Mortgage Servicing Rights

6 Months Ended

Jun. 30, 2019

The following table summarizes the changes in mortgage servicing rights ("MSRs"), which are included in other assets on the consolidated balance sheets:



	Three months ended June 30						Six months ended June 30
	2019			2018			2019			2018
	(in thousands)
Amortized cost:
Balance at beginning of period	$	38,504		$	37,748		$	38,573		$	37,663
Originations of mortgage servicing rights	1,861			1,746			3,086			3,229
Amortization	(1,539		)	(1,600		)	(2,833		)	(2,998		)
Balance at end of period	$	38,826		$	37,894		$	38,826		$	37,894

MSRs represent the economic value of existing contractual rights to service mortgage loans that have been sold. Accordingly, actual and expected prepayments of the underlying mortgage loans can impact the value of MSRs. The Corporation accounts for MSRs at the lower of amortized cost or fair value.

The fair value of MSRs is estimated by discounting the estimated cash flows from servicing income, net of expense, over the expected life of the underlying loans at a discount rate commensurate with the risk associated with these assets. Expected life is based on the contractual terms of the loans, as adjusted for prepayment projections. The fair values of MSRs were $44.9 million and $50.2 million at June 30, 2019 and December 31, 2018, respectively. Based on its fair value analysis, the Corporation determined no valuation allowance was necessary as of June 30, 2019 or 2018.