Segment information

9 Months Ended

Sep. 30, 2012

Segment information

14. Segment information

Reportable segments have been determined based upon the Company’s internal profitability reporting system, which is organized by strategic business unit. Certain strategic business units have been combined for segment information reporting purposes where the nature of the products and services, the type of customer and the distribution of those products and services are similar. The reportable segments are Business Banking, Commercial Banking, Commercial Real Estate, Discretionary Portfolio, Residential Mortgage Banking and Retail Banking.

The financial information of the Company’s segments was compiled utilizing the accounting policies described in note 22 to the Company’s consolidated financial statements as of and for the year ended December 31, 2011. The management accounting policies and processes utilized in compiling segment financial information are highly subjective and, unlike financial accounting, are not based on authoritative guidance similar to GAAP. As a result, the financial information of the reported segments is not necessarily comparable with similar information reported by other financial institutions. As also described in note 22 to the Company’s 2011 consolidated financial statements, neither goodwill nor core deposit and other intangible assets (and the amortization charges associated with such assets) resulting from acquisitions of financial institutions have been allocated to the Company’s reportable segments, but are included in the “All Other” category. The Company does, however, assign such intangible assets to business units for purposes of testing for impairment.

Information about the Company’s segments is presented in the following table:

	Three months ended September 30
	2012								2011
	Total revenues(a)		Inter- segment revenues			Net income (loss)			Total revenues(a)		Inter- segment revenues			Net income (loss)
	(in thousands)
Business Banking	$	114,181		1,011			38,411			110,627		957			31,237
Commercial Banking		255,498		1,561			112,654			230,023		1,318			93,783
Commercial Real Estate		169,806		5,031			75,896			152,878		410			65,566
Discretionary Portfolio		1,805		(25,593	)		(5,039	)		16,437		(3,968	)		2,077
Residential Mortgage Banking		138,662		28,454			44,727			67,757		25,012			10,805
Retail Banking		318,567		2,841			58,441			314,113		2,583			43,947
All Other		109,936		(13,305	)		(31,628	)		93,266		(26,312	)		(64,307	)
Total	$	1,108,455		—			293,462			985,101		—			183,108

	Nine months ended September 30
	2012									2011
	Total revenues(a)			Inter- segment revenues			Net income (loss)			Total revenues(a)		Inter- segment revenues			Net income (loss)
	(in thousands)
Business Banking	$	335,475			3,202			110,829			314,416		2,890			84,121
Commercial Banking		741,714			4,832			315,373			672,199		3,674			277,225
Commercial Real Estate		491,433			5,860			225,025			412,250		1,214			179,634
Discretionary Portfolio		(11,162	)		(60,990	)		(28,037	)		171,303		(16,174	)		76,566
Residential Mortgage Banking		341,699			100,350			94,238			183,910		44,018			21,556
Retail Banking		939,409			8,931			165,289			920,645		8,537			151,318
All Other		306,632			(62,185	)		(149,412	)		281,460		(44,159	)		(78,681	)
Total	$	3,145,200			—			733,305			2,956,183		—			711,739

	Average total assets
	Nine months ended				Year ended
	September 30				December 31
	2012		2011		2011
			(in millions)
Business Banking	$	4,918		4,995		5,192
Commercial Banking		19,691		17,397		17,650
Commercial Real Estate		16,364		14,730		15,025
Discretionary Portfolio		16,428		13,844		14,170
Residential Mortgage Banking		2,316		1,913		1,958
Retail Banking		11,746		11,904		11,940
All Other		8,055		7,706		8,042
Total	$	79,518		72,489		73,977

(a) Total revenues are comprised of net interest income and other income. Net interest income is the difference between taxable-equivalent interest earned on assets and interest paid on liabilities by a segment and a funding charge (credit) based on the Company’s internal funds transfer and allocation methodology. Segments are charged a cost to fund any assets (e.g. loans) and are paid a funding credit for any funds provided (e.g. deposits). The taxable-equivalent adjustment aggregated $6,534,000 and $6,546,000 for the three-month periods ended September 30, 2012 and 2011, respectively, and $19,884,000 and $19,341,000 for the nine-month periods ended September 30, 2012 and 2011, respectively, and is eliminated in “All Other” total revenues. Intersegment revenues are included in total revenues of the reportable segments. The elimination of intersegment revenues is included in the determination of “All Other” total revenues.