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Business Segments
 6 Months Ended
Jun. 30, 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 June 30, 2017  
    Centers     Dairy &
livestock and
agribusiness		     Other (1)     Total  
      (Dollars in thousands)    

Net interest income

     $ 48,762         $ 2,369         $ 19,352         $ 70,483    

(Recapture of) provision for loan losses

     875         (421)        (1,454)        (1,000)   
 

 

 

    

 

 

    

 

 

    

 

 

  

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

     47,887         2,790         20,806         71,483    
 

 

 

    

 

 

    

 

 

    

 

 

  

Noninterest income

     5,303         49         5,424         10,776    

Noninterest expense

     13,206         504         23,163         36,873    
 

 

 

    

 

 

    

 

 

    

 

 

  

Segment pre-tax profit

     $ 39,984         $ 2,335         $ 3,067         $ 45,386    
 

 

 

    

 

 

    

 

 

    

 

 

  

Goodwill

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

 

 

    

 

 

    

 

 

    

 

 

  

Segment assets as of June 30, 2017

     $   7,314,110         $   348,570         $   755,523         $   8,418,203    
 

 

 

    

 

 

    

 

 

    

 

 

  

 

  (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 June 30, 2016  
    Centers     Dairy &
livestock and
agribusiness		     Other (1)     Total  
    (Dollars in thousands)  

Net interest income

     $ 44,583         $ 1,986         $ 19,387         $ 65,956    

(Recapture of) provision for loan losses

     1,215         (401)        (814)        -    
 

 

 

    

 

 

    

 

 

    

 

 

  

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

     43,368         2,387         20,201         65,956    
 

 

 

    

 

 

    

 

 

    

 

 

  

Noninterest income

     5,326         54         3,894         9,274    

Noninterest expense

     12,891         499         21,048         34,438    
 

 

 

    

 

 

    

 

 

    

 

 

  

Segment pre-tax profit

     $ 35,803         $ 1,942         $ 3,047         $ 40,792    
 

 

 

    

 

 

    

 

 

    

 

 

  

Goodwill

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

 

 

    

 

 

    

 

 

    

 

 

  

Segment assets as of June 30, 2016

     $   6,949,273         $   378,246         $   984,788         $   8,312,307    
 

 

 

    

 

 

    

 

 

    

 

 

  

(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 Six Months Ended June 30, 2017  
    Centers     Dairy &
livestock and
agribusiness		     Other (1)     Total  
    (Dollars in thousands)  

Net interest income

     $ 94,340         $ 4,513         $ 37,063         $ 135,916    

(Recapture of) provision for loan losses

     1,386         (3,120)        (3,766)        (5,500)   
 

 

 

    

 

 

    

 

 

    

 

 

  

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

     92,954         7,633         40,829         141,416    
 

 

 

    

 

 

    

 

 

    

 

 

  

Noninterest income

     10,510         104         8,884         19,498    

Noninterest expense

     25,644         1,005         44,341         70,990    
 

 

 

    

 

 

    

 

 

    

 

 

  

Segment pre-tax profit

     $ 77,820         $ 6,732         $ 5,372         $ 89,924    
 

 

 

    

 

 

    

 

 

    

 

 

  

Goodwill

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

 

 

    

 

 

    

 

 

    

 

 

  

Segment assets as of June 30, 2017

     $   7,314,110         $   348,570         $   755,523         $   8,418,203    
 

 

 

    

 

 

    

 

 

    

 

 

  

(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 Six Months Ended June 30, 2016  
    Centers     Dairy &
livestock and
agribusiness		     Other (1)     Total  
    (Dollars in thousands)  

Net interest income

     $ 86,817         $ 3,919         $ 37,736         $ 128,472    

(Recapture of) provision for loan losses

     3,415         (1,353)        (2,062)        -    
 

 

 

    

 

 

    

 

 

    

 

 

  

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

     83,402         5,272         39,798         128,472    
 

 

 

    

 

 

    

 

 

    

 

 

  

Noninterest income

     10,153         107         7,697         17,957    

Noninterest expense

     25,501         978         42,323         68,802    
 

 

 

    

 

 

    

 

 

    

 

 

  

Segment pre-tax profit

     $ 68,054         $ 4,401         $ 5,172         $ 77,627    
 

 

 

    

 

 

    

 

 

    

 

 

  

Goodwill

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

 

 

    

 

 

    

 

 

    

 

 

  

Segment assets as of June 30, 2016

     $   6,949,273         $   378,246         $   984,788         $   8,312,307    
 

 

 

    

 

 

    

 

 

    

 

 

  

(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.