INVESTMENT SECURITIES

9 Months Ended

Sep. 30, 2011

INVESTMENT SECURITIES [Abstract]

INVESTMENT SECURITIES

NOTE 5 – INVESTMENT SECURITIES

The amortized cost and approximate fair value of investment securities as of September 30, 2011 and December 31, 2010 are summarized as follows:

	September 30, 2011
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Available-for-Sale:
U.S. Treasury and government agencies	$	1,489	$	5	$	-		$	1,494
Mortgage-backed securities (1)		129,471		2,494		(101	)		131,864
Asset-backed securities		648		5		-			653
Municipal securities		2,075		-		(86	)		1,989
Corporate notes		20,000		-		(29	)		19,971
	$	153,683	$	2,504	$	(216	)	$	155,971
Held-to-Maturity:
Mortgage-backed securities	$	361,256	$	15,794	$	-		$	377,050

(1)           Includes an interest only strip security of $3 million.

	December 31, 2010
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Available-for-Sale:
U.S. Treasury and government agencies	$	1,711	$	-	$	(30	)	$	1,681
Mortgage-backed securities		204,182		561		(3,169	)		201,574
Asset-backed securities		719		3		-			722
Municipal securities		2,088		-		(237	)		1,851
	$	208,700	$	564	$	(3,436	)	$	205,828

The following table shows proceeds from the sale of available for sale investment securities, gross gains and gross losses on those sales of securities:

	For the nine months ended September 30,
	2011		2010
Proceeds from sale of available-for-sale investment securities	$	112,757	$	139,436
Gross gains		1,413		1,113
Gross losses		-		(2	)

The following table shows investment securities by stated maturity. Investment securities backed by mortgages have expected maturities that differ from contractual maturities because borrowers have the right to call or prepay, and are, therefore, classified separately with no specific maturity date:

	September 30, 2011
	Available-for-Sale						Held-to-Maturity
	Amortized Cost			Fair Value			Amortized Cost			Fair Value
Due in one year or less		$	1,170		$	1,171		$	-		$	-
Due after one year through five years			22,882			22,775			-			-
Due after five years through ten years			119			120			-			-
Due after ten years			41			41			-			-
			24,212			24,107			-			-
Mortgage-backed securities			129,471			131,864			361,256			377,050
Total investment securities		$	153,683			155,971		$	361,256		$	377,050

The Bancorp's investments' gross unrealized losses and fair value, aggregated by investment category and length of time for individual securities that have been in a continuous unrealized loss position, at September 30, 2011 and December 31, 2010 are as follows:

	September 30, 2011
	Less than 12 months					12 months or more					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Available-for-Sale:
Mortgage-backed securities	$	65	$	(1	)	$	418	$	(100	)	$	483	$	(101	)
Municipal securities		-		-			1,989		(86	)		1,989		(86	)
Corporate notes		4,971		(29	)		-		-			4,971		(29	)
Total investment securities available-for-sale	$	5,036	$	(30	)	$	2,407	$	(186	)	$	7,443	$	(216	)

	December 31, 2010
	Less than 12 months							12 months or more							Total
	Fair Value			Unrealized Losses				Fair Value			Unrealized Losses				Fair Value			Unrealized Losses
Available-for-Sale:
U.S. Treasury and government agencies		$	1,457		$	(29	)		$	116		$	(1	)		$	1,573		$	(30	)
Mortgage-backed securities			134,068			(3,104	)			524			(65	)			134,592			(3,169	)
Municipal securities			-			-				1,851			(237	)			1,851			(237	)
Total investment securities available-for-sale		$	135,525		$	(3,133	)		$	2,491		$	(303	)		$	138,016		$	(3,436	)

At September 30, 2011, there were eight available for sale investment securities in the less than twelve month category and five available for sale investment securities in the twelve month or more category. At December 31, 2010, there were thirty-three available-for-sale investment securities in the less than twelve month category and six available for sale investment securities in the twelve month or more category. In management's opinion, the unrealized losses reflect primarily changes in interest rates, such as but not limited to changes in economic conditions and the liquidity of the market, subsequent to the acquisition of specific securities. The Bancorp does not intend to sell. In addition, the Bancorp does not believe that it will be more likely than not that the Bancorp will be required to sell the securities prior to maturity or market price recovery.