Mortgage Banking and Servicing Rights (Tables)

12 Months Ended

Dec. 31, 2020

Mortgage Banking and Servicing Rights [Abstract]

Components of Mortgage Banking Income

The following table presents the components of mortgage banking income:

(in thousands) Year Ended December 31	2020			2019			2018
Net gain on sale of mortgage loans held for sale	$	7,226		$	1,746		$	1,288
Net loan servicing income (expense):
Servicing fees		1,515			1,297			1,275
Late fees		52			72			73
Ancillary fees		1,310			190			282
Fair value adjustments		(1,064	)		(975	)		(343	)
Net loan servicing income		1,813			584			1,287
Mortgage banking income	$	9,039		$	2,330		$	2,575

Activity for Capitalized Mortgage Servicing Rights Using Fair Value Method

Activity for capitalized mortgage servicing rights using the fair value method is as follows:

(in thousands)	2020			2019			2018
Fair value of MSRs, beginning of year	$	3,263		$	3,607		$	3,484
New servicing assets created		1,869			631			466
Change in fair value during the year due to:
Time decay (1)		(135	)		(167	)		(189	)
Payoffs (2)		(766	)		(293	)		(227	)
Changes in valuation inputs or assumptions (3)		(163	)		(515	)		73
Fair value of MSRs, end of year	$	4,068		$	3,263		$	3,607

(1) Represents decrease in value due to regularly scheduled loan principal payments and partial loan paydowns.

(2) Represents decrease in value due to loans that paid off during the period.

(3) Represents change in value resulting from market-driven changes in interest rates.