Quarterly report pursuant to Section 13 or 15(d)

LOAN SALES AND SECURITIZATIONS (Tables)

v3.4.0.3
LOAN SALES AND SECURITIZATIONS (Tables)
3 Months Ended
Mar. 31, 2016
Transfers and Servicing [Abstract]  
Summarizes activity relating to loans securitized sold with servicing retained
The following table summarizes activity relating to SBA loans sold with servicing retained for the three-month periods ended March 31, 2016 and 2015:
 
 
 
Three months ended
March 31,
(dollar amounts in thousands)
 
 
2016
 
2015
SBA loans sold with servicing retained
 
 
$
45,889

 
$
42,401

Pretax gains resulting from above loan sales (1)
 
 
3,521

 
3,574


(1)
Recorded in gain on sale of loans.
The following table summarizes activity relating to residential mortgage loans sold with servicing retained for the three-month periods ended March 31, 2016 and 2015:
 

 
Three months ended
March 31,
(dollar amounts in thousands)
 
 
2016
 
2015
Residential mortgage loans sold with servicing retained
 
 
$
632,466

 
$
630,683

Pretax gains resulting from above loan sales (1)
 
 
14,113

 
14,862

(1)
Recorded in mortgage banking income.
Summarizes activity relating to loans sold with servicing retained using the fair value method
The following tables summarize the changes in MSRs recorded using either the fair value method or the amortization method for the three-month periods ended March 31, 2016 and 2015:
Fair Value Method:
 
 
Three months ended
March 31,
(dollar amounts in thousands)
 
 
2016
 
2015
Fair value, beginning of period
 
 
$
17,585

 
$
22,786

Change in fair value during the period due to:
 
 
 
 
 
Time decay (1)
 
 
(273
)
 
(339
)
Payoffs (2)
 
 
(504
)
 
(818
)
Changes in valuation inputs or assumptions (3)
 
 
(1,989
)
 
(1,174
)
Fair value, end of period:
 
 
$
14,819

 
$
20,455

Weighted-average life (years)
 
 
5.2

 
4.7

(1)
Represents decrease in value due to passage of time, including the impact from both regularly scheduled loan principal payments and partial loan paydowns.
(2)
Represents decrease in value associated with loans that paid off during the period.
(3)
Represents change in value resulting primarily from market-driven changes in interest rates and prepayment speeds.
Summarizes activity relating to loans sold with servicing retained using the amortization method
Amortization Method:
 
 
Three months ended
March 31,
(dollar amounts in thousands)
 
 
2016
 
2015
Carrying value, beginning of period
 
 
$
143,133

 
$
132,813

New servicing assets created
 
 
6,109

 
6,454

Servicing assets acquired
 
 

 

Impairment (charge) / recovery
 
 
(16,340
)
 
(7,990
)
Amortization and other
 
 
(5,627
)
 
(5,823
)
Carrying value, end of period
 
 
$
127,275

 
$
125,454

Fair value, end of period
 
 
$
127,516

 
$
125,691

Weighted-average life (years)
 
 
6.5

 
5.7

The following tables summarize the changes in the carrying value of the servicing asset for the three-month periods ended March 31, 2016 and 2015, and the fair value at the end of each period were as follows:
 
 
 
Three months ended
March 31,
(dollar amounts in thousands)
 
 
2016
 
2015
Carrying value, beginning of period
 
 
$
19,747

 
$
18,536

New servicing assets created
 
 
1,511

 
1,457

Amortization and other
 
 
(1,733
)
 
(2,046
)
Carrying value, end of period
 
 
$
19,525

 
$
17,947

Fair value, end of period
 
 
$
23,048

 
$
19,436

Weighted-average life (years)
 
 
3.3

 
3.3

Changes in the carrying value of automobile loan servicing rights for the three-month periods ended March 31, 2016 and 2015, and the fair value at the end of each period were as follows:
 
 
 
Three months ended
March 31,
(dollar amounts in thousands)
 
 
2016
 
2015
Carrying value, beginning of period
 
 
$
8,771

 
$
6,898

New servicing assets created
 
 

 

Amortization and other
 
 
(1,742
)
 
(1,835
)
Carrying value, end of period
 
 
$
7,029

 
$
5,063

Fair value, end of period
 
 
$
7,250

 
$
5,155

Weighted-average life (years)
 
 
3.3

 
2.4

Summary of key assumptions and the sensitivity of the servicing rights value to changes in the assumptions
A summary of key assumptions and the sensitivity of the SBA loan servicing rights value to changes in these assumptions at March 31, 2016 and December 31, 2015 follows:
 
March 31, 2016
 
December 31, 2015
 
 
 
Decline in fair value due to
 
 
 
Decline in fair value due to
(dollar amounts in thousands)
Actual
 
10%
adverse
change
 
20%
adverse
change
 
Actual
 
10%
adverse
change
 
20%
adverse
change
Constant prepayment rate (annualized)
7.50
%
 
$
(319
)
 
$
(632
)
 
7.60
%
 
$
(313
)
 
$
(622
)
Discount rate
15.00

 
(618
)
 
(1,210
)
 
15.00

 
(610
)
 
(1,194
)
For MSRs under the fair value method, a summary of key assumptions and the sensitivity of the MSR value at March 31, 2016 and December 31, 2015, to changes in these assumptions follows:
 
March 31, 2016
 
December 31, 2015
 
 
 
Decline in fair value due to
 
 
 
Decline in fair value due to
(dollar amounts in thousands)
Actual
 
10%
adverse
change
 
20%
adverse
change
 
Actual
 
10%
adverse
change
 
20%
adverse
change
Constant prepayment rate (annualized)
12.30
%
 
$
(628
)
 
$
(1,212
)
 
14.70
%
 
$
(864
)
 
$
(1,653
)
Spread over forward interest rate swap rates
549 bps

 
(483
)
 
(935
)
 
539 bps

 
(559
)
 
(1,083
)

For MSRs under the amortization method, a summary of key assumptions and the sensitivity of the MSR value at March 31, 2016 and December 31, 2015, to changes in these assumptions follows:
 
March 31, 2016
 
December 31, 2015
 
 
 
Decline in fair value due to
 
 
 
Decline in fair value due to
(dollar amounts in thousands)
Actual
 
10%
adverse
change
 
20%
adverse
change
 
Actual
 
10%
adverse
change
 
20%
adverse
change
Constant prepayment rate (annualized)
9.60
%
 
$
(4,207
)
 
$
(8,140
)
 
11.10
%
 
$
(5,543
)
 
$
(10,648
)
Spread over forward interest rate swap rates
1,206 bps

 
(3,800
)
 
(7,370
)
 
875 bps

 
(4,662
)
 
(9,017
)
A summary of key assumptions and the sensitivity of the automobile loan servicing rights value to changes in these assumptions at March 31, 2016 and December 31, 2015 follows:
 
March 31, 2016
 
December 31, 2015
 
 
 
Decline in fair value due to
 
 
 
Decline in fair value due to
(dollar amounts in thousands)
Actual
 
10%
adverse
change
 
20%
adverse
change
 
Actual
 
10%
adverse
change
 
20%
adverse
change
Constant prepayment rate (annualized)
18.56
%
 
$
(450
)
 
$
(730
)
 
18.36
%
 
$
(500
)
 
$
(895
)
Spread over forward interest rate swap rates
500 bps

 
(6
)
 
(12
)
 
500 bps

 
(10
)
 
(19
)