Company: HBCP
Filing Date: 2025-03-12
Form Type: 10-K
Source: 0001436425-25-000012
Chunk: 48

Company: HOME BANCORP, INC.
Filing Date: 2025-03-12
Form: 10-K
Item: Item 8
Chunk 48
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 servicing rights are initially measured at fair value at the date of sale and included in the gain on sale of loans recorded in the Consolidated Statements of Income. The servicing assets are amortized over the estimated net servicing life of the loans. Changes in the carrying value of servicing assets are recorded in service fees and charges on the Consolidated Statements of Income. Activity related to servicing assets for SBA loans and selected other related information for the years ended December 31, 2024, 2023 and 2022 is summarized as follows.(dollars in thousands)202420232022Balance, beginning of period$124 $— $— Recognition of SBA servicing asset— 132 — Amortization(21)(8)— Balance, end of period103 124 — Fair value, end of period$132 $130 $— Additional information related to SBA servicing assetsWeighted average prepayment rate11.70 %11.60 %— %Weighted average term (years)6.506.670.00Weighted average discount rate13.50 %14.50 %— %

The fair value adjustments to servicing rights are mainly due to market-based assumptions associated with discounted cash flows, loan prepayment speeds, and changes in interest rates. A significant change in prepayments of the loans in the servicing portfolio could result in significant changes in the valuation adjustments, thus creating potential volatility in the carrying amount of the servicing rights. 

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7. Office Properties and Equipment

Office properties and equipment consisted of the following at December 31 of the years indicated.(dollars in thousands)20242023Land$13,657 $13,709 Buildings and improvements41,266 38,599 Furniture and equipment19,016 18,850 Total office properties and equipment73,939 71,158 Less accumulated depreciation31,615 29,178 Total office properties and equipment, net$42,324 $41,980 Depreciation expense for the years ended December 31, 2024, 2023 and 2022 was $3,498,000, $3,571,000 and $3,464,000, respectively.The Company leases space under non-cancelable operating leases agreements for certain bank branch facilities with remaining lease terms of 1 to 10 years. Certain lease arrangements contain extension options which typically range from 4 to 10 years at