SEGMENT REPORTING
The Company’s reportable segment is determined by the Chief Executive Officer, who is designated as the chief operating decision maker (“CODM”), based upon information provided about the Company’s products and services offered, primarily banking operations. The segment is also distinguished by the level of information provided to the CODM, who uses such information to review performance of various line of businesses, which are then aggregated if operating performance, product/services, and customers are similar. The CODM evaluates the financial performance of the Company’s businesses using revenue streams, comparative product pricing, and significant expenses to assess performance and return on assets. The CODM uses consolidated net income and profitability metrics to benchmark the Company against its competitors. Benchmarking analysis and monitoring of budget to actual results are used to assess performance and establish compensation. The CODM when making significant decisions takes into consideration certain financial metrics including loan growth, deposit growth, return on assets, return on average tangible common equity, efficiency ratio, and net interest margin.
Interest income from loans and other earning assets, and income from fee-based businesses provide banking operation revenue. Interest expense on deposits and other sources of funding, provisions for credit losses, and operating expenses, primarily salaries and employee benefits, occupancy, furniture, equipment and software, and data processing and item processing, provide the significant expenses of banking operations. The Company currently operates as a single-segment and all operations are domestic. The Merger did not result in any additional operating segments for the Company since Territorial branches became part of the Company’s single segment.
The following table presents certain segment income statement information, including significant expense categories:
| | | | | | | | | | | | | | | | | |
| Year Ended December 31, |
| 2025 | | 2024 | | 2023 |
| (Dollars in thousands) |
| Net interest income | $ | 472,234 | | | $ | 427,851 | | | $ | 525,861 | |
| Provision for credit losses | (31,802) | | | (17,280) | | | (31,592) | |
| Noninterest income | 26,468 | | | 47,077 | | | 45,577 | |
| Noninterest expense | (389,623) | | | (324,684) | | | (361,959) | |
| Income before income tax expense | $ | 77,277 | | | $ | 132,964 | | | $ | 177,887 | |
| | | | | |
| Significant segment expenses | | | | | |
| Salaries and employee benefits | $ | 214,110 | | | $ | 177,860 | | | $ | 207,871 | |
| Occupancy | 34,206 | | | 27,469 | | | 28,868 | |
| Furniture, equipment and software | 32,020 | | | 23,968 | | | 24,152 | |
| Data processing and item processing | 12,475 | | | 9,684 | | | 8,832 | |
| Merger and restructuring-related costs | 21,534 | | | 5,627 | | | 11,576 | |
The following table presents certain segment balance sheet information:
| | | | | | | | | | | | | | | | | |
| December 31, |
| 2025 | | 2024 | | 2023 |
| (Dollars in thousands) |
| Total assets | $ | 18,531,626 | | | $ | 17,054,008 | | | $ | 19,131,522 | |
| Investment securities AFS and HTM | 2,072,864 | | | 2,075,628 | | | 2,408,971 | |
| Total loans receivable | 14,701,012 | | | 13,618,272 | | | 13,853,619 | |
| Total deposits | 15,603,143 | | | 14,327,489 | | | 14,753,753 | |
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.