Note 24: Regulatory Matters

12 Months Ended

Dec. 31, 2017

Notes

Note 24: Regulatory Matters

Note 24:    Regulatory Matters

The Company and the Bank are subject to various regulatory capital requirements administered by the federal banking agencies.  Failure to meet minimum capital requirements can result in certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct and material effect on the Company’s financial statements.  Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of the Company’s and the Bank’s assets, liabilities and certain off-balance-sheet items as calculated under U.S. GAAP, regulatory reporting practices, and regulatory capital standards.  The Company’s and the Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulatory reporting standards to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below as of December 31, 2017) of Total and Tier I Capital (as defined) to risk-weighted assets (as defined), of Tier I Capital (as defined) to adjusted tangible assets (as defined) and of Common Equity Tier 1 Capital (as defined) to risk-weighted assets (as defined).  Management believes, as of December 31, 2017, that the Bank met all capital adequacy requirements to which it was then subject.

As of December 31, 2017, the most recent notification from the Bank’s regulators categorized the Bank as well capitalized under the regulatory framework for prompt corrective action.  To be categorized as well capitalized as of December 31, 2017, the Bank must have maintained minimum Total capital, Tier I capital, Tier 1 Leverage capital and Common Equity Tier 1 capital ratios as set forth in the table.  There are no conditions or events since that notification that management believes have changed the Bank’s category.

The Company and the Bank are subject to certain restrictions on the amount of dividends that may be declared without prior regulatory approval.  At December 31, 2017 and 2016, the Company and the Bank exceeded their minimum capital requirements then in effect.  The entities may not pay dividends which would reduce capital below the minimum requirements shown above. In addition to the minimum capital ratios, the new capital rules include a capital conservation buffer, under which a banking organization must have CET1 more than 2.5% above each of its minimum risk-based capital ratios in order to avoid restrictions on paying dividends, repurchasing shares, and paying certain discretionary bonuses, phased in at an additional 0.625% per year beginning January 1, 2016.  The net unrealized gain or loss on available-for-sale securities is not included in computing regulatory capital. 

The Company’s and the Bank’s actual capital amounts and ratios are presented in the following table.  No amount was deducted from capital for interest-rate risk.

					To Be Well
					Capitalized Under
			For Capital		Prompt Corrective
	Actual		Adequacy Purposes		Action Provisions
	Amount	Ratio	Amount	Ratio	Amount	Ratio
	(Dollars In Thousands)
As of December 31, 2017
Total capital
Great Southern Bancorp, Inc.	$597,177	14.1%	$339,649	8.0%	N/A	N/A
Great Southern Bank	$558,668	13.2%	$339,575	8.0%	$424,468	10.0%
Tier I capital
Great Southern Bancorp, Inc.	$485,685	11.4%	$254,737	6.0%	N/A	N/A
Great Southern Bank	$522,176	12.3%	$254,681	6.0%	$339,575	8.0%
Tier I leverage capital
Great Southern Bancorp, Inc.	$485,685	10.9%	$177,881	4.0%	N/A	N/A
Great Southern Bank	$522,176	11.7%	$177,844	4.0%	$222,305	5.0%
Common equity Tier I capital
Great Southern Bancorp, Inc.	$460,661	10.9%	$191,053	4.5%	N/A	N/A
Great Southern Bank	$522,152	12.3%	$191,011	4.5%	$275,904	6.5%
As of December 31, 2016
Total capital
Great Southern Bancorp, Inc.	$556,106	13.6%	$327,610	8.0%	N/A	N/A
Great Southern Bank	$520,989	12.7%	$327,505	8.0%	$409,382	10.0%
Tier I capital
Great Southern Bancorp, Inc.	$443,706	10.8%	$245,707	6.0%	N/A	N/A
Great Southern Bank	$483,589	11.8%	$245,629	6.0%	$327,505	8.0%
Tier I leverage capital
Great Southern Bancorp, Inc.	$443,706	9.9%	$178,693	4.0%	N/A	N/A
Great Southern Bank	$483,589	10.8%	$178,643	4.0%	$223,304	5.0%
Common equity Tier I capital
Great Southern Bancorp, Inc.	$418,687	10.2%	$184,280	4.5%	N/A	N/A
Great Southern Bank	$483,569	11.8%	$184,222	4.5%	$266,098	6.5%