v3.26.1
Segment Reporting
 6 Months Ended
Jun. 30, 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, 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 June 30, 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:
June 30, 2026December 31, 2025
Community BankCCBXTreasury & AdministrationConsolidatedCommunity BankCCBXTreasury & AdministrationConsolidated
Assets(dollars in thousands; unaudited)
Cash and due from banks$4,415 $1,111 $1,002,922 $1,008,448 $4,243 $750 $731,977 $736,970 
Intrabank assets— 989,920 (989,920)— — 633,600 (633,600)— 
Securities— — 45,245 45,245 — — 48,247 48,247 
Loans held for sale— 107,838 — 107,838 — 71,216 — 71,216 
Total loans receivable1,982,518 2,225,752 — 4,208,270 1,941,979 1,807,552 — 3,749,531 
Allowance for credit losses
(15,723)(198,001)— (213,724)(18,231)(151,299)— (169,530)
All other assets27,649 216,138 56,288 300,075 29,809 235,137 40,057 305,003 
Total assets$1,998,859 $3,342,758 $114,535 $5,456,152 $1,957,800 $2,596,956 $186,681 $4,741,437 
Liabilities
Total deposits$1,574,166 $3,287,732 $— $4,861,898 $1,586,359 $2,557,840 $— $4,144,199 
Total borrowings— — 48,112 48,112 — — 48,036 48,036 
Intrabank liabilities416,575 — (416,575)— 366,216 — (366,216)— 
All other liabilities8,118 55,026 19,551 82,695 5,225 39,116 13,902 58,243 
Total liabilities$1,998,859 $3,342,758 $(348,912)$4,992,705 $1,957,800 $2,596,956 $(304,278)$4,250,478 
Three months ended June 30, 2026Three months ended June 30, 2025
Community BankCCBXTreasury & AdministrationConsolidatedCommunity BankCCBX Treasury & AdministrationConsolidated
(dollars in thousands; unaudited)
INTEREST INCOME AND EXPENSE
Interest income$32,517 $78,580 $7,457 $118,554 $30,603 $68,264 $8,930 $107,797 
Interest (expense) income intrabank transfer(3,931)5,962 (2,031)— (3,792)7,825 (4,033)— 
Interest expense5,657 22,386 1,144 29,187 6,783 23,617 660 31,060 
Net interest income22,929 62,156 4,282 89,367 20,028 52,472 4,237 76,737 
Provision/(Recapture) for credit losses(2,311)94,468 — 92,157 (216)32,427 — 32,211 
Net interest income/(expense) after provision for credit losses on loans and unfunded commitments25,240 (32,312)4,282 (2,790)20,244 20,045 4,237 44,526 
NONINTEREST INCOME
Deposit service charges and fees1,045 (29)— 1,016 913 — — 913 
Other income155 21 466 642 174 — (117)57 
BaaS program income— 12,012 — 12,012 — 7,651 — 7,651 
BaaS indemnification income— 75,037 — 75,037 — 34,072 — 34,072 
Noninterest income1,200 87,041 466 88,707 1,087 41,723 (117)42,693 
NONINTEREST EXPENSE
Salaries and employee benefits7,529 12,050 4,036 23,615 7,029 8,766 5,655 21,450 
Occupancy757 84 49 890 818 74 23 915 
Data processing and software licenses2,339 10,323 1,686 14,348 1,952 3,843 (254)5,541 
Legal and professional expenses377 4,832 988 6,197 700 2,353 2,909 5,962 
Credit enhancement receivable
   valuation adjustment		— 46,009 — 46,009 — — — — 
Other expense956 3,475 900 5,331 2,114 1,538 25 3,677 
BaaS loan expense— 40,409 — 40,409 — 32,483 — 32,483 
BaaS fraud expense— 4,312 — 4,312 — 2,804 — 2,804 
Total noninterest expense11,958 121,494 7,659 141,111 12,613 51,861 8,358 72,832 
Net income/(loss) before income taxes14,482 (66,765)(2,911)(55,194)8,718 9,907 (4,238)14,387 
Income taxes3,731 (15,587)(1,233)(13,089)2,138 2,742 (1,521)3,359 
Net income/(loss)$10,751 $(51,178)$(1,678)$(42,105)$6,580 $7,165 $(2,717)$11,028 
Six Months Ended June 30, 2026Six Months Ended June 30, 2025
Community BankCCBXTreasury & AdministrationConsolidatedCommunity BankCCBX Treasury & AdministrationConsolidated
(dollars in thousands; unaudited)
INTEREST INCOME AND EXPENSE
Interest income$64,251 $149,733 $16,251 $230,235 $60,895 $136,119 $15,690 $212,704 
Interest income (expense) intrabank transfer(7,556)14,118 (6,562)— (7,701)13,910 (6,209)— 
Interest expense11,228 44,485 1,798 57,511 13,387 45,198 1,320 59,905 
Net interest income45,467 119,366 7,891 172,724 39,807 104,831 8,161 152,799 
Provision/(Recapture) for credit losses (2,853)146,408 — 143,555 291 87,701 — 87,992 
Net interest income/(expense) after provision for credit losses on loans and unfunded commitments48,320 (27,042)7,891 29,169 39,516 17,130 8,161 64,807 
NONINTEREST INCOME
Service charges and fees1,863 3 — 1,866 1,773 — — 1,773 
Other income269 17 892 1,178 332 — 423 755 
BaaS program income— 22,900 — 22,900 — 13,929 — 13,929 
BaaS indemnification income— 128,840 — 128,840 — 89,713 — 89,713 
Noninterest income2,132 151,760 892 154,784 2,105 103,642 423 106,170 
NONINTEREST EXPENSE
Salaries and employee benefits14,826 23,577 8,376 46,779 14,169 16,741 12,057 42,967 
Occupancy1,569 92 88 1,749 1,649 159 141 1,949 
Data processing and software licenses4,156 15,358 2,477 21,991 3,383 5,582 1,458 10,423 
Legal and professional expenses821 10,047 2,331 13,199 744 5,046 6,060 11,850 
Credit enhancement receivable
   valuation adjustment		— 46,009 — 46,009 — — — — 
Other expense1,968 6,424 1,724 10,116 3,043 3,151 1,651 7,845 
BaaS loan expense— 77,349 — 77,349 — 64,990 — 64,990 
BaaS fraud expense— 7,371 — 7,371 — 4,797 — 4,797 
Total noninterest expense23,340 186,227 14,996 224,563 22,988 100,466 21,367 144,821 
Net income (loss) before income taxes27,112 (61,509)(6,213)(40,610)18,633 20,306 (12,783)26,156 
Income taxes5,649 (14,369)(1,804)(10,524)3,725 4,749 (3,076)5,398 
Net income (loss)$21,463 $(47,140)$(4,409)$(30,086)14,908 15,557 (9,707)20,758