Note 18  Business Segment Reporting Our business segments reflect the internal reporting that we use to evaluate operating performance of services and to assess the allocation of our resources. A brief description of our current business segments is as follows: Servicing. This segment is primarily comprised of our core residential mortgage servicing business and currently accounts for most of our total revenues. We provide residential and commercial mortgage loan servicing, special servicing and asset management services. We earn fees for providing these services to owners of the mortgage loans and foreclosed real estate. In most cases, we provide these services either because we purchased the MSRs from the owner of the mortgage, retained the MSRs on the sale of residential mortgage loans or because we entered into a subservicing or special servicing agreement with the entity that owns the MSR. Our residential servicing portfolio includes conventional, government-insured and non-Agency loans. Non-Agency loans include subprime loans, which represent residential loans that generally did not qualify under GSE guidelines or have subsequently become delinquent. Lending. The Lending segment purchases and originates conventional and government-insured residential forward and reverse mortgage loans. The loans are typically sold shortly after origination into a liquid market on a servicing retained (securitization) or servicing released (sale to a third party) basis. We originate loans directly with customers (retail channel) in forward lending as well as through our correspondent lending arrangements, broker relationships (wholesale) and retail channels of reverse mortgage lending. Corporate Items and Other. Corporate Items and Other includes revenues and expenses of corporate support services, CR Limited (CRL), our wholly-owned captive reinsurance subsidiary, discontinued operations and inactive entities, business activities that are individually insignificant, revenues and expenses that are not directly related to other reportable segments, interest income on short-term investments of cash and interest expense on corporate debt. Corporate Items and Other also includes severance, retention, facility-related and other expenses incurred in 2019 related to our re-engineering plan. Our cash balances are included in Corporate Items and Other. CRL provides re-insurance related to coverage on foreclosed real estate properties owned or serviced by us. We allocate a portion of interest income to each business segment, including interest earned on cash balances and short-term investments. We also allocate expenses incurred by corporate support services to each business segment. Interest expense on direct asset financings are recorded in the respective Servicing and Lending segments, while interest expense on the SSTL and Senior Notes is recorded in Corporate Items and Other and is not allocated. Financial information for our segments is as follows: Three Months Ended June 30, 2019 Results of Operations Servicing Lending Corporate Items and Other Corporate Eliminations Business Segments Consolidated Revenue $ 242,510 $ 28,794 $ 3,034 $  $ 274,338 Expenses (1) 290,087 21,026 20,381  331,494 Other income (expense): Interest income 1,872 1,546 419  3,837 Interest expense (14,191 ) (1,399 ) (15,981 )  (31,571 ) Bargain purchase gain   (96 ) (96 ) Other 890 444 (681 )  653 Other income (expense), net (11,429 ) 591 (16,339 )  (27,177 ) Income (loss) before income taxes $ (59,006 ) $ 8,359 $ (33,686 ) $  $ (84,333 ) Three Months Ended June 30, 2018 Results of Operations Servicing Lending Corporate Items and Other Corporate Eliminations Business Segments Consolidated Revenue $ 230,509 $ 19,002 $ 4,070 $  $ 253,581 Expenses (1) 166,888 17,785 20,977  205,650 Other income (expense): Interest income 1,466 1,360 529  3,355 Interest expense (62,675 ) (1,472 ) (13,356 )  (77,503 ) Other (326 ) 294 (2,156 )  (2,188 ) Other income (expense), net (61,535 ) 182 (14,983 )  (76,336 ) Income (loss) before income taxes $ 2,086 $ 1,399 $ (31,890 ) $  $ (28,405 ) Six months ended June 30, 2019 Revenue $ 501,784 $ 69,885 $ 6,557 $  $ 578,226 Expenses (1) (2) 555,984 42,357 13,258  611,599 Other income (expense): Interest income 4,165 3,095 1,135  8,395 Interest expense (68,889 ) (3,067 ) (30,060 )  (102,016 ) Bargain purchase gain   (381 )  (381 ) Other 2,416 663 (1,121 )  1,958 Other income (expense), net (62,308 ) 691 (30,427 )  (92,044 ) Income (loss) before income taxes $ (116,508 ) $ 28,219 $ (37,128 ) $  $ (125,417 ) Six months ended June 30, 2018 Revenue $ 456,605 $ 48,197 $ 9,036 $  $ 513,838 Expenses (1) 337,984 38,081 36,086  412,151 Other income (expense): Interest income 1,894 2,852 1,309  6,055 Interest expense (97,193 ) (3,417 ) (27,703 )  (128,313 ) Other (754 ) 620 (2,735 )  (2,869 ) Other income (expense), net (96,053 ) 55 (29,129 )  (125,127 ) Income (loss) before income taxes $ 22,568 $ 10,171 $ (56,179 ) $  $ (23,440 ) Total Assets Servicing Lending Corporate Items and Other Corporate Eliminations Business Segments Consolidated June 30, 2019 $ 3,195,218 $ 5,978,325 $ 454,250 $  $ 9,627,793 December 31, 2018 $ 3,306,208 $ 5,603,481 $ 484,527 $  $ 9,394,216 June 30, 2018 $ 2,851,910 $ 5,242,716 $ 325,570 $  $ 8,420,196 Depreciation and Amortization Expense Servicing Lending Corporate Items and Other Business Segments Consolidated Three months ended June 30, 2019 Depreciation expense $ 761 $ 46 $ 10,205 $ 11,012 Amortization of debt discount   350 350 Amortization of debt issuance costs   751 751 Three months ended June 30, 2018 Depreciation expense $ 1,256 $ 25 $ 4,834 $ 6,115 Amortization of debt discount   442 442 Amortization of debt issuance costs   1,005 1,005 Six months ended June 30, 2019 Depreciation expense $ 1,569 $ 81 $ 17,913 $ 19,563 Amortization of debt discount   701 701 Amortization of debt issuance costs   1,451 1,451 Six months ended June 30, 2018 Depreciation expense $ 2,613 $ 54 $ 9,973 $ 12,640 Amortization of debt discount   706 706 Amortization of debt issuance costs   1,662 1,662 (1) Compensation and benefits expense in the Corporate Items and Other segment for the three and six months ended June 30, 2019 and 2018 includes $0.8 million and $19.2 million , and $1.6 million , and $7.3 million , respectively, of severance expense attributable to PHH integration-related headcount reductions of primarily U.S.-based employees in 2019 and headcount reductions in connection with our strategic decisions to exit the automotive capital services business and the forward lending correspondent and wholesale channels in late 2017 and early 2018, as well as our overall efforts to reduce costs. (2) Included in the Corporate Items and Other segment for the six months ended June 30, 2019 , we recorded in Professional services expense a recovery from a service provider of $30.7 million during the first quarter of 2019 of amounts previously recognized as expense.