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Transfers of Financial Assets
 12 Months Ended
Dec. 31, 2016
Transfers and Servicing [Abstract]  
Transfers of Financial Assets
Transfers of Financial Assets
Transfers of Financial Assets
The Company sells financial assets in the normal course of business, primarily residential mortgage loans sold to government-sponsored enterprises through established programs and securitizations. The gain or loss on residential mortgage loans sold and the fair value adjustment to loans held for sale are included as mortgage banking activities in the accompanying Consolidated Statements of Income.
The Company may be required to repurchase a loan in the event of certain breaches of the representations and warranties, or in the event of default of the borrower within 90 days of sale, as provided for in the sale agreements. A reserve for loan repurchases provides for estimated losses pertaining to the potential repurchase of loans associated with the Company's mortgage banking activities. The reserve reflects management’s evaluation of the identity of counterparty, the vintage of the loans sold, the amount of open repurchase requests, specific loss estimates for each open request, the current level of loan losses in similar vintages held in the residential loan portfolio, and estimated recoveries on the underlying collateral. The reserve also reflects management’s expectation of losses from repurchase requests for which the Company has not yet been notified, as the performance of loans sold and the quality of the servicing provided by the acquirer may also impact the reserve. The provision recorded at the time of the loan sale is netted from the gain or loss recorded in mortgage banking activities, while any incremental provision, post loan sale, is recorded in other non-interest expense in the accompanying Consolidated Statements of Income.
The following table provides a summary of activity in the reserve for loan repurchases:
 
Years ended December 31,
(In thousands)
2016
 
2015
 
2014
Beginning balance
$
1,192

 
$
1,059

 
$
2,254

(Benefit) provision charged to expense
(303
)
 
133

 
(493
)
Repurchased loans and settlements charged off
(99
)
 
—

 
(702
)
Ending balance
$
790

 
$
1,192

 
$
1,059


The following table provides information for mortgage banking activities:
 
Years ended December 31,
(In thousands)
2016
 
2015
 
2014
Residential mortgage loans held for sale:
 
 
 
 
 
Proceeds from sale
$
438,925

 
$
452,590

 
$
287,132

Net gain on sale
11,629

 
7,795

 
4,070

Fair value option adjustment
(526
)
 
—

 
—

Loans sold with servicing rights retained
399,318

 
416,277

 
264,292


The Company has retained servicing rights on residential mortgage loans totaling $2.6 billion and $2.5 billion at December 31, 2016 and 2015, respectively.
The following table presents the changes in carrying value for mortgage servicing assets:
 
Years ended December 31,
(In thousands)
2016
 
2015
 
2014
Beginning balance
$
20,698

 
$
19,379

 
$
20,983

Additions
11,312

 
8,027

 
4,581

Amortization
(7,554
)
 
(6,699
)
 
(6,318
)
Valuation recovery (provision) (1)
10

 
(9
)
 
133

Ending balance
$
24,466

 
$
20,698

 
$
19,379

(1)
The valuation recovery (provision) resulted in a valuation allowance balance of $22 thousand, $32 thousand, and $23 thousand at December 31, 2016, 2015, and 2014, respectively.
Loan servicing fees, net of mortgage servicing rights amortization, were $1.1 million, $1.5 million, and $1.5 million, for the years ended December 31, 2016, 2015, and 2014, respectively, and are included as a component of loan related fees in the accompanying Consolidated Statements of Income.
See Note 16: Fair Value Measurements for additional fair value information on loans held for sale and mortgage servicing assets.
Additionally, loans not originated for sale were sold for cash proceeds of $26.5 million for certain commercial loans, resulting in a gain of $2.1 million, and loans not originated for sale were sold approximately at carrying value, for cash proceeds of $7.6 million for certain residential loans, for the year ended December 31, 2016. Loans not originated for sale were sold approximately at carrying value for cash proceeds of $729 thousand for certain commercial loans and $32.9 million for certain consumer loans, for the year ended December 31, 2015.