1 unchanged sentence
Asset and Liability Management and Market Risk
−Removed: A principal operating objective of the Company is to produce a stable component of earnings by achieving a favorable interest rate spread that can be sustained during fluctuations in prevailing interest rates.
+Added: A principal operating objective of the Company is to produce stable earnings by achieving a favorable interest rate spread that can be sustained during fluctuations in prevailing interest rates.
The Company has sought to reduce its exposure to adverse changes in interest rates by attempting to achieve a closer match between the periods in which its interest-bearing liabilities and interest-earning assets can be expected to reprice through the origination of adjustable-rate mortgages and loans with shorter terms to maturity and the purchase of other shorter term interest-earning assets.
9 unchanged sentences
Interest rate sensitivity is a measure of the difference between amounts of interest-earning assets and interest-bearing liabilities which either reprice or mature within a given period of time.
−Removed: The difference, or the interest rate repricing "gap,"
−Removed: provides an indication of the extent to which an institution's interest rate spread will be affected by changes in interest rates.
+Added: The difference, or the interest rate repricing “gap,” provides an indication of the extent to which an institution’s interest rate spread will be affected by changes in interest rates.
A gap is considered positive when the amount of interest-rate sensitive assets exceeds the amount of interest-rate sensitive liabilities repricing during the same period, and is considered negative when the amount of interest-rate sensitive liabilities exceeds the amount of interest-rate sensitive assets during the same period.
1 unchanged sentence
During a period of falling interest rates, the opposite would be true.
−Removed: As of September 30, 2020, Great Southern's interest rate risk models indicate that, generally, rising interest rates are expected to have a positive impact on the Company's net interest income, while declining interest rates are expected to have a negative impact on net interest income.
+Added: As of March 31, 2021, Great Southern’s interest rate risk models indicate that, generally, rising interest rates are expected to have a positive impact on the Company’s net interest income, while declining interest rates are expected to have a negative impact on net interest income.
We model various interest rate scenarios for rising and falling rates, including both parallel and non-parallel shifts in rates.
2 unchanged sentences
In the subsequent months we expect that the net interest margin would stabilize and begin to improve, as renewal interest rates on maturing time deposits are expected to decrease compared to the current rates paid on those products.
−Removed: Subsequent to September 30, 2020, cumulative time deposit maturities are as follows:
+Added: Subsequent to March 31, 2021, cumulative time deposit maturities are as follows:
within three months --$339 million;
within six months -- $619 million;
−Removed: and within twelve months -- $1.2 billion.
−Removed: At September 30, 2020, the weighted average interest rates on these various cumulative maturities were 1.22%, 1.24% and 1.14%, respectively.
+Added: and within twelve months -- $941 million.
+Added: At March 31, 2021, the weighted average interest rates on these various cumulative maturities were 0.78%, 0.79% and 0.78%, respectively.
The current level and shape of the interest rate yield curve poses challenges for interest rate risk management.
2 unchanged sentences
The FRB also implemented rate change increases of 0.25% on eight additional occasions beginning December 14, 2016 and through December 31, 2018, with the Federal Funds rate reaching as high as 2.50%.
−Removed: After December 2018, the FRB paused its rate increases and, in July, September and
−Removed: October 2019, implemented rate decreases of 0.25% on each of those occasions.
+Added: After December 2018, the FRB paused its rate increases and, in July, September and October 2019, implemented rate decreases of 0.25% on each of those occasions.
At December 31, 2019, the Federal Funds rate stood at 1.75%.
−Removed: In response to the COVID-19 pandemic in the first quarter of 2020, the FRB decreased interest rates on two occasions in March 2020, a 0.50% decrease on March 3rd and a 1.00% decrease on March 16th.
−Removed: At September 30, 2020, the Federal Funds rate stood at 0.25%.
−Removed: A substantial portion of Great Southern’s loan portfolio ($2.10 billion at September 30 , 2020 ) is tied to the one-month or three-month LIBOR index and will be subject to adjustment at least once within 90 days after September 30, 2020 .
+Added: In response to the COVID-19 pandemic, the FRB decreased interest rates on two occasions in March 2020, a 0.50% decrease on March 3rd and a 1.00% decrease on March 16th.
+Added: At March 31, 2021, the Federal Funds rate stood at 0.25%.
+Added: A substantial portion of Great Southern’s loan portfolio ($2.00 billion at March 31, 2021) is tied to the one-month or three-month LIBOR index and will be subject to adjustment at least once within 90 days after March 31, 2021.
Of these loans, $1.97 billion had interest rate floors.
−Removed: Great Southern also has a portfolio of loans ($256 million at September 30 , 2020 ) tied to a "prime rate"
−Removed: of interest and will adjust immediately with changes to the “prime rate” of interest.
−Removed: During the latter half of 2019 and the nine months ended September 30, 2020, we experienced some compression of our net interest margin percentage due to 2.25% of Federal Fund rate cuts over that time period.
+Added: Great Southern also has a portfolio of loans ($246 million at March 31,
+Added: 2021) tied to a “prime rate” of interest and will adjust immediately with changes to the “prime rate” of interest.
+Added: During 2020, we experienced some compression of our net interest margin due to 2.25% of Federal Fund rate cuts.
Margin compression primarily resulted from generally slower changing average interest rates on deposits and borrowings and lower yields on loans and other interest-earning assets.
−Removed: LIBOR interest rates decreased further in April and May of 2020, putting pressure on loan yields during the three months ended June 30, 2020 and September 30, 2020, and strong pricing competition for loans and deposits remains in most of our markets.
+Added: LIBOR interest rates decreased further in April and May of 2020, putting pressure on loan yields during most of 2020 and into 2021, and strong pricing competition for loans and deposits remains in most of our markets.
Interest rate risk exposure estimates (the sensitivity gap) are not exact measures of an institution’s actual interest rate risk.
22 unchanged sentences
The notional amount of the swap was $400 million with a contractual termination date of October 6, 2025.
−Removed: Under the terms of the swap, the Company received a fixed rate of interest of 3.018% and paid a floating rate of interest equal to one-month USD-LIBOR.
+Added: Under the terms of the swap, the Company received a fixed rate of interest of 3.018% and paid a floating rate of
+Added: interest equal to one-month USD-LIBOR.
The floating rate reset monthly and net settlements of interest due to/from the counterparty also occurred monthly.
7 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.