Press Release

Southern Missouri Bancorp Reports 7th Consecutive Quarter of Record Earnings

Company Release - 4/21/2003
    POPLAR BLUFF, Mo.--(BUSINESS WIRE)--April 21, 2003--

        Cash Operating Earnings Per Share Total $0.61 Per Share
         Board Declares Quarterly Dividend of $0.14 Per Share

Southern Missouri Bancorp, Inc., ("Company") (NASDAQ: SMBC), the parent corporation of Southern Missouri Bank and Trust Co. ("SMBT"), today announced cash operating earnings, excluding the amortization of intangible assets, of $729,000, or $.61 per diluted share for the quarter ended March 31, 2003, up 11% from the $.55 per share earned during the same period of the prior year. Through the first nine months of fiscal 2003, our cash operating earnings totaled $2.1 million or $1.79 per diluted share, up 23% from the $1.46 earned during the same period of the prior year. These earnings provided an annualized return on assets of 1.02% and an annualized return on average common equity of 11.43% for the nine-month period ended March 31, 2003.

Net income for the third quarter of fiscal 2003 was $689,000, or $.58 per diluted share, an increase of 11% from the $.52 earned during the same period of the prior year. Through the first nine months of fiscal 2003, our net income totaled $2.0 million or $1.69 per diluted share, up 23% from the $1.37 reported during the same period of the prior year.

In summarizing the recently ended quarter's financial results, Greg Steffens, President and CEO of SMBT stated: "We are very pleased to report our 7th consecutive quarter of record earnings during a period of economic uncertainty and a challenging interest rate environment. We have been able to continue to expand earnings by increasing non-interest related income while controlling operating expenditures. We are especially proud of the continued improvement in our credit quality and our 71% growth in non-interest income over the last quarter when compared to the same period of the prior year. The growth in non-interest income was primarily due to the implementation of an overdraft privilege program, which allows our non-business checking account customers the ability to overdraw their accounts up to $400, the customer is charged a fee for each check that is presented for payment while the account balance is negative. The fees generated by this program have offset a contraction in our net interest rate spread. Over the last quarter, our spread was negatively impacted by increased loan and security prepayment rates, which hampered loan growth and lowered investment portfolio returns. Overall, we expect the economic and interest-rate environment to remain challenging, but we believe our business plan will continue to generate shareholder value."

Net interest income decreased $55,000 for the three-month period ended March 31, 2003, as compared to the same period of the prior year. The decrease was due to the compression of our interest rate spread, primarily from lower investment portfolio yields as indicated by the drop in average investment yields from 4.22% for the three month period ended March 31, 2002, to 2.78% for the current quarter. The drop in investment yields was primarily due to the Company's strategy of keeping the average life of the investment portfolio less than three years. The average interest rate spread for the three-month period ended March 31, 2003, was 3.19% as compared to 3.47% over the same period of the prior year and 3.36% last quarter. The Company's net interest income increased $547,000 over the nine-month period ended March 31, 2003, as compared to the same period of the prior year. The 8.4% increase was primarily due to increased average balances. Through the first nine months of fiscal 2003, the average interest rate spread was 3.33% as compared to 3.28% over the same period of the prior year.

The Company's non-interest income increased $162,000 and $300,000 over the respective three and nine-month periods ended March 31, 2003, as compared to the same periods of the prior year. The respective increases of 71.4% and 46.5% were primarily due to an expanded customer base, structural changes in the assessment of overdraft fees and the implementation in the third quarter of the overdraft privilege program, which resulted in increased banking service charges.

During the first nine months of fiscal 2003, the Company's total assets increased $14.9 million, or 5.6%, to $281.2 million at March 31, 2003. The majority of this growth was attributed to the $12.2 million increase in the loan portfolio to $223.4 million. Changes in the composition of the loan portfolio included growth in commercial loans of $12.6 million. Asset growth has been funded primarily with deposits and securities sold under agreements to repurchase, which have increased $11.0 million and $2.7 million, respectively since June 30, 2002.

The Company's stockholders' equity increased $555,000, from $24.5 million at June 30, 2002, to $25.1 million at March 31, 2003. The increase was primarily due to increased earnings, partially offset by stock repurchases and cash dividends.

The Company announced on March 19, 2003, its intention to repurchase up to 58,720 shares of its own common stock, or approximately 5% of its outstanding common shares. The repurchased shares will be held as treasury shares to be used for general corporate purposes. Although the Company has not yet repurchased any shares of its common stock under the latest board authorization, the Company will do so from time to time, subject to market conditions, business opportunities and other economic considerations, and the Company's determination of the most efficient use of capital in order to maximize shareholder value.

On April 15, 2003, the Company declared its 37th consecutive quarterly dividend. The $.14 cash dividend will be paid May 30, 2003, to shareholders of record at the close of business on May 15, 2003.

On March 31, 2003, the Company had 1,154,744 common shares outstanding. The common stock traded between $20.95 and $25.00 per share during the quarter ended March 31, 2003, with the last trade of the quarter occurring at $24.00. The Company, through its banking subsidiary, provides a wide array of financial services to Southeastern Missouri through its main office located in Poplar Bluff and six other full-service facilities located in Poplar Bluff, Dexter, Qulin, Kennett, Doniphan, and Van Buren, Missouri.

Except for the historical information contained herein, the matters discussed in this press release may be deemed to be forward-looking statements that involve risks and uncertainties, including changes in economic conditions in the Company's market area, changes in policies by regulatory agencies, fluctuations in interest rates, demand for loans in the Company's market area and competition. Actual strategies and results in future periods may differ materially from those currently expected. These forward-looking statements represent the Company's judgement as of the date of this release. The Company disclaims however, any intent or obligation to update these forward-looking statements.

SOUTHERN MISSOURI BANCORP, INC.
        UNAUDITED CONDENSED CONSOLIDATED FINANCIAL INFORMATION

Selected Financial Data at:                   March  31,   June 30,
---------------------------                     2003         2002
                                            ------------ ------------
Total assets                                $281,179,000$266,288,000
Available-for-sale securities                 34,331,000   32,759,000
Loans                                        223,426,000  211,212,000
Allowance for losses on loans                  1,780,000    1,569,000
Non-performing assets                            394,000      720,000
Deposits                                     199,904,000  188,947,000
FHLB advances                                 48,000,000   47,000,000
Securities sold under repurchase agreements    7,040,000    4,311,000
Stockholders' equity                          25,066,000   24,511,000

Equity to assets ratio                              8.92%        9.20%
Allowance as a percentage of loans                  0.80%        0.73%
Non-performing loans as a percentage of
 loans                                              0.02%        0.16%

Per common share:
Book value                                  $      21.38$      20.34
Market value                                       24.00        19.25
Tangible book value                                18.67        17.54

                            Three Months Ended    Nine Months Ended
                                 March 31,            March 31,
Selected Operating Data:     2003       2002       2003       2002
------------------------     ----       ----       ----       ----
Net interest income       $2,281,000$2,336,000$7,050,000$6,503,000
Provision for losses on
 loans                        60,000    110,000    270,000    280,000
Non-interest income          389,000    227,000    944,000    644,000
Non-interest expense       1,528,000  1,504,000  4,518,000  4,351,000
Income taxes                 393,000    326,000  1,177,000    861,000
                           ---------- ---------- ---------- ----------
Net earnings                 689,000    623,000  2,029,000  1,655,000

Cash operating earnings   $  729,000$  664,000$2,149,000$1,776,000

Per common share:
Net earnings:
    Basic                 $      .59 $      .53 $     1.73$     1.39
    Diluted               $      .58 $      .52 $     1.69$     1.37
Cash operating earnings
    Basic                 $      .63 $      .56 $     1.83$     1.49
    Diluted               $      .61 $      .55 $     1.79$     1.46
Cash dividends            $      .14 $     .125 $      .42 $      .38

Average basic shares
 outstanding               1,164,063  1,178,854  1,171,687  1,194,627
Average diluted shares
 outstanding               1,197,761  1,201,644  1,202,261  1,214,947

Profitability Ratios:
-------------------------
Return on average assets:
    Net earnings                 .99%       .96%       .99%       .88%
    Cash operating
     earnings                   1.05%      1.02%      1.05%       .95%
Return on average common
 equity:
    Net earnings               11.40%     10.56%     11.01%      9.42%
    Cash operating
     earnings                  12.06%     11.25%     11.67%     10.10%
Net interest margin             3.46%      3.77%      3.63%      3.64%
Net interest spread             3.19%      3.47%      3.33%      3.28%
    CONTACT: Southern Missouri Bancorp, Inc.Greg Steffens, 573/785-1421

    SOURCE: Southern Missouri Bancorp, Inc.