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Mortgage Banking
 6 Months Ended
Jun. 30, 2022
Mortgage Banking [Abstract]  
Mortgage Banking

9. Mortgage Banking

Net revenues from the sales and servicing of mortgage loans consisted of the following:

 

 

 

Three Months Ended
June 30,

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

 

(In Thousands)

 

Mortgage banking gain, net

 

$

1,166

 

 

$

2,670

 

 

$

3,710

 

 

$

8,311

 

Mortgage loans servicing revenue (expense):

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage loans servicing revenue

 

 

1,862

 

 

 

1,888

 

 

 

3,741

 

 

 

3,805

 

Amortization of mortgage servicing rights

 

 

(1,375

)

 

 

(1,953

)

 

 

(2,778

)

 

 

(4,297

)

Mortgage servicing rights valuation adjustments

 

 

295

 

 

 

(448

)

 

 

1,527

 

 

 

4,872

 

 

 

 

782

 

 

 

(513

)

 

 

2,490

 

 

 

4,380

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net revenue from sale and servicing of mortgage loans

 

$

1,948

 

 

$

2,157

 

 

$

6,200

 

 

$

12,691

 

The unpaid principal balance of residential mortgage loans serviced for third parties was $2.92 billion and $2.94 billion at June 30, 2022 and December 31, 2021.

Activity for capitalized mortgage servicing rights and the related valuation allowance follows for the three and six months ended June 30, 2022 and 2021:

 

 

 

Three Months Ended
June 30,

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

 

(In Thousands)

 

Mortgage servicing assets:

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

22,189

 

 

$

21,696

 

 

$

22,244

 

 

$

21,666

 

Loans sold, servicing retained

 

 

1,059

 

 

 

1,939

 

 

 

2,407

 

 

 

4,313

 

Amortization

 

 

(1,375

)

 

 

(1,953

)

 

 

(2,778

)

 

 

(4,297

)

Carrying value before valuation allowance at end of period

 

 

21,873

 

 

 

21,682

 

 

 

21,873

 

 

 

21,682

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation allowance:

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

 

(1,474

)

 

 

(3,193

)

 

 

(2,707

)

 

 

(8,513

)

Impairment recovery (charges)

 

 

294

 

 

 

(448

)

 

 

1,527

 

 

 

4,872

 

Balance at end of period

 

 

(1,180

)

 

 

(3,641

)

 

 

(1,180

)

 

 

(3,641

)

Net carrying value of MSRs at end of period

 

$

20,693

 

 

$

18,041

 

 

$

20,693

 

 

$

18,041

 

Fair value of MSRs at end of period

 

$

26,927

 

 

$

18,054

 

 

$

26,927

 

 

$

18,054

 

Amortization of mortgage servicing rights is computed based on payments and payoffs of the related mortgage loans serviced. Estimates of future amortization expense are not easily estimable.

The Company had no accrual for secondary market buy-back activity at June 30, 2022 or December 31, 2021 based on management’s estimate of potential losses from this activity. There was no expense or credit recognized in the three and six months ended June 30, 2022 and 2021.