Segment Information

12 Months Ended

Dec. 31, 2023

Segment Reporting [Abstract]

Segment Information

Segment Information

Our operations are conducted through two operating segments: Banking and Mortgage Operations. Corporate represents costs not allocated to the operating segments. Operating segments are defined as components of an enterprise that engage in business activity from which revenues are earned and expenses are incurred for which discrete financial information is available that is evaluated regularly by executive management in deciding how to allocate resources and in assessing performance. Operating segments have been determined based on the products and services offered and reflect the manner in which financial information is currently evaluated by management. Each segment operates under the same banking charter, but is reported on a segmented basis for this report. Each of the operating segments is complementary to each other and because of the interrelationship of the segments, the information presented is not indicative of how the segments would perform if they operated as independent entities.

The Banking segment originates loans and provides deposits and fee based services to consumer, business, and mortgage lending customers. Products offered include a full range of commercial and consumer banking and financial services. The interest income on loans held-for-investment is recognized in the Banking segment, excluding newly originated residential first mortgages within the Mortgage Operations segment.

The Mortgage Operations segment originates, sells, services, and manages market risk from changes in interest rates on one-to-four family residential mortgage loans to sell or hold on our balance sheet. Loans originated-to-sell comprise the

majority of the lending activity. The Mortgage Operations segment recognizes interest income on loans that are held-for-sale and newly originated residential mortgages held-for-investment, the gains from one to four family residential mortgage sales, and revenue for servicing loans and other ancillary fees following a sales transaction. Revenue from servicing activities is earned on a contractual fee basis. The Mortgage Operations segment services loans for the held-for-investment portfolio, for which it earns revenue via an intercompany service fee allocation which appears as a cost to Banking in mortgage fees. Forward traded loan purchases and sales settlements as well as mortgage servicing rights and related fair value adjustments are reported in this segment.

Corporate represents miscellaneous other expenses of a corporate nature as well as revenue and expenses not directly assigned or allocated to the Banking or Mortgage Operations segments. The majority of executive management’s time is spent managing operating segments; related costs have been allocated between the operating segments and Corporate.

Revenues are comprised of net interest income before the provision (benefit) for credit losses and noninterest income. Noninterest expenses are allocated to each operating segment. Provision for credit losses is primarily allocated to the Banking segment. Allocation methodologies may be subject to periodic adjustment as management systems evolve and/or the business or product lines within the segments change.

Significant segment totals are reconciled to the financial statements as follows for the year ended December 31,:

	Banking		Mortgage Operations		Corporate		Total Segments
2023
Summary of Operations
Net interest income (expense)	$	292,573	$	5,871	$	(5,013)	$	293,431
Provision for credit losses	15,790		2,457		—		18,247
Noninterest income:
Service charges on deposit accounts	21,345		—		—		21,345
Credit and debit card fees	11,997		3		—		12,000
Trust and investment advisory fees	5,693		—		—		5,693
(Loss) income from mortgage banking services, net	(1,676)		33,060		—		31,384
Other noninterest income	8,670		—		—		8,670
Total noninterest income	46,029		33,063		—		79,092
Noninterest expense:
Salary and employee benefits	106,030		25,313		1,888		133,231
Occupancy and equipment	30,461		2,775		190		33,426
Other noninterest expenses	39,165		14,933		2,038		56,136
Total noninterest expense	175,656		43,021		4,116		222,793
Income (loss) before income taxes	$	147,156	$	(6,544)	$	(9,129)	$	131,483
Other Information
Depreciation expense	$	6,320	$	233	$	—	$	6,553
Identifiable assets	$	6,907,741	$	910,728	$	61,255	$	7,879,724

	Banking		Mortgage Operations		Corporate		Total Segments
2022
Summary of Operations
Net interest income (expense)	$	241,840	$	5,455	$	(5,663)	$	241,632
Provision for credit losses	14,781		3,269		—		18,050
Noninterest income:
Service charges on deposit accounts	18,211		—		—		18,211
Credit and debit card fees	11,511		—		—		11,511
Trust and investment advisory fees	6,806		—		—		6,806
(Loss) income from mortgage banking services, net	(3,035)		49,320		—		46,285
Other noninterest income	6,762		(9)		—		6,753
Total noninterest income	40,255		49,311		—		89,566
Noninterest expense:
Salary and employee benefits	94,310		38,456		1,593		134,359
Occupancy	27,407		3,854		83		31,344
Other noninterest expenses	57,082		13,814		2,527		73,423
Total noninterest expense	178,799		56,124		4,203		239,126
Income (loss) before income taxes	$	88,515	$	(4,627)	$	(9,866)	$	74,022
Other Information
Depreciation expense	$	6,754	$	364	$	—	$	7,118
Identifiable assets	$	6,633,383	$	752,841	$	44,098	$	7,430,322

	Banking		Mortgage Operations		Corporate		Total Segments
2021
Summary of Operations
Net interest income (expense)	$	152,515	$	7,270	$	(4,552)	$	155,233
Provision (benefit) for credit losses	3,235		(235)		—		3,000
Noninterest income:
Service charges on deposit accounts	12,504		—		—		12,504
Credit and debit card fees	9,596		—		—		9,596
Trust and investment advisory fees	7,795		—		—		7,795
(Loss) income from mortgage banking services, net	(2,409)		88,819		—		86,410
Other noninterest income	7,946		(7)		—		7,939
Total noninterest income	35,432		88,812		—		124,244
Noninterest expense:
Salary and employee benefits	95,064		55,557		1,305		151,926
Occupancy	24,558		3,067		3		27,628
Other noninterest expenses	30,297		12,341		2,443		45,081
Total noninterest expense	149,919		70,965		3,751		224,635
Income (loss) before income taxes	$	34,793	$	25,352	$	(8,303)	$	51,842
Other Information
Depreciation expense	$	5,728	$	390	$	—	$	6,118
Identifiable assets	$	5,058,281	$	573,552	$	34,981	$	5,666,814