Mortgage Servicing Rights

12 Months Ended

Dec. 31, 2013

Mortgage Servicing Rights

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 $272,280 and $269,554 at December 31, 2013 and 2012, respectively. The following is a summary of changes in the balance of MSRs:

	Originated			Valuation
	MSR			Allowance			Total
Balance at January 1, 2011	$	1,303		($	203	)	$	1,100
Additions from originated servicing		419			0			419
Amortization charged to earnings		(436	)		0			(436	)
Change in valuation allowance credited 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
Additions from originated servicing		625			0			625
Amortization charged to earnings		(421	)		0			(421	)
Change in valuation allowance credited to earnings		0			259			259
Balance at December 31, 2013	$	1,717		($	21	)	$	1,696

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

	Years Ending December 31,
	2013			2012			2011
Cash gain on sale of mortgage loans	$	826		$	1,113		$	642
Originated mortgage servicing rights		625			774			419
Increase (decrease) in accrued mortgage rate lock commitments		(78	)		31			3
Gain on sale of mortgage loans		1,373			1,918			1,064
Mortgage servicing fee income		674			649			645
Provision for representation and warranty losses on serviced loans		(294	)		(28	)		(38	)
FHLB credit enhancement fee income		0			2			16
Amortization of mortgage servicing rights		(421	)		(547	)		(436	)
Decrease (increase) in servicing right valuation allowance		259			(199	)		122
Loan servicing fee income, net		218			(123	)		309
Mortgage banking income, net	$	1,591		$	1,795		$	1,373