Loans Held for Sale and Loan Servicing

12 Months Ended

Dec. 31, 2020

Transfers and Servicing [Abstract]

Loans Held for Sale and Loan Servicing

Loans Held for Sale and Loan ServicingAt December 31, 2020 and 2019, loans held for sale consisted of conventional residential mortgages originated for subsequent sale, with an estimated fair value in excess of their carrying value. Therefore, no valuation reserve was necessary for loans held for sale as of the balance sheet dates.

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 $629.5 million and $579.9 million at December 31, 2020 and 2019, respectively.

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

	2020				2019
	Loans Sold		Net Gains on Sale		Loans Sold		Net Gains on Sale
	(Dollars in thousands)
Residential loans	$	263,063	$	8,158	$	157,952	$	2,867
Commercial loans	131		10		315		28
Total	$	263,194	$	8,168	$	158,267	$	2,895

There were no obligations to repurchase loans for any amount at December 31, 2020, but there were contractual risk sharing commitments on certain sold loans totaling $747 thousand as of such date. (See Note 19.)

The Company generally retains the servicing rights on loans sold. At December 31, 2020 and 2019, the unamortized balance of servicing rights on loans sold with servicing retained was $2.3 million and $1.7 million, respectively, and is included in Other assets. The estimated fair value of these servicing rights was in excess of their carrying value at December 31, 2020 and 2019, 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,
	2020		2019
	(Dollars in thousands)
Capitalization of servicing rights	$	1,736	$	862
Amortization of servicing rights	1,194		812
Net capitalization of servicing rights	$	542	$	50