LOAN SALES AND SECURITIZATIONS (Tables)
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6 Months Ended |
Jun. 30, 2016 |
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| Transfers and Servicing [Abstract] |
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| Summarizes activity relating to loans securitized sold with servicing retained |
The following table summarizes activity relating to residential mortgage loans sold with servicing retained for the three-month and six-month periods ended June 30, 2016 and 2015:
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Three Months Ended
June 30, |
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Six months ended
June 30, |
(dollar amounts in thousands) |
2016 |
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2015 |
|
2016 |
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2015 |
Residential mortgage loans sold with servicing retained |
$ |
715,589 |
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$ |
938,412 |
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$ |
1,348,055 |
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$ |
1,569,096 |
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Pretax gains resulting from above loan sales (1) |
18,618 |
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27,471 |
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32,731 |
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42,334 |
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(1) |
Recorded in mortgage banking income. |
The following table summarizes activity relating to SBA loans sold with servicing retained for the three-month and six-month periods ended June 30, 2016 and 2015:
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Three Months Ended
June 30, |
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Six months ended
June 30, |
(dollar amounts in thousands) |
2016 |
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2015 |
|
2016 |
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2015 |
SBA loans sold with servicing retained |
$ |
58,629 |
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$ |
53,534 |
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$ |
104,518 |
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$ |
95,935 |
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Pretax gains resulting from above loan sales (1) |
4,662 |
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|
4,696 |
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8,183 |
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8,270 |
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(1) |
Recorded in gain on sale of loans. |
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| 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 and six-month periods ended June 30, 2016 and 2015:
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Fair Value Method: |
Three Months Ended
June 30, |
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Six months ended
June 30, |
(dollar amounts in thousands) |
2016 |
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2015 |
|
2016 |
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2015 |
Fair value, beginning of period |
$ |
14,819 |
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$ |
20,455 |
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$ |
17,585 |
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$ |
22,786 |
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Change in fair value during the period due to: |
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Time decay (1) |
(245 |
) |
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(332 |
) |
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(518 |
) |
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(671 |
) |
Payoffs (2) |
(465 |
) |
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(997 |
) |
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(969 |
) |
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(1,815 |
) |
Changes in valuation inputs or assumptions (3) |
(1,004 |
) |
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1,555 |
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(2,993 |
) |
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381 |
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Fair value, end of period: |
$ |
13,105 |
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$ |
20,681 |
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$ |
13,105 |
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$ |
20,681 |
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Weighted-average life (years) |
5.1 |
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5.1 |
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5.1 |
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5.1 |
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(1) |
Represents decrease in value due to passage of time, including the impact from both regularly scheduled loan principal payments and partial loan paydowns. |
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(2) |
Represents decrease in value associated with loans that paid off during the period. |
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(3) |
Represents change in value resulting primarily from market-driven changes in interest rates and prepayment speeds. |
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| Summarizes activity relating to loans sold with servicing retained using the amortization method |
Changes in the carrying value of automobile loan servicing rights for the three-month and six-month periods ended June 30, 2016 and 2015, and the fair value at the end of each period were as follows:
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Three Months Ended
June 30, |
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Six months ended
June 30, |
(dollar amounts in thousands) |
2016 |
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2015 |
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2016 |
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2015 |
Carrying value, beginning of period |
$ |
7,029 |
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$ |
5,063 |
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$ |
8,771 |
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$ |
6,898 |
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New servicing assets created |
— |
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11,180 |
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— |
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11,180 |
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Amortization and other |
(1,571 |
) |
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(1,913 |
) |
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(3,313 |
) |
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(3,748 |
) |
Carrying value, end of period |
$ |
5,458 |
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$ |
14,330 |
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$ |
5,458 |
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$ |
14,330 |
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Fair value, end of period |
$ |
5,551 |
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$ |
14,336 |
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$ |
5,551 |
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$ |
14,336 |
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Weighted-average life (years) |
3.0 |
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3.2 |
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3.0 |
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3.2 |
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Amortization Method: |
Three Months Ended
June 30, |
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Six months ended
June 30, |
(dollar amounts in thousands) |
2016 |
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2015 |
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2016 |
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2015 |
Carrying value, beginning of period |
$ |
127,275 |
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$ |
125,454 |
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$ |
143,133 |
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$ |
132,813 |
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New servicing assets created |
7,277 |
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10,338 |
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13,386 |
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16,792 |
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Servicing assets acquired |
— |
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— |
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— |
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— |
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Impairment (charge) / recovery |
(7,295 |
) |
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12,970 |
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(23,635 |
) |
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4,980 |
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Amortization and other |
(5,965 |
) |
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(5,635 |
) |
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(11,592 |
) |
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(11,458 |
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Carrying value, end of period |
$ |
121,292 |
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$ |
143,127 |
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$ |
121,292 |
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$ |
143,127 |
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Fair value, end of period |
$ |
121,464 |
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$ |
143,434 |
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$ |
121,464 |
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$ |
143,434 |
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Weighted-average life (years) |
6.1 |
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6.5 |
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6.1 |
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6.5 |
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The following tables summarize the changes in the carrying value of the servicing asset for the three-month and six-month periods ended June 30, 2016 and 2015, and the fair value at the end of each period were as follows:
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Three Months Ended
June 30, |
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Six months ended
June 30, |
(dollar amounts in thousands) |
2016 |
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2015 |
|
2016 |
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2015 |
Carrying value, beginning of period |
$ |
19,526 |
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$ |
17,947 |
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$ |
19,747 |
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$ |
18,536 |
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New servicing assets created |
1,868 |
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1,839 |
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3,380 |
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3,296 |
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Amortization and other |
(1,782 |
) |
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(1,514 |
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(3,515 |
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(3,560 |
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Carrying value, end of period |
$ |
19,612 |
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$ |
18,272 |
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$ |
19,612 |
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$ |
18,272 |
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Fair value, end of period |
$ |
23,823 |
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$ |
20,350 |
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$ |
23,823 |
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$ |
20,350 |
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Weighted-average life (years) |
3.3 |
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3.3 |
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3.3 |
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3.3 |
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| 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 June 30, 2016 and December 31, 2015 follows:
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June 30, 2016 |
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December 31, 2015 |
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Decline in fair value due to |
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Decline in fair value due to |
(dollar amounts in thousands) |
Actual |
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10%
adverse
change
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20%
adverse
change
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Actual |
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10%
adverse
change
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20%
adverse
change
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Constant prepayment rate (annualized)
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7.50 |
% |
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$ |
(326 |
) |
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$ |
(648 |
) |
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7.60 |
% |
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$ |
(313 |
) |
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$ |
(622 |
) |
Discount rate |
15.00 |
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(637 |
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(1,248 |
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15.00 |
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(610 |
) |
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(1,194 |
) |
For MSRs under the fair value method, a summary of key assumptions and the sensitivity of the MSR value at June 30, 2016 and December 31, 2015, to changes in these assumptions follows:
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June 30, 2016 |
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December 31, 2015 |
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Decline in fair value due to |
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Decline in fair value due to |
(dollar amounts in thousands) |
Actual |
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10%
adverse
change
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20%
adverse
change
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Actual |
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10%
adverse
change
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20%
adverse
change
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Constant prepayment rate (annualized)
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12.70 |
% |
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$ |
(569 |
) |
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$ |
(1,098 |
) |
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14.70 |
% |
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$ |
(864 |
) |
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$ |
(1,653 |
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Spread over forward interest rate swap rates |
551 bps |
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(414 |
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(802 |
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539 bps |
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(559 |
) |
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(1,083 |
) |
For MSRs under the amortization method, a summary of key assumptions and the sensitivity of the MSR value at June 30, 2016 and December 31, 2015, to changes in these assumptions follows:
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June 30, 2016 |
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December 31, 2015 |
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Decline in fair value due to |
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Decline in fair value due to |
(dollar amounts in thousands) |
Actual |
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10%
adverse
change |
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20%
adverse
change |
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Actual |
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10%
adverse
change |
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20%
adverse
change |
Constant prepayment rate (annualized)
|
10.50 |
% |
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$ |
(4,375 |
) |
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$ |
(8,445 |
) |
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11.10 |
% |
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$ |
(5,543 |
) |
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$ |
(10,648 |
) |
Spread over forward interest rate swap rates |
1,208 bps |
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(3,530 |
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(6,848 |
) |
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875 bps |
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(4,662 |
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(9,017 |
) |
A summary of key assumptions and the sensitivity of the automobile loan servicing rights value to changes in these assumptions at June 30, 2016 and December 31, 2015 follows:
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June 30, 2016 |
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December 31, 2015 |
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Decline in fair value due to |
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Decline in fair value due to |
(dollar amounts in thousands) |
Actual |
|
10%
adverse
change |
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20%
adverse
change |
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Actual |
|
10%
adverse
change |
|
20%
adverse
change |
Constant prepayment rate (annualized)
|
18.48 |
% |
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$ |
(240 |
) |
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$ |
(469 |
) |
|
18.36 |
% |
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$ |
(500 |
) |
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$ |
(895 |
) |
Spread over forward interest rate swap rates |
500 bps |
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(5 |
) |
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(10 |
) |
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500 bps |
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(10 |
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(19 |
) |
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