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Revenue Recognition
 12 Months Ended
Dec. 31, 2021
Revenue from Contract with Customer [Abstract]  
Revenue Recognition Revenue Recognition
The Company accounts for revenue from contracts with customers in accordance with ASC 606, which requires revenue that is derived from a contract with a customer to be recognized when the Company satisfies the related performance obligations by transferring to the customer a good or service. The majority of the Company’s contracts with customers associated with revenue streams that are within the scope of ASC 606 are considered short-term in nature, such as a deposit account agreement, which can be canceled at any time, or a service provided to a customer at a point in time. These revenue streams are included in noninterest income.

The Company’s principal source of revenue is interest income on loans, investment securities, and other interest earning assets, all of which are not within the scope of ASC 606 and are accounted for under other applicable GAAP. The remainder of the Company’s revenue is classified as noninterest income and is earned from a variety of sources, such as custodial and other fees, service charges, gains and losses, interchange income, and other income.

The following table provides a summary of the Company’s noninterest income, segregated by revenue streams within and outside the scope of ASC 606 for the periods indicated:

For the Year Ended December 31,
202120202019
(Dollars in thousands)
Within Scope(1)
Out-of-Scope(2)
Within Scope(1)
Out-of-Scope(2)
Within Scope(1)
Out-of-Scope(2)
Noninterest income:
Loan servicing income$— $2,121 $— $2,028 $— $1,840 
Service charges on deposit accounts9,219 — 6,712 — 5,769 — 
Other service fee income1,566 — 1,554 — 1,438 — 
Debit card interchange income3,489 — 2,526 — 3,004 — 
Earnings on bank-owned life insurance— 11,299 — 7,160 — 3,486 
Net gain from sales of loans— 4,428 — 8,609 — 6,642 
Net gain from sales of investment securities— 16,906 — 13,882 — 8,571 
Trust custodial account fees38,176 — 16,653 — — — 
Escrow and exchange fees7,286 — 2,663 — 
Other income430 12,930 427 9,111 1,015 3,471 
Total noninterest income$60,166 $47,684 $30,535 $40,790 $11,226 $24,010 
______________________________
(1) Revenues from contracts with customers accounted for under ASC 606.
(2) Revenues not within the scope of ASC 606 and accounted for under other applicable GAAP requirements.
    
The major revenue streams by fee type that are within the scope of ASC 606 presented in the above tables are described in additional detail below:

Service Charges on Deposit Accounts and Other Service Fee Income

Service charges on deposit accounts and other service fee income consists of periodic service charges on deposit accounts and transaction based fees such as those related to overdrafts, ATM charges, and wire transfer fees. The majority of these revenues are accounted for under ASC 606. Performance obligations for periodic service charges on deposit accounts are typically short-term in nature and are generally satisfied on a monthly basis, while performance obligations for other transaction based fees are typically satisfied at a point in time. Periodic service charges are generally collected monthly directly from the customer’s deposit account, and at the end of a statement cycle, while transaction based service charges are typically collected at the time of or soon after the service is performed.

Debit Card Interchange Income

Debit card interchange fee income consists of transaction processing fees associated with customer debit card transactions and are accounted for under ASC 606. These fees are earned each time a request for payment is originated by a customer debit cardholder at a merchant and the Company satisfies it performance obligation through daily settlement through a payment network. Debit card interchange fees are typically received and recorded as revenue on a daily basis.
    
Trust Custodial Account Fees

Trust custodial account fee income is a revenue stream acquired in the Opus acquisition in June 2020 and is attributable to contracts executed with Pacific Premier Trust clients, largely to perform maintenance and custodial services for their alternative IRA investments as well as certain accounts that do not qualify as individual retirement accounts pursuant to the Internal Revenue Code. Typically, these fees are billed and collected on a quarterly basis and recognized commensurate with completion of the performance obligations required under the contracts. At December 31, 2021 and December 31, 2020, the Company had accrued fees receivable of approximately $13.1 million and $5.8 million, respectively, which are included in other assets in the consolidated statements of financial position. The balance of accrued fees receivable is net an allowance for credit losses for doubtful accounts of approximately $955,000 and $268,000 at December 31, 2021 and December 31, 2020, respectively. The allowance represents the Company’s estimate of credit losses on accrued fees receivable in accordance in ASC 326.

Escrow and Exchange Fees

Escrow and exchange fee income is a revenue stream associated with Commerce Escrow, which was acquired in the Opus acquisition in 2020. These fees relate to agreements with customers participating in escrow and exchange transactions associated with Section 1031 of the Internal Revenue Code. Escrow and exchange services include preparation of closing statements and custody of escrow funds. The fees are received from the sale proceeds of a relinquished property and are recognized as revenue upon closing of the escrow transaction, which is the final performance obligation.

Other Income

Other noninterest income includes other miscellaneous fees, which are accounted for under ASC 606; however, much like service charges on deposit accounts, these fees have performance obligations that are very short-term in nature and are typically satisfied at a point in time. Revenue is typically recorded at the time these fees are collected, which is generally upon the completion of the related transaction or service provided.
Other revenue streams that occur from time to time include gains and losses from the sale of nonfinancial assets such as other real estate owned and property premises and equipment. The Company accounts for these revenue streams in accordance with ASC 610-20, which requires the Company to look to guidance in ASC 606 in the application of certain measurement and recognition concepts. The Company records gains and losses on the sale of nonfinancial assets when control of the asset has been surrendered to the buyer, which generally occurs at a specific point in time.

Practical Expedient
The Company also employs a practical expedient with respect to contract acquisition costs, which are generally capitalized and amortized into expense. These costs relate to expenses incurred directly attributable to the efforts to obtain a contract. The practical expedient allows the Company to immediately recognize contract acquisition costs in current period earnings when these costs would have been amortized over a period of one year or less.