Segment Reporting

6 Months Ended

Jun. 30, 2022

Segment Reporting

Segment Reporting

NOTE 15 Segment Reporting

The Company determines reportable segments based on the services offered, the significance of the services offered, the significance of those services to the Company’s financial statements, and management’s regular review of the operating results of those services. The Company operates through four operating segments: Banking, Retirement and Benefit Services, Wealth Management, and Mortgage.

The financial information presented for each segment includes net interest income, provision for loan losses, direct noninterest income, and direct noninterest expense, before indirect allocations. Corporate Administration includes the indirect overhead and is set forth in the table below. The segment net income before taxes represents direct revenue and expense before indirect allocations and income taxes.

The following table presents key metrics related to the Company’s segments for the periods presented:

	Three months ended June 30, 2022
			Retirement and		Wealth				Corporate
(dollars in thousands)	Banking		Benefit Services		Management		Mortgage		Administration		Consolidated
Net interest income	$	22,779	$	—	$	—	$	558	$	(561)	$	22,776
Provision for loan losses		—		—		—		—		—		—
Noninterest income		1,341		16,293		5,548		6,038		6		29,226
Noninterest expense		15,619		6,598		1,630		5,209		10,928		39,984
Net income before taxes	$	8,501	$	9,695	$	3,918	$	1,387	$	(11,483)	$	12,018

	Six months ended June 30, 2022
			Retirement and		Wealth				Corporate
(dollars in thousands)	Banking		Benefit Services		Management		Mortgage		Administration		Consolidated
Net interest income	$	44,304	$	—	$	—	$	1,267	$	(1,122)	$	44,449
Provision for loan losses		—		—		—		—		—		—
Noninterest income		2,879		33,939		10,874		10,969		35		58,696
Noninterest expense		28,313		15,030		3,468		10,229		21,015		78,055
Net income before taxes	$	18,870	$	18,909	$	7,406	$	2,007	$	(22,102)	$	25,090

	Three months ended June 30, 2021
			Retirement and		Wealth				Corporate
(dollars in thousands)	Banking		Benefit Services		Management		Mortgage		Administration		Consolidated
Net interest income	$	21,188	$	—	$	—	$	490	$	(538)	$	21,140
Provision for loan losses		—		—		—		—		—		—
Noninterest income		1,466		17,871		5,138		12,287		(14)		36,748
Noninterest expense		10,914		9,988		2,128		10,661		8,859		42,550
Net income before taxes	$	11,740	$	7,883	$	3,010	$	2,116	$	(9,411)	$	15,338

	Six months ended June 30, 2021
			Retirement and		Wealth				Corporate
(dollars in thousands)	Banking		Benefit Services		Management		Mortgage		Administration		Consolidated
Net interest income	$	43,068	$	—	$	—	$	936	$	(826)	$	43,178
Provision for loan losses		—		—		—		—		—		—
Noninterest income		2,988		35,126		10,124		29,419		(28)		77,629
Noninterest expense		21,998		20,100		4,463		21,514		17,517		85,592
Net income before taxes	$	24,058	$	15,026	$	5,661	$	8,841	$	(18,371)	$	35,215

Banking

The Banking division offers a complete line of loan, deposit, cash management, and treasury services through fourteen offices in North Dakota, Minnesota, and Arizona. These products and services are supported through web and mobile based applications. The majority of the Company’s assets and liabilities are in the Banking segment’s balance sheet.

Retirement and Benefit Services

Retirement and Benefit Services provides the following services nationally: recordkeeping and administration services to qualified retirement plans; ESOP trustee, recordkeeping, and administration; investment fiduciary services to retirement plans; health savings accounts, flex spending accounts, COBRA recordkeeping and administration services, and payroll to employers; and payroll and HRIS services for employers. In addition, the division operates within each of the banking markets, as well as in Lansing, Michigan and Littleton, Colorado.

Wealth Management

The Wealth Management division provides advisory and planning services, investment management, and trust and fiduciary services to clients across the Company’s footprint.

Mortgage

The Mortgage division offers first and second mortgage loans through a centralized mortgage unit in Minneapolis, Minnesota, as well as through the Banking office locations.