Segment Information

6 Months Ended

Jun. 30, 2019

FASB Codification 280 – “Segment Reporting” identifies operating segments as components of an enterprise which are evaluated regularly by the Corporation’s chief operating decision maker, our Chief Executive Officer, in deciding how to allocate resources and assess performance. The Corporation has applied the aggregation criterion set forth in this codification to the results of its operations.

The Corporation’s Banking segment consists of commercial and retail banking. The Banking segment is evaluated as a single strategic unit which generates revenues from a variety of products and services. The Banking segment generates interest income from its lending (including leases) and investing activities and is dependent on the gathering of lower cost deposits from its branch network or borrowed funds from other sources for funding its loans, resulting in the generation of net interest income. The Banking segment also derives revenues from other sources including gains on the sale in available for sale investment securities, gains on the sale of residential mortgage loans, service charges on deposit accounts, cash sweep fees, overdraft fees, bank owned life insurance (“BOLI”) income and revenue associated with its Visa Check Card offering. Also included in the Banking segment are two subsidiaries of the Bank, KCMI Capital, Inc. and Bryn Mawr Equipment Financing, Inc., both of which provide specialized lending solutions to our customers.

The Wealth Management segment has responsibility for a number of activities within the Corporation, including trust administration, other related fiduciary services, custody, investment management and advisory services, employee benefits and IRA administration, estate settlement, tax services and brokerage. Bryn Mawr Trust of Delaware and Lau Associates are included in the Wealth Management segment of the Corporation since they have similar economic characteristics, products and services to those of the Wealth Management Division of the Corporation. BMT Investment Advisers, formed in May 2017, which serves as investment adviser to BMT Investment Funds, a Delaware statutory trust, is also reported under the Wealth Management segment. In addition, the Wealth Management Division oversees all insurance services of the Corporation, which are conducted through the Bank’s insurance subsidiary, BMT Insurance Advisors, Inc., and are reported in the Wealth Management segment.

The accounting policies of the Corporation are applied by segment in the following tables. The segments are presented on a pre-tax basis.

The following tables detail the Corporation’s segments for the three and six months ended June 30, 2019 and 2018:



	Three Months Ended June 30, 2019									Three Months Ended June 30, 2018
(dollars in thousands)	Banking			Wealth Management			Consolidated			Banking			Wealth Management			Consolidated
Net interest income	$	36,610		$	1		$	36,611		$	37,315		$	1		$	37,316
Provision for loan and lease losses	1,627			—			1,627			3,137			—			3,137
Net interest income after loan loss provision	34,983			1			34,984			34,178			1			34,179
Noninterest income:
Fees for wealth management services	—			11,510			11,510			—			10,658			10,658
Insurance commissions	—			1,697			1,697			—			1,902			1,902
Capital markets revenue	1,489			—			1,489			2,105			—			2,105
Service charges on deposit accounts	852			—			852			752			—			752
Loan servicing and other fees	553			—			553			475			—			475
Net gain on sale of loans	752			—			752			528			—			528
Net gain on sale of investment securities available for sale	—			—			—			—			—			—
Net gain on sale of OREO	—			—			—			111			—			111
Other operating income	3,342			26			3,368			3,486			58			3,544
Total noninterest income	6,988			13,233			20,221			7,457			12,618			20,075

Noninterest expenses:
Salaries & wages	12,295			4,743			17,038			11,184			5,056			16,240
Employee benefits	2,338			979			3,317			1,922			955			2,877
Occupancy and bank premises	2,608			517			3,125			2,235			462			2,697
Amortization of intangible assets	328			628			956			385			504			889
Professional fees	1,221			95			1,316			879			53			932
Other operating expenses	7,983			1,453			9,436			10,875			1,326			12,201
Total noninterest expenses	26,773			8,415			35,188			27,480			8,356			35,836
Segment profit	15,198			4,819			20,017			14,155			4,263			18,418
Intersegment (revenues) expenses⁽¹⁾	(125		)	125			—			(150		)	150			—
Pre-tax segment profit after eliminations	$	15,073		$	4,944		$	20,017		$	14,005		$	4,413		$	18,418
% of segment pre-tax profit after eliminations	75.3		%	24.7		%	100.0		%	76.0		%	24.0		%	100.0		%
Segment assets (dollars in millions)	$	4,682.0		$	54.6		$	4,736.6		$	4,339.3		$	54.9		$	4,394.2



	Six Months Ended June 30, 2019									Six Months Ended June 30, 2018
(dollars in thousands)	Banking			Wealth Management			Consolidated			Banking			Wealth Management			Consolidated
Net interest income	$	74,255		$	3		$	74,258		$	74,753		$	2		$	74,755
Provision for loan and lease losses	5,363			—			5,363			4,167			—			4,167
Net interest income after loan loss provision	68,892			3			68,895			70,586			2			70,588
Noninterest income:
Fees for wealth management services	—			21,902			21,902			—			20,966			20,966
Insurance commissions	—			3,369			3,369			—			3,595			3,595
Capital markets revenue	3,708			—			3,708			2,771			—			2,771
Service charges on deposit accounts	1,660			—			1,660			1,465			—			1,465
Loan servicing and other fees	1,162			—			1,162			1,161			—			1,161
Net gain on sale of loans	1,071			—			1,071			1,046			—			1,046
Net gain on sale of investment securities available for sale	—			—			—			7			—			7
Net (loss) gain on sale of OREO	(24		)	—			(24		)	287			—			287
Other operating income	6,579			47			6,626			8,211			102			8,313
Total noninterest income	14,156			25,318			39,474			14,948			24,663			39,611

Noninterest expenses:
Salaries & wages	28,070			9,869			37,939			22,340			9,882			32,222
Employee benefits	5,510			1,973			7,483			4,598			1,987			6,585
Occupancy and bank premises	5,340			1,037			6,377			4,811			936			5,747
Amortization of intangible assets	655			1,239			1,894			783			985			1,768
Professional fees	2,384			252			2,636			1,608			72			1,680
Other operating expenses	15,252			3,331			18,583			21,306			2,558			23,864
Total noninterest expenses	57,211			17,701			74,912			55,446			16,420			71,866
Segment profit	25,837			7,620			33,457			30,088			8,245			38,333
Intersegment (revenues) expenses*	(248		)	248			—			(299		)	299			—
Pre-tax segment profit after eliminations	$	25,589		$	7,868		$	33,457		$	29,789		$	8,544		$	38,333
% of segment pre-tax profit after eliminations	76.5		%	23.5		%	100.0		%	77.7		%	22.3		%	100.0		%
Segment assets (dollars in millions)	$	4,682.0		$	54.6		$	4,736.6		$	4,339.3		$	54.9		$	4,394.2

(1) Inter-segment revenues consist of rental payments, interest on deposits and management fees.

Wealth Management Segment Information



(dollars in millions)	June 30, 2019		December 31, 2018
Assets under management, administration, supervision and brokerage	$	14,815.3	$	13,429.5