Company: MCHB
Filing Date: 2025-04-15
Form Type: ARS
Source: 0001518715-25-000069
Chunk: 94

Company: Mechanics Bancorp
Filing Date: 2025-04-15
Form: ARS
Chunk 94
---
,256 Origination 2,190 509 Amortization (5,612) (5,778) Ending balance $ 26,565 $ 29,987 75

Key economic assumptions used in measuring the initial fair value of capitalized multifamily MSRs were as follows: Years Ended December 31, (rates per annum) (1) 2024 2023 Discount rate 13.10 % 13.00 % (1) Based on a weighted average. For multifamily MSRs, we use a discounted cash flow valuation technique which utilizes CPRs and discount rates as significant unobservable inputs as noted in the table below: At December 31, 2024 At December 31, 2023 Range of Inputs Average (1) Range of Inputs Average (1) Discount Rates 13.00% - 15.00% 13.10 % 13.00% - 15.00% 13.00 % (1) Weighted averages of all the inputs within the range. At December 31, 2024, the expected weighted-average life of the Company's multifamily and SBA MSRs was 11.41 years. Projected amortization expense for the gross carrying value of multifamily and SBA MSRs is estimated as follows: (in thousands) At December 31, 2024 2025 $ 5,278 2026 4,807 2027 4,101 2028 3,645 2029 3,286 2030 and thereafter 5,448 Carrying value of multifamily and SBA MSRs $ 26,565 The projected amortization expense of multifamily and SBA MSRs is an estimate and subject to key assumptions of the underlying valuation model. The amortization expense for future periods was calculated by applying the same quantitative factors, such as actual MSR prepayment experience and discount rates, which were used to determine amortization expense. These factors are inherently subject to significant fluctuations, primarily due to the effect that changes in interest rates may have on expected loan prepayment experience. Accordingly, any projection of MSR amortization in future periods is limited by the conditions that existed at the time the calculations were performed and may not be indicative of actual amortization expense that will be recorded in future periods. NOTE 10–COMMITMENTS, GUARANTEES AND CONTINGENCIES: Commitments In the ordinary course of business, the Company extends secured and unsecured open-end loans to meet the financing