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Mortgage Servicing Rights (Tables)
 3 Months Ended
Mar. 31, 2015
Transfers and Servicing of Financial Assets [Abstract]  
Analysis of mortgage servicing rights accounted for under the fair value measurement method
For the three months ended March 31, 2015 and 2014, the change in the carrying value of the Company’s mortgage servicing rights accounted for under the fair value measurement method was as follows:
 
 
Three Months Ended
March 31,
(dollars in thousands)
 
2015

 
2014

Balance at Beginning of Period
 
$
2,604

 
$
3,826

Change in Fair Value:
 
 

 
 

Due to Change in Valuation Assumptions 1
 
(251
)
 
(349
)
Due to Payoffs
 
(76
)
 
(96
)
Total Changes in Fair Value of Mortgage Servicing Rights
 
(327
)
 
(445
)
Balance at End of Period
 
$
2,277

 
$
3,381

1 
Principally represents changes in discount rates and loan repayment rate assumptions, mostly due to changes in interest rates.
Analysis of mortgage servicing rights accounted for under the amortization method
For the three months ended March 31, 2015 and 2014, the change in the carrying value of the Company’s mortgage servicing rights accounted for under the amortization method, net of valuation allowance, was as follows:
 
Three Months Ended
March 31,
(dollars in thousands)
2015

 
2014

Balance at Beginning of Period
$
22,091

 
$
24,297

Servicing Rights that Resulted From Asset Transfers
134

 
354

Amortization
(839
)
 
(654
)
Valuation Allowance Provision
(20
)
 
—

Balance at End of Period
$
21,366


$
23,997

 
 
 
 
Valuation Allowance:
 
 
 
Balance at Beginning of Period
$
(57
)
 
$
—

Valuation Allowance Provision
(20
)
 
—

Balance at End of Period
$
(77
)

$
—

 
 
 
 
Fair Value of Mortgage Servicing Rights Accounted for
 Under the Amortization Method
 

 
 

Beginning of Period
$
22,837

 
$
30,100

End of Period
$
21,431

 
$
28,303
Schedule of key data and assumptions used in estimating the fair value of mortgage servicing rights
The key data and assumptions used in estimating the fair value of the Company’s mortgage servicing rights as of March 31, 2015 and December 31, 2014 were as follows:
 
March 31,
2015

 
December 31, 2014

Weighted-Average Constant Prepayment Rate 1
12.96
%
 
11.62
%
Weighted-Average Life (in years)
5.83

 
6.28

Weighted-Average Note Rate
4.27
%
 
4.28
%
Weighted-Average Discount Rate 2
10.32
%
 
10.61
%
1 
Represents annualized loan repayment rate assumption.
2 
Derived from multiple interest rate scenarios that incorporate a spread to the London Interbank Offered Rate swap curve and market volatilities.
Schedule of sensitivity analysis of the fair value of mortgage servicing rights
A sensitivity analysis of the Company’s fair value of mortgage servicing rights to changes in certain key assumptions as of March 31, 2015 and December 31, 2014 is presented in the following table.
(dollars in thousands)
March 31,
2015

 
December 31,
2014

Constant Prepayment Rate
 

 
 

Decrease in fair value from 25 basis points (“bps”) adverse change
$
(236
)
 
$
(265
)
Decrease in fair value from 50 bps adverse change
(467
)
 
(524
)
Discount Rate
 

 
 

Decrease in fair value from 25 bps adverse change
(224
)
 
(250
)
Decrease in fair value from 50 bps adverse change
(445
)
 
(495
)