Loan Servicing

12 Months Ended

Dec. 31, 2012

Loan Servicing

Note 13: Loan Servicing

Loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid principal balances of these loans consist of the following:

	2012		2011
Loans serviced for
Freddie Mac	$	304,831	$	368,518
Fannie Mae		29,196		44,948
FHLB		11,578		16,241
Other investors		1,753		1,926
	$	347,358	$	431,633

The aggregate fair value of capitalized mortgage servicing rights is based on comparable market values and expected cash flows, with impairment assessed based on portfolio characteristics including product type and interest rates. The approximate fair value of mortgage-servicing rights at December 31, 2012 was $1,731,000. The amount of servicing fees collected during 2012, 2011 and 2010 totaled approximately $986,000, $1,080,000 and $955,000.

	2012			2011			2010
Mortgage-servicing rights
Balances, January 1	$	3,101		$	3,674		$	3,984
Servicing rights capitalized		294			430			682
Amortization of servicing rights		(999	)		(1,003	)		(992	)
		2,396			3,101			3,674
Valuation allowance		(665	)		(475	)		(325	)
Balances, December 31,	$	1,731		$	2,626		$	3,349

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

	2012		2011
Mortgage-servicing rights
Fair value, beginning of period	$	2,626	$	3,350
Fair value, end of period		1,731		2,626

Activity in the valuation allowance for mortgage servicing rights was as follows:

	2012		2011			2010
Balance, beginning of year	$	475	$	325		$	500
Additions		190		355			—
Reductions		—		(205	)		(175	)
Balance, end of year	$	665	$	475		$	325