SERVICING RIGHTS (Tables)

12 Months Ended

Dec. 31, 2012

Schedule of Servicing Assets at Fair Value

Changes in mortgage servicing rights for the years ended December 31, 2012 and 2011 were as follows:



	2012			2011
	(dollars expressed in thousands)
Balance, beginning of year	$	9,077		12,150
Originated mortgage servicing rights	4,887			3,450
Change in fair value resulting from changes in valuation inputs or assumptions used in valuation model ⁽¹⁾	(2,089		)	(4,280	)
Other changes in fair value ⁽²⁾	(2,723		)	(2,243	)
Balance, end of year	$	9,152		9,077


(1)	The change in fair value resulting from changes in valuation inputs or assumptions used in valuation model primarily reflects the change in discount rates and prepayment speed assumptions, primarily due to changes in interest rates.


(2)	Other changes in fair value reflect changes due to the collection/realization of expected cash flows over time.

Changes in SBA servicing rights for the years ended December 31, 2012 and 2011 were as follows:



	2012			2011
	(dollars expressed in thousands)
Balance, beginning of year	$	6,303		7,432
Originated SBA servicing rights	—			—
Change in fair value resulting from changes in valuation inputs or assumptions used in valuation model ⁽¹⁾	434			150
Other changes in fair value ⁽²⁾	(1,097		)	(1,279	)
Balance, end of year	$	5,640		6,303


(1)	The change in fair value resulting from changes in valuation inputs or assumptions used in valuation model primarily reflects the change in discount rates and prepayment speed assumptions, primarily due to changes in interest rates.


(2)	Other changes in fair value reflect changes due to the collection/realization of expected cash flows over time.

- Definition

Tabular disclosure of the activity in the balance of servicing assets (including a description of where changes in fair value are reported in the statement of income for each period for which results of operations are presented), including but not limited to, the following: beginning and ending balances, additions (for instance, through purchases of servicing assets), disposals, changes in fair value during the period resulting from changes in inputs or assumptions used in the valuation model, other changes in fair value along with a description of those changes, and other changes that affect the balance along with a description of those changes.

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