Great Southern completes consolidation of 9 branches, cuts 66 jobs to reduce costs
Key Facts
Great Southern Bancorp announced it had completed the consolidation of 9 banking centers and eliminated 66 jobs, implementing a reorganization estimated to generate annual savings of $4.4 million to $4.8 million. The company confirmed in its third-quarter earnings release that the affected centers had been consolidated into nearby company locations, with implementation completed by October 1, 2026. The job cuts spanned various departments, including the banking centers affected by the consolidation, extending the cost reductions across the branch network and other divisions. The company had set out the savings range in its second-quarter earnings release as part of its estimates of the financial impact of the center consolidations and job cuts. In the release filed with the U.S. Securities and Exchange Commission, it said the estimate included "savings in compensation, facilities and other noninterest expenses." The reorganization thus moved from an announced plan to reduce those expenses to completed measures, with the expected financial benefit also dependent on the impact on deposits and funding.
The company warned in its third-quarter earnings release that the loss of some customer deposits associated with the branch closures would offset part of the expense savings. It linked this to the need for more expensive replacement funding, increasing interest expense and reducing the expected benefit of the cost cuts. Lower noninterest revenue generated by deposit accounts would add to that impact, according to the company. Great Southern described these two factors as "additional interest expense on alternative funding sources, along with lower noninterest income." The impact of the branch closures outlined by the company therefore includes lower operating costs, as well as the cost of replacing lost deposits and the revenue associated with those accounts.
Confirmation that the reorganization had been completed came as the company reported preliminary third-quarter net income of $14.0 million, compared with $17.8 million in the year-earlier period. Great Southern said results for the period were adversely affected by noncash cash flow hedge accounting adjustments. The company linked the adjustments to insufficient eligible loan balances to support the full designated notional amount of certain interest rate swaps. The shortfall in balances relates to historical periods, according to the bank's explanation of the adjustments affecting reported results. The release described the impact as stemming from "noncash cash flow hedge accounting adjustments," explaining one of the factors that weighed on third-quarter earnings.
Regarding its service network following the consolidation, Great Southern said it currently operates 78 retail banking centers. The consolidation retained service for the affected centers at nearby company locations, according to its description of the reorganization's implementation. Alongside the reduction in branches, its network of ATMs offering live teller service totaled 44 active machines. The company said these machines offer extended service hours as part of its banking service channels for customers. The network outlined in the earnings release reflects continued service through the remaining banking centers and machines equipped with live teller service following the consolidation.
The company had scheduled a conference call to discuss the results for October 22, 2026, at 2:00 p.m. U.S. Central Time. The announced date follows the earnings release confirming completion of the branch consolidations and job cuts. As for the reorganization's expected financial impact, the company projected an annual improvement in pretax income of $2.3 million to $2.7 million in its second-quarter earnings release. That estimate is below the expense savings range after accounting for deposit losses, replacement funding costs and lower deposit account revenue. The company identified the fourth quarter of 2026 as the start of the expected improvement in pretax income.