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Note 7 - Revenue from Contracts with Customers
 9 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Revenue from Contract with Customer [Text Block]

NOTE 7 – REVENUE FROM CONTRACTS WITH CUSTOMERS

 

ChoiceOne has a variety of sources of revenue, which include interest and fees from customers as well as revenue from non-customers.  ASC Topic 606, Revenue from Contracts With Customers, covers certain sources of revenue that are classified within noninterest income in the Consolidated Statements of Income.  Sources of revenue that are included in the scope of ASC Topic 606 include service charges and fees on deposit accounts, interchange income, investment asset management income and transaction-based revenue, and other charges and fees for customer services.

 

Service Charges and Fees on Deposit Accounts

Revenue includes charges and fees to provide account maintenance, overdraft services, wire transfers, funds transfer, and other deposit-related services.  Account maintenance fees such as monthly service charges are recognized over the period of time that the service is provided.  Transaction fees such as wire transfer charges are recognized when the service is provided to the customer.

 

Interchange Income

Revenue includes debit card interchange and network revenues.  This revenue is earned on debit card transactions that are conducted through payment networks such as MasterCard. The revenue is recorded as services are delivered and is presented net of interchange expenses.

 

Investment Commission Income

Revenue includes fees from the investment management advisory services and revenue is recognized when services are rendered.  Revenue also includes commissions received from the placement of brokerage transactions for purchase or sale of stocks or other investments. Commission income is recognized when the transaction has been completed.

 

Trust Fee Income

Revenue includes fees from the management of trust assets and from other related advisory services. Revenue is recognized when services are rendered.

 

Following is noninterest income separated by revenue within the scope of ASC 606 and revenue within the scope of other GAAP topics:

 

   

Three Months Ended

    

Nine Months Ended

  
   

September 30,

    

September 30,

  

(Dollars in thousands)

  

2020

    

2019

    

2020

    

2019

  
                                 

Service charges and fees on deposit accounts

   $ 842     $ 690     $ 2,498     $ 1,987  

Interchange income

     1,217       404       2,808       1,288  

Investment commission income

     123       72       384       177  

Trust fee income

     197       -       569       -  

Other charges and fees for customer services

     111       57       342       177  

Noninterest income from contracts with customers within the scope of ASC 606

     2,490       1,223       6,601       3,629  

Noninterest income within the scope of other GAAP topics

     3,835       712       10,408       2,092  

Total noninterest income

   $ 6,326     $ 1,935     $ 17,009     $ 5,721