Southern Missouri Bancorp, Inc. (NASDAQ:SMBC) Q2 2023 Earnings Conference Call January 31, 2023 10:30 AM ET

Company Participants

Lora Daves - Chief Financial Officer

Greg Steffens - Chairman and Chief Executive Officer

Matt Funke - President and Chief Administrative Officer

Conference Call Participants

Andrew Liesch - Piper Sandler

Kelly Motta - KBW

Operator

Ladies and gentlemen, welcome to the Southern Missouri Bancorp Quarterly Earnings Conference Call. My name is Glenn and I will be the moderator for today’s call. [Operator Instructions] I will now hand you over to your host, Lora Daves to begin. Laura, please go ahead.

Lora Daves

Thank you, Glenn. Good morning, everyone. This is Lora Daves, CFO with Southern Missouri Bancorp. Thank you for joining us. The purpose of this call is to review the information and data presented in our quarterly earnings release dated Monday, January 30, 2023 and to take your questions. We may make certain forward-looking statements during today’s call and we refer you to our cautionary statement regarding forward-looking statements contained in the press release.

I am joined on the call today by Greg Steffens, our Chairman and CEO and Matt Funke, President and Chief Administrative Officer. Matt will lead off our conversation today with some highlights from our most recent quarter and fiscal year.

Matt Funke

Thanks, Lora and good morning, everyone. This is Matt Funke. Thanks for joining us. We are pleased to report this morning that the December quarter, which is the second quarter of our fiscal year, provided continued growth for Southern Missouri. Shortly after quarter end, we closed our merger with Citizens Bancshares. We will talk more about the merger after reviewing results.

Growth this quarter primarily reflected an increase in net loans receivable partially offset by a decrease in other assets. We earned $1.26 diluted per share in the December quarter, that’s up $0.22 from the linked September quarter and down $0.09 from the December 2021 quarter.

Net interest margin for the quarter was 3.45% as compared to 3.77% reported for the year ago period and 3.65% reported for the first quarter of fiscal ‘23, the linked quarter. Net interest income resulting from accelerated accretion of deferred origination fees on PPP loans was significantly reduced as compared to the year ago period, adding less than 1 basis point during the current quarter as compared to 13 basis points in the year ago period. There wasn’t a material impact in the linked quarter from PPP origination fees either. We viewed our core margin is down about 19 basis points, both quarter-over-quarter and year-over-year. Average interest earning cash and cash equivalent balances decreased compared to the linked quarter and year ago periods as loan growth outpaced deposit growth.