MORTGAGE BANKING ACTIVITIES (Tables)

3 Months Ended

Mar. 31, 2015

MORTGAGE BANKING ACTIVITIES

Activity for Mortgage Loans Held for Sale

	Three Months Ended
	March 31,
(in thousands)	2015			2014
Balance, beginning of period	$	6,388		$	3,506
Origination of mortgage loans held for sale	45,835			14,110
Proceeds from the sale of mortgage loans held for sale	(40,697		)	(15,700		)
Net gain on sale of mortgage loans held for sale	1,222			498
Balance, end of period	$	12,748		$	2,414

Components of Mortgage Banking Income

	Three Months Ended
	March 31,
(in thousands)	2015			2014
Net gain realized on sale of mortgage loans held for sale	$	889		$	458
Net change in fair value recognized on loans held for sale	178			(35		)
Net change in fair value recognized on rate lock commitments	247			80
Net change in fair value recognized on forward contracts	(92		)	(5		)
Net gain recognized	1,222			498
Loan servicing income	469			302
Amortization of mortgage servicing rights	(338		)	(314		)
Net servicing income recognized	131			(12		)
Total Mortgage Banking income	$	1,353		$	486

Activity for capitalized mortgage servicing rights

	Three Months Ended
	March 31,
(in thousands)	2015			2014
Balance, beginning of period	$	4,813		$	5,409
Additions	389			132
Amortized to expense	(338		)	(314		)
Balance, end of period	$	4,864		$	5,227

Mortgage Servicing Rights

(dollars in thousands)	March 31, 2015		December 31, 2014
Fair value of mortgage servicing rights portfolio	$	6,427	$	6,651
Monthly prepayment rate of unpaid principal balance*	105% - 462%		95% - 462%
Discount rate	10%		10%
Weighted average default rate	1.50%		1.50%
Weighted average life in years	5.37		5.70

* - Rates are applied to individual tranches with similar characteristics.

Schedule of notional amounts and fair values of mortgage banking derivatives

	Notional Amount		Fair Value		Notional Amount		Fair Value
(in thousands)	March 31, 2015				December 31, 2014
Included in Mortgage loans held for sale:
Mortgage loans held for sale	$	12,446	$	12,748	$	6,265	$	6,388
Included in other assets:
Rate lock loan commitments	$	26,561	$	497	$	12,866	$	250
Included in other liabilities:
Mandatory forward contracts	$	30,098	$	125	$	13,181	$	33