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Loan Servicing
 12 Months Ended
Dec. 31, 2018
Text Block [Abstract]  
Loan Servicing
Note 10 – Loan Servicing
Loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid principal balances of loans serviced for others totaled approximately $1.299 billion and $1.310 billion at December 31, 2018 and 2017.
The aggregate fair value of capitalized mortgage servicing rights was approximately $13.9 million, $12.8 million, and $12.1 million at December 31, 2018, 2017 and 2016, compared to the carrying values of $12.3 million, $11.6 million and $11.1 million, respectively. The fair value of capitalized mortgage servicing rights was approximately $8.9 million on January 1, 2016. Comparable market values and a valuation model that calculates the present value of future cash flows were used to estimate fair value. For purposes of measuring impairment, risk characteristics including product type, investor type and interest rates, were used to stratify the originated mortgage servicing rights.
 
 
 
December 31

2018
 
 
December 31

2017
 
 
December 31

2016
 
Mortgage servicing rights
 
 
 
 
 
 
 
 
 
 
 
 
Balances, January 1
 
$
12,189
 
 
$
11,681
 
 
$
9,271
 
Servicing rights capitalized
 
 
1,883
 
 
 
2,109
 
 
 
3,426
 
Amortization of servicing rights
 
 
(1,196
)
 
 
(1,601
)
 
 
(1,016
)
Balances, December 31
 
 
12,876
 
 
 
12,189
 
 
 
11,681
 
Impairment allowance
 
 
 
 
 
 
 
 
 
 
 
 
Balances, January 1
 
 
(587
)
 
 
(507
)
 
 
(397
)
Additions
 
 
(78
)
 
 
(85
)
 
 
(236
)
Reductions
 
 
138
 
 
 
5
 
 
 
126
 
Balances, December 31
 
 
(527
)
 
 
(587
)
 
 
(507
)
Mortgage servicing rights, net
 
$
12,349
 
 
$
11,602
 
 
$
11,174
 
During 2018, the Bank reduced the impairment allowance approximately $60,000. During 2017 and 2016, the Bank recorded additional impairment of approximately $80,000 and $110,000, respectively.