REVENUE FROM CONTRACTS WITH CUSTOMERS

3 Months Ended

Mar. 31, 2023

REVENUE FROM CONTRACTS WITH CUSTOMERS [Abstract]

REVENUE FROM CONTRACTS WITH CUSTOMERS [Text Block]

NOTE 19 – REVENUE FROM CONTRACTS WITH CUSTOMERS

Revenue Recognition

In accordance with ASC Topic 606, “Revenue from Contracts with Customers” (“ASC Topic 606”), revenues are recognized when

control of promised goods or services is transferred to customers and in an amount that reflects the consideration to which the

Corporation expects to be entitled in exchange for those goods or services. At contract inception, once the contract is determined to be

within the scope of ASC Topic 606, the Corporation assesses the goods or services that are promised within each contract, identifies

the respective performance obligations, and assesses whether each promised good or service is distinct. The Corporation then

recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the

performance obligation is satisfied.

Disaggregation of Revenue 

The following tables summarize the Corporation’s revenue, which includes net interest income on financial instruments and non-

interest income, disaggregated by type of service and business segment for the quarters ended March 31, 2023 and 2022:

Quarter ended March 31, 2023

Mortgage

Banking

Consumer

(Retail)

Banking

Commercial

and Corporate

Treasury and

Investments

United States

Operations

Virgin Islands

Operations

Total

(In thousands)

Net interest income

(1)

$

21,788

$

137,744

$

14,940

$

(658)

$

20,930

$

6,141

$

200,885

Service charges and fees on deposit accounts

-

5,486

3,154

-

165

736

9,541

Insurance commissions

-

4,640

-

-

28

179

4,847

Merchant-related income

-

2,263

-

-

29

468

2,760

Credit and debit card fees

-

7,638

22

-

2

496

8,158

Other service charges and fees

161

1,152

854

-

583

344

3,094

Not in scope of ASC Topic 606

 (1)

2,913

855

145

160

40

5

4,118

 Total non-interest income

3,074

22,034

4,175

160

847

2,228

32,518

Total Revenue

$

24,862

$

159,778

$

19,115

$

(498)

$

21,777

$

8,369

$

233,403

Quarter ended March 31, 2022

Mortgage

Banking

Consumer

(Retail)

Banking

Commercial

and Corporate

Treasury and

Investments

United States

Operations

Virgin Islands

Operations

Total

(In thousands)

Net interest income

(1)

$

25,779

$

89,546

$

40,415

$

7,409

$

16,482

$

5,993

$

185,624

Service charges and fees on deposit accounts

-

5,539

2,976

-

138

710

9,363

Insurance commissions

-

4,967

-

-

29

279

5,275

Merchant-related income

-

1,822

373

-

5

389

2,589

Credit and debit card fees

-

6,671

16

-

(7)

410

7,090

Other service charges and fees

143

1,110

1,113

-

499

157

3,022

Not in scope of ASC Topic 606

(1)

5,109

354

76

(112)

80

12

5,519

Total non-interest income

5,252

20,463

4,554

(112)

744

1,957

32,858

Total Revenue

$

31,031

$

110,009

$

44,969

$

7,297

$

17,226

$

7,950

$

218,482

(1)

Most of the Corporation's revenue is not within the scope of ASC Topic 606. The guidance explicitly excludes net interest income from financial assets and liabilities, as well as other non-interest income from loans, leases, investment securities and derivative

financial instruments.

For the quarters ended March 31, 2023 and 2022, most of the Corporation’s revenue within the scope of ASC Topic 606 was

related to performance obligations satisfied at a point in time.

See Note 26 – Revenue from Contracts with Customers, to the audited consolidated financial statements included in the 2022

Annual Report on Form 10-K for a discussion of major revenue streams under the scope of ASC Topic 606.

Contract Balances

A

contract liability is an entity’s obligation to transfer goods or services to a customer in exchange for consideration from the

customer. FirstBank participates in a merchant revenue-sharing agreement with another entity to which the Bank sold its merchant

contracts portfolio and related point-of-sale terminals, and a growth agreement with an international card service association to expand

the customer base and enhance product offerings. FirstBank recognizes the revenue under these agreements over time, as the Bank

completes its performance obligations.

The following table shows the activity of contract liabilities for the quarters ended March 31, 2023 and 2022:

Quarter Ended March 31, 

2023

2022

(In thousands)

Beginning Balance

$

841

$

1,443

Less:

 Revenue recognized

(81)

(289)

Ending balance

$

760

$

1,154

As of March 31, 2023 and 2022, there were no contract assets recorded on the Corporation’s consolidated financial statements.

Other

Except for the contract liabilities noted above, the Corporation did not have any significant performance obligations as of March 31,

2023. The Corporation also did not have any material contract acquisition costs and did not make any significant judgments or

estimates in recognizing revenue for financial reporting purposes.