20. LOAN SERVICING

Park serviced sold mortgage loans of $1,471 million at December 31, 2010 compared to $1,518 million at December 31, 2009, and $1,369 million at December 31, 2008. At December 31, 2010, $36.0 million of the sold mortgage loans were sold with recourse compared to $53 million at December 31, 2009. Management closely monitors the delinquency rates on the mortgage loans sold with recourse. At December 31, 2010, management determined that no liability was deemed necessary for these loans.

Park capitalized $3.1 million in mortgage servicing rights in 2010, $5.5 million in 2009 and $1.5 million in 2008. Park's amortization of mortgage servicing rights was $3.2 million in 2010, $4.0 million in 2009 and $1.7 million in 2008. The amortization of mortgage loan servicing rights is included within "Other service income". Generally, mortgage servicing rights are capitalized and amortized on an individual sold loan basis. When a sold mortgage loan is paid off, the related mortgage servicing rights are fully amortized.

Activity for mortgage servicing rights and the related valuation allowance follows:

December 31 (In thousands)	2010			2009
Mortgage servicing rights:
Carrying amount, net, beginning of year	$	10,780		$	8,306
Additions		3,062			5,480
Amortization		(3,180	)		(4,077	)
Change in valuation allowance		(174	)		1,071
Carrying amount, net, end of year	$	10,488		$	10,780
Valuation allowance:
Beginning of year	$	574		$	1,645
Additions/(reductions) expensed		174			(1,071	)
End of year	$	748		$	574