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Investment Securities
 12 Months Ended
Dec. 31, 2011
Investment Securities  
Investment Securities

(2)       Investment Securities

 

The following is a summary of the investments categorized as Available for Sale at December 31, 2011 and 2010:

 

 

 

 

 

Gross

 

Gross

 

 

 

 

 

Amortized

 

Unrealized

 

Unrealized

 

Fair

 

(in thousands)

 

Cost

 

Gains

 

Losses

 

Value

 

At December 31, 2011:

 

 

 

 

 

 

 

 

 

Investments — Available for Sale

 

 

 

 

 

 

 

 

 

U.S. Gov’t Treasuries

 

$

2,102

 

$

37

 

$

—

 

$

2,139

 

Corporate Notes

 

 

6,280

 

 

43

 

 

(2

)

 

6,321

 

Residential Mortgage-Backed Securities

 

118,170

 

2,624

 

(38

)

120,756

 

Residential Collateralized Mortgage Obligations (“CMOs”)

 

692

 

—

 

(2

)

690

 

Total

 

$

127,244

 

$

2,704

 

$

(42

)

$

129,906

 

At December 31, 2010:

 

 

 

 

 

 

 

 

 

Investments — Available for Sale

 

 

 

 

 

 

 

 

 

U.S. Gov’t Treasuries

 

$

150

 

$

—

 

$

—

 

$

150

 

Debt issued by the states of the United States

 

 

2,012

 

 

3

 

 

—

 

 

2,015

 

Residential Mortgage-Backed Securities

 

53,105

 

1,588

 

(174

)

54,519

 

Residential CMOs

 

1,783

 

7

 

—

 

1,790

 

Total

 

$

57,050

 

$

1,598

 

$

(174

)

$

58,474

 

 

The Company did not have any investment securities categorized as “Held to Maturity” or “Trading” at December 31, 2011 or 2010.

 

Additionally, at December 31, 2011 and 2010, the carrying amount of securities pledged to the State of California Treasurer’s Office to secure their deposits was $53.6 million and $56.3 million, respectively.  Deposits from the State of California were $34.0 million at both December 31, 2011 and 2010.

 

The following table summarizes the fair value of AFS securities and the weighted average yield of investment securities by contractual maturity at December 31, 2011.  Residential mortgage-backed securities are included in maturity categories based on their stated maturity date.  Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations.  The weighted average life of these securities was 3.57 years at December 31, 2011.

 

 (dollars in thousands)

Available for Sale

 

1 Year or Less

 

Weighted Average Yield

 

After 1 Through 5 Years

 

Weighted Average Yield

 

After 5 Through 10 Years

 

Weighted Average Yield

 

After 10 Years

 

Weighted Average Yield

 

Total

 

Weighted Average Yield

 

U.S. Government Treasuries

 

$

—

 

—

 %

$

2,139

 

1.19

%

$

—

 

—

%

$

—

 

—

%

$

2,139

 

1.19

 %

Corporate Notes

 

—

 

—

 

6,321

 

1.56

 

—

 

—

 

—

 

—

 

6,321

 

1.56

 

Residential Mortgage-Backed Securities

 

8

 

4.17

 

1,061

 

4.35

 

83,345

 

2.41

 

36,342

 

2.98

 

120,756

 

2.60

 

Residential CMOs

 

—

 

—

 

—

 

—

 

243

 

1.21

 

447

 

0.35

 

690

 

0.65

 

Total

 

$

8

 

4.17

 %

$

9,521

 

1.79

%

$

83,588

 

2.41

%

$

36,789

 

2.95

%

$

129,906

 

2.52

%

 

A total of nine securities had unrealized losses at both December 31, 2011 and December 31, 2010.  Information pertaining to securities with gross unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous loss position, follows:





 

 

 

Less than Twelve Months

 

Twelve Months or More

 

(in thousands)

 

Gross Unrealized Losses

 

Fair Value

 

Gross Unrealized Losses

 

Fair Value

 

At December 31, 2011:

 

 

 

 

 

 

 

 

 

Investments-Available for Sale

 

 

 

 

 

 

 

 

 

Corporate Notes

 

$

(2

)

$

2,157

 

$

—

 

$

—

 

Residential Mortgage-Backed Securities

 

 

(38

)

 

11,188

 

 

 

 

 

 

 

Residential CMOs

 

 

(2

)

 

690

 

 

—

 

 

—

 

Total

 

$

(42

)

$

14,035

 

$

—

 

$

—

 

At December 31, 2010:

 

 

 

 

 

 

 

 

 

Investments-Available for Sale

 

 

 

 

 

 

 

 

 

Residential Mortgage-Backed Securities

 

$

(174

)

$

18,146

 

$

—

 

$

—

 

 

The Company’s assessment that it has the ability to continue to hold impaired investment securities along with its evaluation of their future performance provide the basis for it to conclude that its impaired securities are not other-than-temporarily impaired.  In assessing whether it is more likely than not that the Company will be required to sell any impaired security before its anticipated recovery, which may be at their maturity, it considers the significance of each investment, the amount of impairment, as well as the Company’s liquidity position and the impact on the Company’s capital position.  As a result of its analyses, the Company determined at December 31, 2011 and 2010 that the unrealized losses on its securities portfolio on which impairments had not been recognized are temporary.

 

The Company sold one available for sale security totaling $140,000 during the year ended December 31, 2011, resulting in a realized gain of $2,000.  The Company sold two available for sale securities totaling $3.8 million during the year ended December 31, 2010, resulting in a realized gain of $44,000.  These gains were reported in non-interest income within the accompanying Consolidated Statements of Operations.