Segment Information

The Company’s operations include three primary segments: core banking, trust and investment advisory services, and insurance operations. The core banking segment involves attracting deposits from the general public and using such funds to originate consumer, commercial and agricultural, commercial and agricultural real estate, and residential mortgage loans, primarily in the Company’s local markets. The core banking segment also involves the sale of residential mortgage loans in the secondary market. The trust and investment advisory services segment involves providing trust, investment advisory, and brokerage services to customers. The insurance segment offers a full range of personal and corporate property and casualty insurance products, primarily in the Company’s banking subsidiary’s local markets.

The core banking segment is comprised by the Company’s banking subsidiary, German American Bancorp, which operated through 53 banking offices at December 31, 2017. Net interest income from loans and investments funded by deposits and borrowings is the primary revenue for the core-banking segment. The trust and investment advisory services segment’s revenues are comprised primarily of fees generated by the trust operations of the Company's banking subsidiary and by German American Investment Services, Inc. These fees are derived by providing trust, investment advisory, and brokerage services to its customers. The insurance segment primarily consists of German American Insurance, Inc., which provides a full line of personal and corporate insurance products. Commissions derived from the sale of insurance products are the primary source of revenue for the insurance segment.

The following segment financial information has been derived from the internal financial statements of the Company which are used by management to monitor and manage financial performance. The accounting policies of the three segments are the same as those of the Company. The evaluation process for segments does not include holding company income and expense. Holding company amounts are the primary differences between segment amounts and consolidated totals, and are reflected in the column labeled “Other” below, along with amounts to eliminate transactions between segments.



	Core Banking		Trust and Investment Advisory Services		Insurance		Other			Consolidated Totals
Year Ended December 31, 2017
Net Interest Income	$	100,659	$	6	$	9	$	(765	)	$	99,909
Net Gains on Sales of Loans	3,280		—		—		—			3,280
Net Gains on Securities	593		—		—		3			596
Trust and Investment Product Fees	3		5,272		—		(3		)	5,272
Insurance Revenues	28		34		7,917		—			7,979
Noncash Items:
Provision for Loan Losses	1,750		—		—		—			1,750
Depreciation and Amortization	4,351		4		76		256			4,687
Income Tax Expense (Benefit)	12,262		145		512		(1,385		)	11,534
Segment Profit (Loss)	39,520		217		918		21			40,676
Segment Assets at December 31, 2017	3,142,096		1,987		10,078		(9,801		)	3,144,360



	Core Banking			Trust and Investment Advisory Services		Insurance		Other			Consolidated Totals
Year Ended December 31, 2016
Net Interest Income	$	95,562		$	1	$	7	$	(666	)	$	94,904
Net Gains on Sales of Loans	3,359			—		—		—			3,359
Net Gains on Securities	1,979			—		—		—			1,979
Trust and Investment Product Fees	(3		)	4,662		—		(15		)	4,644
Insurance Revenues	23			29		7,689		—			7,741
Noncash Items:
Provision for Loan Losses	1,200			—		—		—			1,200
Depreciation and Amortization	4,002			3		72		238			4,315
Income Tax Expense (Benefit)	14,306			168		741		(1,269		)	13,946
Segment Profit (Loss)	35,070			227		1,147		(1,260		)	35,184
Segment Assets at December 31, 2016	2,958,585			1,851		8,494		(12,936		)	2,955,994



	Core Banking		Trust and Investment Advisory Services			Insurance		Other			Consolidated Totals
Year Ended December 31, 2015
Net Interest Income	$	75,939	$	8		$	6	$	(401	)	$	75,552
Net Gains on Sales of Loans	2,959		—			—		—			2,959
Net Gains on Securities	698		—			—		27			725
Trust and Investment Product Fees	3		3,957			—		(3		)	3,957
Insurance Revenues	24		33			7,432		—			7,489
Noncash Items:
Provision for Loan Losses	—		—			—		—			—
Depreciation and Amortization	3,994		13			107		150			4,264
Income Tax Expense (Benefit)	11,836		(24		)	663		(869		)	11,606
Segment Profit (Loss)	29,461		(70		)	1,003		(330		)	30,064
Segment Assets at December 31, 2015	2,367,296		1,338			7,022		(1,955		)	2,373,701