MORTGAGE BANKING ACTIVITIES (Tables)

6 Months Ended

Jun. 30, 2015

MORTGAGE BANKING ACTIVITIES

Activity for Mortgage Loans Held for Sale

	Three Months Ended						Six Months Ended
	June 30,						June 30,
(in thousands)	2015			2014			2015			2014
Balance, beginning of period	$	12,748		$	2,414		$	6,388		$	3,506
Origination of mortgage loans held for sale	50,173			19,174			96,008			33,284
Proceeds from the sale of mortgage loans held for sale	(53,775		)	(15,447		)	(94,472		)	(31,147		)
Net gain on sale of mortgage loans held for sale	1,131			668			2,353			1,166
Balance, end of period	$	10,277		$	6,809		$	10,277		$	6,809

Components of Mortgage Banking Income

	Three Months Ended						Six Months Ended
	June 30,						June 30,
(in thousands)	2015			2014			2015			2014
Net gain realized on sale of mortgage loans held for sale	$	1,209		$	460		$	2,098		$	918
Net change in fair value recognized on loans held for sale	(81		)	159			97			124
Net change in fair value recognized on rate lock commitments	(121		)	99			126			179
Net change in fair value recognized on forward contracts	124			(50		)	32			(55		)
Net gain recognized	1,131			668			2,353			1,166
Loan servicing income	471			492			940			794
Amortization of mortgage servicing rights	(378		)	(348		)	(716		)	(662		)
Net servicing income recognized	93			144			224			132
Total Mortgage Banking income	$	1,224		$	812		$	2,577		$	1,298

Activity for capitalized mortgage servicing rights

	Three Months Ended						Six Months Ended
	June 30,						June 30,
(in thousands)	2015			2014			2015			2014
Balance, beginning of period	$	4,864		$	5,227		$	4,813		$	5,409
Additions	485			130			874			262
Amortized to expense	(378		)	(348		)	(716		)	(662		)
Balance, end of period	$	4,971		$	5,009		$	4,971		$	5,009

Mortgage Servicing Rights

(dollars in thousands)	June 30, 2015			December 31, 2014
Fair value of mortgage servicing rights portfolio	$	6,922		$	6,651
Monthly prepayment rate of unpaid principal balance*	105% - 462		%	95% - 462		%
Discount rate	12		%	10		%
Weighted average default rate	1.50		%	1.50		%
Weighted average life in years	6.42			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)	June 30, 2015				December 31, 2014
Included in Mortgage loans held for sale:
Mortgage loans held for sale	$	10,057	$	10,277	$	6,265	$	6,388
Included in other assets:
Rate lock loan commitments	$	23,261	$	376	$	12,866	$	250
Included in other liabilities:
Mandatory forward contracts	$	26,186	$	1	$	13,181	$	33