Great Southern Bancorp, Inc.

Good day, ladies and gentlemen, and welcome to the Grace Southern Bancorp, Inc. Fourth Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. Following management's prepared remarks, we will host a question-and-answer session, and our instructions will be given at that time. If during your conference days you require operator assistance, please press star then zero, and our operator will be happy to assist you. As a reminder, this conference call may be recorded for replay purposes. It is now my pleasure to hand the conference to Mr. Kelly Polonis, Investor Relations. Ma'am, you may begin.

Thank you, Brian. Good afternoon and welcome. This is Kelly Colonis, Investor Relations for Great Southern. The purpose of this call is to discuss the company's results for the quarter ending December 31st, 2018. Before we begin, I need to remind you that during the course of this call, we may make forward-looking statements about future events and future financial performance. You should not place undue reliance on any forward-looking statements which speak only as of the date they are made. These statements are subject to a number of factors that could cause actual results to differ materially from the results anticipated or projected. For a list of some of these factors, please see the forward-looking statements disclosure in our fourth quarter 2018 earnings release. President and CEO Joe Turner and Chief Financial Officer Rex Copeland are here with me. I'll turn the call over to Joe Turner.

Thanks, Kelly. Good afternoon, everybody. and I also want to thank you for joining our earnings call this afternoon. As usual, I'll provide some preliminary remarks and then Rex will go into the release in a little more detail. Hopefully, you've had a chance to review the release. If you have, you've seen that we had a very solid quarter and year for that matter. During the fourth quarter, we earned $17.3 million or $1.21 per share. For the fourth quarter, our return on average common equity was 13.34%. Our annualized return on assets was 1.5%, and our margin was 4.07%. We did earn about almost $700,000 during the quarter from income on an interest rate swap that was entered into in October, net fees associated with one-time fees associated with entering into that swap. That added about a penny and a half to our earnings. We continue to feel very positive about the loan portfolio, both in terms of production and in terms of quality. Our loans grew $46 million during the quarter, $263 million during the year. In spite of $42 million of paydowns in the acquired loan portfolio, and I think like $106 million of paydowns in the consumer portfolio as we continue to see that portfolio pay down. Really good healthy loan growth, great commercial loan origination volume, $1.35 billion of new originations across our footprint. Atlanta and Denver offices were open during the quarter. and they're of course staffed by industry veterans and we're excited to see what they'll do in 2019. Our loan pipeline continues to be good, up about $140 million from the end of the year. Importantly, closed construction loans were up $204 million from the end of the year and up about $78 million from the end of the third quarter. and so forth. Asset quality continues to improve as well. Coming out very good numbers in the third quarter. Non-performers actually reduced by about $4 million to $11.8 million. I think at this point we're something less than one quarter or 1% non-performer ratio to assets. We feel very good about where that is. – common stockholders' equity grew $60 million during the year. Of course, almost – not quite $10 million of that relates to mark-to-market gain on the swap that I mentioned earlier, but even without that, our common stockholders' equity grew $50 million. Our book value per share increased from 33.48 to 37.59. Our ratio of tangible common equity to tangible assets is 11.2%. And we were calculating earlier today, even if you were to net the $9 million of mark-to-market gain-off and the approximate $10.5 million that we're going to pay for the special dividend that we announced earlier today, we'd still be 10.7% or 10.8% tangible common equity ratio. So a very strong capital position. We did repurchase 17,542 shares of stock during the quarter at an average price of $51.52. As I mentioned, we probably more importantly just announced our intent to pay a special dividend of $0.75 a share. I think this underscores our commitment to return value to shareholders. That concludes my prepared remarks. I'll turn the call over to Rex Copeland at this time.