| Segment Reporting |
Note 12 – Segment Reporting The Company has two reportable segments: traditional commercial banking and mortgage banking. Revenues from commercial banking operations consist primarily of interest earned on loans and securities and fees from deposit services. Mortgage banking operating revenues consist principally of interest earned on mortgage loans held for sale, gains on sales of loans in the secondary mortgage market, and loan origination fee income. The Commercial Banking Segment provides the Mortgage Banking Segment with the short-term funds needed to originate mortgage loans through a warehouse line of credit and charges the Mortgage Banking Segment interest based on the Commercial Banking Segment’s cost of funds. Additionally, the Mortgage Banking Segment leases premises from the Commercial Banking Segment. These transactions are eliminated in the consolidation process. The following table presents segment information as of and for the three and six months ended June 30, 2021 and 2020 (in thousands): | | | | | | | | | | | | | | | Commercial | | Mortgage | | | | | Consolidated | | | Banking | | Banking | | Eliminations | | Totals | Three Months Ended June 30, 2021 | | | | | | | | | | | | | | | | | | | | | | | | | | Revenues | | | | | | | | | | | | | Interest income | | $ | 6,870 | | $ | 102 | | $ | — | | $ | 6,972 | Gain on sale of loans | | | — | | | 2,729 | | | — | | | 2,729 | Other revenues | | | 733 | | | 238 | | | (45) | | | 926 | Total revenues | | | 7,603 | | | 3,069 | | | (45) | | | 10,627 | | | | | | | | | | | | | | Expenses | | | | | | | | | | | | | Recovery of provision for loan losses | | | (500) | | | — | | | — | | | (500) | Interest expense | | | 580 | | | — | | | — | | | 580 | Salaries and benefits | | | 2,496 | | | 1,016 | | | — | | | 3,512 | Commissions | | | — | | | 890 | | | — | | | 890 | Other expenses | | | 1,791 | | | 202 | | | (45) | | | 1,948 | Total operating expenses | | | 4,367 | | | 2,108 | | | (45) | | | 6,430 | | | | | | | | | | | | | | Income before income taxes | | | 3,236 | | | 961 | | | — | | | 4,197 | Income tax expense | | | 701 | | | 202 | | | — | | | 903 | Net income | | $ | 2,535 | | $ | 759 | | $ | — | | $ | 3,294 | | | | | | | | | | | | | | Total assets | | $ | 717,993 | | $ | 19,366 | | $ | (19,427) | | $ | 717,932 |
| | | | | | | | | | | | | | | Commercial | | Mortgage | | | | | Consolidated | | | Banking | | Banking | | Eliminations | | Totals | Three Months Ended June 30, 2020 | | | | | | | | | | | | | | | | | | | | | | | | | | Revenues | | | | | | | | | | | | | Interest income | | $ | 6,087 | | $ | 136 | | $ | (30) | | $ | 6,193 | Gain on sale of loans | | | — | | | 2,804 | | | — | | | 2,804 | Other revenues | | | 571 | | | 277 | | | (60) | | | 788 | Total revenues | | | 6,658 | | | 3,217 | | | (90) | | | 9,785 | | | | | | | | | | | | | | Expenses | | | | | | | | | | | | | Provision for loan losses | | | 300 | | | — | | | — | | | 300 | Interest expense | | | 1,249 | | | 30 | | | (30) | | | 1,249 | Salaries and benefits | | | 1,628 | | | 984 | | | — | | | 2,612 | Commissions | | | — | | | 777 | | | — | | | 777 | Other expenses | | | 1,605 | | | 302 | | | (60) | | | 1,847 | Total operating expenses | | | 4,782 | | | 2,093 | | | (90) | | | 6,785 | | | | | | | | | | | | | | Income before income taxes | | | | | | | | | | | | | Income tax expense | | | 1,876 | | | 1,124 | | | — | | | 3,000 | Net income | | | 429 | | | 236 | | | — | | | 665 | | | $ | 1,447 | | $ | 888 | | $ | — | | $ | 2,335 | | | | | | | | | | | | | | Total assets | | $ | 723,802 | | $ | 12,716 | | $ | (13,872) | | $ | 722,646 |
| | | | | | | | | | | | | | | Commercial | | Mortgage | | | | | Consolidated | | | Banking | | Banking | | Eliminations | | Totals | Six Months Ended June 30, 2021 | | | | | | | | | | | | | | | | | | | | | | | | | | Revenues | | | | | | | | | | | | | Interest income | | $ | 13,789 | | $ | 237 | | $ | (23) | | $ | 14,003 | Gain on sale of loans | | | — | | | 6,904 | | | — | | | 6,904 | Other revenues | | | 1,456 | | | 466 | | | (135) | | | 1,787 | Total revenues | | | 15,245 | | | 7,607 | | | (158) | | | 22,694 | | | | | | | | | | | | | | Expenses | | | | | | | | | | | | | Recovery of provision for loan losses | | | (500) | | | — | | | — | | | (500) | Interest expense | | | 1,235 | | | 23 | | | (23) | | | 1,235 | Salaries and benefits | | | 4,641 | | | 2,292 | | | — | | | 6,933 | Commissions | | | — | | | 1,668 | | | — | | | 1,668 | Other expenses | | | 3,635 | | | 628 | | | (135) | | | 4,128 | Total operating expenses | | | 9,011 | | | 4,611 | | | (158) | | | 13,464 | | | | | | | | | | | | | | Income before income taxes | | | 6,234 | | | 2,996 | | | — | | | 9,230 | Income tax expense | | | 1,410 | | | 629 | | | — | | | 2,039 | Net income | | $ | 4,824 | | $ | 2,367 | | $ | — | | $ | 7,191 | | | | | | | | | | | | | | Total assets | | $ | 717,993 | | $ | 19,366 | | $ | (19,427) | | $ | 717,932 |
| | | | | | | | | | | | | | | Commercial | | Mortgage | | | | | Consolidated | | | Banking | | Banking | | Eliminations | | Totals | Six Months Ended June 30, 2020 | | | | | | | | | | | | | | | | | | | | | | | | | | Revenues | | | | | | | | | | | | | Interest income | | $ | 11,677 | | $ | 245 | | $ | (45) | | $ | 11,877 | Gain on sale of loans | | | — | | | 4,429 | | | — | | | 4,429 | Other revenues | | | 1,304 | | | 473 | | | (116) | | | 1,661 | Total revenues | | | 12,981 | | | 5,147 | | | (161) | | | 17,967 | | | | | | | | | | | | | | Expenses | | | | | | | | | | | | | Provision for loan losses | | | 700 | | | — | | | — | | | 700 | Interest expense | | | 2,506 | | | 45 | | | (45) | | | 2,506 | Salaries and benefits | | | 3,836 | | | 1,799 | | | — | | | 5,635 | Commissions | | | — | | | 1,215 | | | — | | | 1,215 | Other expenses | | | 3,313 | | | 576 | | | (116) | | | 3,773 | Total operating expenses | | | 10,355 | | | 3,635 | | | (161) | | | 13,829 | | | | | | | | | | | | | | Income before income taxes | | | | | | | | | | | | | Income tax expense | | | 2,626 | | | 1,512 | | | — | | | 4,138 | Net income | | | 588 | | | 317 | | | — | | | 905 | | | $ | 2,038 | | $ | 1,195 | | $ | — | | $ | 3,233 | | | | | | | | | | | | | | Total assets | | $ | 723,802 | | $ | 12,716 | | $ | (13,872) | | $ | 722,646 |
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