Business Segment Reporting

9 Months Ended

Sep. 30, 2012

Business Segment Reporting

8. Business Segment Reporting

The Company has strategically aligned its operations into the following four reportable segments (collectively, “Business Segments”): Bank, Payment Solutions, Institutional Investment Management, and Asset Servicing. Business segment financial results produced by the Company’s internal management accounting system are evaluated regularly by the Executive Committee in deciding how to allocate resources and assess performance for individual Business Segments. The Business Segments were redefined during the first quarter of 2012 to reflect changes in how executive management responsibilities were changed by the Executive Committee for each of the core businesses, the products and services provided and the types of customers served, and how financial information is currently evaluated by management. The management accounting system assigns balance sheet and income statement items to each business segment using methodologies that are refined on an ongoing basis. In 2011, the Business Segments were Commercial Financial Services, Institutional Financial Services, and Personal Financial Services. For comparability purposes, amounts in all periods presented are based on methodologies in effect at September 30, 2012. Previously reported results have been reclassified to conform to the current organizational structure.

The following summaries provide information about the activities of each segment:

The Bank provides a full range of banking services to commercial, retail, government and correspondent bank customers through the Company’s branches, call center, internet banking, and ATM network. Services include traditional commercial and consumer banking, treasury management, leasing, foreign exchange, merchant bankcard, wealth management, brokerage, insurance, capital markets, investment banking, corporate trust, and correspondent banking.

Payment Solutions provides consumer and commercial credit and debit card, prepaid debit card solutions, healthcare services, and institutional cash management. Healthcare services include health savings account and flexible savings account products for healthcare providers, third-party administrators and large employers.

Institutional Investment Management provides equity and fixed income investment strategies in the intermediary and institutional markets via mutual funds, traditional separate accounts and sub-advisory relationships.

Asset Servicing provides services to the asset management industry, supporting a range of investment products, including mutual funds, alternative investments and managed accounts. Services include fund administration, fund accounting, investor services, transfer agency, distribution, marketing, custody, alternative investment services, managed account services, and collective and multiple-series trust services.

Business Segment Information

Segment financial results were as follows (in thousands):

	Three Months Ended September 30, 2012
	Bank		Payment Solutions		Institutional Investment Management		Asset Servicing		Total
Net interest income	$	69,109	$	10,843	$	—	$	413	$	80,365
Provision for loan losses		2,168		2,332		—		—		4,500
Noninterest income		47,851		15,381		24,789		18,300		106,321
Noninterest expense		94,012		17,696		17,186		17,011		145,905
Income before taxes		20,780		6,196		7,603		1,702		36,281
Income tax expense		5,320		2,060		2,130		646		10,156
Net income	$	15,460	$	4,136	$	5,473	$	1,056	$	26,125
Average assets	$	10,681,000	$	849,000	$	80,000	$	1,562,000	$	13,172,000

	Three Months Ended September 30, 2011
	Bank		Payment Solutions		Institutional Investment Management		Asset Servicing		Total
Net interest income	$	67,773	$	10,832	$	3	$	466	$	79,074
Provision for loan losses		1,873		2,627		—		—		4,500
Noninterest income		48,386		14,004		21,593		16,974		100,957
Noninterest expense		92,768		13,199		16,792		16,669		139,428
Income before taxes		21,518		9,010		4,804		771		36,103
Income tax expense		5,818		2,634		1,340		296		10,088
Net income	$	15,700	$	6,376	$	3,464	$	475	$	26,015
Average assets	$	10,360,000	$	745,000	$	93,000	$	959,000	$	12,157,000

	Nine Months Ended September 30, 2012
	Bank		Payment Solutions		Institutional Investment Management		Asset Servicing		Total
Net interest income	$	206,611	$	32,124	$	2	$	1,090	$	239,827
Provision for loan losses		6,424		7,076		—		—		13,500
Noninterest income		168,885		48,122		74,585		57,256		348,848
Noninterest expense		282,142		49,030		50,375		50,948		432,495
Income before taxes		86,930		24,140		24,212		7,398		142,680
Income tax expense		23,772		7,544		6,974		2,733		41,023
Net income	$	63,158	$	16,596	$	17,238	$	4,665	$	101,657
Average assets	$	10,850,000	$	855,000	$	82,000	$	1,437,000	$	13,224,000

	Nine Months Ended September 30, 2011
	Bank		Payment Solutions		Institutional Investment Management		Asset Servicing		Total
Net interest income	$	204,368	$	31,687	$	9	$	1,376	$	237,440
Provision for loan losses		8,849		8,351		—		—		17,200
Noninterest income		158,049		41,757		64,156		52,601		316,563
Noninterest expense		281,643		41,135		49,337		48,410		420,525
Income before taxes		71,925		23,958		14,828		5,567		116,278
Income tax expense		19,418		7,394		4,217		2,043		33,072
Net income	$	52,507	$	16,564	$	10,611	$	3,524	$	83,206
Average assets	$	10,235,000	$	692,000	$	89,000	$	1,358,000	$	12,374,000