10 unchanged sentences
In an attempt to manage our exposure to changes in interest rates and comply with applicable regulations, we monitor Great Southern’s interest rate risk.
−Removed: In monitoring interest rate risk, we regularly analyze and manage assets and liabilities based on their
−Removed: payment streams and interest rates, the timing of their maturities and their sensitivity to actual or potential changes in market interest rates.
+Added: In monitoring interest rate risk, we regularly analyze and manage assets and liabilities based on their payment streams and interest rates, the timing of their maturities and their sensitivity to actual or potential changes in market interest rates.
The ability to maximize net interest income is largely dependent upon the achievement of a positive interest rate spread that can be sustained despite fluctuations in prevailing interest rates.
4 unchanged sentences
During a period of falling interest rates, the opposite would be true.
−Removed: As of June 30, 2024, Great Southern’s interest rate risk models indicate that, generally, rising interest rates are expected to have a modestly positive impact on the Company’s net interest income, while declining interest rates are expected to have a modestly negative impact on net interest income.
−Removed: The negative impact of a falling Federal Funds rate and other market interest rates also falling could be more pronounced if we are not able to decrease non-maturity deposit rates accordingly.
+Added: As of September 30, 2024, Great Southern’s interest rate risk models indicated that, generally, rising interest rates are expected to have a modestly positive impact on the Company’s net interest income, while declining interest rates are expected to have a mostly neutral impact on net interest income.
+Added: Any negative impact of a falling Federal Funds rate and other market interest rates also falling could be more pronounced if we are not able to decrease non-maturity deposit rates accordingly.
We model various interest rate scenarios for rising and falling rates, including both parallel and non-parallel shifts in rates.
6 unchanged sentences
LIBOR/SOFR interest rates decreased significantly in 2020 and remained very low in 2021 and into the first three months of 2022, putting pressure on loan yields, and strong pricing competition for loans and deposits remained in most of our markets.
−Removed: Since March 2022, market interest rates have increased fairly rapidly.
+Added: After March 2022, market interest rates increased fairly rapidly.
This increased loan yields and expanded our net interest income and net interest margin in the latter half of 2022 and the first three months of 2023.
−Removed: While market interest rate increases are expected to result in increases to loan yields, we expect that much of this benefit will be offset by increased funding costs, including changes in the funding mix, as experienced in the year ended December 31, 2023.
−Removed: As of June 30, 2024, time deposit maturities over the next 12 months were as follows:
+Added: While market interest rate increases are expected to result in increases to loan yields, we expect that much of this benefit will be offset by increased funding costs, including changes in the funding mix, as experienced in the year ended December 31, 2023 and much of 2024.
+Added: To date, the fed funds rate cut in September 2024 has not negatively impacted our net interest income or net interest margin.
+Added: As of September 30, 2024, time deposit maturities over the next 12 months were as follows:
within three months -- $537 million with a weighted-average rate of 4.53%;
1 unchanged sentence
and within six to twelve months -- $145 million with a weighted-average rate of 3.20%.
−Removed: Based on time deposit market rates in June 2024, replacement rates for these maturing time deposits are likely to be approximately 4.00-4.35%.
+Added: Based on time deposit market rates in September 2024, replacement rates for these maturing time deposits are likely to be approximately 3.50-4.20%.
The current level and shape of the interest rate yield curve poses challenges for interest rate risk management.
10 unchanged sentences
At December 31, 2023, the Federal Funds rate was 5.50%.
−Removed: To date in 2024, the FRB has not implemented any rate changes and at June 30, 2024, the Federal Funds rate was 5.50%.
−Removed: Financial markets now expect the possibility of significant further increases in Federal Funds interest rates in 2024 to be unlikely, with interest rate decisions being made at each FRB meeting based on economic data available at the time.
−Removed: However, the FRB has further indicated, and financial markets now have begun to price in, that it is likely that the Federal Funds interest rate will remain near this peak level for a few more months before any rate cuts occur, possibly as early as September 2024.
−Removed: Great Southern’s loan portfolio includes loans ($1.41 billion at June 30, 2024) tied to various SOFR indexes that will be subject to adjustment at least once within 90 days after June 30, 2024.
+Added: In 2024, the FRB implemented a rate decrease of 0.50% in September.
+Added: At September 30, 2024, the Federal Funds rate was 5.00%.
+Added: Financial markets expect the possibility of further decreases in Federal Funds interest rates in 2024 and 2025 to be likely, but at a methodical pace and with interest rate decisions being made at each FRB meeting based on economic data available at the time.
+Added: Great Southern’s loan portfolio includes loans ($1.54 billion at September 30, 2024) tied to various SOFR indexes that will be subject to adjustment at least once within 90 days after September 30, 2024.
All of these loans have interest rate floors at various rates.
−Removed: Great Southern has a portfolio of loans ($826 million at June 30, 2024) tied to a “prime rate” of interest that will adjust immediately or within 90 days of a change to the “prime rate” of interest.
+Added: Great Southern also has a portfolio of loans ($782 million at September 30, 2024) tied to a “prime rate” of interest that will adjust immediately or within 90 days of a change to the “prime rate” of interest.
All of these loans had interest rate floors at various rates.
−Removed: addition, Great Southern has a portfolio of loans ($7 million at June 30, 2024) tied to an AMERIBOR index that will adjust immediately or within 90 days of a change to the “prime rate” of interest.
+Added: In addition, Great Southern has a portfolio of loans ($8.0 million at September 30, 2024) tied to an AMERIBOR index that will adjust immediately or within 90 days of a change to the rate of interest on this index.
All of these loans had interest rate floors at various rates.
−Removed: At June 30, 2024, nearly all of these SOFR, “prime rate” and AMERIBOR loans had fully-indexed rates that were at or above their floor rate and so are expected to move fully with future market interest rate increases.
+Added: At September 30, 2024, nearly all of these SOFR, AMERIBOR and “prime rate” loans had fully-indexed rates that were at or above their floor rate and so are expected to move fully with future market interest rate increases.
+Added: The current rates are such that a significant majority of these loans will also move fully with moderate future market interest rate decreases.
Interest rate risk exposure estimates (the sensitivity gap) are not exact measures of an institution’s actual interest rate risk.
25 unchanged sentences
Due to lower market interest rates, the Company received net interest settlements which were recorded as loan interest income.
−Removed: If USD-SOFR exceeded the fixed rate of interest, the Company was required to pay net settlements
−Removed: to the counterparty and record those net payments as a reduction of interest income on loans.
+Added: If USD-SOFR exceeded the fixed rate of interest, the Company was required to pay net settlements to the counterparty and record those net payments as a reduction of interest income on loans.
The effective portion of the gain or loss on the derivative was reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affected earnings.
24 unchanged sentences
The Company received a net settlement payment from the swap counterparty totaling $26,500 upon termination.
−Removed: At the time of the early termination, the Company recorded a market value adjustment to the brokered deposit of $163,000, which will be amortized as a reduction of interest expense from January 2024 through February 2025.
+Added: At the time of the early termination, the Company recorded a market value adjustment to the brokered deposits of $163,000, which will be amortized as a reduction of interest expense from January 2024 through February 2025.
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.