NOTE 15 - SEGMENT REPORTING

The Company’s reportable segments consist of Wealth Management, Capital Management, and Mortgage. The chief operating decision maker (“CODM”) is the Chief Executive Officer. The measure of profit or loss used by the CODM to identify and measure the Company’s reportable segments is income before income tax.

The Wealth Management segment consists of operations relative to the Company’s fully integrated wealth management products and services. Services provided include deposit, loan, insurance, and trust and investment management advisory products and services.

The Capital Management segment consists of operations relative to the Company’s institutional investment management services over proprietary fixed income, high yield, and equity strategies, including the advisor of three listed mutual funds. Capital Management products and services are financial in nature for which revenues are based on a percentage of assets under management or paid premiums.

The Mortgage segment consists of operations relative to the Company’s residential mortgage service offerings. Mortgage products and services are financial in nature for which premiums are recognized net of expenses, upon the sale of mortgage loans to third parties.

The tables below present the financial information for each segment that is specifically identifiable or based on allocations using internal methods for the three months and nine months ended September 30, 2019 and 2018 (in thousands):


Three Months Ended September 30, 2019	Wealth Management		Capital Management		Mortgage		Consolidated
Income Statement
Total interest income	$	11,473	$	—	$	—	$	11,473
Total interest expense		3,533		—		—		3,533
Provision for loan losses		100		—		—		100
Net interest income		7,840		—		—		7,840
Non-interest income		4,714		776		3,298		8,788
Total income		12,554		776		3,298		16,628
Depreciation and amortization expense		274		22		55		351
All other non-interest expense		10,434		701		1,956		13,091
Income before income tax	$	1,846	$	53	$	1,287	$	3,186

Goodwill	$	15,994	$	3,692	$	—	$	19,686
Assets held for sale		—		3,553		—		3,553
Total assets	$	1,195,340	$	8,528	$	68,057	$	1,271,925


Three Months Ended September 30, 2018	Wealth Management		Capital Management		Mortgage		Consolidated
Income Statement
Total interest income	$	9,940	$	—	$	—	$	9,940
Total interest expense		2,152		—		—		2,152
Provision for loan losses		18		—		—		18
Net interest income		7,770		—		—		7,770
Non-interest income		4,613		850		1,175		6,638
Total income		12,383		850		1,175		14,408
Depreciation and amortization expense		323		130		104		557
All other non-interest expense		9,675		606		1,338		11,619
Income (loss) before income tax	$	2,385	$	114	$	(267)	$	2,232

Goodwill	$	15,994	$	8,817	$	—	$	24,811
Total assets	$	1,022,436	$	9,853	$	19,238	$	1,051,527


Nine Months Ended September 30, 2019	Wealth Management		Capital Management			Mortgage		Consolidated
Income Statement
Total interest income	$	33,698	$	-		$	-	$	33,698
Total interest expense		9,827		-			-		9,827
Provision for loan losses		216		-			-		216
Net-interest income		23,655		-			-		23,655
Non-interest income		13,956		2,339			8,053		24,348
Total income		37,611		2,339			8,053		48,003
Depreciation and amortization expense		902		248			197		1,347
All other non-interest expense		30,935		3,709	(1)		4,710		39,354
Income (loss) before income tax	$	5,774	$	(1,618)		$	3,146	$	7,302

Goodwill	$	15,994	$	3,692		$	—	$	19,686
Assets held for sale		—		3,553			—		3,553
Total assets	$	1,195,340	$	8,528		$	68,057	$	1,271,925

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(1)

Includes goodwill impairment charge of $1.6 million.


Nine Months Ended September 30, 2018	Wealth Management		Capital Management		Mortgage		Consolidated
Income Statement
Total interest income	$	28,451	$	—	$	—	$	28,451
Total interest expense		5,726		—		—		5,726
Recovery of loan losses		(169)		—		—		(169)
Net-interest income		22,894		—		—		22,894
Non-interest income		14,457		2,556		3,809		20,822
Total income		37,351		2,556		3,809		43,716
Depreciation and amortization expense		963		393		351		1,707
All other non-interest expense		29,839		2,882		4,118		36,839
Income (loss) before income tax	$	6,549	$	(719)	$	(660)	$	5,170

Goodwill	$	15,994	$	8,817	$	—	$	24,811
Total assets	$	1,022,436	$	9,853	$	19,238	$	1,051,527