NON-INTEREST REVENUE AND EXPENSE

On April 1, 2018, the Company adopted ASU No, 2014-09, "Revenue from Contracts with Customers (Topic 606)" and all subsequent ASUs that modified Topic 606. As stated in Note 12, Impact of Recent Accounting Standards, the implementation of the new standard did not have a material impact to the Company's consolidated financial statements and as such, management determined that a cumulative effect adjustment to opening retained earnings was not deemed necessary. Results for reporting periods beginning after April 1, 2018 are presented under Topic 606, while prior period amounts were not adjusted and continue to be reported in accordance with the previous accounting guidance under Topic 605.

Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and securities. In addition, certain non-interest income streams such as gains on sales of residential mortgage and SBA loans, income associated with servicing assets, and loan fees, including residential mortgage originations to be sold and prepayment and late fees charged across all loan categories are also not in scope of the new guidance. Topic 606 is applicable to non-interest revenue streams, such as depository fees, service charges and commission revenues. However, the recognition of these revenue streams did not change significantly upon adoption of Topic 606. Non-interest revenue streams in-scope of Topic 606 are discussed below.

Depository fees and charges

Depository fees and charges primarily relate to service fees on deposit accounts and fees earned from debit cards and check cashing transactions. Service fees on deposit accounts consist of ATM fees, NSF fees, account maintenance charges and other deposit related fees. The revenue is recognized monthly when the Bank's performance obligations are complete, or as incurred for transaction-based fees in accordance with the fee schedules for the Bank's deposit products and services.

Loan fees and service charges

Loan fees and service charges primarily relate to program management fees and fees earned in accordance with the Bank's standard lending fees (such as inspection and late charges). These standard lending fees are earned on a monthly basis upon receipt.

Other non-interest income

Other non-interest income primarily relates to an advertising services agreement, covering marketing and use of the Bank's office space with a third party. The revenue is recognized on a monthly basis.

The following table presents non-interest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three and six months ended September 30, 2019 and 2018:



	Three Months Ended September 30,				Six Months Ended September 30,
$ in thousands	2019		2018		2019		2018
Non-interest income
In-scope of Topic 606
Depository fees and charges	$	811	$	854	$	1,615	$	1,687
Loan fees and service charges	70		67		146		122
Other non-interest income	14		16		27		33
Non-interest income (in-scope of Topic 606)	895		937		1,788		1,842
Non-interest income (out-of-scope of Topic 606)	303		142		370		541
Total non-interest income	$	1,198	$	1,079	$	2,158	$	2,383

The following table sets forth other non-interest income and expense totals exceeding 1% of the aggregate of total interest income and non-interest income for any of the periods presented:



	Three Months Ended September 30,					Six Months Ended September 30,
$ in thousands	2019		2018			2019		2018
Other non-interest income:
Gain on sale of real estate owned	$	188	$	16		$	208	$	79
Compliance fee	28		44			56		180
Other	76		(36		)	93		10
Total non-interest income	$	292	$	24		$	357	$	269

Other non-interest expense:
Advertising	$	109	$	97		$	202	$	176
Legal expense	75		102			173		243
Insurance and surety	160		203			304		368
Audit expense	136		143			262		331
Outsourced service	89		174			245		308
Data lines / internet	102		96			210		172
Retail expenses	177		211			377		414
Regulatory assessment	53		86			108		174
Director's fees	77		86			154		173
Other	419		598			935		1,198
Total non-interest expense	$	1,397	$	1,796		$	2,970	$	3,557