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SEGMENT INFORMATION
 9 Months Ended
Sep. 30, 2016
Segment Reporting [Abstract]  
SEGMENT INFORMATION
SEGMENT INFORMATION
 
We have the following three reportable segments: Banking Operations, Treasury and All Others. These segments are consistent with our internal functional reporting lines and are managed separately because each unit has different target markets, technological requirements, marketing strategies and specialized skills.
 
The Banking Operations segment includes construction and real estate development lending, commercial lending, residential mortgage lending, indirect auto lending, trust services, retail brokerage services and our retail branch offices, which provide a full range of deposit and loan products, as well as various other banking services. The Treasury segment is responsible for managing the Company’s investment securities portfolio and wholesale funding activities. The All Others segment consists of all activities not captured by the Banking Operations or Treasury segments described above and includes activities such as electronic banking, data processing and management of bank owned properties.
 
The accounting policies of the segments are consistent with the Company’s accounting policies that are described in Note 1 to the consolidated financial statements in the Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC. The majority of the Company’s net income is derived from net interest income. Accordingly, management focuses primarily on net interest income, rather than gross interest income and expense amounts, in evaluating segment profitability.
 
Intersegment net interest income (expense) was allocated to each segment based upon a funds transfer pricing process that assigns costs of funds to assets and earnings credits to liabilities based on market interest rates that reflect interest rate sensitivity and maturity characteristics. All administrative and overhead expenses are allocated to the segments at cost. Cash, investment securities, loans and leases and their related balances are allocated to the segment responsible for acquisition and maintenance of those assets. Segment assets also include all premises and equipment used directly in segment operations.

Segment profits and assets are provided in the following table for the periods indicated.

(dollars in thousands)
Banking
Operations
 
Treasury
 
All Others
 
Total
Three Months Ended September 30, 2016
 

 
 

 
 

 
 

Net interest income
$
32,583

 
$
6,843

 
$
—

 
$
39,426

Inter-segment net interest income (expense)
8,588

 
(6,398
)
 
(2,190
)
 
—

Credit for loan and lease losses
743

 
—

 
—

 
743

Other operating income
6,833

 
652

 
3,490

 
10,975

Other operating expense
(15,875
)
 
(410
)
 
(17,001
)
 
(33,286
)
Administrative and overhead expense allocation
(14,873
)
 
(253
)
 
15,126

 
—

Income before taxes
17,999

 
434

 
(575
)
 
17,858

Income tax (expense) benefit
(6,452
)
 
(162
)
 
222

 
(6,392
)
Net income (loss)
$
11,547

 
$
272

 
$
(353
)
 
$
11,466


(dollars in thousands)
Banking
Operations
 
Treasury
 
All Others
 
Total
Three Months Ended September 30, 2015
 

 
 

 
 

 
 

Net interest income
$
29,424

 
$
8,381

 
$
—

 
$
37,805

Inter-segment net interest income (expense)
11,176

 
(7,477
)
 
(3,699
)
 
—

Credit for loan and lease losses
3,647

 
—

 
—

 
3,647

Other operating income
5,438

 
734

 
3,657

 
9,829

Other operating expense
(14,291
)
 
(436
)
 
(17,448
)
 
(32,175
)
Administrative and overhead expense allocation
(15,798
)
 
(245
)
 
16,043

 
—

Income before taxes
19,596

 
957

 
(1,447
)
 
19,106

Income tax (expense) benefit
(6,859
)
 
(335
)
 
294

 
(6,900
)
Net income (loss)
$
12,737

 
$
622

 
$
(1,153
)
 
$
12,206

(dollars in thousands)
Banking
Operations
 
Treasury
 
All Others
 
Total
Nine Months Ended September 30, 2016
 

 
 

 
 

 
 

Net interest income
$
95,519

 
$
22,727

 
$
—

 
$
118,246

Inter-segment net interest income (expense)
28,581

 
(20,315
)
 
(8,266
)
 
—

Credit for loan and lease losses
2,872

 
—

 
—

 
2,872

Other operating income
18,860

 
2,794

 
11,178

 
32,832

Other operating expense
(45,522
)
 
(1,237
)
 
(53,617
)
 
(100,376
)
Administrative and overhead expense allocation
(43,014
)
 
(643
)
 
43,657

 
—

Income before taxes
57,296

 
3,326

 
(7,048
)
 
53,574

Income tax (expense) benefit
(20,095
)
 
(1,167
)
 
2,472

 
(18,790
)
Net income (loss)
$
37,201

 
$
2,159

 
$
(4,576
)
 
$
34,784

(dollars in thousands)
Banking
Operations
 
Treasury
 
All Others
 
Total
Nine Months Ended September 30, 2015
 

 
 

 
 

 
 

Net interest income
$
86,115

 
$
25,219

 
$
—

 
$
111,334

Inter-segment net interest income (expense)
32,826

 
(24,242
)
 
(8,584
)
 
—

Credit for loan and lease losses
13,713

 
—

 
—

 
13,713

Other operating income
17,892

 
439

 
10,812

 
29,143

Other operating expense
(44,469
)
 
(1,407
)
 
(52,775
)
 
(98,651
)
Administrative and overhead expense allocation
(43,839
)
 
(799
)
 
44,638

 
—

Income before taxes
62,238

 
(790
)
 
(5,909
)
 
55,539

Income tax (expense) benefit
(21,783
)
 
276

 
904

 
(20,603
)
Net income
$
40,455

 
$
(514
)
 
$
(5,005
)
 
$
34,936


(dollars in thousands)
Banking
Operations
 
Treasury
 
All Others
 
Total
At September 30, 2016:
 
 
 
 
 
 
 
Investment securities
$
—

 
$
1,488,797

 
$
—

 
$
1,488,797

Loans and leases (including loans held for sale)
3,452,409

 
—

 
—

 
3,452,409

Other
43,760

 
251,999

 
82,982

 
378,741

Total assets
$
3,496,169

 
$
1,740,796

 
$
82,982

 
$
5,319,947


(dollars in thousands)
Banking
Operations
 
Treasury
 
All Others
 
Total
At December 31, 2015:
 
 
 
 
 
 
 
Investment securities
$
—

 
$
1,520,172

 
$
—

 
$
1,520,172

Loans and leases (including loans held for sale)
3,225,641

 
—

 
—

 
3,225,641

Other
74,963

 
226,172

 
84,340

 
385,475

Total assets
$
3,300,604

 
$
1,746,344

 
$
84,340

 
$
5,131,288