v3.26.1
Segment Reporting
 3 Months Ended
Mar. 31, 2026
Segment Reporting [Abstract]  
Segment Reporting Segment Reporting
As defined in ASC 280, Segment Reporting, 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 (“CODM”) 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 classifications within accounting and reporting systems, which provides line of business results. This system uses various techniques to assign balance sheet and income statement amounts to the business segments, including allocations of income and expense. A primary objective of this measurement system and related internal financial reporting practices are to produce consistent results that reflect the underlying financial impact of the segments on the Company and to provide a basis of support for strategic decision making. The accounting policies applicable to our segments are those that apply to our preparation of the accompanying Consolidated Financial Statements. Based on these criteria, we have identified three segments: the community bank, CCBX, and treasury & administration. The Executive Leadership Team, which includes the CEO, Presidents, CFO and other key executive members, which the Company has designated as the CODMs, evaluates the financial performance of the Company’s segments by evaluating interest income and expense, noninterest income and significant expenses. The community bank segment includes all community banking activities. A primary focus of the community bank is on providing a wide range of banking products and services to consumers and small to medium sized businesses in the broader Puget Sound region in the state of Washington and through the Internet and our mobile banking application. We currently operate 14 full-service banking locations, 12 of which are located in Snohomish County, where we are the largest community bank by deposit market share, and two of which are located in neighboring counties (one in King County and one in Island County). We also have a loan production office which is located in King county. The CCBX segment provides BaaS that allows digital financial service providers, companies and brands to offer their customers banking services. The CCBX segment has 30 partners as of March 31, 2026. The treasury & administration segment includes investments, debt and other reporting items that are not specific to the community bank or CCBX segments.
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, reported segments and the financial information of the reported segments are not necessarily comparable with similar information reported by other financial institutions. Additionally, because of the interrelationships of the various segments, the information presented is not indicative of how the segments would perform if they operated as independent entities. Changes in management structure or allocation methodologies and procedures may result in future changes to previously reported segment financial data. Furthermore, changes in management structure or allocation methodologies and procedures may result in changes in reported segment financial data. The Company continues to evaluate its methodology on allocating items to the Company’s various segments to support strategic business decisions by the Company’s executive leadership. Income and expenses that are specific to a segment are directly posted to each segment. Additionally, certain indirect expenses are allocated to each segment utilizing various metrics, such as number of employees, utilization of space, and allocations based on loan and deposit balances. We have implemented a transfer pricing process that credits or charges the community bank and CCBX segments with intrabank interest income or expense for the difference in average loans and average deposits, with the treasury & administration segment as the offset for those entries.
Summarized financial information concerning the Company's reportable segments and the reconciliation to the consolidated financial results is shown in the following tables for the periods indicated:
March 31, 2026December 31, 2025
Community BankCCBXTreasury & AdministrationConsolidatedCommunity BankCCBXTreasury & AdministrationConsolidated
Assets(dollars in thousands; unaudited)
Cash and Due from Banks$4,454 $1,441 $1,489,572 $1,495,467 $4,243 $750 $731,977 $736,970 
Intrabank assets— 1,417,932 (1,417,932)— — 633,600 (633,600)— 
Securities— — 46,169 46,169 — — 48,247 48,247 
Loans held for sale— 124,039 — 124,039 — 71,216 — 71,216 
Total loans receivable1,975,255 1,884,124 — 3,859,379 1,941,979 1,807,552 — 3,749,531 
Allowance for credit losses
(18,153)(154,274)— (172,427)(18,231)(151,299)— (169,530)
All other assets29,503 240,799 40,900 311,202 29,809 235,137 40,057 305,003 
Total assets$1,991,059 $3,514,061 $158,709 $5,663,829 $1,957,800 $2,596,956 $186,681 $4,741,437 
Liabilities0
Total deposits$1,572,942 $3,468,222 $— $5,041,164 $1,586,359 $2,557,840 $— $4,144,199 
Total borrowings— — 48,074 48,074 — — 48,036 48,036 
Intrabank liabilities413,278 — (413,278)— 366,216 — (366,216)— 
All other liabilities4,839 45,839 20,151 70,829 5,225 39,116 13,902 58,243 
Total liabilities$1,991,059 $3,514,061 $(345,053)$5,160,067 $1,957,800 $2,596,956 $(304,278)$4,250,478 
Three months ended March 31, 2026Three months ended March 31, 2025
Community BankCCBXTreasury & AdministrationConsolidatedCommunity Bank CCBX Treasury & AdministrationConsolidated
(dollars in thousands; unaudited)
INTEREST INCOME AND EXPENSE
Interest income$31,734 $71,153 $8,794 $111,681 $30,292 $67,855 $6,760 $104,907 
Interest (expense) income intrabank transfer(3,625)8,156 (4,531)— (3,909)6,085 (2,176)— 
Interest expense5,571 22,099 654 28,324 6,604 21,581 660 28,845 
Net interest income22,538 57,210 3,609 83,357 19,779 52,359 3,924 76,062 
Provision/(Recapture) for credit losses(542)51,940 — 51,398 507 55,274 — 55,781 
Net interest income/(expense) after provision for credit losses on loans and unfunded commitments23,080 5,270 3,609 31,959 19,272 (2,915)3,924 20,281 
NONINTEREST INCOME
Deposit service charges and fees818 32 — 850 860 — — 860 
Other income114 (4)426 536 156 — 542 698 
BaaS program income— 10,888 — 10,888 — 6,278 — 6,278 
BaaS indemnification income— 53,803 — 53,803 — 55,641 — 55,641 
Noninterest income932 64,719 426 66,077 1,016  61,919 542 63,477 
NONINTEREST EXPENSE
Salaries and employee benefits7,297 11,527 4,298 23,122 7,155 7,975 6,402 21,532 
Occupancy812 8 39 859 830 85 119 1,034 
Data processing and software licenses1,817 5,035 791 7,643 1,395 1,146 1,691 4,232 
Legal and professional expenses444 5,215 1,343 7,002 63 3,273 3,152 6,488 
Other expense1,012 2,949 866 4,827 910 1,626 1,667 4,203 
BaaS loan expense— 36,940 — 36,940 — 32,507 — 32,507 
BaaS fraud expense— 3,059 — 3,059 — 1,993 — 1,993 
Total noninterest expense11,382 64,733 7,337 83,452 10,353 48,605 13,031 71,989 
Net income/(loss) before income taxes12,630 5,256 (3,302)14,584 9,935 10,399 (8,565)11,769 
Income taxes1,918 1,218 (571)2,565 1,587 2,007 (1,555)2,039 
Net income/(loss)$10,712 $4,038 $(2,731)$12,019 $8,348 $8,392 $(7,010)$9,730