21. SEGMENT RESULTS

The financial performance of the Company is also monitored by an internal funds transfer pricing profitability measurement system which produces line of business results and key performance measures. The Company’s major business units include retail banking, commercial banking, trust, and investment/parent. The reported results reflect the underlying economics of the business segments. Expenses for centrally provided services are allocated based upon the cost and estimated usage of those services. The businesses are match-funded and interest rate risk is centrally managed and accounted for within the investment/parent business segment. The key performance measure the Company focuses on for each business segment is net income contribution.

Retail banking includes the deposit-gathering branch franchise and lending to both individuals and small businesses. Lending activities include residential mortgage loans, direct consumer loans, and small business commercial loans. Commercial banking to businesses includes commercial loans, and CRE loans. The trust segment contains our wealth management businesses which include the Trust Company, WCCA, our registered investment advisory firm and financial services. Wealth management includes personal trust products and services such as personal portfolio investment management, estate planning and administration, custodial services and pre-need trusts. Also, institutional trust products and services such as 401(k) plans, defined benefit and defined contribution employee benefit plans, and individual retirement accounts are included in this segment. Financial services include the sale of mutual funds, annuities, and insurance products. The wealth management businesses also includes the union collective investment funds, namely the ERECT and BUILD funds which are designed to use union pension dollars in construction projects that utilize union labor. The investment/parent includes the net results of investment securities and borrowing activities, general corporate expenses not allocated to the business segments, interest expense on guaranteed junior subordinated deferrable interest debentures, and centralized interest rate risk management. Inter-segment revenues were not material.

The contribution of the major business segments to the Consolidated Results of Operations were as follows:

YEAR ENDED DECEMBER 31, 2016

RETAIL
BANKING

COMMERCIAL
BANKING

TRUST

INVESTMENT/
PARENT

TOTAL

(IN THOUSANDS)

Net interest income

20,860

18,518

(5,300)

34,134

Provision for loan loss

175

3,775

—

3,950

Non-interest income

5,281

439

8,749

169

14,638

Non-interest expense

21,704

10,453

7,097

2,361

41,615

Income (loss) before income
taxes

4,262

4,729

1,708

(7,492

)

3,207

Income tax expense (benefit)

1,252

1,387

581

(2,323

)

897

Net income (loss)

3,010

3,342

1,127

(5,169)

2,310

Total assets

357,500

635,843

5,217

155,220

1,153,780

	YEAR ENDED DECEMBER 31, 2015
	RETAIL BANKING		COMMERCIAL BANKING		TRUST		INVESTMENT/ PARENT			TOTAL
	(IN THOUSANDS)
Net interest income	$	20,680	$	18,390	$	58	$	(3,767	)	$	35,361
Provision for loan loss		192		1,058		—		—			1,250
Non-interest income		5,537		552		8,683		495			15,267
Non-interest expense		21,849		10,303		6,606		2,280			41,038
Income (loss) before income taxes		4,176		7,581		2,135		(5,552	)		8,340
Income tax expense (benefit)		1,160		2,167		726		(1,710	)		2,343
Net income (loss)	$	3,016	$	5,414	$	1,409	$	(3,842	)	$	5,997
Total assets	$	415,008	$	589,840	$	5,263	$	138,386		$	1,148,497

	YEAR ENDED DECEMBER 31, 2014
	RETAIL BANKING		COMMERCIAL BANKING		TRUST		INVESTMENT/ PARENT			TOTAL
	(IN THOUSANDS)
Net interest income	$	20,141	$	16,777	$	47	$	(2,921	)	$	34,044
Credit provision for loan loss		57		318		—		—			375
Non-interest income		5,633		381		8,118		191			14,323
Non-interest expense		22,531		10,868		6,967		3,005			43,371
Income (loss) before income taxes		3,186		5,972		1,198		(5,735	)		4,621
Income tax expense (benefit)		958		1,819		634		(1,813	)		1,598
Net income (loss)	$	2,228	$	4,153	$	564	$	(3,922	)	$	3,023
Total assets	$	376,009	$	563,690	$	5,015	$	144,549		$	1,089,263