On July 1, 2020, as part of the IBKC merger, FHN obtained IBKC's mortgage banking operations which includes origination and servicing of residential first lien mortgages that conform to standards established by GSEs that are major investors in U.S. home mortgages but can also consist of junior lien and jumbo loans secured by residential property. These loans are primarily sold to private companies that are unaffiliated with the GSEs on a servicing-released basis. Gains and losses on these mortgage loans are included in mortgage banking and title income on the

Consolidated Statements of Income. Prior to the merger, FHN’s mortgage banking operations were not significant. At September 30, 2021, FHN had approximately $48 million of loans that remained from pre-2009 Mortgage Business operations. Activity related to the pre-2009 mortgage loans was primarily limited to payments and write-offs in 2020 and 2021, with no new originations or loan sales, and only an insignificant amount of repurchases. These loans are excluded from the disclosure below.

The following table summarizes activity relating to residential mortgage loans held for sale as of the nine months ended September 30, 2021 and the year ended December 31, 2020.


(Dollars in millions)	September 30, 2021		December 31, 2020
Balance at beginning of period	$	409	$	4
Acquired	—		320
Originations and purchases	2,154		2,499
Sales, net of gains	(2,302)		(2,405)
Mortgage loans transferred from (to) held for investment	30		(9)
Balance at end of period	$	291	$	409

Mortgage Servicing Rights

Effective with the IBKC merger, FHN made an election to record mortgage servicing rights at the lower of cost or market value and amortize over the remaining servicing life of the loans, with consideration given to prepayment assumptions. Mortgage servicing rights are included in other assets on the Consolidated Balance Sheets. Mortgage servicing rights had the following carrying values as of the periods indicated.


	September 30, 2021						December 31, 2020
(Dollars in millions)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount			Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Mortgage servicing rights	$	36	$	(7)	$	29		$	28	$	(3)	$	25

In addition, there was an insignificant amount of non-mortgage and commercial servicing rights as of September 30, 2021 and December 31, 2020. Total mortgage servicing fees included in mortgage banking and title income were $1 million for the three months ended September 30, 2021 and $2 million for the nine months ended September 30, 2021. Total mortgage servicing fees included in mortgage banking and title income were $1 million for the three and nine months ended September 30, 2020.