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Mortgage Banking and Servicing Rights (Tables)
 12 Months Ended
Dec. 31, 2018
Mortgage Banking and Servicing Rights [Abstract]  
Components of Mortgage Banking Income
The following table presents the components of mortgage banking income:

(in thousands)
Year Ended December 31
 
2018
  
2017
  
2016
 
Net gain on sale of mortgage loans held for sale
 
$
1,288
  
$
1,232
  
$
1,831
 
Net loan servicing income (expense)
            
Servicing fees
  
1,275
   
1,255
   
1,239
 
Late fees
  
73
   
84
   
78
 
Ancillary fees
  
282
   
239
   
322
 
Fair value adjustments
  
(343
)
  
(361
)
  
(324
)
Net loan servicing income
  
1,287
   
1,217
   
1,315
 
Mortgage banking income
 
$
2,575
  
$
2,449
  
$
3,146
 
Activity for Capitalized Mortgage Servicing Rights Using Fair Value Method
Activity for capitalized mortgage servicing rights using the fair value method is as follows:

(in thousands)
 
2018
  
2017
  
2016
 
Fair value of MSRs, beginning of period
 
$
3,484
  
$
3,433
  
$
3,236
 
New servicing assets created
  
466
   
412
   
521
 
Change in fair value during the period due to:
            
Time decay (1)
  
(189
)
  
(184
)
  
(175
)
Payoffs (2)
  
(227
)
  
(268
)
  
(313
)
Changes in valuation inputs or assumptions (3)
  
73
   
91
   
164
 
Fair value of MSRs, end of period
 
$
3,607
  
$
3,484
  
$
3,433
 

(1)
Represents decrease in value due to regularly scheduled loan principal payments and partial loan paydowns.
(2)
Represents decrease in value due to loans that paid off during the period.
(3)
Represents change in value resulting from market-driven changes in interest rates.