8. CORE DEPOSIT PREMIUM AND MORTGAGE SERVICING RIGHTS

The following table presents changes in our core deposit premium and mortgage servicing rights for the periods presented:



	Core Deposit Premium			Mortgage Servicing Rights			Total
	(Dollars in thousands)
Balance as of December 31, 2015	$	7,355		$	17,797		$	25,152
Additions	—			3,048			3,048
Amortization	(2,675		)	(5,066		)	(7,741		)
Balance as of December 31, 2016	$	4,680		$	15,779		$	20,459
Additions	—			2,352			2,352
Amortization	(2,674		)	(2,288		)	(4,962		)
Balance as of December 31, 2017	$	2,006		$	15,843		$	17,849
Additions	—			1,612			1,612
Amortization	(2,006		)	(1,859		)	(3,865		)
Balance as of December 31, 2018	$	—		$	15,596		$	15,596

The gross carrying value, accumulated amortization, and net carrying value related to our core deposit premium and mortgage servicing rights as of December 31, 2018 and 2017 are presented below:



	December 31, 2018							December 31, 2017
	Gross Carrying Value		Accumulated Amortization			Net Carrying Value		Gross Carrying Value		Accumulated Amortization			Net Carrying Value
	(Dollars in thousands)
Core deposit premium	$	44,642	$	(44,642	)	$	—	$	44,642	$	(42,636	)	$	2,006
Mortgage servicing rights	66,013		(50,417		)	15,596		64,401		(48,558		)	15,843
Total	$	110,655	$	(95,059	)	$	15,596	$	109,043	$	(91,194	)	$	17,849

Our core deposit premium as of December 31, 2018 has been fully amortized. Based on our mortgage servicing rights held as of December 31, 2018, estimated amortization expense for the next five succeeding fiscal years and all years thereafter are as follows (dollars in thousands):



Year Ending December 31:
2019	$	1,615
2020	1,315
2021	1,100
2022	931
2023	781
Thereafter	9,854
Total	$	15,596

We utilize the amortization method to measure our mortgage servicing rights. Under the amortization method, we amortize our mortgage servicing rights in proportion to and over the period of net servicing income. Income generated as the result of new mortgage servicing rights is reported as a component of mortgage banking income and totaled $1.6 million, $2.4 million, and $3.0 million in 2018, 2017 and 2016, respectively. Amortization of the servicing rights is reported as a component of mortgage banking income in our consolidated statements of income. Ancillary income is recorded in other income. Mortgage servicing rights are recorded when loans are sold to third-parties with servicing of those loans retained and we classify and pool our mortgage servicing rights into buckets of homogeneous characteristics.

Initial fair value of the servicing right is calculated by a discounted cash flow model prepared by a third-party service provider based on market value assumptions at the time of origination and we assess the servicing right for impairment using current market value assumptions at each reporting period. Critical assumptions used in the discounted cash flow model include mortgage prepayment speeds, discount rates, costs to service and ancillary income. Variations in our assumptions could materially affect the estimated fair values. Changes to our assumptions are made when current trends and market data indicate that new trends have developed. Current market value assumptions based on loan product types (fixed-rate, adjustable-rate and balloon loans) include average discount rates, servicing costs and ancillary income. Many of these assumptions are subjective and require a high level of management judgment. Our mortgage servicing rights portfolio and valuation assumptions are periodically reviewed by management.

Prepayment speeds may be affected by economic factors such as home price appreciation, market interest rates, the availability of other credit products to our borrowers and customer payment patterns. Prepayment speeds include the impact of all borrower prepayments, including full payoffs, additional principal payments and the impact of loans paid off due to foreclosure liquidations. As market interest rates decline, prepayment speeds will generally increase as customers refinance existing mortgages under more favorable interest rate terms. As prepayment speeds increase, anticipated cash flows will generally decline resulting in a potential reduction, or impairment, to the fair value of the capitalized mortgage servicing rights. Alternatively, an increase in market interest rates may cause a decrease in prepayment speeds and therefore an increase in fair value of mortgage servicing rights.

The following table presents the fair market value and key assumptions used in determining the fair market value of our mortgage servicing rights:



	Year Ended December 31,
	2018			2017
	(Dollars in thousands)
Fair market value, beginning of period	$	17,161		$	18,087
Fair market value, end of period	17,696			17,161
Weighted average discount rate	9.5		%	9.5		%
Weighted average prepayment speed assumption	14.5		%	16.0		%

Loans serviced for others as of December 31, 2018 and 2017 totaled $2.01 billion and $2.08 billion, respectively. Loans serviced for others are not reported as assets on the Company's consolidated balance sheets.