Segment Reporting

9 Months Ended

Sep. 30, 2025

Segment Reporting

Segment Reporting

Note 13 – Segment Reporting

The Corporation is managed under an organizational structure that conducts business in two primary operating segments;  (i) Community Banking and (ii) Wealth Management.  The Corporation is primarily managed based on the line of business structure.  In that regard, the Corporation provides the same lines of business, which have the same product and service offerings, have similar types and classes of customers and utilize similar service delivery methods across our entire geographic footprint.  Pricing guidelines for products and services are across all regions.  Community Banking and Trust and Investment Services are delineated by the products and services that each segment offers.  

Business activity for the operating segments is as follows:

Community Banking:  The Community Banking segment is conducted through the Bank and involves delivering a broad range of financial products and services, including various loan and deposit products, to consumer, business, and not-for-profit customers.  Parent company income and assets are included in the Community Banking segment, as the majority of parent company functions are related to this segment.  Major revenue sources include net interest income, gains on sales of mortgage loans, and service charges on deposit accounts.  Expenses include salaries and employee benefits, occupancy, data processing, FDIC premiums, marketing, equipment, and other expenses.  

Wealth Management:  The Wealth Management segment is conducted through the Bank and offers corporate trustee services, trust and estate administration, IRA administration and custody services.  Revenues for this segment is generated from administration, service and custody fees, brokerage commissions, and management fees that are derived from Assets Under Management.  Expenses include personnel, occupancy, data processing, marketing, equipment, and other expenses.  

The accounting policies of each reportable segment are the same as those of our consolidated entity except that expenses for consolidated back-office operations and general overhead-type expenses such as executive administration, accounting, information technology and human resources are recorded in the Community Banking segment and reimbursed by the Wealth Management segment through a monthly management fee based on estimated uses of those services.

An internal team of the Corporation’s executive directors including the Chief Executive Officer, Chief Financial Officer, and Chief Wealth Officer serve as the Corporation’s Chief Operating Decision Maker (“CODM”).  The CODM reviews actual net income verses budgeted net income to assess segment performance on a monthly basis and to make decisions about allocating capital and personnel to the segments.

Financial results by operating segment, including significant expense categories provided to the CODM are detailed below.  Certain prior period amounts have been reclassified to conform to the current presentation.  The Trust and Investment Services segment excludes off-balance-sheet assets under management with a total fair value of $1.8 billion and $1.7 billion at September 30, 2025 and December 31 2024, respectively.

Total assets of each operating segment at September 30, 2025 and December 31, 2024 were as follows:

	Community		Wealth
	Banking		Management		Total
Total assets as of September 30, 2025	$	2,023,680	$	294	$	2,023,974
Total assets as of December 31, 2024	$	1,972,513	$	509	$	1,973,022

Information for the operating segments for the nine- and three-month periods ended September 30, 2025 and 2024 is presented in the following tables:

		Nine months ended
		September 30, 2025
	Community		Wealth
(in thousands)	Banking		Management		Total
Interest income	$	74,695	$	—	$	74,695
Interest expense		24,569		—		24,569
Net interest income		50,126		—		50,126
Credit loss expense		2,026		—		2,026
Net interest income after credit loss expense		48,100		—		48,100
Other operating income:
Net gains on sales of residential mortgages		401		—		401
Service charges on deposit accounts		1,687		—		1,687
Other service charges		638		—		638
Trust department income		—		7,157		7,157
Debit card income		2,884		—		2,884
Brokerage commissions		—		1,137		1,137
Other segment income (1)		1,431		—		1,431
Total other operating income		7,041		8,294		15,335
Other operating expenses:
Salaries and employee benefits		18,841		3,398		22,239
Equipment and occupancy		3,628		73		3,701
Data processing		4,331		289		4,620
FDIC premiums		778		—		778
Other segment expenses (2)		6,848		350		7,198
Total operating expenses		34,426		4,110		38,536
Income before income taxes and intercompany fees		20,715		4,184		24,899
Intercompany management fee income/(expense)		9		(9)		—
Income before income taxes		20,724		4,175		24,899
Income tax expense		5,283		878		6,161
Net income	$	15,441	$	3,297	$	18,738
Significant noncash items:
Credit loss expense	$	2,026	$	—	$	2,026
Depreciation		1,923		12		1,935
Amortization of intangible assets		90		157		247

(1) Other segment income includes bank owned life insurance income, gains on sales of investment securities available for sale, gains on disposals of fixed assets, and and miscellaneous income.

(2) Other segment expenses include professional services, contract labor, telephone, investor relations, contributions, net OREO expense/(income), and miscellaneous expenses.

		Nine months ended
		September 30, 2024
	Community		Wealth
(in thousands)	Banking		Management		Total
Interest income	$	68,268	$	—	$	68,268
Interest expense		23,990		—		23,990
Net interest income		44,278		—		44,278
Credit loss expense		2,404		—		2,404
Net interest income after credit loss expense		41,874		—		41,874
Other operating income:
Net gains on sales of residential mortgages		282		—		282
Service charges on deposit accounts		1,667		—		1,667
Other service charges		676		—		676
Trust department income		—		6,771		6,771
Debit card income		2,931		—		2,931
Brokerage commissions		—		1,154		1,154
Other segment income (1)		1,288		—		1,288
Total other operating income		6,844		7,925		14,769
Other operating expenses:
Salaries and employee benefits		18,359		3,214		21,573
Equipment and occupancy		4,409		91		4,500
Data processing		3,821		252		4,073
FDIC premiums		810		—		810
Other segment expenses (2)		6,264		339		6,603
Total operating expenses		33,663		3,896		37,559
Income before income taxes and intercompany fees		15,055		4,029		19,084
Intercompany management fee income/(expense)		9		(9)		—
Income before income taxes		15,064		4,020		19,084
Income tax expense		3,857		844		4,701
Net income	$	11,207	$	3,176	$	14,383
Significant noncash items:
Credit loss expense	$	2,404	$	—	$	2,404
Depreciation		2,612		21		2,633
Amortization of intangible assets		90		157		247

(1) Other segment income includes bank owned life insurance income, and miscellaneous income.

(2) Other segment expenses include professional services, contract labor, telephone, investor relations, contributions, net OREO expense/(income), and miscellaneous expenses.

		For the three months ended
		September 30, 2025
	Community		Wealth
(in thousands)	Banking		Management		Total
Interest income	$	25,762	$	—	$	25,762
Interest expense		8,359		—		8,359
Net interest income		17,403		—		17,403
Credit loss expense		510		—		510
Net interest income after credit loss expense		16,893		—		16,893
Other operating income:
Net gains on sales of residential mortgages		163		—		163
Service charges on deposit accounts		563		—		563
Other service charges		218		—		218
Trust department income		—		2,448		2,448
Debit card income		980		—		980
Brokerage commissions		—		346		346
Other segment income (1)		617		—		617
Total other operating income		2,541		2,794		5,335
Other operating expenses:
Salaries and employee benefits		6,443		1,146		7,589
Equipment and occupancy		1,171		23		1,194
Data processing		1,423		94		1,517
FDIC premiums		266		—		266
Other segment expenses (2)		2,311		109		2,420
Total operating expenses		11,614		1,372		12,986
Income before income taxes and intercompany fees		7,820		1,422		9,242
Intercompany management fee income/(expense)		3		(3)		—
Income before income taxes		7,823		1,419		9,242
Income tax expense		1,996		298		2,294
Net income	$	5,827	$	1,121	$	6,948
Significant noncash items:
Credit loss expense	$	510	$	—	$	510
Depreciation		652		3		655
Amortization of intangible assets		30		52		82

(1) Other segment income includes bank owned life insurance income, gains on sales of investment securities available for sale, gains on disposals of fixed assets, and and miscellaneous income.

(2) Other segment expenses include professional services, contract labor, telephone, investor relations, contributions, net OREO expense/(income), and miscellaneous expenses.

		For the three months ended
		September 30, 2024
	Community		Wealth
(in thousands)	Banking		Management		Total
Interest income	$	23,257	$	—	$	23,257
Interest expense		8,029		—		8,029
Net interest income		15,228		—		15,228
Credit loss expense		264		—		264
Net interest income after credit loss expense		14,964		—		14,964
Other operating income:
Net gains on sales of residential mortgages		141		—		141
Service charges on deposit accounts		555		—		555
Other service charges		236		—		236
Trust department income		—		2,328		2,328
Debit card income		1,000		—		1,000
Brokerage commissions		—		297		297
Other segment income (1)		496		—		496
Total other operating income		2,428		2,625		5,053
Other operating expenses:
Salaries and employee benefits		6,108		1,052		7,160
Equipment and occupancy		1,306		30		1,336
Data processing		1,260		73		1,333
FDIC premiums		256		—		256
Other segment expenses (2)		2,118		111		2,229
Total operating expenses		11,048		1,266		12,314
Income before income taxes and intercompany fees		6,344		1,359		7,703
Intercompany management fee income/(expense)		3		(3)		—
Income before income taxes		6,347		1,356		7,703
Income tax expense		1,666		266		1,932
Net income	$	4,681	$	1,090	$	5,771
Significant noncash items:
Credit loss expense	$	264	$	—	$	264
Depreciation		834		10		844
Amortization of intangible assets		30		52		82

(1) Other segment income includes bank owned life insurance income, and miscellaneous income.

(2) Other segment expenses include professional services, contract labor, telephone, investor relations, contributions, net OREO expense/(income), and miscellaneous expenses.