In-process software

  
SoftwareCosts related to computer software developed or obtained for internal use are capitalized if the projects improve functionality and provide long-term future operational benefits. Capitalized costs are amortized using the straight-line method over the asset’s expected useful life, based upon the basic pattern of consumption and economic benefits provided by the asset. Citizens begins to amortize the software when the asset (or identifiable component of the asset) is substantially complete and ready for its intended use. All other costs incurred in connection with an internal-use software project are expensed as incurred. Capitalized software is included in other assets on the Consolidated Balance Sheets.Citizens had capitalized software assets of $2.3 billion and $2.2 billion and related accumulated amortization of $1.5 billion and $1.3 billion as of December 31, 2021 and 2020, respectively. Amortization expense was $235 million, $215 million and $194 million for the years ended December 31, 2021, 2020 and 2019, respectively.The estimated future amortization expense for capitalized software assets is presented below.

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| Year | (in millions) |
| 2022 | $209  |  |
| 2023 | 180  |  |
| 2024 | 153  |  |
| 2025 | 112  |  |
| 2026 | 45  |  |
| Thereafter | 22  |  |
| Total(1) | $721  |  |

(1) Excluded from this balance is $154 million of in-process software at December 31, 2021.  
NOTE 8 - MORTGAGE BANKING AND OTHER The Company sells residential mortgages into the secondary market. The Company retains no beneficial interests in these sales, but may retain the servicing rights for the loans sold. The Company may exercise its option to repurchase eligible government guaranteed residential mortgages or may be obligated to subsequently repurchase a loan if the purchaser discovers a representation or warranty violation such as noncompliance with eligibility or servicing requirements, or customer fraud that should have been identified in a loan file review.Mortgage loans held for sale are accounted for at fair value on an individual loan basis. Changes in the fair value, and realized gains and losses on the sales of mortgage loans, are reported in mortgage banking income.The following table summarizes activity related to residential mortgage loans sold with servicing rights retained:

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|  | Year Ended December 31, |
| (in millions) | 2021 |  | 2020 |  | 2019 |
| Cash proceeds from residential mortgage loans sold with servicing retained | $37,039  |  |  | $33,221  |  |  | $20,430  |  |
| Repurchased residential mortgages(1) | 1,381  |  |  | —  |  |  | —  |  |
| Gain on sales(2) | 382  |  |  | 895  |  |  | 251  |  |
| Contractually specified servicing, late and other ancillary fees(2) | 247  |  |  | 227  |  |  | 208  |  |

(1) Includes government insured or guaranteed loans eligible for repurchase through the exercise of our removal of account provision option.(2) Reported in mortgage banking fees in the Consolidated Statements of Operations.The Company recognizes the right to service residential mortgage loans for others, or MSRs, as separate assets, which are presented in other assets on the Consolidated Balance Sheets, when purchased, or when servicing is contractually separated from the underlying mortgage loans by sale with servicing rights retained. MSRs are initially recorded at fair value. Subsequent to the initial recognition, MSRs are measured using either the fair value method or the amortization method. Effective January 1, 2020, the Company elected to account for all MSRs previously accounted for under the amortization method under the fair value method. Upon election, the Company recognized a cumulative effect adjustment to retained earnings of $6 million, net of taxes, equal to the difference between the carrying value of the MSRs and the fair value. Under the fair value method, the MSRs are recorded at fair value at each reporting date with any changes in fair value during the period recorded in mortgage banking fees in the Consolidated Statements of Operations. The unpaid principal balance of residential 

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|  |  | Citizens Financial Group, Inc. | 113 |


