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Missouri-based Great Southern terminates another loss-share agreement with FDIC

Springfield, Mo.-based Great Southern Bancorp Inc. unit Great Southern Bank terminated its existing loss-share agreements with the Federal Deposit Insurance Corp. over the FDIC-assisted transaction for the failed Maple Grove, Minn.-based Inter Savings Bank FSB.

The bank entered into these loss-share agreements in 2012 in conjunction with its acquisition of certain assets and assumption of all deposits of the failed bank.

Pursuant to the termination agreement, the FDIC will pay $15.0 million to the bank to settle all outstanding items related to the terminated loss sharing agreements. As a result, assets that were covered by the terminated loss sharing agreements, including covered loans of $138.8 million and covered other real estate owned of $2.9 million as of March 31, have been reclassified as noncovered assets as of June 9.

Great Southern Bancorp expects to realize a one-time, after-tax gain of approximately 35 cents per diluted common share, inclusive of the write-off of the remaining indemnification asset, other receivables from the FDIC and the bank's clawback liability due to the regulator.

As of June 9, the company had discounts related to the loan pools totaling approximately $14.0 million which are available to absorb charge-offs. Future charge-offs exceeding that aggregate amount would impact the company's allowance for loan losses.

The agreement is the bank's last with the FDIC — Great Southern Bank terminated its loss-share agreements for three other FDIC-assisted transactions in April 2016.