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Servicing Rights
 3 Months Ended
Mar. 31, 2023
Transfers and Servicing [Abstract]  
Servicing Rights Servicing Rights
Mortgage servicing rights
The following table details the activity in the Company's mortgage servicing rights ("MSR") for the three-month periods ended March 31, 2023 and 2022:
Three Months Ended March 31,
(In Thousands)20232022
Balance, beginning of period$18,635 $13,724 
Additions for new MSR capitalized463 987 
Changes in fair value:
  Due to changes in model inputs of assumptions (1)
(212)1,192 
  Other (2)
(583)(481)
Balance, end of period$18,303 $15,422 

(1) Principally reflects changes in discount rates and prepayment speed assumptions, which are primarily affected by changes in interest rates.
(2) Represents changes due to collection/realization of expected cash flows over time.

The following table details information related to our serviced mortgage loan portfolio as of March 31, 2023 and December 31, 2022:
(In Thousands)March 31, 2023December 31, 2022
Balance of mortgage loans serviced for others$911,065 $898,840 
MSR as a percentage of serviced loans2.01 %2.07 %

    The Company recognized servicing fees of $905,000 and $783,000 during the three-month periods ending March 31, 2023 and 2022, respectively, which includes contractually specified servicing fees and ancillary fees as a component of other noninterest income in the Company's Consolidated Statements of Income.

    The following table outlines the weighted average key assumptions used in measuring the fair value of MSR as of March 31, 2023 and December 31, 2022:
March 31, 2023December 31, 2022
Constant prepayment rate5.67 %6.64 %
Discount rate10.97 %11.25 %
    Key economic assumptions and the sensitivity of the current fair value for MSR to immediate adverse changes in those assumptions at March 31, 2023 and December 31, 2022 were as follows:
(In Thousands)March 31, 2023December 31, 2022
Aggregate portfolio principal balance$911,065 $898,840 
Weighted average rate of note3.54 %3.47 %
March 31, 2023Base1.0% Adverse Rate Change2.0% Adverse Rate Change
Constant prepayment rate5.67 %5.71 %7.15 %
Discount rate10.97 %9.97 %8.97 %
Fair value MSR$18,303 $17,778 $16,869 
Percentage of MSR2.01 %1.95 %1.85 %
December 31, 2022
Constant prepayment rate6.64 %13.28 %19.92 %
Discount rate11.25 %10.25 %9.25 %
Fair value MSR$18,635 $14,763 $11,796 
Percentage of MSR2.07 %1.64 %1.31 %

    The above tables show the sensitivity to market rate changes for the par rate coupon for a conventional one-to-four family Alaska Housing Finance Corporation/FNMA/FHLMC serviced home loan. The above tables reference a 100 basis point and 200 basis point decrease in discount rates.

    These sensitivities are hypothetical and should be used with caution as the tables above demonstrate the Company’s methodology for estimating the fair value of MSR is highly sensitive to changes in key assumptions. For example, actual prepayment experience may differ and any difference may have a material effect on MSR fair value. Changes in fair value resulting from changes in assumptions generally cannot be extrapolated because the relationship of the change in the assumption to the change in fair value may not be linear. Also, in these tables, the effects of a variation in a particular assumption on the fair value of the MSR is calculated without changing any other assumption; in reality, changes in one factor may be associated with changes in another (for example, decreases in market interest rates may provide an incentive to refinance; however, this may also indicate a slowing economy and an increase in the unemployment rate, which reduces the number of borrowers who qualify for refinancing), which may magnify or counteract the sensitivities. Thus, any measurement of MSR fair value is limited by the conditions existing and assumptions made at a particular point in time. Those assumptions may not be appropriate if they are applied to a different point in time.

Commercial servicing rights
    The commercial servicing rights asset ("CSR") has a carrying value of $2.2 million at March 31, 2023 and $2.1 million at December 31, 2022, and is included in other assets and carried at fair value on the Company's Consolidated Balance Sheets. Total commercial loans serviced for others were $290.8 million and $285.3 million at March 31, 2023 and December 31, 2022, respectively. Key assumptions used in measuring the fair value of the CSR as of March 31, 2023 and December 31, 2022 include a constant prepayment rate of 10.19% and a discount rate of 12.00%.