Note 16 - Revenue from Contracts With Customers

3 Months Ended

Mar. 31, 2020

Notes to Financial Statements

Revenue from Contract with Customer [Text Block]

Note

1

6

–

Revenue from Contracts with Customers

All of the Company’s revenue from customers within the scope of ASC

606

is recognized as non-interest income. A description of the Company’s revenue streams accounted for under ASC

606

follows:

Service Charges on Deposit Accounts:

The Company earns fees from its deposit customers for transaction-based, account maintenance, and overdraft services. Transaction-based fees, which include services such as ATM use fees, stop payment charges, statement rendering, and ACH fees, are recognized at the time the transaction is executed as that is the point in time the Company fulfills the customer’s request. Account maintenance fees, which relate primarily to monthly maintenance, are earned over the course of a month, representing the period over which the Company satisfies the performance obligation. Overdraft fees are recognized at the point in time that the overdraft occurs. Service charges are withdrawn from the customer’s account balance.

Bank Card Interchange Income:

The Company earns interchange fees from bank cardholder transactions conducted through a

third

-party payment network. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided to the cardholder. Prior to adopting ASC

606,

the Company reported bank card interchange fees net of expenses. Under ASC

606,

bank card interchange fees are reported gross.

Gains/Losses on Sales of OREO:

The Company records a gain or loss from the sale of OREO when control of the property transfers to the buyer, which generally occurs at the time of an executed deed. When the Company finances the sale of OREO to the buyer, the Company assesses whether the buyer is committed to perform their obligations under the contract and whether collectability of the transaction price is probable. Once these criteria are met, the OREO asset is derecognized and the gain or loss on sale is recorded upon transfer of control of the property to the buyer. In determining the gain or loss on the sale, the Company adjusts the transaction price and related gain (loss) on sale if a significant financing component is present. Gains and losses on sales of OREO are netted with OREO expense and reported in non-interest expense.

Other Non-interest I

ncome

: Other non-interest income includes revenue from several sources that are within the scope of ASC

606,

including title insurance commissions, income from secondary market loan sales, and other transaction-based revenue that is individually immaterial. Other non-interest income included approximately

$156,000

and

$136,000

of revenue for

three

months ended

March 31, 2020

and

March 31, 2019,

respectively, within the scope of ASC

606.

The remaining other non-interest income for the

three

months is excluded from the scope of ASC

606.