Segment and Related Information

6 Months Ended

Jun. 30, 2020

The Company manages its operations through three reportable business segments in accordance with the standards set forth in FASB ASC 280, “Segment Reporting”: (i) banking (“Banking”), (ii) insurance (“Tompkins Insurance”) and (iii) wealth management (“Tompkins Financial Advisors”). The Company’s insurance services and wealth management services, other than trust services, are managed separately from the Banking segment.

Banking

The Banking segment is primarily comprised of the Company’s four banking subsidiaries: Tompkins Trust Company, a commercial bank with fourteen banking offices located in Ithaca, NY and surrounding communities; The Bank of Castile (DBA Tompkins Bank of Castile), a commercial bank with sixteen banking offices located in the Genesee Valley region of New York State as well as Monroe County; Mahopac Bank (DBA Tompkins Mahopac Bank), a commercial bank with fourteen full-service banking offices located in the counties north of New York City; and VIST Bank (DBA Tompkins VIST Bank), a banking organization with twenty banking offices headquartered and operating in the areas surrounding southeastern Pennsylvania.

Insurance

The Company provides property and casualty insurance services and employee benefits consulting through Tompkins Insurance Agencies, Inc., a 100% wholly-owned subsidiary of the Company, headquartered in Batavia, New York. Tompkins Insurance is an independent insurance agency, representing many major insurance carriers and provides employee benefit consulting to employers in Western and Central New York and Southeastern Pennsylvania, assisting them with their medical, group life insurance and group disability insurance. Tompkins Insurance has five stand-alone offices in Western New York.

Wealth Management

The Wealth Management segment is generally organized under the Tompkins Financial Advisors brand. Tompkins Financial Advisors offers a comprehensive suite of financial services to customers, including trust and estate services, investment management and financial and insurance planning for individuals, corporate executives, small business owners and high net worth individuals. Tompkins Financial Advisors has offices in each of the Company’s four subsidiary banks.

Summarized financial information concerning the Company’s reportable segments and the reconciliation to the Company’s consolidated results is shown in the following table. Investment in subsidiaries is netted out of the presentations below. The “Intercompany” column identifies the intercompany activities of revenues, expenses and other assets between the banking, insurance and wealth management services segments. The Company accounts for intercompany fees and services at an estimated fair value according to regulatory requirements for the services provided. Intercompany items relate primarily to the use of human resources, information systems, accounting and marketing services provided by any of the banks and the holding company. All other accounting policies are the same as those described in the summary of significant accounting policies in the 2019 Annual Report on Form 10-K.


As of and for the three months ended June 30, 2020
(In thousands)	Banking		Insurance		Wealth Management		Intercompany		Consolidated
Interest income	$	63,445	$	1	$	0	$	(1)	$	63,445
Interest expense	7,080		0		0		(1)		7,079
Net interest income	56,365		1		0		0		56,366
Provision (credit) for credit loss expense	(348)		0		0		0		(348)
Noninterest income	6,248		7,360		4,095		(526)		17,177
Noninterest expense	37,709		6,358		3,347		(526)		46,888
Income before income tax expense	25,252		1,003		748		0		27,003
Income tax expense	5,113		260		167		0		5,540
Net Income attributable to noncontrolling interests and Tompkins Financial Corporation	20,139		743		581		0		21,463
Less: Net income attributable to noncontrolling interests	32		0		0		0		32
Net Income attributable to Tompkins Financial Corporation	$	20,107	$	743	$	581	$	0	$	21,431

Depreciation and amortization	$	2,484	$	57	$	10	$	0	$	2,551
Assets	7,528,501		42,215		25,474		(14,134)		7,582,056
Goodwill	64,585		19,866		7,996		0		92,447
Other intangibles, net	2,758		2,623		119		0		5,500
Net loans and leases	5,372,203		0		0		0		5,372,203
Deposits	6,391,034		0		0		(13,513)		6,377,521
Total Equity	643,139		31,567		23,323		0		698,029


As of and for the three months ended June 30, 2019
(In thousands)	Banking		Insurance		Wealth Management		Intercompany		Consolidated
Interest income	$	66,092	$	1	$	0	$	0	$	66,093
Interest expense	13,775		0		0		0		13,775
Net interest income	52,317		1		0		0		52,318
Provision for credit loss expense	601		0		0		0		601
Noninterest income	7,150		7,853		4,059		(542)		18,520
Noninterest expense	37,067		6,331		3,214		(542)		46,070
Income before income tax expense	21,799		1,523		845		0		24,167
Income tax expense	4,148		401		194		0		4,743
Net Income attributable to noncontrolling interests and Tompkins Financial Corporation	17,651		1,122		651		0		19,424
Less: Net income attributable to noncontrolling interests	32		0		0		0		32
Net Income attributable to Tompkins Financial Corporation	$	17,619	$	1,122	$	651	$	0	$	19,392

Depreciation and amortization	$	2,400	$	56	$	10	$	0	$	2,466
Assets	6,602,541		42,163		22,541		(12,855)		6,654,390
Goodwill	64,370		19,866		8,211		0		92,447
Other intangibles, net	3,750		3,162		180		0		7,092
Net loans and leases	4,815,012		0		0		0		4,815,012
Deposits	5,001,210		0		0		(12,313)		4,988,897
Total Equity	605,031		32,293		20,353		0		657,677


Six months ended June 30, 2020
(In thousands)	Banking		Insurance		Wealth Management		Intercompany		Consolidated
Interest income	$	126,644	$	2	$	0	$	(2)	$	126,644
Interest expense	17,311		0		0		(2)		17,309
Net interest income	109,333		2		0		0		109,335
Provision for credit loss expense	15,946		0		0		0		15,946
Noninterest income	13,241		15,510		8,469		(1,083)		36,137
Noninterest expense	74,399		12,920		6,392		(1,083)		92,628
Income before income tax expense	32,229		2,592		2,077		0		36,898
Income tax expense	6,269		691		489		0		7,449
Net Income attributable to noncontrolling interests and Tompkins Financial Corporation	25,960		1,901		1,588		0		29,449
Less: Net income attributable to noncontrolling interests	69		0		0		0		69
Net Income attributable to Tompkins Financial Corporation	$	25,891	$	1,901	$	1,588	$	0	$	29,380

Depreciation and amortization	$	4,969	$	116	$	20	$	0	$	5,105


Six months ended June 30, 2019
(In thousands)	Banking		Insurance		Wealth Management		Intercompany		Consolidated
Interest income	$	131,022	$	1	$	0	$	(2)	$	131,021
Interest expense	26,791		0		0		(2)		26,789
Net interest income	104,231		1		0		0		$	104,232
Provision for credit loss expense	1,046		0		0		0		1,046
Noninterest income	14,718		16,001		8,257		(1,049)		37,927
Noninterest expense	72,395		12,607		6,326		(1,049)		90,279
Income before income tax expense	45,508		3,395		1,931		0		$	50,834
Income tax expense	8,982		891		465		0		10,338
Net Income attributable to noncontrolling interests and Tompkins Financial Corporation	36,526		2,504		1,466		0		$	40,496
Less: Net income attributable to noncontrolling interests	64		0		0		0		64
Net Income attributable to Tompkins Financial Corporation	$	36,462	$	2,504	$	1,466	$	0	$	40,432

Depreciation and amortization	$	4,813	$	112	$	21	$	0	$	4,946