Segment Information

The Company’s operations consist of three primary segments: community banking, specialty finance and wealth management.

The three reportable segments are strategic business units that are separately managed as they offer different products and services and have different marketing strategies. In addition, each segment’s customer base has varying characteristics and each segment has a different regulatory environment. While the Company’s management monitors each of the fifteen bank subsidiaries’ operations and profitability separately, these subsidiaries have been aggregated into one reportable operating segment due to the similarities in products and services, customer base, operations, profitability measures, and economic characteristics.

For purposes of internal segment profitability, management allocates certain intersegment and parent company balances. Management allocates a portion of revenues to the specialty finance segment related to loans and leases originated by the specialty finance segment and sold or assigned to the community banking segment. Similarly, for purposes of analyzing the contribution from the wealth management segment, management allocates a portion of the net interest income earned by the community banking segment on deposit balances of customers of the wealth management segment to the wealth management segment. See Note 10 — Deposits, for more information on these deposits. Finally, expenses incurred at the Wintrust parent company are allocated to each segment based on each segment's risk-weighted assets.

The segment financial information provided in the following tables has been derived from the internal profitability reporting system used by management to monitor and manage the financial performance of the Company. The accounting policies of the segments are substantially similar to those described in “Summary of Significant Accounting Policies” in Note 1 of the Company’s 2017 Form 10-K. The Company evaluates segment performance based on after-tax profit or loss and other appropriate profitability measures common to each segment.

The following is a summary of certain operating information for reportable segments:



	Three months ended						$ Change in Contribution			% Change in Contribution
(Dollars in thousands)	March 31, 2018			March 31, 2017			$ Change in Contribution			% Change in Contribution
Net interest income:
Community Banking	$	183,254		$	156,280		$	26,974		17	%
Specialty Finance	32,912			26,812			6,100			23
Wealth Management	4,441			5,056			(615		)	(12	)
Total Operating Segments	220,607			188,148			32,459			17
Intersegment Eliminations	4,475			4,432			43			1
Consolidated net interest income	$	225,082		$	192,580		$	32,502		17	%
Non-interest income:
Community Banking	$	56,547		$	42,716		$	13,831		32	%
Specialty Finance	15,725			14,156			1,569			11
Wealth Management	22,958			20,802			2,156			10
Total Operating Segments	95,230			77,674			17,556			23
Intersegment Eliminations	(9,551		)	(8,909		)	(642		)	(7	)
Consolidated non-interest income	$	85,679		$	68,765		$	16,914		25	%
Net revenue:
Community Banking	$	239,801		$	198,996		$	40,805		21	%
Specialty Finance	48,637			40,968			7,669			19
Wealth Management	27,399			25,858			1,541			6
Total Operating Segments	315,837			265,822			50,015			19
Intersegment Eliminations	(5,076		)	(4,477		)	(599		)	(13	)
Consolidated net revenue	$	310,761		$	261,345		$	49,416		19	%
Segment profit:
Community Banking	$	57,280		$	37,677		$	19,603		52	%
Specialty Finance	20,000			16,098			3,902			24
Wealth Management	4,701			4,603			98			2
Consolidated net income	$	81,981		$	58,378		$	23,603		40	%
Segment assets:
Community Banking	$	23,213,499		$	21,164,041		$	2,049,458		10	%
Specialty Finance	4,568,906			3,966,542			602,364			15
Wealth Management	674,367			648,310			26,057			4
Consolidated total assets	$	28,456,772		$	25,778,893		$	2,677,879		10	%