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 Bank, which operated through 65 banking offices at March 31, 2019. 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
Three Months Ended
March 31, 2019
Net Interest Income	$	34,135	$	2	$	5	$	(551	)	$	33,591
Net Gains on Sales of Loans	981		—		—		—			981
Net Gains on Securities	155		—		—		—			155
Trust and Investment Product Fees	1		1,566		—		—			1,567
Insurance Revenues	3		21		3,181		—			3,205
Noncash Items:
Provision for Loan Losses	675		—		—		—			675
Depreciation and Amortization	1,927		1		18		64			2,010
Income Tax Expense (Benefit)	2,655		76		357		(340		)	2,748
Segment Profit (Loss)	14,499		215		1,090		(737		)	15,067
Segment Assets at March 31, 2019	3,888,904		2,963		8,771		(5,114		)	3,895,524



	Core Banking		Trust and Investment Advisory Services		Insurance		Other			Consolidated Totals
Three Months Ended
March 31, 2018
Net Interest Income	$	25,790	$	3	$	2	$	(185	)	$	25,610
Net Gains on Sales of Loans	650		—		—		—			650
Net Gains on Securities	270		—		—		—			270
Trust and Investment Product Fees	2		1,771		—		—			1,773
Insurance Revenues	1		2		2,927		—			2,930
Noncash Items:
Provision for Loan Losses	350		—		—		—			350
Depreciation and Amortization	1,115		1		19		64			1,199
Income Tax Expense (Benefit)	2,244		136		321		(217		)	2,484
Segment Profit (Loss)	10,762		385		939		(273		)	11,813
Segment Assets at December 31, 2018	3,926,242		2,658		11,368		(11,178		)	3,929,090