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MORTGAGE BANKING OPERATIONS (Tables)
 6 Months Ended
Jun. 30, 2024
Mortgage Banking [Abstract]  
Mortgage Loans on Real Estate, by Loan
LHFS consisted of the following:
 
(in thousands)At June 30, 2024At December 31, 2023
Single family$22,147 $12,849 
CRE, multifamily and SBA7,634 6,788 
Total$29,781 $19,637 

Loans sold consisted of the following for the periods indicated: 

 Quarter Ended June 30,Six Months Ended June 30,
(in thousands)2024202320242023
Single family$98,081 $92,787 $168,460 $156,260 
CRE, multifamily and SBA13,539 4,649 21,735 13,399 
Total$111,620 $97,436 $190,195 $169,659 
Net Gain on Loan Origination and Sale Activity
Gain on loan origination and sale activities, including the effects of derivative risk management instruments, consisted of the following: 
 Quarter Ended June 30,Six Months Ended June 30,
(in thousands)2024202320242023
Single family$2,718 $2,171 $4,704 $4,389 
CRE, multifamily and SBA318 285 638 477 
Total$3,036 $2,456 $5,342 $4,866 
Company's Portfolio of Loans Serviced for Others
The Company's portfolio of loans serviced for others is primarily comprised of loans held in U.S. government and agency MBS issued by Fannie Mae, Freddie Mac and Ginnie Mae. The unpaid principal balance of loans serviced for others is as follows:

(in thousands)At June 30, 2024At December 31, 2023
Single family $5,243,515 $5,316,304 
CRE, multifamily and SBA 1,873,031 1,900,039 
Total$7,116,546 $7,216,343 
Mortgage Repurchase Losses
The following is a summary of changes in the Company's liability for estimated single-family mortgage repurchase losses:

 Quarter Ended June 30,Six Months Ended June 30,
(in thousands)2024202320242023
Balance, beginning of period$1,317 $1,789 $1,481 $2,232 
Additions, net of adjustments (1)
(20)32 (148)(111)
Realized (losses) recoveries, net (2)
(95)(93)(131)(393)
Balance, end of period$1,202 $1,728 $1,202 $1,728 
(1) Includes additions for new loan sales and changes in estimated probable future repurchase losses on previously sold loans.
(2) Includes principal losses and accrued interest on repurchased loans, "make-whole" settlements, settlements with claimants and certain related expenses.
Revenue from Mortgage Servicing, Including the Effects of Derivative Risk Management Instruments
Revenue from mortgage servicing, including the effects of derivative risk management instruments, consisted of the following:
 Quarter Ended June 30,Six Months Ended June 30,
(in thousands)2024202320242023
Servicing income, net:
Servicing fees and other$6,562 $6,592 $12,916 $13,261 
Amortization of single family MSRs (1)
(1,713)(1,626)(3,141)(3,310)
Amortization of multifamily and SBA MSRs(1,459)(1,435)(2,861)(2,989)
Total
3,390 3,531 6,914 6,962 
Risk management, single family MSRs:
Changes in fair value of MSRs due to assumptions (2)
529 1,320 1,147 1,009 
Net gain (loss) from economic hedging (3)
(509)(1,592)(1,619)(1,673)
Total
20 (272)(472)(664)
               Loan servicing income $3,410 $3,259 $6,442 $6,298 
(1) Represents changes due to collection/realization of expected cash flows and curtailments.
(2) Principally reflects changes in model assumptions, including prepayment speed assumptions, which are primarily affected by changes in mortgage interest rates.
(3)    The interest income from US Treasury notes securities used for hedging purposes, which is included in interest income on the consolidated income statements, was $0.3 million and $0.5 million for the quarters ended June 30, 2024 and 2023, respectively, and was $0.6 million and $0.9 million for the six months ended June 30, 2024 and 2023, respectively.
Changes in Single Family MSRs Measured at Fair Value The changes in single family MSRs measured at fair value are as follows:
Quarter Ended June 30,Six Months Ended June 30,
(in thousands)2024202320242023
Beginning balance$74,056 $75,701 $74,249 $76,617 
Additions and amortization:
Originations
853 919 1,470 1,538 
Purchases
— — — 460 
Amortization (1)
(1,713)(1,626)(3,141)(3,310)
Net additions and amortization
(860)(707)(1,671)(1,312)
Changes in fair value assumptions (2)
529 1,320 1,147 1,009 
Ending balance$73,725 $76,314 $73,725 $76,314 
(1) Represents changes due to collection/realization of expected cash flows and curtailments.
(2) Principally reflects changes in model assumptions, including prepayment speed assumptions, which are primarily affected by changes in mortgage interest rates.
Key Economic Assumptions Used in Measuring Initial FV of Capitalized Single Family MSRs
Key economic assumptions used in measuring the initial fair value of capitalized single family MSRs were as follows: 

Quarter Ended June 30,Six Months Ended June 30,
(rates per annum) (1)
2024202320242023
Constant prepayment rate ("CPR") (2)
17.46 %16.70 %18.28 %13.78 %
Discount rate 10.45 %10.99 %10.33 %10.44 %
(1) Based on a weighted average.
(2) Represents an expected lifetime average CPR used in the model.
Schedule of Sensitivity Analysis of Fair Value, Transferor's Interests in Transferred Financial Assets
For single family MSRs, we use a discounted cash flow valuation technique which utilizes CPRs and discount rates as significant unobservable inputs as noted in the table below:
At June 30, 2024At December 31, 2023
Range of Inputs
Average (1)
Range of Inputs
Average (1)
CPRs (2)
6.10% - 34.00%
6.58 %
6.80% - 32.50%
7.00 %
Discount Rates
10.00% - 16.00%
10.72 %
10.00% - 17.00%
10.00 %
(1) Weighted averages of all the inputs within the range.
(2) Represents the expected lifetime average CPR used in the model.

To compute hypothetical sensitivities of the value of our single family MSRs to immediate adverse changes in key assumptions, we computed the impact of changes to CPRs and in discount rates as outlined below:

(dollars in thousands)At June 30, 2024
Fair value of single family MSR$73,725 
Expected weighted-average life (in years)8.46
CPR
Impact on fair value of 25 basis points adverse change in interest rates$(648)
Impact on fair value of 50 basis points adverse change in interest rates$(1,393)
Discount rate
Impact on fair value of 100 basis points increase$(2,184)
Impact on fair value of 200 basis points increase$(4,774)
Changes in Multifamily MSRs Measured at the Lower of Amortized Cost or Fair Value
The changes in multifamily and SBA MSRs measured at the lower of amortized cost or fair value were as follows: 

Quarter Ended June 30,Six Months Ended June 30,
(in thousands)2024202320242023
Beginning balance$28,863 $33,839 $29,987 $35,256 
Originations179 73 457 210 
Amortization(1,459)(1,435)(2,861)(2,989)
Ending balance$27,583 $32,477 $27,583 $32,477 

Key economic assumptions used in measuring the initial fair value of capitalized multifamily MSRs were as follows:
 
Quarter Ended June 30,Six Months Ended June 30,
(rates per annum) (1)
2024202320242023
Discount rate13.00 %13.00 %13.00 %13.00 %
(1)Based on a weighted average.
For multifamily MSRs, we use a discounted cash flow valuation technique which utilizes CPRs and discount rates as significant unobservable inputs as noted in the table below. Multifamily DUS loans typically contain yield maintenance features that significantly reduce loan prepayments, resulting in a CPR of zero for valuation purposes.

At June 30, 2024At December 31, 2023
Range of Inputs
Average (1)
Range of Inputs
Average (1)
Discount Rates
13.00% - 15.00%
13.00 %
13.00% - 15.00%
13.00 %
(1) Weighted averages of all the inputs within the range.