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Revenue Recognition
 9 Months Ended
Sep. 30, 2022
Revenue from Contract with Customer [Abstract]  
Revenue Recognition Revenue Recognition
The Company’s primary source of revenue is interest income generated from loans and investment securities. Interest income is recognized according to the terms of the financial instrument agreement over the life of the loan or investment security unless it is determined that the counterparty is unable to continue making interest payments. Interest income also includes prepaid interest fees from commercial customers, which approximates the interest foregone on the balance of the loan prepaid.
The Company’s additional source of income, also referred to as noninterest income, is generated from deposit related fees, interchange fees, loan fees, merchant fees, loan sales, investment services and other miscellaneous income and is largely based on contracts with customers. In these cases, the Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. The Company considers a customer to be any party to which the Company will provide goods or services that are an output of the Company’s ordinary activities in exchange for consideration. There is little seasonality with regards to revenue from contracts with customers and all inter-company revenue is eliminated when the Company’s financial statements are consolidated.
Generally, the Company enters into contracts with customers that are short-term in nature where the performance obligations are fulfilled and payment is processed at the same time. Such examples include revenue related to merchant fees, interchange fees and investment services income. In addition, revenue generated from existing customer relationships such as deposit accounts are also considered short-term in nature, because the relationship may be terminated at any time and payment is processed at the time performance obligations are fulfilled. As a result, the Company does not have contract assets, contract liabilities or related receivable accounts for contracts with customers. In cases where collectability is a concern, the Company does not record revenue.
Generally, the pricing of transactions between the Company and each customer is either (i) established within a legally enforceable contract between the two parties, as is the case with loan sales, or (ii) disclosed to the customer at a specific point in time, as is the case when a deposit account is opened or before a new loan is underwritten. Fees are usually fixed at a specific amount or as a percentage of a transaction amount. No judgment or estimates by management are required to record revenue related to these transactions and pricing is clearly identified within these contracts.
The Company primarily operates in one geographic region, Northern and Central New Jersey and contiguous areas. Therefore, all significant operating decisions are based upon analysis of the Company as one operating segment or unit.
We disaggregate our revenue from contracts with customers by contract-type and timing of revenue recognition, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Noninterest income not generated from customers during the Company’s ordinary activities primarily relates to income from bank owned life insurance, gains/losses on the sale of investment securities, gains/losses on the sale of other real estate owned, gains/losses on the sale of property, plant and equipment and mortgage servicing rights.
The following table sets forth the components of noninterest income for the three and nine months ended September 30, 2022 and 2021:
For the Three Months Ended September 30,For the Nine Months Ended September 30,
(in thousands)2022202120222021
Deposit-Related Fees and Charges
Debit card interchange income$1,686 $1,585 $4,995 $4,603 
Overdraft charges802 647 2,327 1,785 
ATM service charges220 182 599 497 
Demand deposit fees and charges79 107 166 348 
Savings service charges21 15 58 44 
Total deposit-related fees and charges2,808 2,536 8,145 7,277 
Commissions and fees
Loan fees712 376 2,302 1,367 
Wire transfer charges502 376 1,484 1,126 
Investment services income457 373 1,562 1,210 
Merchant fees 300 270 853 729 
Commissions from sales of checks88 73 263 226 
Safe deposit income105 82 258 240 
Other income42 54 129 143 
Total commissions and fees2,206 1,604 6,851 5,041 
Gains on sales of loans355 550 2,496 1,865 
Other income
Gains on customer swap transactions711 — 1,110 634 
Title insurance income44 43 46 87 
Other income82 99 870 262 
Total other income837 142 2,026 983 
Revenue not from contracts with customers1,027 637 1,558 1,331 
Total Noninterest Income$7,233 $5,469 $21,076 $16,497 
Timing of Revenue Recognition:
Products and services transferred at a point in time6,206 4,832 19,518 15,143 
Products and services transferred over time— — — 23 
Revenue not from contracts with customers1,027 637 1,558 1,331 
Total Noninterest Income$7,233 $5,469 $21,076 $16,497