SEGMENT REPORTING

9 Months Ended

Sep. 30, 2016

Segment Reporting [Abstract]

SEGMENT REPORTING

SEGMENT REPORTING

The Company utilizes an internal reporting system to measure the performance of various operating segments within the Bank and the Company overall. The Company has identified four operating segments for purposes of management reporting: (i) Commercial Banking; (ii) Mortgage Banking; (iii) Financial Advisory; and (iv) Corporate/Other. The Company sold all of its membership interests in The Palisades Group on May 5, 2016 and ceased Financial Advisory activities through this segment (see Note 2 for additional information).

The principal business of the Commercial Banking segment consists of attracting deposits and investing these funds primarily in commercial, consumer and real estate secured loans. The principal business of the Mortgage Banking segment is originating conforming SFR loans and selling these loans in the secondary market. The Corporate/Other segment includes the holding company. The Corporate/Other segment engages in business activities through the sale of assets, other real estate owned, and loans held at the holding company and incurs interest expense on debt as well as non-interest expense for corporate related activities. The principal business of the Financial Advisory segment was operated by The Palisades Group and provided services related to the purchase, sale and management of SFR mortgage loans.

During the fourth quarter of 2015, the Company developed a measurement method to allocate centrally incurred costs to its operating segments. The Company allocates shared service costs within Commercial Banking noninterest expense, as well as Corporate/Other noninterest expense, to the respective operating segments. The cost allocation was done on a comparable basis. These allocations of centrally incurred costs resulted in a reduction of noninterest expense for Commercial Banking and Corporate/Other, in the amount of $4.2 million and $3.9 million, respectively, for the three months ended September 30, 2016, and $11.6 million and $11.1 million, respectively, for the nine months endedSeptember 30, 2016. The allocations reduced noninterest expense for Commercial Banking and Corporate/Other, in the amount of $1.6 million and $3.7 million, respectively, for the three months ended September 30, 2015, and $5.2 million and $9.9 million, respectively, for the nine months endedSeptember 30, 2015. Additionally, these allocations resulted in an increase of noninterest expense for Mortgage Banking and Financial Advisory, in the amount of $8.1 million and $0, respectively, for the three months ended September 30, 2016, and $22.0 million and $760 thousand, respectively, for the nine months endedSeptember 30, 2016. The allocation resulted in an increase of noninterest expense for Mortgage Banking and Financial Advisory, in the amount of $4.9 million and $444 thousand, respectively, for the three months ended September 30, 2015, and $14.0 million and $1.1 million, respectively, for the nine months endedSeptember 30, 2015.

The following table represents the operating segments’ financial results and other key financial measures as of or for the three months ended September 30, 2016 and 2015:

	As of or For the Three Months Ended
	Commercial Banking		Mortgage Banking		Financial Advisory		Corporate/ Other			Inter-segment Elimination			Consolidated
	(In thousands)
September 30, 2016
Net interest income (loss)	$	85,429	$	4,108	$	—	$	(2,576	)	$	—		$	86,961
Provision for loan and lease losses	2,592		—		—		—			—			2,592
Noninterest income	19,536		52,276		—		2,818			—			74,630
Noninterest expense	77,177		47,085		—		—			—			124,262
Income (loss) before income taxes	$	25,196	$	9,299	$	—	$	242		$	—		$	34,737
Total assets	$	10,606,617	$	576,406	$	—	$	218,520		$	(185,139	)	$	11,216,404
September 30, 2015
Net interest income (loss)	$	55,911	$	3,606	$	—	$	(3,967	)	$	—		$	55,550
Provision for loan and lease losses	735		—		—		—			—			735
Noninterest income	14,669		33,843		3,072		—			(857		)	50,727
Noninterest expense	44,566		35,442		2,592		—			(857		)	81,743
Income (loss) before income taxes	$	25,279	$	2,007	$	480	$	(3,967	)	$	—		$	23,799
Total assets	$	6,822,439	$	418,877	$	8,670	$	175,173		$	(168,349	)	$	7,256,810

The following table represents the operating segments’ financial results and other key financial measures as of or for the nine months endedSeptember 30, 2016 and 2015:

	As of or For the Nine Months Ended
	Commercial Banking		Mortgage Banking		Financial Advisory			Corporate/ Other			Inter-segment Elimination			Consolidated
	(In thousands)
September 30, 2016
Net interest income (loss)	$	237,137	$	10,986	$	—		$	(9,708	)	$	—		$	238,415
Provision for loan and lease losses	4,682		—		—			—			—			4,682
Noninterest income	63,058		121,115		2,636			6,512			(1,128		)	192,193
Noninterest expense	181,499		127,130		3,199			2,737			(1,128		)	313,437
Income (loss) before income taxes	$	114,014	$	4,971	$	(563	)	$	(5,933	)	$	—		$	112,489
Total assets	$	10,606,617	$	576,406	$	—		$	218,520		$	(185,139	)	$	11,216,404
September 30, 2015
Net interest income (loss)	$	162,352	$	9,593	$	—		$	(10,294	)	$	—		$	161,651
Provision for loan and lease losses	6,209		—		—			—			—			6,209
Noninterest income	44,013		111,461		11,590			—			(3,664		)	163,400
Noninterest expense	131,708		108,203		9,295			—			(3,664		)	245,542
Income (loss) before income taxes	$	68,448	$	12,851	$	2,295		$	(10,294	)	$	—		$	73,300
Total assets	$	6,822,439	$	418,877	$	8,670		$	175,173		$	(168,349	)	$	7,256,810