Mortgage Servicing Rights

12 Months Ended

Dec. 31, 2012

MortgageServicingRightsAbstract

Mortgage Servicing Rights

NOTE 7 Mortgage Servicing Rights

Mortgage loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid principal balances of residential mortgage loans serviced for FHLB and FNMA were $269,554 and $261,811 at December 31, 2012 and 2011, respectively. The following is a summary of changes in the balance of MSRs:

	Originated			Valuation
	MSR			Allowance			Total
Balance at January 1, 2010	$	1,229		($	82	)	$	1,147
Additions from originated servicing		550			0			550
Amortization charged to earnings		(476	)		0			(476	)
Change in valuation allowance charged to earnings		0			(121	)		(121	)
Balance at December 31, 2010		1,303			(203	)		1,100
Additions from originated servicing		419			0			419
Amortization charged to earnings		(436	)		0			(436	)
Change in valuation allowance creditd to earnings		0			122			122
Balance at December 31, 2011		1,286			(81	)		1,205
Additions from originated servicing		774			0			774
Amortization charged to earnings		(547	)		0			(547	)
Change in valuation allowance charged to earnings		0			(199	)		(199	)
Balance at December 31, 2012	$	1,513		($	280	)	$	1,233

The table below summarizes the components of PSB’s mortgage banking income for the three years ended December 31.

	Years Ending December 31,
	2012			2011			2010
Cash gain on sale of mortgage loans	$	1,113		$	642		$	861
Originated mortgage servicing rights		774			419			550
Increase in accrued mortgage rate lock commitments		31			3			51
Gain on sale of mortgage loans		1,918			1,064			1,462
Mortgage servicing fee income		649			645			578
Foreclosure servicing credit losses		(28	)		(38	)		0
FHLB credit enhancement fee income		2			16			29
Amortization of mortgage servicing rights		(547	)		(436	)		(476	)
Decrease (increase) in servicing right valuation allowance		(199	)		122			(121	)
Loan servicing fee income, net		(123	)		309			10
Mortgage banking income, net	$	1,795		$	1,373		$	1,472