Business Segments

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Business Segments

NOTE 16. Business Segments

The Company has three reportable operating segments: community banking, marine lending and wealth management. Revenue from community banking operations consist primarily of net interest income related to investments in loan and securities and outstanding deposits and borrowings, fees earned on deposit accounts and debit card interchange activity. Revenue from marine lending operations consist primarily of net interest income related to commercial and consumer marine loans. The wealth management division's net revenues are comprised primarily of income from offering wealth management services and insurance products through third-party service providers.

On August 23, 2023, the Company completed a sale of specific assets from its marine lending segment. As part of the sale, the Company sold its interest in marine vessel floor plan loans totaling $52.8 million, its rights to service loans that had been sold to secondary market investors prior to the date of sale (valued at $595 thousand on balance sheet prior to sale), and other assets that were not individually significant. The Company received total consideration, net of selling expenses, of $53.5 million and recognized a gain of $435 thousand. The assets sold as well as their related revenues and contribution to earnings did not constitute a significant portion of the Company's assets or operating results for the year ended December 31, 2023. Subsequent to the sale of these assets, the Company retained ownership of its marine vessel retail loans which continue to constitute a significant portion of the Company's assets, revenues, and earnings. The Company expects to cease accepting new marine lending business and hold the retained outstanding loans until they are ultimately repaid.

Financial information of the parent company is included in the "All Other" category. The parent company's revenue and expenses are comprised primarily of interest expense associated with subordinated debt.

The following table provides income and asset information as of March 31, 2024 and December 31, 2023 and for the three months ended March 31, 2024 and March 31, 2023, which are included within the Consolidated Balance Sheets and Consolidated Statements of Income. The results by business segment are based on management’s accounting process, which assigns income statement items and assets to each operating segment. Given the Company's reportable segments are contained within the Bank, management must make certain allocations of expenses, which may not be representative of the costs expected to be incurred if the specific business segments operated as stand-alone entities. The Company expects it will continue to evaluate its business segments and internal reporting structure, including the production of discrete financial information to the chief operating decision-maker.

	Three Months Ended
	March 31, 2024
	Community Banking			Marine Lending		Wealth Management		All Other			Eliminations		Consolidated
	(in thousands)
Interest Income	$	18,450		$	3,462	$	—	$	—		$	—	$	21,912
Interest Expense		7,694			1,440		—		354			—		9,488
Net Interest Income (Expense)		10,756			2,022		—		(354	)		—		12,424
Gain on sales of loans		161			—		—		—			—		161
Other noninterest income		1,932			—		1,378		—			—		3,310
Net Revenue		12,849			2,022		1,378		(354	)		—		15,895
Provision for credit losses		86			389		—		—			—		475
Noninterest expense		11,317			218		729		113			—		12,377
Income before taxes		1,446			1,415		649		(467	)		—		3,043
Income tax expense		145			297		136		(83	)		—		495
Net Income	$	1,301		$	1,118	$	513	$	(384	)	$	—	$	2,548
Other data:
Capital expenditures	$	91		$	—	$	3	$	—		$	—	$	94
Depreciation and amortization		338			—		32		17			—		387
	Three Months Ended
	March 31, 2023
	Community Banking			Marine Lending		Wealth Management		All Other			Eliminations		Consolidated
	(in thousands)
Interest Income	$	15,241		$	3,317	$	—	$	—		$	—	$	18,558
Interest Expense		4,367			1,193		—		354			—		5,914
Net Interest Income (Expense)		10,874			2,124		—		(354	)		—		12,644
Gain on sales of loans		214			242		—		—			—		456
Other noninterest income		1,862			50		1,158		—			—		3,070
Net Revenue		12,950			2,416		1,158		(354	)		—		16,170
Provision for credit losses		506			158		—		—			—		664
Noninterest expense		10,360			1,282		603		141			—		12,386
Income before taxes		2,084			976		555		(495	)		—		3,120
Income tax expense		327			205		117		(114	)		—		535
Net Income	$	1,757		$	771	$	438	$	(381	)	$	—	$	2,585
Other data:
Capital expenditures	$	(10	)	$	17	$	—	$	—		$	—	$	7
Depreciation and amortization		420			95		31		17			—		563

	Community Banking		Marine Lending		Wealth Management		All Other		Eliminations		Consolidated
Total assets at March 31, 2024	$	1,526,973	$	253,912	$	1,051	$	965	$	—	$	1,782,901
Total assets at December 31, 2023	$	1,562,600	$	261,011	$	1,080	$	906	$	—	$	1,825,597