Segment Information

The Company's operations are managed along two operating segments: Community Banking and Home Mortgage Lending. The Community Banking segment's principal business focus is the offering of loan and deposit products to business and consumer customers in its primary market areas. As of June 30, 2017, the Community Banking segment operated 14 branches throughout Alaska. The Home Mortgage Lending segment's principal business focus is the origination and sale of mortgage loans for 1-4 family residential properties.

Summarized financial information for the Company's reportable segments and the reconciliation to the consolidated financial results is shown in the following tables:



	Three Months Ended June 30, 2017
(In Thousands)	Community Banking		Home Mortgage Lending		Consolidated

Interest income		$14,482		$410		$14,892
Interest expense	529		119		648
Net interest income	13,953		291		14,244
Provision for loan losses	300		—		300
Other operating income	3,367		6,351		9,718
Other operating expense	13,240		5,226		18,466
Income before provision for income taxes	3,780		1,416		5,196
Provision for income taxes	871		584		1,455
Net income	2,909		832		3,741
Less: net income attributable to the noncontrolling interest	152		—		152
Net income attributable to Northrim BanCorp, Inc.		$2,757		$832		$3,589



	Three Months Ended June 30, 2016
(In Thousands)	Community Banking		Home Mortgage Lending		Consolidated

Interest income		$14,246		$472		$14,718
Interest expense	417		222		639
Net interest income	13,829		250		14,079
Provision for loan losses	200		—		200
Other operating income	3,354		8,510		11,864
Compensation expense - RML acquisition payments	687		—		687
Other operating expense	12,504		6,178		18,682
Income before provision for income taxes	3,792		2,582		6,374
Provision for income taxes	805		1,063		1,868
Net income	2,987		1,519		4,506
Less: net income attributable to the noncontrolling interest	156		—		156
Net income attributable to Northrim BanCorp, Inc.		$2,831		$1,519		$4,350



	Six Months Ended June 30, 2017
(In Thousands)	Community Banking		Home Mortgage Lending		Consolidated

Interest income		$28,597		$760		$29,357
Interest expense	1,095		185		1,280
Net interest income	27,502		575		28,077
Provision for loan losses	700		—		700
Other operating income	6,813		11,801		18,614
Compensation expense - RML acquisition payments	174		—		174
Other operating expense	24,853		10,045		34,898
Income before provision for income taxes	8,588		2,331		10,919
Provision for income taxes	2,293		963		3,256
Net income	6,295		1,368		7,663
Less: net income attributable to the noncontrolling interest	249		—		249
Net income attributable to Northrim BanCorp, Inc.		$6,046		$1,368		$7,414



	Six Months Ended June 30, 2016
(In Thousands)	Community Banking		Home Mortgage Lending		Consolidated

Interest income		$28,694		$842		$29,536
Interest expense	932		351		1,283
Net interest income	27,762		491		28,253
Provision for loan losses	903		—		903
Other operating income	6,763		14,206		20,969
Compensation expense - RML acquisition payments	817		—		817
Other operating expense	24,810		11,113		35,923
Income before provision for income taxes	7,995		3,584		11,579
Provision for income taxes	2,090		1,477		3,567
Net income	5,905		2,107		8,012
Less: net income attributable to the noncontrolling interest	286		—		286
Net income attributable to Northrim BanCorp, Inc.		$5,619		$2,107		$7,726



June 30, 2017
(In Thousands)	Community Banking		Home Mortgage Lending		Consolidated

Total assets		$1,417,828		$75,377		$1,493,205
Loans held for sale		$—		$53,863		$53,863



December 31, 2016
(In Thousands)	Community Banking		Home Mortgage Lending		Consolidated

Total assets		$1,459,950		$66,590		$1,526,540
Loans held for sale		$—		$43,596		$43,596