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Capitalized Mortgage Servicing Rights

3 Months Ended

Mar. 31, 2023

Capitalized Mortgage Servicing Rights

Note 5 — Capitalized Mortgage Servicing Rights

Our capitalized mortgage servicing rights (“MSRs”) reflect commercial real estate MSRs derived primarily from loans sold in our Agency Business or acquired MSRs. The discount rates used to determine the present value of all our MSRs throughout the periods presented were between 8% - 13% (representing a weighted average discount rate of 12%) based on our best estimate of market discount rates. The weighted average estimated life remaining of our MSRs was 8.6 years at both March 31, 2023 and December 31, 2022.

A summary of our capitalized MSR activity is as follows (in thousands):


	Three Months Ended March 31, 2023						Three Months Ended March 31, 2022
	Originated		Acquired		Total		Originated		Acquired		Total
Beginning balance	$	386,878	$	14,593	$	401,471	$	395,573	$	27,161	$	422,734
Additions		13,886		—		13,886		26,971		—		26,971
Amortization		(14,287)		(1,129)		(15,416)		(12,927)		(2,045)		(14,972)
Write-downs and payoffs		(2,841)		(466)		(3,307)		(11,556)		(1,141)		(12,697)
Ending balance	$	383,636	$	12,998	$	396,634	$	398,061	$	23,975	$	422,036

We collected prepayment fees totaling $2.1 million and $16.1 million during the three months ended March 31, 2023 and 2022, respectively, which are included as a component of servicing revenue, net on the consolidated statements of income. At March 31, 2023 and December 31, 2022, we had no valuation allowance recorded on any of our MSRs.

The expected amortization of capitalized MSRs recorded at March 31, 2023 is as follows (in thousands):


Year	Amortization
2023 (nine months ending 12/31/2023)	$	46,546
2024		60,349
2025		56,515
2026		50,349
2027		45,525
Thereafter		137,350
Total	$	396,634

Based on scheduled maturities, actual amortization may vary from these estimates.