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Business Segments
 3 Months Ended
Mar. 31, 2025
Business Segments  
Business Segments

NOTE 10: Business Segments

​

The Corporation operates in a decentralized fashion in three business segments: community banking, mortgage banking and consumer finance. The community banking segment comprises C&F Bank, C&F Wealth Management, C&F Insurance and CVB Title. Revenues from community banking operations consist primarily of net interest income related to investments in loans and securities and outstanding deposits and borrowings, fees earned on deposit accounts, debit card interchange activity, and net revenues from offering wealth management services through third-party service providers.  Through C&F Mortgage, mortgage banking operating revenues consist principally of gains on sales of loans in the secondary market, mortgage banking fee income related to loan originations, fees earned by providing mortgage loan origination functions to third-party lenders, and net interest income on mortgage loans held for sale. Revenues from consumer finance operations through C&F Finance consist primarily of net interest income earned on purchased retail installment sales contracts.

​

The standalone Corporation’s revenues and expenses are comprised primarily of interest expense associated with the Corporation’s trust preferred capital notes and subordinated debt, general corporate expenses, and changes in the value of investments held in the rabbi trust and the deferred compensation liability related to its nonqualified deferred compensation plan.  The results of the Corporation, which includes funding and operating costs that are not allocated to the business segments, are included in the column labeled “Other” in the tables below.

​

The Corporation’s chief operating decision makers (CODMs) are the President/Chief Executive Officer and the Chief Financial Officer.  The CODMs use net income to evaluate income generated from segment assets in deciding whether to reinvest profits into the segments or into other parts of the entity, such as for acquisitions or to pay dividends. Net income is used to monitor budget versus actual results. The CODMs also use net income in competitive analysis by benchmarking to the Corporation’s competitors. The competitive analysis along with the monitoring of budgeted versus actual results are used in assessing performance of the segments and in establishing management’s compensation.

​

Interest expense is allocated to the mortgage banking and consumer finance segments through borrowings from the community banking segment. The community banking segment extends two warehouse lines of credit to the mortgage banking segment, providing a portion of the funds needed to originate mortgage loans, that carry interest rates at the daily FHLB advance rate plus a spread ranging from 50 basis points to 175 basis points. The community banking segment also provides the consumer finance segment with a portion of the funds needed to purchase loan contracts by means of a variable

rate line of credit that carries interest at one-month term SOFR plus 211.5 basis points, with a floor of 3.5 percent and a ceiling of 6.0 percent, and fixed rate notes that carry interest at rates ranging from 3.8 percent to 4.0 percent. The community banking segment acquires certain residential real estate loans from the mortgage banking segment at prices similar to those paid by third-party investors. These transactions are eliminated to reach consolidated totals. In addition to unallocated expenses recorded by the holding company, certain overhead costs are incurred by the community banking segment and are not allocated to the mortgage banking and consumer finance segments.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three Months Ended March 31, 2025

 

​

    

Community

    

Mortgage

    

Consumer

    

​

​

    

​

​

    

​

​

 

(Dollars in thousands)

​

Banking

​

Banking

​

Finance

​

Other

​

Eliminations

​

Consolidated

 

Interest income

​

$

23,384

​

$

339

​

$

12,123

​

$

—

​

$

142

​

$

35,988

​

Interest expense

​

 

10,381

​

​

—

​

 

—

​

 

597

​

 

—

​

 

10,978

​

Net interest income before allocation

​

​

13,003

​

​

339

​

​

12,123

​

​

(597)

​

​

142

​

​

25,010

​

Net interest allocation1

​

​

5,754

​

​

(72)

​

​

(5,682)

​

​

—

​

​

—

​

​

—

​

Net interest income

​

 

18,757

​

 

267

​

 

6,441

​

 

(597)

​

 

142

​

 

25,010

​

Gain on sales of loans

​

​

—

​

​

1,985

​

​

—

​

​

—

​

​

(138)

​

​

1,847

​

Other noninterest income

​

​

4,230

​

​

1,136

​

​

177

​

​

222

​

​

(39)

​

​

5,726

​

Net revenue

​

 

22,987

​

 

3,388

​

 

6,618

​

 

(375)

​

 

(35)

​

 

32,583

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Provision for credit losses

​

 

100

​

 

—

​

​

2,900

​

​

—

​

​

—

​

 

3,000

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Salaries and employee benefits

​

​

9,279

​

​

1,792

​

​

1,977

​

​

435

​

​

—

​

​

13,483

​

Occupancy expense

​

​

1,830

​

​

213

​

​

150

​

​

—

​

​

—

​

​

2,193

​

Data processing

​

​

2,342

​

​

226

​

​

290

​

​

8

​

​

—

​

​

2,866

​

Professional fees

​

​

724

​

​

26

​

​

91

​

​

80

​

​

—

​

​

921

​

Insurance expense

​

​

416

​

​

30

​

​

45

​

​

—

​

​

—

​

​

491

​

Marketing and advertising expenses

​

​

384

​

​

140

​

​

5

​

​

—

​

​

—

​

​

529

​

Loan processing and collection expenses

​

​

42

​

​

230

​

​

411

​

​

—

​

​

—

​

​

683

​

Provision for indemnifications

​

​

—

​

​

(25)

​

​

—

​

​

—

​

​

—

​

​

(25)

​

Other segment items2

​

​

1,215

​

​

177

​

​

436

​

​

107

​

​

(17)

​

​

1,918

​

Total noninterest expense

​

​

16,232

​

​

2,809

​

​

3,405

​

​

630

​

​

(17)

​

​

23,059

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Income (loss) before taxes

​

 

6,655

​

 

579

​

 

313

​

 

(1,005)

​

 

(18)

​

 

6,524

​

Income tax expense (benefit)

​

 

1,210

​

 

148

​

​

87

​

​

(312)

​

 

(4)

​

 

1,129

​

Net income (loss)

​

$

5,445

​

$

431

​

$

226

​

$

(693)

​

$

(14)

​

$

5,395

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Other data:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Capital expenditures

​

$

236

​

$

31

​

$

—

​

$

—

​

$

—

​

$

267

​

Depreciation and amortization

​

​

875

​

​

33

​

​

80

​

​

—

​

​

—

​

​

988

​

1Interest expense is allocated to the mortgage banking and consumer finance segments through borrowings from the community banking segment.
2Other segment items for each reportable segment include:
a.Community banking – licenses and other taxes expense, travel and education expense, telecommunications expense, other real estate owned losses and expense, net periodic pension cost, office supplies, and certain overhead expenses.
b.Mortgage banking – licenses and other taxes expense, travel and education expense, telecommunications expense, office supplies, and certain overhead expenses.
c.Consumer finance – licenses and taxes other expense, travel and education expense, telecommunications expense, payment processing expense, office supplies, and certain overhead expenses.

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​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three Months Ended March 31, 2024

 

​

    

Community

    

Mortgage

    

Consumer

    

​

​

    

​

​

    

​

​

 

(Dollars in thousands)

​

Banking

​

Banking

​

Finance

​

Other

​

Eliminations

​

Consolidated

 

Interest income

​

$

20,322

​

$

281

​

$

12,025

​

$

—

​

$

80

​

$

32,708

​

Interest expense

​

 

9,005

​

​

—

​

 

—

​

 

545

​

 

—

​

 

9,550

​

Net interest income before allocation

​

​

11,317

​

​

281

​

​

12,025

​

​

(545)

​

​

80

​

​

23,158

​

Net interest allocation1

​

​

5,847

​

​

(44)

​

​

(5,803)

​

​

—

​

​

—

​

​

—

​

Net interest income

​

 

17,164

​

 

237

​

 

6,222

​

 

(545)

​

 

80

​

 

23,158

​

Gain on sales of loans

​

​

—

​

​

1,481

​

​

—

​

​

—

​

​

(193)

​

​

1,288

​

Other noninterest income

​

​

4,110

​

​

1,048

​

​

255

​

​

840

​

​

(49)

​

​

6,204

​

Net revenue

​

 

21,274

​

 

2,766

​

 

6,477

​

 

295

​

 

(162)

​

 

30,650

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Provision for credit losses

​

 

500

​

 

—

​

​

3,000

​

​

—

​

​

—

​

 

3,500

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Salaries and employee benefits

​

​

9,443

​

​

1,599

​

​

2,144

​

​

1,066

​

​

—

​

​

14,252

​

Occupancy expense

​

​

1,743

​

​

232

​

​

157

​

​

—

​

​

—

​

​

2,132

​

Data processing

​

​

2,231

​

​

240

​

​

340

​

​

18

​

​

—

​

​

2,829

​

Professional fees

​

​

709

​

​

20

​

​

87

​

​

99

​

​

—

​

​

915

​

Insurance expense

​

​

337

​

​

30

​

​

39

​

​

—

​

​

—

​

​

406

​

Marketing and advertising expenses

​

​

51

​

​

103

​

​

14

​

​

—

​

​

—

​

​

168

​

Loan processing and collection expenses

​

​

48

​

​

184

​

​

396

​

​

—

​

​

—

​

​

628

​

Provision for indemnifications

​

​

—

​

​

(140)

​

​

—

​

​

—

​

​

—

​

​

(140)

​

Other segment items2

​

​

1,354

​

​

105

​

​

383

​

​

134

​

​

(16)

​

​

1,960

​

Total noninterest expense

​

​

15,916

​

​

2,373

​

​

3,560

​

​

1,317

​

​

(16)

​

​

23,150

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Income (loss) before taxes

​

 

4,858

​

 

393

​

 

(83)

​

 

(1,022)

​

 

(146)

​

 

4,000

​

Income tax expense (benefit)

​

 

846

​

 

99

​

​

(20)

​

​

(328)

​

 

(32)

​

 

565

​

Net income (loss)

​

$

4,012

​

$

294

​

$

(63)

​

$

(694)

​

$

(114)

​

$

3,435

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Other data:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Capital expenditures

​

$

293

​

$

81

​

$

111

​

$

—

​

$

—

​

$

485

​

Depreciation and amortization

​

​

838

​

​

14

​

​

85

​

​

—

​

​

—

​

​

937

​

1Interest expense is allocated to the mortgage banking and consumer finance segments through borrowings from the community banking segment.
2Other segment items for each reportable segment include:
a.Community banking – licenses and other taxes expense, travel and education expense, telecommunications expense, other real estate owned losses and expense, net periodic pension cost, office supplies, and certain overhead expenses.
b.Mortgage banking – licenses and other taxes expense, travel and education expense, telecommunications expense, office supplies, and certain overhead expenses.
c.Consumer finance – licenses and taxes other expense, travel and education expense, telecommunications expense, payment processing expense, office supplies, and certain overhead expenses.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Community

    

Mortgage

    

Consumer

    

​

​

    

​

​

    

​

​

​

(Dollars in thousands)

​

Banking

​

Banking

​

Finance

​

Other

​

Eliminations

​

Consolidated

​

At March 31, 2025:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total assets

​

$

2,499,614

​

$

35,467

​

$

468,437

​

$

29,809

​

$

(420,797)

​

$

2,612,530

​

Total loans held for investment, net

​

​

1,463,679

​

​

—

​

​

439,604

​

​

—

​

​

—

​

​

1,903,283

​

Total loans held for sale

​

​

—

​

​

28,089

​

​

—

​

​

—

​

​

(811)

​

​

27,278

​

Total deposits

​

​

2,229,805

​

​

—

​

​

—

​

​

—

​

​

(13,151)

​

​

2,216,654

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

At December 31, 2024:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Total assets

​

$

2,449,641

​

$

29,837

​

$

472,672

​

$

31,823

​

$

(420,599)

​

$

2,563,374

​

Total loans held for investment, net

​

​

1,436,226

​

​

—

​

​

444,085

​

​

—

​

​

—

​

​

1,880,311

​

Total loans held for sale

​

​

—

​

​

21,906

​

​

—

​

​

—

​

​

(1,794)

​

​

20,112

​

Total deposits

​

​

2,186,139

​

​

—

​

​

—

​

​

—

​

​

(15,279)

​

​

2,170,860

​

​