Quarterly report pursuant to Section 13 or 15(d)

Servicing Assets and Liabilities

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Servicing Assets and Liabilities
 6 Months Ended
Jun. 30, 2017
Transfers and Servicing [Abstract]  
Servicing Assets and Liabilities
Servicing Assets and Liabilities

The changes in servicing assets and liabilities for the six months ended June 30, 2017 and 2016 were as follows:

 
2017
 
2016
 
(in thousands)
Servicing assets:
 
 
 
Balance at beginning of period
$
10,564

 
$
11,744

Addition related to sale of SBA loans
1,194

 
863

Amortization
(1,608
)
 
(1,270
)
Reversal of allowance
330

 
—

Balance at end of period
$
10,480

 
$
11,337

 
 
 
 
Servicing liabilities:
 
 
 
Balance at beginning of period
$
3,143

 
$
4,784

Amortization
(523
)
 
(863
)
Reversal of allowance
(67
)
 
—

Balance at end of period
$
2,553

 
$
3,921



At June 30, 2017 and 2016, we serviced loans sold to unaffiliated parties in the amounts of $477.3 million and $481.4 million, respectively. These represented loans that have been sold for which the Bank continues to provide servicing. These loans are maintained off balance sheet and are not included in the loans receivable balance. All of the loans serviced were SBA loans.

The Company recorded servicing fee income of $1.2 million for each of the three-month periods ended June 30, 2017 and 2016, and $2.4 million and $2.3 million for the six months ended June 30, 2017 and 2016, respectively. Servicing fee income, net of amortization of servicing assets and liabilities, is included in other operating income in the consolidated statements of income. Net amortization expense was $658,000 and $52,000 for the three months ended June 30, 2017 and 2016, respectively, and $1.1 million and $407,000 for the six months ended June 30, 2017 and 2016, respectively.