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Mortgage Servicing Rights (Tables)
 9 Months Ended
Sep. 30, 2015
Transfers and Servicing of Financial Assets [Abstract]  
Analysis of mortgage servicing rights accounted for under the fair value measurement method
For the three and nine months ended September 30, 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
September 30,
 
Nine Months Ended
September 30,
(dollars in thousands)
2015

 
2014

 
2015

 
2014

Balance at Beginning of Period
$
2,188

 
$
2,960

 
$
2,604

 
$
3,826

Change in Fair Value:
 

 
 

 
 

 
 

Due to Change in Valuation Assumptions 1
—

 
(145
)
 
(251
)
 
(816
)
Due to Payoffs
(116
)
 
(72
)
 
(281
)
 
(267
)
Total Changes in Fair Value of Mortgage Servicing Rights
(116
)
 
(217
)
 
(532
)
 
(1,083
)
Balance at End of Period
$
2,072

 
$
2,743

 
$
2,072

 
$
2,743

1 
Primarily 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 and nine months ended September 30, 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
September 30,
 
Nine Months Ended
September 30,
(dollars in thousands)
2015

 
2014

 
2015

 
2014

Balance at Beginning of Period
$
21,238

 
$
23,437

 
$
22,091

 
$
24,297

Servicing Rights that Resulted From Asset Transfers
645

 
100

 
1,330

 
664

Amortization
(633
)
 
(742
)
 
(2,228
)
 
(2,094
)
Valuation Allowance Provision
(21
)
 
21

 
36

 
(51
)
Balance at End of Period
$
21,229

 
$
22,816


$
21,229


$
22,816

 
 
 
 
 
 
 
 
Valuation Allowance:
 
 
 
 
 
 
 
Balance at Beginning of Period
$
—

 
$
(72
)
 
$
(57
)
 
$
—

Valuation Allowance Provision
(21
)
 
21

 
36

 
(51
)
Balance at End of Period
$
(21
)
 
$
(51
)

$
(21
)

$
(51
)
 
 
 
 
 
 
 
 
Fair Value of Mortgage Servicing Rights Accounted for
 Under the Amortization Method
 

 
 

 
 

 
 

Beginning of Period
$
26,205

 
$
25,848

 
$
22,837

 
$
30,100

End of Period
$
24,419

 
$
24,336

 
$
24,419

 
$
24,336
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 September 30, 2015 and December 31, 2014 were as follows:
 
September 30,
2015

 
December 31, 2014

Weighted-Average Constant Prepayment Rate 1
10.01
%
 
11.62
%
Weighted-Average Life (in years)
6.98

 
6.28

Weighted-Average Note Rate
4.23
%
 
4.28
%
Weighted-Average Discount Rate 2
9.71
%
 
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 September 30, 2015 and December 31, 2014 is presented in the following table.
(dollars in thousands)
September 30,
2015

 
December 31,
2014

Constant Prepayment Rate
 

 
 

Decrease in fair value from 25 basis points (“bps”) adverse change
$
(285
)
 
$
(265
)
Decrease in fair value from 50 bps adverse change
(565
)
 
(524
)
Discount Rate
 

 
 

Decrease in fair value from 25 bps adverse change
(284
)
 
(250
)
Decrease in fair value from 50 bps adverse change
(562
)
 
(495
)