REVENUE FROM CONTRACTS WITH CUSTOMERS

9 Months Ended

Sep. 30, 2020

REVENUE FROM CONTRACTS WITH CUSTOMERS

REVENUE FROM CONTRACTS WITH CUSTOMERS

NOTE 11 – REVENUE FROM CONTRACTS WITH CUSTOMERS

All of the Company’s revenue from contracts with customers within the scope of ASC 606 is recognized within non-interest income. The guidance does not apply to revenue associated with financial instruments, including loans and investment securities that are accounted for under other GAAP, which comprise a significant portion of our revenue stream. A description of the Company’s revenue streams accounted for under ASC 606 is as follows:

Service Charges on Deposit Accounts: The Company earns fees from 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 at the point in time that 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 Service charges on deposits are withdrawn from the customer’s account balance.

Interchange Income: The Company earns interchange fees from debit and credit card holder transactions conducted through various payment networks. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with the transaction processing services provided by the cardholder.

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 the collectability of the transaction prices is probable. Once these criteria are met, the OREO asset is derecognized and the gain or loss on sale is recorded upon the 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.

All of the Company’s revenue from contracts with customers in the scope of ASC 606 is recognized within non-interest income. The following table presents the Company’s sources of non-interest income revenue, by operating segments, for the three months and nine months period ended September 30, 2020 and 2019. Items outside the scope of ASC 606 are noted as such.

	Three Months Ended September 30,2020								Nine Months Ended September 30,2020
	Commercial/		Mortgage						Commercial/		Mortgage
	Retail		Banking		Holding				Retail		Banking		Holding
($in thousands)	Bank		Division		Company		Total		Bank		Division		Company		Total
Non-interest income
Service charges on deposits
Overdraft fees	$	750	$	—	$	—	$	750	$	2,330	$	—	$	—	$	2,330
Other		1,029		—		—		1,029		2,958		1		—		2,959
Interchange income		2,491		—		—		2,491		6,871		—		—		6,871
Investment brokerage fees		277		—		—		277		659		—		—		659
Net gains (losses) on OREO		(55)		—		—		(55)		(396)		—		—		(396)
Net gains (losses) on sales of securities (a)		32		—		—		32		278		—		—		278
Gain on acquisition		—		—		—		—		7,023		—		—		7,023
Gain on premises and equipment		—		—		—		—		461		—		—		461
Other		1,313		2,961		(4)		4,270		3,581		7,173		9		10,763
Total non-interest income	$	5,837	$	2,961	$	(4)	$	8,794	$	23,765	$	7,174	$	9	$	30,948

	Three Months Ended September 30,2019								Nine Months Ended September 30,2019
	Commercial/		Mortgage						Commercial/		Mortgage
	Retail		Banking		Holding				Retail		Banking		Holding
($in thousands)	Bank		Division		Company		Total		Bank		Division		Company		Total
Non-interest income
Service charges on deposits
Overdraft fees	$	1,117	$	—	$	—	$	1,117	$	3,129	$	1	$	—	$	3,130
Other		861		1		—		862		2,596		2		—		2,598
Interchange income		2,252		—		—		2,252		5,949		—		—		5,949
Investment brokerage fees		24		—		—		24		58		—		—		58
Net gains (losses) on OREO		51		—		—		51		23		—		—		23
Net gains (losses) on sales of securities (a)		57		—		—		57		131		—		—		131
Gain on premises and equipment		19		—		—		19		11		—		—		11
Other		913		1,799		9		2,721		2,860		4,265		348		7,473
Total non-interest income	$	5,294	$	1,800	$	9	$	7,103	$	14,757	$	4,268	$	348	$	19,373

(a) Not within scope of ASC 606