| Schedule of Carrying Value of Loan Servicing Rights Assets |
The carrying value of the loan servicing rights assets is shown in the table below:
| | | | | | | | | | | | | (dollars in thousands) | June 30, 2026 | | December 31, 2025 | | Loan Servicing Rights | | | | | Residential mortgage | $ | 125,938 | | | $ | 113,370 | | | SBA | 1,604 | | | 1,602 | | | | | | | Total loan servicing rights | $ | 127,542 | | | $ | 114,972 | |
The table below is an analysis of the activity in the Company’s MSRs:
| | | | | | | | | | | | | | | | | | | | | | | | | (dollars in thousands) | Three Months Ended June 30, | | Six Months Ended June 30, | | Residential mortgage servicing rights | 2026 | | 2025 | | 2026 | | 2025 | | Beginning carrying value, net | $ | 120,160 | | | $ | 116,584 | | | $ | 113,370 | | | $ | 112,514 | | | Additions | 8,891 | | | 12,791 | | | 18,843 | | | 20,108 | | | | | | | | | | | Amortization | (3,113) | | | (3,353) | | | (6,275) | | | (6,600) | | | | | | | | | | | | | | | | | | | Ending carrying value, net | $ | 125,938 | | | $ | 126,022 | | | $ | 125,938 | | | $ | 126,022 | |
The table below is an analysis of the activity in the Company’s SBA loan servicing rights:
| | | | | | | | | | | | | | | | | | | | | | | | | (dollars in thousands) | Three Months Ended June 30, | | Six Months Ended June 30, | | SBA servicing rights | 2026 | | 2025 | | 2026 | | 2025 | | Beginning carrying value, net | $ | 1,703 | | | $ | 2,927 | | | $ | 1,602 | | | $ | 2,926 | | | Additions | 41 | | | 129 | | | 209 | | | 286 | | | | | | | | | | | | | | | | | | | Amortization | (140) | | | (270) | | | (207) | | | (426) | | | | | | | | | | | Ending carrying value, net | $ | 1,604 | | | $ | 2,786 | | | $ | 1,604 | | | $ | 2,786 | | | | | | | | | | | | | | | | | |
|
| Schedule of Sensitivity of Fair Value to Adverse Changes in Model Inputs and/or Assumptions |
The key metrics and the sensitivity of the fair value to adverse changes in model inputs and/or assumptions are summarized below:
| | | | | | | | | | | | | (dollars in thousands) | June 30, 2026 | | December 31, 2025 | | Residential mortgage servicing rights | | | | | Fair value of residential mortgage servicing rights | $ | 165,143 | | | $ | 143,385 | | | Unpaid principal balance of loans serviced for others | $ | 9,481,412 | | | $ | 8,676,676 | | | Composition of residential loans serviced for others: | | | | | FHLMC | 25.37 | % | | 24.06 | % | | FNMA | 61.37 | % | | 63.31 | % | | GNMA | 13.26 | % | | 12.63 | % | | Total | 100.00 | % | | 100.00 | % | | Weighted average term (months) | 353 | | 353 | | Weighted average age (months) | 41 | | 41 | | Modeled prepayment speed | 6.87 | % | | 7.96 | % | | Decline in fair value due to a 10% adverse change | $ | (4,726) | | | $ | (4,673) | | | Decline in fair value due to a 20% adverse change | $ | (9,361) | | | $ | (9,140) | | | Weighted average discount rate | 9.49 | % | | 9.44 | % | | Decline in fair value due to a 10% adverse change | $ | (6,562) | | | $ | (5,711) | | | Decline in fair value due to a 20% adverse change | $ | (12,946) | | | $ | (11,181) | |
| | | | | | | | | | | | | (dollars in thousands) | June 30, 2026 | | December 31, 2025 | | SBA servicing rights | | | | | Fair value of SBA servicing rights | $ | 2,528 | | | $ | 2,425 | | | Unpaid principal balance of loans serviced for others | $ | 191,962 | | | $ | 190,377 | | | Weighted average life (in years) | 3.28 | | 3.35 | | Modeled prepayment speed | 17.41 | % | | 18.09 | % | | Decline in fair value due to a 10% adverse change | $ | (144) | | | $ | (133) | | | Decline in fair value due to a 20% adverse change | $ | (274) | | | $ | (254) | | | Weighted average discount rate | 10.24 | % | | 11.01 | % | | Decline in fair value due to a 100 basis point adverse change | $ | (70) | | | $ | (63) | | | Decline in fair value due to a 200 basis point adverse change | $ | (136) | | | $ | (122) | |
|