NON-CONSOLIDATED VARIABLE INTEREST ENTITIES AND SERVICING ASSETS (Tables)

12 Months Ended

Dec. 31, 2018

Changes in Servicing Assets [Table Text Block]

	The changes in servicing assets are shown below:

		Year Ended December 31,
		2018		2017		2016
	(In thousands)
	Balance at beginning of year	$	25,255	$	26,244	$	24,282
	Capitalization of servicing assets		3,864		3,318		5,260
	Amortization		(2,895)		(3,091)		(3,229)
	Temporary impairment recoveries (charges), net		1,289		(1,611)		(325)
	Other (1)		(85)		395		256
	Balance at end of year	$	27,428	$	25,255	$	26,244


(1)	Amount represents adjustments related to the repurchase of loans serviced for others.

Changes in Impairment Allowance [Table Text Block]

Changes in the impairment allowance were as follows:

	Year ended December 31,
	2018		2017		2016
(In thousands)
Balance at beginning of year	$	1,451	$	461	$	136
Temporary impairment charges		123		1,611		466
OTTI of servicing assets		(132)		(621)		-
Recoveries		(1,412)		-		(141)
Balance at end of year	$	30	$	1,451	$	461

Components of Net Servicing Income [Table Text Block]

The components of net servicing income are shown below:

	Year ended December 31,
	2018		2017		2016
(In thousands)
Servicing fees	$	8,704	$	7,630	$	7,606
Late charges and prepayment penalties		510		405		674
Adjustment for loans repurchased		(85)		395		256
Other		(8)		(35)		(1)
Servicing income, gross		9,121		8,395		8,535
Amortization and impairment of servicing assets		(1,606)		(4,702)		(3,554)
Servicing income, net	$	7,515	$	3,693	$	4,981

Key Economic Assumptions Used in Determining Fair Value at Time of Sale of Loans [Table Text Block]

The Corporation’s servicing assets are subject to prepayment and interest rate risks. Key economic assumptions used in determining the fair value at the time of sale of the related mortgages ranged as follows:

	Maximum		Minimum
2018:
Constant prepayment rate:
Government-guaranteed mortgage loans	6.0	%	5.6	%
Conventional conforming mortgage loans	6.5	%	6.2	%
Conventional non-conforming mortgage loans	10.3	%	9.1	%
Discount rate:
Government-guaranteed mortgage loans	12.0	%	12.0	%
Conventional conforming mortgage loans	10.0	%	10.0	%
Conventional non-conforming mortgage loans	14.3	%	14.3	%

2017:
Constant prepayment rate:
Government-guaranteed mortgage loans	6.2	%	6.0	%
Conventional conforming mortgage loans	6.7	%	6.3	%
Conventional non-conforming mortgage loans	9.5	%	9.1	%
Discount rate:
Government-guaranteed mortgage loans	12.0	%	12.0	%
Conventional conforming mortgage loans	10.0	%	10.0	%
Conventional non-conforming mortgage loans	14.3	%	14.3	%

2016:
Constant prepayment rate:
Government-guaranteed mortgage loans	7.6	%	5.9	%
Conventional conforming mortgage loans	8.0	%	6.3	%
Conventional non-conforming mortgage loans	14.1	%	9.3	%
Discount rate:
Government-guaranteed mortgage loans	12.0	%	11.5	%
Conventional conforming mortgage loans	10.0	%	9.5	%
Conventional non-conforming mortgage loans	14.3	%	13.8	%

Weighted-Averages of Key Economic Assumptions in Valuation Model [Table Text Block]

The weighted averages of the key economic assumptions that the Corporation used in its valuation model and the sensitivity of the current fair value to immediate 10% and 20% adverse changes in those assumptions for mortgage loans as of December 31, 2018 were as follows:

(Dollars in thousands)
Carrying amount of servicing assets	$	27,428
Fair value	$	31,738
Weighted-average expected life (in years)		8.45

Constant prepayment rate (weighted-average annual rate)		6.26	%
Decrease in fair value due to 10% adverse change	$	747
Decrease in fair value due to 20% adverse change	$	1,462

Discount rate (weighted-average annual rate)		11.25	%
Decrease in fair value due to 10% adverse change	$	1,528
Decrease in fair value due to 20% adverse change	$	2,930