Segment Information

The Company's operations are managed along three reportable operating segments: Community Banking, Home Mortgage Lending, and Specialty Finance. The Company reevaluated our reportable operating segments in 2024 concurrent with the acquisition of SCF, which resulted in the addition of the Specialty Finance segment. The Community Banking segment's principal business focus is the offering of loan and deposit products to business and consumer customers in its primary market areas. As of December 31, 2025, the Community Banking segment operated 20 branches throughout Alaska. The Home Mortgage Lending segment's principal business focus is the origination and sale of mortgage loans for 1-4 family residential properties, mortgage loan servicing for a portion of mortgage loans sold, and investment in certain 1-4 family residential mortgage loans on our balance sheet. The Specialty Finance segment's principal business focus is factoring, asset based lending and alternative working capital solutions to small and medium sized enterprises, and includes SCF and Northrim Funding Services, which was previously reported in the Community Banking segment prior to the acquisition of SCF.

The Company's reportable segments are determined by the Chief Financial Officer and the Chief Executive Officer, whom collectively are the designated chief operating decision maker. The reportable segments are determined based on information provided about the Company's products and services offered. They are also distinguished by the level of information provided to the chief operating decision maker, who uses the information to review performance of various components of the business, which are then aggregated if operating performance, products and services, and customers are similar. The chief operating decision maker evaluates the financial performance of the Company's business components such as by evaluating revenue streams, significant expenses, and budget to actual results in assessing the performance of the Company's segments and in the determination of allocating resources. Segment pretax net income or loss is used to assess the performance of the community banking segment by monitoring the margin between interest income and interest expense and the efficiency ratio specific to the segment. Segment pretax net income or loss is used to assess the performance of the home mortgage lending segment by monitoring the premium received on loan sales, the margin between interest income and interest expense, and the profitability of home mortgage servicing activities. Segment pretax net income or loss is used to assess the performance of the specialty finance segment by monitoring the yield of purchased receivable fees.

Accounting policies for segments are the same as those described in Note 1 to the Consolidated Financial Statements. Interest expense included in Part II. Item 8 of this report is allocated to each segment based on average cash utilized to fund the operations of the segment and the average cost of interest-bearing liabilities for the consolidated entity. Indirect salary expense for activities such as general management, accounting and finance, human resources, compliance, information technology, risk management, and internal audit are allocated based on the average percentage of employee time spent working in each specific segment.

Financial information for the Company's reportable segments and the reconciliation to the consolidated financial results for the periods indicated is shown in the following tables:


December 31, 2025
(In Thousands)	Community Banking	Home Mortgage Lending	Specialty Finance	Consolidated

Interest income	$157,060	$18,087	$3,231	$178,378
Interest expense	34,427	5,804	2,538	42,769
Net interest income	122,633	12,283	693	135,609
Provision for credit losses	2,338	1,178	394	3,910
Net interest income after provision for credit losses	120,295	11,105	299	131,699
Net realized gains on mortgage loans sold	—	16,777	—	16,777
Change in fair value of mortgage loan commitments, net	—	346	—	346
Total production revenue	—	17,123	—	17,123
Mortgage servicing revenue	—	10,822	—	10,822
Change in fair value of mortgage servicing rights:
Due to changes in model inputs of assumptions	—	(1,402)	—	(1,402)
Other	—	(2,380)	—	(2,380)
Total mortgage servicing revenue, net	—	7,040	—	7,040
Other mortgage banking revenue	—	1,074	—	1,074
Total mortgage banking income	—	25,237	—	25,237
Purchased receivable income	—	—	25,806	25,806
Other operating income	26,582	—	(422)	26,160
Total other operating income	26,582	25,237	25,384	77,203
Salaries and other personnel expense	49,080	22,224	7,033	78,337
Data processing expense	11,395	1,112	618	13,125
Occupancy expense	5,557	1,985	280	7,822
Professional and outside services	2,854	1,032	795	4,681
Marketing expense	3,164	547	17	3,728
Insurance expense	3,120	85	7	3,212
Compensation expense - SCF acquisition payments	—	—	2,333	2,333
Other operating expense	7,230	2,788	1,127	11,145
Total other operating expense	82,400	29,773	12,210	124,383
Income before provision for income taxes	64,477	6,569	13,473	84,519
Provision for income taxes	14,928	1,767	3,216	19,911
Net income	$49,549	$4,802	$10,257	$64,608

Total assets	$2,724,236	$390,242	$175,795	$3,290,273
Loans held for sale	$—	$100,323	$—	$100,323
1-4 family residential properties secured by first liens	$—	$243,185	$—	$243,185
Purchased receivables, net	$—	$—	$101,642	$101,642
Goodwill	$7,525	$7,492	$34,857	$49,874


December 31, 2025
(In Thousands)	Community Banking	Home Mortgage Lending	Specialty Finance	Consolidated

Interest income	$157,060	$18,087	$3,231	$178,378
Mortgage banking income - external revenue	—	25,237	—	25,237
Mortgage banking income - intersegment revenues	—	2,945	—	2,945
Purchased receivable income	—	—	25,806	25,806
Other operating income	26,582	—	(422)	26,160
	183,642	46,269	28,615	258,526
Reconciliation of revenue
Elimination of intersegment revenues	—	(2,945)	—	(2,945)
Total consolidated revenues	$183,642	$43,324	$28,615	$255,581
Less:
Interest expense	34,427	5,804	2,538	42,769
Provision for credit losses	2,338	1,178	394	3,910
Segment gross profit	146,877	36,342	25,683	208,902

Less(1):
Salaries and other personnel expense	$49,080	$22,224	$7,033	$78,337
Data processing expense	11,395	1,112	618	13,125
Occupancy expense	5,557	1,985	280	7,822
Professional and outside services	2,854	1,032	795	4,681
Marketing expense	3,164	547	17	3,728
Insurance expense	3,120	85	7	3,212
Compensation expense - SCF acquisition payments	—	—	2,333	2,333
Intersegment expense	2,945	—	—	2,945
Other segment items(2)	7,230	2,788	1,127	11,145
Segment expense	85,345	29,773	12,210	127,328

Reconciliation of expense
Elimination of intersegment expense	($2,945)	$—	$—	(2,945)
Total consolidated expense	$82,400	$29,773	$12,210	$124,383

Income before provision for income taxes	$64,477	$6,569	$13,473	$84,519

1The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker. All expenses are allocated to a segment.

2Other segment items for each reportable segment include:

Community banking: OREO (income) expense, net of rental income and gains on sale, director fees, operational charge offs net of recoveries, loan collection and collateral costs, and other miscellaneous operating costs related to community banking activities.

Home mortgage lending: OREO (income) expense, net of rental income and gains on sale related home mortgage loans, director fees related at Residential Mortgage, loan collection and collateral costs related to home mortgage loans, and other miscellaneous operating costs related to home mortgage lending activities.

Specialty finance: miscellaneous operating costs related to specialty finance activities.


December 31, 2024
(In Thousands)	Community Banking	Home Mortgage Lending	Specialty Finance	Consolidated

Interest income	$136,495	$16,477	$947	$153,919
Interest expense	34,391	5,249	1,096	40,736
Net interest income (loss)	102,104	11,228	(149)	113,183
Provision for credit losses	2,276	892	125	3,293
Net interest income (loss) after provision for credit losses	99,828	10,336	(274)	109,890
Net realized gains on mortgage loans sold	—	13,994	—	13,994
Change in fair value of mortgage loan commitments, net	—	172	—	172
Total production revenue	—	14,166	—	14,166
Mortgage servicing revenue	—	9,155	—	9,155
Change in fair value of mortgage servicing rights:
Due to changes in model inputs of assumptions	—	1,334	—	1,334
Other	—	(1,535)	—	(1,535)
Total mortgage servicing revenue, net	—	8,954	—	8,954
Other mortgage banking revenue	—	882	—	882
Total mortgage banking income	—	24,002	—	24,002
Purchased receivable income	—	—	7,146	7,146
Other operating income (loss)	10,960	—	(67)	10,893
Total other operating income	10,960	24,002	7,079	42,041
Salaries and other personnel expense	44,864	20,968	2,015	67,847
Data processing expense	9,918	966	102	10,986
Occupancy expense	5,534	1,927	148	7,609
Professional and outside services	2,284	827	1,240	4,351
Marketing expense	2,518	499	11	3,028
Insurance expense	2,690	101	170	2,961
Other operating expense	5,277	2,336	542	8,155
Total other operating expense	73,085	27,624	4,228	104,937
Income before provision for income taxes	37,703	6,714	2,577	46,994
Provision for income taxes	7,359	1,934	730	10,023
Net income	$30,344	$4,780	$1,847	$36,971

Total assets	$2,547,709	$357,630	$136,530	$3,041,869
Loans held for sale	$—	$59,957	$—	$59,957
1-4 family residential properties secured by first liens	$—	$270,966	$—	$270,966
Purchased receivables, net	$—	$—	$74,078	$74,078
Goodwill	$7,525	$7,492	$35,001	$50,018


December 31, 2024
(In Thousands)	Community Banking	Home Mortgage Lending	Specialty Finance	Consolidated

Interest income	$136,495	$16,477	$947	$153,919
Mortgage banking income - external revenue	—	24,002	—	24,002
Mortgage banking income - intersegment revenue	—	3,623	—	3,623
Purchased receivable income	—	—	7,146	7,146
Other operating income (loss)	10,960	—	(67)	10,893
	147,455	44,102	8,026	199,583
Reconciliation of revenue
Elimination of intersegment revenues	—	(3,623)	—	(3,623)
Total consolidated revenues	$147,455	$40,479	$8,026	$195,960
Less:
Interest expense	34,391	5,249	1,096	40,736
Provision for credit losses	2,276	892	125	3,293
Segment gross profit	110,788	34,338	6,805	151,931

Less(1):
Salaries and other personnel expense	$44,864	$20,968	$2,015	$67,847
Data processing expense	9,918	966	102	10,986
Occupancy expense	5,534	1,927	148	7,609
Professional and outside services	2,284	827	1,240	4,351
Marketing expense	2,518	499	11	3,028
Insurance expense	2,690	101	170	2,961
Intersegment expense	3,623	—	—	3,623
Other segment items(2)	5,277	2,336	542	8,155
Segment expense	76,708	27,624	4,228	108,560

Reconciliation of expense
Elimination of intersegment expense	($3,623)	$—	$—	(3,623)
Total consolidated expense	$73,085	$27,624	$4,228	$104,937

Income before provision for income taxes	$37,703	$6,714	$2,577	$46,994

1The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker. All expenses are allocated to a segment.

2Other segment items for each reportable segment include:

Specialty finance: miscellaneous operating costs related to specialty finance activities.


December 31, 2023
(In Thousands)	Community Banking	Home Mortgage Lending	Specialty Finance	Consolidated

Interest income	$121,855	$9,693	$403	$131,951
Interest expense	26,300	2,395	—	28,695
Net interest income	95,555	7,298	403	103,256
Provision for credit losses	3,842	—	—	3,842
Net interest income after provision for credit losses	91,713	7,298	403	99,414
Net realized gains on mortgage loans sold	—	7,828	—	7,828
Change in fair value of mortgage loan commitments, net	—	(102)	—	(102)
Total production revenue	—	7,726	—	7,726
Mortgage servicing revenue	—	7,368	—	7,368
Change in fair value of mortgage servicing rights:
Due to changes in model inputs of assumptions	—	(922)	—	(922)
Other	—	(1,765)	—	(1,765)
Total mortgage servicing revenue, net	—	4,681	—	4,681
Other mortgage banking revenue	—	356	—	356
Total mortgage banking income	—	12,763	—	12,763
Purchased receivable income	—	—	4,482	4,482
Other operating income	9,130	—	—	9,130
Total other operating income	9,130	12,763	4,482	26,375
Salaries and other personnel expense	42,795	17,873	1,073	61,741
Data processing expense	9,091	692	38	9,821
Occupancy expense	5,432	1,839	123	7,394
Professional and outside services	2,305	751	72	3,128
Marketing expense	2,465	462	2	2,929
Insurance expense	2,423	96	—	2,519
Other operating expense	4,742	1,784	123	6,649
Total other operating expense	69,253	23,497	1,431	94,181
Income (loss) before provision for income taxes	31,590	(3,436)	3,454	31,608
Provision for income taxes	6,175	(943)	982	6,214
Net income (loss)	$25,415	($2,493)	$2,472	$25,394

Total assets	$2,496,910	$267,706	$42,881	$2,807,497
Loans held for sale	$—	$31,974	$—	$31,974
1-4 family residential properties secured by first liens	$—	$203,738	$—	$203,738
Purchased receivables, net	$—	$—	$36,842	$36,842
Goodwill	$7,525	$7,492	$—	$15,017


December 31, 2023
(In Thousands)	Community Banking	Home Mortgage Lending	Specialty Finance	Consolidated

Interest income	$121,855	$9,693	$403	$131,951
Mortgage banking income - external revenue	—	12,763	—	12,763
Mortgage banking income - intersegment revenue	—	1,370	—	1,370
Purchased receivable income	—	—	4,482	4,482
Other operating income	9,130	—	—	9,130
	130,985	23,826	4,885	159,696
Reconciliation of revenue
Elimination of intersegment revenues	—	(1,370)	—	(1,370)
Total consolidated revenues	$130,985	$22,456	$4,885	$158,326
Less:
Interest expense	26,300	2,395	—	28,695
Provision for credit losses	3,842	—	—	3,842
Segment gross profit	100,843	20,061	4,885	125,789

Less(1):
Salaries and other personnel expense	$42,795	$17,873	$1,073	$61,741
Data processing expense	9,091	692	38	9,821
Occupancy expense	5,432	1,839	123	7,394
Professional and outside services	2,305	751	72	3,128
Marketing expense	2,465	462	2	2,929
Insurance expense	2,423	96	—	2,519
Intersegment expense	1,370	—	—	1,370
Other segment items(2)	4,742	1,784	123	6,649
Segment expense	70,623	23,497	1,431	95,551

Reconciliation of expense
Elimination of intersegment expense	($1,370)	$—	$—	(1,370)
Total consolidated expense	$69,253	$23,497	$1,431	$94,181

Income before provision for income taxes	$31,590	($3,436)	$3,454	$31,608

1The significant expense categories and amounts align with the segment-level information that is regularly provided to the chief operating decision maker. All expenses are allocated to a segment.

2Other segment items for each reportable segment include:

Specialty finance: miscellaneous operating costs related to specialty finance activities.

Historical Timeline

Fiscal Year	Filed
2025	Mar 6, 2026	Showing above
2024	Mar 10, 2025

2023	Mar 8, 2024

2022	Mar 7, 2023

2021	Mar 4, 2022

2020	Mar 5, 2021

2019	Mar 6, 2020

2018	Mar 13, 2019

2017	Mar 13, 2018

2016	Mar 13, 2017

2015	Mar 11, 2016

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.

NORTHRIM BANCORP INC Segments Disclosure

Historical Timeline

About Segments Disclosures

Other Available Disclosures