MORTGAGE BANKING ACTIVITIES (Tables)

6 Months Ended

Jun. 30, 2015

Mortgage loans serviced for others are not reported as assets. The principal balances of these loans are as follows:

	June 30, 2015		December 31, 2014
	(Dollars in thousands)
Mortgage loan portfolios serviced for:
FHLMC	$	849,109	$	821,609
FNMA		248,012		259,463

Activity for capitalized mortgage servicing rights, included in other assets, was as follows:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2015			2014			2015			2014
	(Dollars in thousands)
Balance, beginning of period	$	5,543		$	5,803		$	5,535		$	5,941
Originations		530			287			981			541
Amortized to expense		(462	)		(432	)		(905	)		(824	)
Balance, end of period		5,611			5,658			5,611			5,658
Less valuation allowance		(12	)		(6	)		(12	)		(6	)
Net balance	$	5,599		$	5,652		$	5,599		$	5,652

Activity in the valuation allowance for mortgage servicing rights was as follows:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2015			2014			2015			2014
	(Dollars in thousands)
Balance, beginning of period	$	(219	)	$	(1	)	$	(58	)	$	—
Impairment charges		—			(5	)		(161	)		(6	)
Recoveries		207			—			207			—
Balance, end of period	$	(12	)	$	(6	)	$	(12	)	$	(6	)

Key economic assumptions in measuring the value of mortgage servicing rights at June 30, 2015, and December 31, 2014, were as follows:

	June 30, 2015	December 31, 2014
Weighted average prepayment rate	195 PSA	219 PSA
Weighted average life (in years)	3.54	3.61
Weighted average discount rate	8.00%	8.00%