Quarterly report pursuant to Section 13 or 15(d)

SEGMENT REPORTING DISCLOSURES

v2.4.1.9
SEGMENT REPORTING DISCLOSURES
 3 Months Ended
Mar. 31, 2015
SEGMENT REPORTING DISCLOSURES [Abstract]  
SEGMENT REPORTING DISCLOSURES

13.SEGMENT REPORTING DISCLOSURES

 

The Company has two reportable segments: a traditional full service community bank segment and a mortgage loan origination business segment. The community bank segment includes one subsidiary bank, the Bank, which provides loan, deposit, investment, and trust services to retail and commercial customers throughout its 131 retail locations in Virginia.  The mortgage segment includes UMG, which provides a variety of mortgage loan products principally in Virginia, North Carolina, South Carolina, Maryland, and the Washington D.C. metro area.  These loans are originated and sold primarily in the secondary market through purchase commitments from investors, which serves to mitigate the Company’s exposure to interest rate risk.

Profit and loss is measured by net income after taxes including realized gains and losses on the Company’s investment portfolio.  The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies.  Inter-segment transactions are recorded at cost and eliminated as part of the consolidation process.

Both of the Company’s reportable segments are service-based.  The mortgage business is a fee-based business while the bank is driven principally by net interest income.  The bank segment provides a distribution and referral network through its customers for the mortgage loan origination business.  The mortgage segment offers a more limited referral network for the bank segment.

The community bank segment provides the mortgage segment with the short-term funds needed to originate mortgage loans through a warehouse line of credit and charges the mortgage banking segment interest at the three month LIBOR rate plus 0.15% with no floor, effective January 1, 2015.  During the quarter ended March 31, 2014, the interest rate on the warehouse line of credit was the three month LIBOR rate plus 1.5% with a floor of 2.0%.     These transactions are eliminated in the consolidation process.  A management fee for operations and administrative support services is charged to all subsidiaries and eliminated in the consolidated totals.

 

Information about reportable segments and reconciliation of such information to the consolidated financial statements for the three months ended March 31, 2015 and 2014 is as follows (dollars in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

UNION BANKSHARES CORPORATION AND SUBSIDIARIES

 

 

 

 

 

 

 

 

 

SEGMENT FINANCIAL INFORMATION

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Community Bank

 

Mortgage

 

Eliminations

 

Consolidated

Three Months Ended March 31, 2015

 

 

 

 

 

 

 

 

 

 

 

Net interest income

$
61,723 

 

$
246 

 

$

 -

 

$
61,969 

Provision for loan losses

 
1,750 

 

 

 -

 

 

 -

 

 
1,750 

Net interest income after provision for loan losses

 
59,973 

 

 
246 

 

 

 -

 

 
60,219 

Noninterest income

 
12,848 

 

 
2,376 

 

 
(170)

 

 
15,054 

Noninterest expenses

 
50,972 

 

 
3,038 

 

 
(170)

 

 
53,840 

Income (loss) before income taxes

 
21,849 

 

 
(416)

 

 

 -

 

 
21,433 

Income tax expense (benefit)

 
5,881 

 

 
(149)

 

 

 -

 

 
5,732 

Net income (loss)

$
15,968 

 

$
(267)

 

$

 -

 

$
15,701 

Total assets

$
7,382,266 

 

$
55,380 

 

$
(49,087)

 

$
7,388,559 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended March 31, 2014

 

 

 

 

 

 

 

 

 

 

 

Net interest income

$
63,526 

 

$
232 

 

$

 -

 

$
63,758 

Provision for loan losses

 

 -

 

 

 -

 

 

 -

 

 

 -

Net interest income after provision for loan losses

 
63,526 

 

 
232 

 

 

 -

 

 
63,758 

Noninterest income

 
11,659 

 

 
2,300 

 

 
(171)

 

 
13,788 

Noninterest expenses

 
62,746 

 

 
4,710 

 

 
(171)

 

 
67,285 

Income (loss) before income taxes

 
12,439 

 

 
(2,178)

 

 

 -

 

 
10,261 

Income tax expense (benefit)

 
3,351 

 

 
(798)

 

 

 -

 

 
2,553 

Net income (loss)

$
9,088 

 

$
(1,380)

 

$

 -

 

$
7,708 

Total assets

$
7,282,311 

 

$
57,705 

 

$
(45,511)

 

$
7,294,505