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Mortgage Servicing Rights
 3 Months Ended
Mar. 31, 2013
Transfers and Servicing [Abstract]  
Mortgage Servicing Rights
Mortgage Servicing Rights 
 
The following table presents the changes in the Company’s mortgage servicing rights (“MSR”) for the three months ended March 31, 2013 and 2012: 

(in thousands) 
 
Three months ended
 
March 31,
 
2013
 
2012
Balance, beginning of period
$
27,428

 
$
18,184

Additions for new mortgage servicing rights capitalized
6,403

 
2,948

Changes in fair value:
 
 
 
 Due to changes in model inputs or assumptions(1)
(1,525
)
 
(94
)
 Other(2)
(209
)
 
(828
)
Balance, end of period
$
32,097

 
$
20,210

 
(1)
Principally reflects changes in discount rates and prepayment speed assumptions, which are primarily affected by changes in interest rates. 
(2)
Represents changes due to collection/realization of expected cash flows over time. 
 
Information related to our serviced loan portfolio as of March 31, 2013 and December 31, 2012 was as follows: 
 
(dollars in thousands)
 
March 31, 2013
 
December 31, 2012
Balance of loans serviced for others
$
3,624,819

 
$
3,162,080

MSR as a percentage of serviced loans
0.89
%
 
0.87
%

 
The amount of contractually specified servicing fees, late fees and ancillary fees earned, recorded in mortgage banking revenue on the Condensed Consolidated Statements of Income, was $2.2 million for the three months ended March 31, 2013, as compared to $1.4 million for the three months ended March 31, 2012. 
 
Key assumptions used in measuring the fair value of MSR as of March 31, 2013 and December 31, 2012 are as follows: 
 
 
March 31, 2013
 
December 31, 2012
Constant prepayment rate
20.48
%
 
21.39
%
Discount rate
8.67
%
 
8.65
%
Weighted average life (years)
4.5

 
4.7


 
  

A sensitivity analysis of the current fair value to changes in discount and prepayment speed assumptions as of March 31, 2013 and December 31, 2012 is as follows:
 
March 31, 2013
 
December 31, 2012
Constant prepayment rate
 
 
 
Effect on fair value of a 10% adverse change
$
(1,733
)
 
$
(1,445
)
Effect on fair value of a 20% adverse change
$
(3,295
)
 
$
(2,754
)
 
 
 
 
Discount rate
 
 
 
Effect on fair value of a 100 basis point adverse change
$
(1,008
)
 
$
(889
)
Effect on fair value of a 200 basis point adverse change
$
(1,957
)
 
$
(1,720
)


The sensitivity analysis presents the hypothetical effect on fair value of the MSR. The effect of such hypothetical change in assumptions generally cannot be extrapolated because the relationship of the change in an assumption to the change in fair value is not linear. Additionally, in the analysis, the impact of an adverse change in one assumption is calculated independent of any impact on other assumptions. In reality, changes in one assumption may result in changes in another assumption.