Business Segments

3 Months Ended

Mar. 31, 2017

Segment Reporting [Abstract]

BUSINESS SEGMENTS

BUSINESS SEGMENTS:

The Company's business segments are determined based on the products and services provided, as well as the nature of the related business activities, and they reflect the manner in which financial information is currently evaluated by management. The Company organizes the segments into two lines of business: Commercial and Consumer Banking segment and Mortgage Banking segment.

A description of the Company's business segments and the products and services that they provide is as follows.

Commercial and Consumer Banking provides diversified financial products and services to our commercial and consumer customers through bank branches and through ATMs, online, mobile and telephone banking. These products and services include deposit products; residential, consumer, business and agricultural portfolio loans; non-deposit investment products; insurance products and cash management services. We originate construction loans, bridge loans and permanent loans for our portfolio primarily on single family residences, and on office, retail, industrial and multifamily property types. We originate multifamily real estate loans through our Fannie Mae DUS^® business, whereby loans are sold to or securitized by Fannie Mae, while the Company generally retains the servicing rights. This segment also reflects the results for the management of the Company's portfolio of investment securities.

Mortgage Banking originates single family residential mortgage loans for sale in the secondary markets and performs mortgage servicing on certain loans. The majority of our mortgage loans are sold to or securitized by Fannie Mae, Freddie Mac or Ginnie Mae, while we retain the right to service these loans. We have become a rated originator and servicer of jumbo loans, allowing us to sell these loans to other securitizers. Additionally, we purchase loans from WMS Series LLC through a correspondent arrangement with that company. We also sell loans on a servicing-released and servicing-retained basis to securitizers and correspondent lenders. A small percentage of our loans are brokered to other lenders or sold on a servicing-released basis to correspondent lenders. On occasion, we may sell a portion of our MSR portfolio. We reflect the results from the management of loan funding and the interest rate risk associated with the secondary market loan sales and the retained single family mortgage servicing rights within this business segment.

Financial highlights by operating segment were as follows.

	Three Months Ended March 31, 2017
(in thousands)	Mortgage Banking			Commercial and Consumer Banking		Total
Condensed income statement:
Net interest income (1)	$	4,747		$	40,904	$	45,651
Provision for credit losses	—			—		—
Noninterest income	65,036			9,425		74,461
Noninterest expense	70,404			36,470		106,874
(Loss) income before income taxes	(621		)	13,859		13,238
Income tax (benefit) expense	(312		)	4,567		4,255
Net (loss) income	$	(309	)	$	9,292	$	8,983
Total assets	$	817,972		$	5,583,171	$	6,401,143

	Three Months Ended March 31, 2016
(in thousands)	Mortgage Banking		Commercial and Consumer Banking		Total
Condensed income statement:
Net interest income (1)	$	5,045	$	35,646	$	40,691
Provision for credit losses	—		1,400		1,400
Noninterest income	67,065		4,643		71,708
Noninterest expense	64,723		36,630		101,353
Income before income taxes	7,387		2,259		9,646
Income tax expense	2,522		717		3,239
Net income	$	4,865	$	1,542	$	6,407
Total assets	$	904,252	$	4,513,000	$	5,417,252

(1) Net interest income is the difference between interest earned on assets and the cost of liabilities to fund those assets. Interest earned includes actual interest earned on segment assets and, if the segment has excess liabilities, interest credits for providing funding to the other segment. The cost of liabilities includes interest expense on segment liabilities and, if the segment does not have enough liabilities to fund its assets, a funding charge based on the cost of excess liabilities from another segment.