Investment Securities

6 Months Ended

Jun. 30, 2011

Investment Securities [Abstract]

INVESTMENT SECURITIES

4. INVESTMENT SECURITIES

The amortized cost and estimated fair value of investment securities at June 30, 2011 and December 31, 2010 consisted of the following:

	June 30, 2011
			Gross		Gross		Estimated
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
Debt securities:
U.S. Treasury securities	$	1,008,000	$	3,000			$	1,011,000
U.S. Government agencies		30,313,000		188,000				30,501,000
U.S. Government agencies collateralized by mortgage obligations		13,949,000		192,000				14,141,000
	$	45,270,000	$	383,000	$	—	$	45,653,000

Unrealized gains on available-for-sale investment securities totaling $383,000 were recorded, net of $158,000 in tax benefit, as accumulated other comprehensive income within shareholders’ equity at June 30, 2011. During the six months ended June 30, 2011 the Company sold twenty-five available-for-sale securities for $27,351,000. The Company realized a gain on sale from twenty-three of these securities totaling $636,000 and a loss on sale on two securities of $24,000 resulting in the recognition of a $612,000 net gain on sale. During the six months ended June 30, 2010 the Company sold forty-two available-for-sale securities for $15,140,000, recording a $580,000 gain on sale. There were no securities sold at a loss during the six months ended June 30, 2010.

	December 31, 2010
			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
Debt securities:
U.S. Treasury securities	$	1,025,000	$	7,000				$	1,032,000
U.S. Government agencies		40,662,000		58,000	$	(290,000	)		40,430,000
U.S. Government agencies collateralized by mortgage obligations		21,110,000		270,000		(107,000	)		21,273,000
Obligations of states and political subdivisions		308,000				(26,000	)		282,000
	$	63,105,000	$	335,000	$	(423,000	)	$	63,017,000

Unrealized losses on available-for-sale investment securities totaling $88,000 were recorded, net of $36,000 in tax benefit, as accumulated other comprehensive loss within shareholders’ equity at December 31, 2010. During the year ended December 31, 2010 the Company sold sixty-five available-for-sale securities for $40,902,000, recording a $1,160,000 gain on sale.

There were no investment securities with unrealized losses at June 30, 2011. Investment securities with unrealized losses at December 31, 2010 are summarized and classified according to the duration of the loss period as follows:

	Less than 12 Months
	Estimated
	Fair		Unrealized
	Value		Losses
Debt securities:
U.S. Government agencies	$	14,763,000	$	290,000
U.S. Government agencies collateralized by mortgage obligations		13,205,000		107,000
Obligations of states and political subdivisions		282,000		26,000
	$	28,250,000	$	423,000

The amortized cost and estimated fair value of investment securities at June 30, 2011 by contractual maturity are shown below. Expected maturities will differ from contractual maturities because the issuers of the securities may have the right to call or prepay obligations with or without call or prepayment penalties.

			Estimated
	Amortized		Fair
	Cost		Value
Within one year	$	1,008,000	$	1,011,000
After one year through five years		30,313,000		30,501,000
		31,321,000		31,512,000
Investment securities not due at a single maturity date:
Government-guaranteed mortgage- backed securities		13,949,000		14,141,000
	$	45,270,000	$	45,653,000

Investment securities with amortized costs totaling $41,309,000 and $36,828,000 and estimated fair values totaling $41,678,000 and $36,814,000 at June 30, 2011 and December 31, 2010, respectively, were pledged to secure deposits, including public deposits and treasury, tax and loan accounts.