COASTAL FINANCIAL CORPCCB
COASTAL FINANCIAL CORP Segments Disclosure
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 28 partners as of December 31, 2025. 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.
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.
| December 31, 2025 | December 31, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||
| Community Bank | CCBX | Treasury & Administration | Consolidated | Community Bank | CCBX | Treasury & Administration | Consolidated | ||||||||||||||||||||||||||||||||||||||||
| Assets | (dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||
| Cash and Due from Banks | $ | 4,243 | $ | 750 | $ | 731,977 | $ | 736,970 | $ | 4,510 | $ | 10,894 | $ | 437,109 | $ | 452,513 | |||||||||||||||||||||||||||||||
| Intrabank assets | — | 633,600 | (633,600) | — | — | 411,768 | (411,768) | — | |||||||||||||||||||||||||||||||||||||||
| Securities | — | — | 48,247 | 48,247 | — | — | 47,321 | 47,321 | |||||||||||||||||||||||||||||||||||||||
| Loans held for sale | — | 71,216 | — | 71,216 | — | 20,600 | — | 20,600 | |||||||||||||||||||||||||||||||||||||||
| Total loans receivable | 1,941,979 | 1,807,552 | — | 3,749,531 | 1,882,988 | 1,603,577 | — | 3,486,565 | |||||||||||||||||||||||||||||||||||||||
Allowance for credit losses | (18,231) | (151,299) | — | (169,530) | (18,924) | (158,070) | — | (176,994) | |||||||||||||||||||||||||||||||||||||||
| All other assets | 29,809 | 235,137 | 40,057 | 305,003 | 28,272 | 211,039 | 51,892 | 291,203 | |||||||||||||||||||||||||||||||||||||||
| Total assets | $ | 1,957,800 | $ | 2,596,956 | $ | 186,681 | $ | 4,741,437 | $ | 1,896,846 | $ | 2,099,808 | $ | 124,554 | $ | 4,121,208 | |||||||||||||||||||||||||||||||
| Liabilities | |||||||||||||||||||||||||||||||||||||||||||||||
| Total deposits | $ | 1,586,359 | $ | 2,557,840 | $ | — | $ | 4,144,199 | 1,521,244 | 2,064,088 | — | 3,585,332 | |||||||||||||||||||||||||||||||||||
| Total borrowings | — | — | 48,036 | 48,036 | — | — | 47,884 | 47,884 | |||||||||||||||||||||||||||||||||||||||
| Intrabank liabilities | 366,216 | — | (366,216) | — | 367,540 | — | (367,540) | — | |||||||||||||||||||||||||||||||||||||||
| All other liabilities | 5,225 | 39,116 | 13,902 | 58,243 | 8,062 | 35,720 | 5,506 | 49,288 | |||||||||||||||||||||||||||||||||||||||
| Total liabilities | $ | 1,957,800 | $ | 2,596,956 | $ | (304,278) | $ | 4,250,478 | $ | 1,896,846 | $ | 2,099,808 | $ | (314,150) | $ | 3,682,504 | |||||||||||||||||||||||||||||||
| Year Ended December 31, 2025 | Year Ended December 31, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||
| Community Bank | CCBX | Treasury & Administration | Consolidated | Community Bank | CCBX | Treasury & Administration | Consolidated | ||||||||||||||||||||||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
| INTEREST INCOME AND EXPENSE | |||||||||||||||||||||||||||||||||||||||||||||||
| Interest income | $ | 122,956 | $ | 274,608 | $ | 32,053 | $ | 429,617 | $ | 123,735 | $ | 248,286 | $ | 24,756 | $ | 396,777 | |||||||||||||||||||||||||||||||
| Interest income (expense) intrabank transfer | (13,788) | 26,673 | (12,885) | — | (21,265) | 30,221 | (8,956) | — | |||||||||||||||||||||||||||||||||||||||
| Interest expense | 26,805 | 90,109 | 2,638 | 119,552 | 26,897 | 94,035 | 2,817 | 123,749 | |||||||||||||||||||||||||||||||||||||||
| Net interest income | 82,363 | 211,172 | 16,530 | 310,065 | 75,573 | 184,472 | 12,983 | 273,028 | |||||||||||||||||||||||||||||||||||||||
| Provision/(Recapture) for credit losses | (504) | 193,135 | — | 192,631 | (1,373) | 278,980 | — | 277,607 | |||||||||||||||||||||||||||||||||||||||
| Provision for unfunded commitments | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Net interest income/(expense) after provision for credit losses - loans and unfunded commitments | 82,867 | 18,037 | 16,530 | 117,434 | 76,946 | (94,508) | 12,983 | (4,579) | |||||||||||||||||||||||||||||||||||||||
| NONINTEREST INCOME | |||||||||||||||||||||||||||||||||||||||||||||||
| Service charges and fees | 3,494 | 64 | — | 3,558 | 3,691 | 47 | — | 3,738 | |||||||||||||||||||||||||||||||||||||||
| Other income | 603 | 1,206 | 1,083 | 2,892 | 751 | 76 | 892 | 1,719 | |||||||||||||||||||||||||||||||||||||||
| BaaS program income | — | 29,491 | — | 29,491 | — | 20,075 | — | 20,075 | |||||||||||||||||||||||||||||||||||||||
| BaaS indemnification income | — | 195,667 | — | 195,667 | — | 282,673 | — | 282,673 | |||||||||||||||||||||||||||||||||||||||
| Noninterest income | 4,097 | 226,428 | 1,083 | 231,608 | 4,442 | 302,871 | 892 | 308,205 | |||||||||||||||||||||||||||||||||||||||
| NONINTEREST EXPENSE | |||||||||||||||||||||||||||||||||||||||||||||||
| Salaries and employee benefits | 30,734 | 35,727 | 19,313 | 85,774 | 24,432 | 28,909 | 16,586 | 69,927 | |||||||||||||||||||||||||||||||||||||||
| Occupancy | 3,285 | 406 | 301 | 3,992 | 3,401 | 333 | 202 | 3,936 | |||||||||||||||||||||||||||||||||||||||
| Data processing and software licenses | 6,092 | 14,117 | 3,306 | 23,515 | 4,759 | 4,029 | 6,682 | 15,470 | |||||||||||||||||||||||||||||||||||||||
| Legal and professional expenses | 1,364 | 9,141 | 9,749 | 20,254 | 99 | 8,904 | 6,503 | 15,506 | |||||||||||||||||||||||||||||||||||||||
| Other expense | 6,395 | 6,917 | 3,850 | 17,162 | 3,845 | 4,727 | 4,528 | 13,100 | |||||||||||||||||||||||||||||||||||||||
| BaaS loan expense | — | 129,086 | — | 129,086 | — | 118,536 | — | 118,536 | |||||||||||||||||||||||||||||||||||||||
| BaaS fraud expense | — | 8,014 | — | 8,014 | — | 9,834 | — | 9,834 | |||||||||||||||||||||||||||||||||||||||
| Total noninterest expense | 47,870 | 203,408 | 36,519 | 287,797 | 36,536 | 175,272 | 34,501 | 246,309 | |||||||||||||||||||||||||||||||||||||||
| Net income before income taxes | 39,094 | 41,057 | (18,906) | 61,245 | 44,852 | 33,091 | (20,626) | 57,317 | |||||||||||||||||||||||||||||||||||||||
| Income taxes | 7,935 | 10,749 | (4,432) | 14,252 | 8,870 | 7,999 | (4,771) | 12,098 | |||||||||||||||||||||||||||||||||||||||
| Net Income | $ | 31,159 | $ | 30,308 | $ | (14,474) | $ | 46,993 | $ | 35,982 | $ | 25,092 | $ | (15,855) | $ | 45,219 | |||||||||||||||||||||||||||||||
| Year Ended December 31, 2023 | |||||||||||||||||||||||
| Community Bank | CCBX | Treasury & Administration | Consolidated | ||||||||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||
| INTEREST INCOME AND EXPENSE | |||||||||||||||||||||||
| Interest income | $ | 106,983 | $ | 197,306 | $ | 18,930 | $ | 323,219 | |||||||||||||||
| Interest income (expense) intrabank transfer | $ | (10,404) | $ | 19,071 | $ | (8,667) | — | ||||||||||||||||
| Interest expense | 17,354 | 71,646 | $ | 2,644 | 91,644 | ||||||||||||||||||
| Net interest income | 79,225 | 144,731 | $ | 7,619 | 231,575 | ||||||||||||||||||
| Provision/(Recapture) for credit losses | 1,111 | 182,881 | $ | — | 183,992 | ||||||||||||||||||
| Net interest income/(expense) after provision for credit losses - loans and unfunded commitments | 78,114 | (38,150) | 7,619 | 47,583 | |||||||||||||||||||
| NONINTEREST INCOME | |||||||||||||||||||||||
| Service charges and fees | 3,810 | 44 | $ | — | 3,854 | ||||||||||||||||||
| Other income | 1,165 | 433 | $ | 501 | 2,099 | ||||||||||||||||||
| BaaS program income | — | 13,240 | $ | — | 13,240 | ||||||||||||||||||
| BaaS indemnification income | — | 184,929 | $ | — | 184,929 | ||||||||||||||||||
| Noninterest income | 4,975 | 198,646 | $ | 501 | 204,122 | ||||||||||||||||||
| NONINTEREST EXPENSE | |||||||||||||||||||||||
| Salaries and employee benefits | 24,104 | 25,159 | $ | 17,198 | 66,461 | ||||||||||||||||||
| Occupancy | 3,741 | 321 | $ | 110 | 4,172 | ||||||||||||||||||
| Data processing and software licenses | 4,595 | 2,321 | $ | 2,433 | 9,349 | ||||||||||||||||||
| Legal and professional expenses | 1,580 | 9,645 | $ | 3,578 | 14,803 | ||||||||||||||||||
| Other expense | 3,954 | 3,759 | $ | 5,161 | 12,874 | ||||||||||||||||||
| BaaS loan expense | — | 79,748 | $ | — | 79,748 | ||||||||||||||||||
| BaaS fraud expense | — | 7,165 | $ | — | 7,165 | ||||||||||||||||||
| Total noninterest expense | 37,974 | 128,118 | $ | 28,480 | 194,572 | ||||||||||||||||||
| Net income before income taxes | 45,115 | 32,378 | (20,360) | 57,133 | |||||||||||||||||||
| Income taxes | 9,913 | 7,116 | (4,475) | 12,554 | |||||||||||||||||||
| Net Income | 35,202 | 25,262 | (15,885) | 44,579 | |||||||||||||||||||
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Mar 17, 2025 | |
| 2023 | Mar 15, 2024 | |
| 2022 | Mar 16, 2023 | |
| 2021 | Mar 14, 2022 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.