Great Southern Bancorp (NASDAQ:GSBC) executives told investors the company delivered higher earnings in the fourth quarter and full year of 2025, citing stable core operations, strong credit quality, and capital deployment that included share repurchases. Management also discussed ongoing loan and deposit competition, the impact of a terminated interest rate swap on interest income, and expectations for net interest margin and expenses as 2026 begins.
Fourth-quarter and full-year results
For the fourth quarter ended Dec. 31, 2025, Great Southern reported net income of $16.3 million, or $1.45 per diluted share, up from $14.9 million, or $1.27 per diluted share, in the year-ago quarter. Net income declined from $17.8 million, or $1.56 per diluted share, in the third quarter of 2025, Chief Financial Officer Rex Copeland said.
Net interest income, margin, and the terminated swap
Net interest income for the fourth quarter was $49.2 million, down $371,000 from the prior-year quarter and down from $50.8 million in the third quarter. Executives attributed the year-over-year decline primarily to the discontinuation of income from a previously terminated interest rate swap, which management said had provided roughly $2 million in quarterly income prior to the fourth quarter.
Interest income fell to $73.4 million from $82.6 million a year earlier, with Copeland citing the swap impact, lower average loan balances, and lower average market interest rates versus the prior-year period. Interest expense totaled $24.3 million, and management said funding costs declined as deposit and borrowing costs moderated. Copeland also noted the company repaid $75 million of subordinated debt in June 2025, contributing to $1.1 million less interest expense in the fourth quarter compared with the year-ago quarter.
Despite the loss of swap income, executives highlighted net interest margin expansion. Great Southern posted an annualized net interest margin of 3.70% in the fourth quarter of 2025, up from 3.49% in the year-ago quarter.
In the Q&A session, management said margin performance in the fourth quarter was helped by lower funding costs and by loan cash flows being redeployed into comparatively higher-rate loans as certain lower-rate loans paid off or renewed. Looking into 2026, executives said they did not expect meaningful additional improvement in deposit costs without Federal Reserve action, noting that most deposits reprice quickly and that any further repricing in core CDs would likely be limited. They also said that, while they do not provide formal guidance, they did not see factors that would make the margin “a whole lot different” than the fourth quarter level.
Loans and deposits: payoffs, pipelines, and competitive pricing
Great Southern ended 2025 with total assets of $5.60 billion, down from $5.98 billion at the end of 2024. Total net loans (excluding mortgage loans held for sale) were $4.36 billion at Dec. 31, 2025, down from $4.69 billion a year earlier. Management cited declines in categories including multifamily residential, commercial construction, one- to four-family residential, and commercial business loans, with executives attributing the decline primarily to elevated payoff activity as capital markets eased during the year.
Executives said loan production remained active and that the pipeline of unfunded commitments was “solid,” with the largest portion tied to the unfunded components of booked construction loans. Still, management emphasized it was maintaining a conservative underwriting posture focused on pricing and structure.
When asked about the outlook for loan growth in 2026, executives described it as “still going to be a challenging” environment, driven largely by the difficulty of forecasting payoffs. They noted that borrower decisions—such as refinancing with other lenders or selling properties—can drive the timing and magnitude of repayments, particularly within the company’s multifamily portfolio.
On the funding side, total deposits ended the year at $4.48 billion, down $122.8 million, or 2.7%, compared with Dec. 31, 2024. Management said the decline was primarily tied to brokered deposits (down about $109 million) and retail time deposits (down $87 million), partially offset by an increase of roughly $75 million in interest-bearing checking accounts. Copeland said the company estimated uninsured deposits, excluding consolidated subsidiary accounts, at approximately $720 million, or about 16.1% of total deposits.
Credit quality, expenses, capital, and shareholder returns
Management repeatedly pointed to credit quality as a key strength. Non-performing assets totaled $8.1 million at quarter-end, representing 0.15% of total assets. The company reported net recoveries of $22,000 in the fourth quarter, compared with net charge-offs of $155,000 in the year-ago quarter. For the full year 2025, Great Southern recorded net recoveries of $11,000. Executives said no provision for credit losses was recorded on outstanding loans in the fourth quarter of 2025, and none was recorded for the full year 2025, compared with a $1.7 million provision in 2024.
However, Copeland said the company recorded a $882,000 provision for unfunded commitments in the fourth quarter of 2025, down from $1.6 million in the fourth quarter of 2024, citing increased unfunded commitment balances.
Non-interest income in the fourth quarter was $7.2 million, up from $6.9 million a year earlier, driven primarily by a $289,000 increase in late charges and loan fees tied to the early payoff of “primarily one” commercial real estate loan.
Non-interest expense totaled $36.0 million, down from $36.9 million a year earlier. Executives said the year-over-year decline largely reflected the absence of a $2 million charge in the year-ago quarter related to a settlement of a contract matter. The company also saw higher net occupancy and equipment expense, which management attributed to items such as higher computer license and support costs related to core systems and disaster recovery enhancements, charges associated with branch closures and lease facility asset adjustments, seasonal snow removal, and real estate tax adjustments. The efficiency ratio was 63.89% in the fourth quarter, compared with 65.43% in the year-ago quarter.
During Q&A, executives said expenses could rise from fourth-quarter levels as the year resets, citing annual employee increases and payroll tax resets early in the year.
Liquidity and capital levels were described as strong. The company ended the year with $189.6 million in cash and cash equivalents and access to approximately $1.63 billion of additional borrowing capacity through the Home Loan Bank and the Federal Reserve Bank.
Stockholders’ equity was $636.1 million at year-end, up from $599.6 million at the end of 2024. Book value per share was $57.50, and tangible common equity increased to 11.2% from 9.9% a year earlier, which management attributed to retained earnings and improved market valuations in the securities portfolio. Copeland said the equity increase also reflected improvements in unrealized losses on investment securities and interest rate swaps, along with stock option exercises, partially offset by dividends and share repurchases.
Great Southern repurchased 241,000 shares in the fourth quarter at an average price of $59.33. For the full year, it repurchased 755,000 shares at an average price of $58.35. The board also declared a quarterly cash dividend of $0.43 per share for the fourth quarter, and total regular dividends for 2025 were $1.66 per share.
In discussing the buyback, executives said they viewed the stock price as attractive relative to book value and characterized repurchases as a good use of capital “particularly while we’re not growing a lot.”
About Great Southern Bancorp (NASDAQ:GSBC)
Great Southern Bancorp, Inc (NASDAQ: GSBC) is the bank holding company for Great Southern Bank, a full-service commercial bank headquartered in Springfield, Missouri. Through its subsidiary, the company provides a broad spectrum of financial products and services designed to meet the needs of individuals, small and mid-sized businesses, and professional clients across its regional footprint.
Great Southern Bank’s core business activities include deposit-taking, lending and treasury management.
