Loans Held for Sale and Loan Servicing

12 Months Ended

Dec. 31, 2016

Transfers and Servicing of Financial Assets [Text Block]

Loans Held for Sale and Loan Servicing

At December 31, 2016 and 2015, Loans held for sale consisted of conventional residential mortgages originated for subsequent sale. At December 31, 2016 and 2015, the estimated fair value of these loans was in excess of their carrying value, and therefore no valuation reserve was necessary for loans held for sale.

Commercial and residential mortgage loans serviced for others are not included in the accompanying balance sheets. The unpaid principal balance of commercial and residential mortgage loans serviced for others was $452.0 million and $422.3 million at December 31, 2016 and 2015, respectively.

Loans sold consisted of the following during the years ended December 31:



	2016				2015				2014
	Loans Sold		Net Gains on Sale		Loans Sold		Net Gains on Sale		Loans Sold		Net Gains on Sale
	(Dollars in thousands)
Residential loans	$	135,294	$	2,880	$	131,706	$	2,871	$	94,892	$	2,097
Commercial loans	251		18		—		—		—		—
Total	$	135,545	$	2,898	$	131,706	$	2,871	$	94,892	$	2,097

There were no obligations to repurchase loans for any amount at December 31, 2016, but there were contractual risk sharing commitments on certain sold loans totaling $634 thousand as of such date.

The Company generally retains the servicing rights on loans sold. At December 31, 2016 and 2015, the unamortized balance of servicing rights on loans sold with servicing retained was $1.6 million and $1.5 million, respectively, included in Other assets. The estimated fair value of these servicing rights was in excess of their carrying value at December 31, 2016 and 2015, and therefore no impairment reserve was necessary. The net capitalization and amortization of MSRs is included in Other income.

The following table presents the capitalization and amortization of loan servicing rights:



	For The Years Ended December 31,
	2016		2015		2014
	(Dollars in thousands)
Capitalization of servicing rights	$	823	$	839	$	571
Amortization of servicing rights	720		670		528
Net capitalization of servicing rights	$	103	$	169	$	43

- Definition

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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