BUSINESS SEGMENTS

9 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

BUSINESS SEGMENTS

6.  BUSINESS SEGMENTS

The Company assesses its results among two operating segments, Banking and Peapack Private. Management uses certain methodologies to allocate income and expense to the business segments. A funds transfer pricing methodology is used to assign interest income and interest expense.  Certain indirect expenses are allocated to segments. These include support unit expenses such as technology and operations and other support functions. Taxes are allocated to each segment based on the effective rate for the period shown. The Banking segment’s effective tax rate for the three and nine months ended September 30, 2020 was affected by a $3.34 million income tax benefit recorded during the first quarter of 2020. For additional information related to this income tax benefit refer to the Income Taxes section of Management’s Discussion and Analysis.

Banking

The Banking segment includes commercial (includes C&I and equipment finance), commercial real estate, multifamily, residential and consumer lending activities; treasury management services; C&I advisory services; escrow management; deposit generation; operation of ATMs; telephone and internet banking services; merchant credit card services and customer support and sales.

Peapack Private

Peapack Private includes PGB Trust & Investments of Delaware, Murphy Capital, Lassus Wherley and Point View, includes investment management services provided for individuals and institutions; personal trust services, including services as executor, trustee, administrator, custodian and guardian, and other financial planning, tax preparation and advisory services.

The following tables present the statements of income and total assets for the Company’s reportable segments for the three and nine months ended September 30, 2020 and 2019.

	Three Months Ended September 30, 2020
			Wealth
			Management
(In thousands)	Banking		Division		Total
Net interest income	$	30,557	$	1,592	$	32,149
Noninterest income		9,451		10,760		20,211
Total income		40,008		12,352		52,360
Provision for loan and lease losses		5,150		—		5,150
Compensation and benefits		13,258		5,944		19,202
Premises and equipment expense		3,527		582		4,109
FDIC expense		605		—		605
Other noninterest expense		2,231		2,314		4,545
Total noninterest expense		24,771		8,840		33,611
Income before income tax expense		15,237		3,512		18,749
Income tax expense		4,254		948		5,202
Net income	$	10,983	$	2,564	$	13,547

	Three Months Ended September 30, 2019
				Wealth
				Management
(In thousands)	Banking			Division		Total
Net interest income	$	28,836		$	1,249	$	30,085
Noninterest income		4,561			9,855		14,416
Total income		33,397			11,104		44,501
Provision for loan and lease losses		800			—		800
Compensation and employee benefits		11,776			5,700		17,476
Premises and equipment expense		3,294			555		3,849
FDIC insurance expense		(277	)		—		(277	)
Other operating expense		2,985			2,226		5,211
Total operating expense		18,578			8,481		27,059
Income before income tax expense		14,819			2,623		17,442
Income tax expense		4,399			817		5,216
Net income	$	10,420		$	1,806	$	12,226

	Nine Months Ended September 30, 2020
			Wealth
			Management
(In thousands)	Banking		Division		Total
Net interest income	$	91,419	$	4,448	$	95,867
Noninterest income		16,036		31,318		47,354
Total income		107,455		35,766		143,221
Provision for loan and lease losses		30,050		—		30,050
Compensation and employee benefits		40,239		17,375		57,614
Premises and equipment expense		10,435		1,753		12,188
FDIC insurance expense		1,310		—		1,310
Other operating expense		7,889		6,709		14,598
Total operating expense		89,923		25,837		115,760
Income before income tax (benefit)/expense		17,532		9,929		27,461
Income tax (benefit)/expense		1,618		2,681		4,299
Net income/(loss)	$	15,914	$	7,248	$	23,162
Total assets at period end	$	5,878,481	$	79,626	$	5,958,107

	Nine Months Ended September 30, 2019
			Wealth
			Management
(In thousands)	Banking		Division		Total
Net interest income	$	85,336	$	4,024	$	89,360
Noninterest income		9,991		29,180		39,171
Total income		95,327		33,204		128,531
Provision for loan and lease losses		2,050		—		2,050
Compensation and employee benefits		36,458		15,717		52,175
Premises and equipment expense		9,265		1,572		10,837
FDIC insurance expense		277		—		277
Other operating expense		8,296		6,562		14,858
Total operating expense		56,346		23,851		80,197
Income before income tax expense		38,981		9,353		48,334
Income tax expense		10,592		2,541		13,133
Net income	$	28,389	$	6,812	$	35,201
Total assets at period end	$	4,840,002	$	85,407	$	4,925,409