Depositors: Strong capital and liquidity positions, along with improved asset quality, enhance the safety and soundness of the institution.

Next Steps

• Continue investing in technology in 2026.
• Transition the banking center at 4700 Mid Rivers Mall Dr. in Cottleville, Mo., to a drive-thru Express Center in Spring 2026.
• Consolidate operations of the Edina, Minn., banking center with the Lakeville, Minn., banking center at the end of January 2026.
• Host a conference call on Thursday, January 22, 2026, at 2:00 p.m. Central Time to discuss fourth quarter 2025 preliminary earnings.

Key Dates

Recommendation

Great Southern Bancorp delivered strong preliminary Q4 and full-year 2025 results, showcasing significant earnings growth, robust net interest margin expansion, and excellent asset quality. The company's disciplined approach to expense management, particularly the non-recurrence of a prior litigation expense, contributed to improved profitability. Despite a decline in total loans and deposits, management's strategic capital deployment through share repurchases and consistent dividends signals confidence and commitment to shareholder value. The strong capital ratios and proactive liquidity management position the company well to navigate a volatile economic environment. These factors, combined with ongoing technology investments, suggest a positive trajectory for long-term value creation.

Keywords

Great Southern Bancorp, GSBC, Bank Earnings, Financial Results, Net Interest Margin, Asset Quality, Loan Portfolio, Deposits, Capital Ratios, Share Repurchase, Banking Industry, SEC Filing, Q4 2025 Earnings, Full Year 2025