SEGMENT INFORMATION

3 Months Ended

Mar. 31, 2020

16. SEGMENT INFORMATION

As defined in ASC 280, Segment Reporting (ASC 280), an operating segment is a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the enterprise’s chief operating decision makers to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available. We evaluate performance based on pretax net income relative to resources used, and allocate resources based on these results. The accounting policies applicable to our segments are those that apply to our preparation of the accompanying unaudited Consolidated Financial Statements. Based on these criteria, we have identified three segments: WSFS Bank, Cash Connect^®, and Wealth Management.

The WSFS Bank segment provides financial products to commercial and retail customers. Retail and Commercial Banking, Commercial Real Estate Lending and other banking business units are operating departments of WSFS Bank. These departments share the same regulator, the same market, many of the same customers and provide similar products and services through the general infrastructure of the Bank. Accordingly, these departments are not considered discrete segments and are appropriately aggregated in the WSFS Bank segment in accordance with ASC 280.

Our Cash Connect^® segment provides ATM vault cash, smart safe and other cash logistics services through strategic partnerships with several of the largest networks, manufacturers and service providers in the ATM industry. Cash Connect^® services non-bank and WSFS-branded ATMs and retail safes nationwide. The balance sheet category Cash in non-owned ATMs includes cash from which fee income is earned through bailment arrangements with customers of Cash Connect^®.

The Wealth Management segment provides a broad array of planning and advisory services, investment management, trust services, and credit and deposit products to individual, corporate, and institutional clients through multiple integrated businesses. WSFS Wealth Investments provides financial advisory services along with insurance and brokerage products. Cypress, a registered investment adviser, is a fee-only wealth management firm managing a “balanced” investment style portfolio focused on preservation of capital and generating current income. West Capital, a registered investment adviser, is a fee-only wealth management firm operating under a multi-family office philosophy to provide customized solutions to institutions and high-net-worth individuals. The institutional trust division of WSFS, WSFS Institutional Services, provides trustee, agency, bankruptcy administration, custodial and commercial domicile services to institutional and corporate clients. The personal trust division of WSFS, Christiana Trust, provides personal trust and fiduciary services to families and individuals across the U.S. Powdermill is a multi-family office specializing in providing independent solutions to high-net-worth individuals, families and corporate executives through a coordinated, centralized approach. WSFS Wealth Client Management serves high-net-worth clients by delivering credit and deposit products and partnering with other Wealth Management units to provide comprehensive solutions to clients.

The following tables show segment results for the three months ended March 31, 2020 and 2019:


	Three Months Ended March 31, 2020														Three Months Ended March 31, 2019
(Dollars in thousands)	WSFS Bank		Cash Connect^®		Wealth Management		Total		WSFS Bank		Cash Connect^®		Wealth Management		Total
Statements of Income
External customer revenues:
Interest income	$	131,309	$	—	$	2,546	$	133,855	$	96,946	$	—	$	2,631	$	99,577
Noninterest income	18,072		11,679		11,096		40,847		17,264		12,402		11,456		41,122
Total external customer revenues	149,381		11,679		13,642		174,702		114,210		12,402		14,087		140,699
Inter-segment revenues:
Interest income	1,943		—		2,849		4,792		3,792		—		4,005		7,797
Noninterest income	2,907		229		173		3,309		1,883		177		186		2,246
Total inter-segment revenues	4,850		229		3,022		8,101		5,675		177		4,191		10,043
Total revenue	154,231		11,908		16,664		182,803		119,885		12,579		18,278		150,742
External customer expenses:
Interest expense	16,747		—		958		17,705		15,136		—		1,127		16,263
Noninterest expenses	73,085		8,223		7,188		88,496		82,577		8,030		6,985		97,592
Provision for credit losses	55,034		—		1,612		56,646		7,286		—		368		7,654
Total external customer expenses	144,866		8,223		9,758		162,847		104,999		8,030		8,480		121,509
Inter-segment expenses:
Interest expense	2,849		954		989		4,792		4,005		2,558		1,234		7,797
Noninterest expenses	402		741		2,166		3,309		363		545		1,338		2,246
Total inter-segment expenses	3,251		1,695		3,155		8,101		4,368		3,103		2,572		10,043
Total expenses	148,117		9,918		12,913		170,948		109,367		11,133		11,052		131,552
Income before taxes	$	6,114	$	1,990	$	3,751	$	11,855	$	10,518	$	1,446	$	7,226	$	19,190
Income tax provision							1,288								6,260
Consolidated net income							10,567								12,930
Net loss attributable to noncontrolling interest							(360)								(93)
Net income attributable to WSFS							10,927								13,023

The following table shows significant components of segment net assets as of March 31, 2020 and December 31, 2019:


	March 31, 2020														December 31, 2019
(Dollars in thousands)	WSFS Bank		Cash Connect^®		Wealth Management		Total		WSFS Bank		Cash Connect^®		Wealth Management		Total
Statements of Financial Condition
Cash and cash equivalents	$	177,508	$	320,077	$	7,525	$	505,110	$	202,792	$	357,494	$	11,466	$	571,752
Goodwill	452,629		—		20,199		472,828		452,629		—		20,199		472,828
Other segment assets	11,064,324		6,983		229,645		11,300,952		10,982,681		6,555		222,486		11,211,722
Total segment assets	$	11,694,461	$	327,060	$	257,369	$	12,278,890	$	11,638,102	$	364,049	$	254,151	$	12,256,302
Capital expenditures	$	2,282	$	211	$	38	$	2,531	$	11,806	$	2,120	$	272	$	14,198