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Business Segments
 3 Months Ended
Mar. 31, 2017
Segment Reporting [Abstract]  
Business Segments
10. BUSINESS SEGMENTS

The Company has identified two principal reportable segments: Business Financial and Commercial Banking Centers (“Centers”) and Dairy & Livestock and Agribusiness. All other operations have been aggregated in “Other”. The Bank has 54 Banking Centers organized in geographic regions, which are the focal points for customer sales and services. The Company utilizes an internal reporting system to measure the performance of various operating departments within the Bank which is the basis for determining the Bank’s reportable segments. The chief operating decision maker (currently our CEO) regularly reviews the financial information of these two segments in deciding how to allocate resources and to assess performance. Our two principal reporting segments, Centers and Dairy & Livestock and Agribusiness, are aggregated into separate operating segments as their products and services are similar and are sold to similar types of customers, have similar production and distribution processes, have similar economic characteristics, and have similar reporting and organizational structures. In 2016, Dairy & Livestock and Agribusiness was reflected as our second reportable segment. All other operating departments have been aggregated and included in “Other” for reporting purposes. Recapture of provision for loan losses was allocated by segment based on loan type in 2016. Prior period information has been conformed to the current presentation. In addition, the Company allocates internal funds to the segments using a methodology that charges users of funds interest expense and credits providers of funds interest income with the net effect of this allocation being recorded in the “Other” category.

The following tables represent the selected financial information for these two business segments. GAAP does not have an authoritative body of knowledge regarding the management accounting used in presenting segment financial information. The accounting policies for each of the business units is the same as those policies identified for the consolidated Company and disclosed in Note 3 — Summary of Significant Accounting Policies, included in our Annual Report on Form 10-K for the year ended December 31, 2016. The income numbers represent the actual income and expenses of each business unit. In addition, each segment has allocated income and expenses based on management’s internal reporting system, which allows management to determine the performance of each of its business units. Loan fees included in the Centers category are the actual loan fees paid to the Company by its customers. These fees are eliminated and deferred in the “Other” category, resulting in deferred loan fees for the condensed consolidated financial statements. All income and expense items not directly associated with the Centers’ business segment are grouped in the “Other” category. Future changes in the Company’s management structure or reporting methodologies may result in changes in the measurement of operating segment results.

 

The following tables present the operating results and other key financial measures for the individual operating segments for the periods presented.

 

    For the Three Months Ended March 31, 2017
    Centers   Dairy &
livestock and
agribusiness		   Other (1)   Total
    (Dollars in thousands)

Net interest income

     $ 45,578       $ 2,144       $ 17,711       $ 65,433  

(Recapture of) provision for loan losses

     511       (2,699 )      (2,312 )      (4,500 ) 
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Net interest income after (recapture of) provision for loan losses

     45,067       4,843       20,023       69,933  
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Noninterest income

     5,207       55       3,460       8,722  

Noninterest expense

     12,438       501       21,178       34,117  
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Segment pre-tax profit

     $ 37,836       $ 4,397       $ 2,305       $ 44,538  
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Goodwill

     $ 119,193       $ -           $ -           $ 119,193  
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Segment assets as of March 31, 2017

     $   7,399,909       $     363,029       $     796,183       $   8,559,121  
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

 

  (1) Includes the elimination of certain items that are included in more than one department, most of which represents products and services for Centers’ customers.

 

    For the Three Months Ended March 31, 2016
    Centers   Dairy &
livestock and
agribusiness		   Other (1)   Total
    (Dollars in thousands)

Net interest income

     $ 42,234       $ 1,933       $ 18,349       $ 62,516  

(Recapture of) provision for loan losses

     2,200       (952 )      (1,248 )      -      
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Net interest income after (recapture of) provision for loan losses

     40,034       2,885       19,597       62,516  
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Noninterest income

     4,827       53       3,803       8,683  

Noninterest expense

     12,610       479       21,275       34,364  
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Segment pre-tax profit

     $ 32,251       $ 2,459       $ 2,125       $ 36,835  
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Goodwill

     $ 88,174       $ -           $ -           $ 88,174  
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

Segment assets as of March 31, 2016

     $   6,586,237       $     386,804       $     947,795       $   7,920,836  
 

 

 

 

  

 

 

 

  

 

 

 

  

 

 

 

 

  (1) Includes the elimination of certain items that are included in more than one department, most of which represents products and services for Centers’ customers.