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Loan Servicing

12 Months Ended

Dec. 31, 2016

Transfers and Servicing [Abstract]

Note 6:

Loan Servicing

The Company has recognized servicing rights for residential mortgage loans sold with servicing retained. Residential mortgage loans serviced for others are subject to credit, prepayment and interest rate risks.

Mortgage loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid principal balance of mortgage loans serviced for others was $36.9 million and $34.9 million at December 31, 2016 and 2015, respectively. Contractually specified servicing fees, late fees and ancillary fees of approximately $40,000 and $30,000 are included in loan servicing fees in the consolidated statements of income at December 31, 2016 and 2015, respectively.

Custodial escrow balances maintained in connection with the foregoing loan servicing, and included in demand deposits, were approximately $345,000 and $313,000 at December 31, 2016 and 2015, respectively.

Comparable market values and a valuation model that calculates the present value of future cash flows were used to estimate fair value. Servicing assets are included in other assets on the consolidated balance sheets.

Activity in the balance of servicing assets was as follows at December 31, 2016 and 2015:

		2016				2015
		(In thousands)
Carrying amount, beginning of period		$	369			$	332
Additions
Servicing obligations that result from transfers of financial assets			82				88
Subtractions
Amortization			44				51
		$	407			$	369

The fair value of servicing rights subsequently measured using the amortization method was as follows:

Fair value, beginning of period		$	404			$	367
Fair value, end of period		$	444			$	404

The entire disclosure for a transferor's continuing involvement in financial assets that it has transferred in a securitization or asset-backed financing arrangement, the nature of any restrictions on assets reported by an entity in its statement of financial position that relate to a transferred financial asset (including the carrying amounts of such assets), how servicing assets and servicing liabilities are reported, and (for securitization or asset-backed financing arrangements accounted for as sales) when a transferor has continuing involvement with the transferred financial assets and transfers of financial assets accounted for as secured borrowings, how the transfer of financial assets affects an entity's financial position, financial performance, and cash flows.

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