YOUR BUSINESS AUTHORITY
Springfield, MO
YOUR BUSINESS AUTHORITY
Springfield, MO
For the year ended Dec. 31, Great Southern Bancorp, the holding company for Great Southern Bank, declared preliminary earnings of $1.63 per share, or $22.7 million, compared to 2004 earnings of $1.89 per share.
Net interest income for the fourth quarter increased $2.6 million to $16 million, up from $13.4 million for the fourth quarter in 2004. Noninterest income was $58.4 million, up by $8.6 million from last year.
The company's reported earnings include the effects of an accounting restatement, also issued today.
Great Southern, along with a number of other financial institutions, is restating financial reports because of a change in interpretation of derivative accounting rules. In a noncash correction, the company will restate its three quarterly reports for 2005 and financial statements from the last four years when it files its annual report in March.
“It is important to understand that this is an issue that relates to matters of documentation and technical and evolving interpretations of complex accounting standards rather than how these hedges were created or managed,” said Rex Copeland, Great Southern chief financial officer, in a news release. Since mid-2000, Great Southern has entered into interest rate swap agreements to hedge the interest rate risk of its brokered certificates of deposit.
The change results in a reduction to retained earnings amounting to about $3.4 million, or 2 percent of stockholder's equity, though Great Southern President and CEO Joseph W. Turner said he expects long-term consequences to be minimal.
“The losses recognized in this correction are not permanent - they are expected to flow back into income in future periods as the interest rate swaps mature,” Turner said in a news release.
Excluding current year effects of Great Southern's accounting restatement, earnings per diluted share for the fourth quarter were 52 cents, compared to 49 cents in fourth-quarter 2004.
Great Southern has 34 branches in southwest and central Missouri and has assets of $2 billion. Shares of company stock (Nasdaq: GSBC) closed Jan. 20 at $28.97, compared to a 52-week range of $26.32 to $36.80.
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