Banking is all about deep relationships, but Great Southern Bancorp (GSBC) has drawn the line at booking its customers' trips to Vegas or insuring their Corvettes.

The decision stems from the kind of soul-searching going on at a lot of community banks. Several failed-bank deals have taken Great Southern to $4 billion of assets and the cusp of being a player in the Midwest. The Springfield, Mo., company announced late last week that it wouldsharpen its focus on bankingby selling its insurance and travel agencies to specialists in those sectors.

"We entered 2008 with 39 banking centers in Missouri, and now we have 107 scattered across six states," Joseph Turner, the chief executive of Great Southern, says in explaining his decision to sell the two nonbank units. "We decided that management's time was better spent elsewhere. …We've built them into good, profitable companies, but they were only providing 2% of our overall profit."

The move bucks a recent trend. With low interest rates expected to last awhile, more banks – including Wells Fargo (WFC), BB&T (BBT) and smaller banks like Bryn Mawr Bank Corp.(BMTC) – havebought fee-based businesses to ease pressure on earnings. That pattern differed from the darkest hours of the downturn, when several banks sold side businesses to raise capital.

Yet not all niches are created equal, analysts say.

Lines like treasury management, trust services and wealth management are the places where banks most often succeed with fee-based businesses, analysts say.

The de rigueur side business is mortgage given the refinancing boom. That is one Great Southern is keeping; it contributed $1.4 million, or 37%, of the company's noninterest income in the third quarter.

The deals to sell the insurance and travel businesses, which are expected to close at the end of November, will result in a $6.8 million onetime gain in the fourth quarter. Several analysts have trimmed their 2013 and 2014 estimates by a nickel to account for the sales. Sandler O'Neill is now expecting the company to earn $1.60 per share next year, while Stifel Nicolaus is expecting the company to earn $2.18 per share.

Analysts embraced the deals despite lowering expectations.

"As they've gotten bigger, I'm not sure how many synergies there were with those businesses," says John Rodis, an analyst at Fig Partners. "The bottom line is that if you look at the vast majority of side businesses like insurance, if they break even for you it is a good thing."

Great Southern said the businesses produced $8.2 million of income, but contributed $7.2 million of expense, resulting in net income of $739,000, in the last year. Those numbers do not tell the whole story, Turner says.

"There are other costs, too – things like diverted management attention," Turner says, adding that those business lines were managed by Great Southern's director of retail banking.

"Focusing on our core business," Turner says, means identifying the adjacent markets it needs to fill in and finding ways to improve the business it currently has.

"We have a lot of capacity that is underutilized," Turner says. "The focus is really all about broadening and deepening our relationships."

One of the best places for Great Southern to focus its attention is in Minnesota, where itacquired the $481 million-asset Inter Savings Bankfrom the Federal Deposit Insurance Corp. in April, says Andrew Liesch, an analyst at Sandler.

Inter Savings "was a thrift, and the Great Southern guys have always been commercial bankers. They can spend some time building up there," Liesch says.

Great Southern had been considering sales of the units for a few years now but wanted to be methodical, Turner says. With an eye on protecting the employees in those divisions, the company wanted to find the right fit.

Adelman Travel, a Wisconsin-based agency with $400 million in annual revenue, has agreed to acquire Great Southern Travel. St. Louis-based HM, one of the largest privately held insurance brokers in the country, would acquire Great Southern Insurance.

"We took a fairly deliberate approach," Turner said. "We sought the most suitable buyers."

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