INVESTMENT SECURITIES

3 Months Ended

Mar. 31, 2012

INVESTMENT SECURITIES [Abstract]

INVESTMENT SECURITIES

NOTE 5 - INVESTMENT SECURITIES

The amortized cost and approximate fair value of investment securities as of March 31, 2012 and December 31, 2011 are summarized as follows:

	March 31, 2012
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Available for Sale:
Mortgage-backed securities (1)	$	5,786	$	48	$	(73	)	$	5,761
Asset-backed securities		599		6		-			605
Municipal securities		2,066		-		(27	)		2,039
Corporate notes		20,000		-		(454	)		19,546
	$	28,451	$	54	$	(554	)	$	27,951
Held to Maturity:
Mortgage-backed securities	$	281,417	$	10,246	$	-		$	291,663

 (1) Includes an interest only strip security of $2,790.

	December 31, 2011
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Available for Sale:
U.S. Treasury and government agencies	$	1,002	$	-	$	(1	)	$	1,001
Mortgage-backed securities (1)		55,818		581		(107	)		56,292
Asset-backed securities		622		5		-			627
Municipal securities		2,071		-		(71	)		2,000
Corporate notes		20,000		-		(783	)		19,217
	$	79,513	$	586	$	(962	)	$	79,137
Held to Maturity:
Mortgage-backed securities	$	319,547	$	11,262	$	-		$	330,809

(1)   Includes an interest only strip security of $2,894.

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

	Three months ended March 31,
	2012		2011
Proceeds from sale of available-for-sale investment securities	$	48,965	$	-
Gross gains	$	209	$	-
Gross losses		-		-
Net gains	$	209	$	-

These gains and losses were determined using the specific identification method and were included in non-interest income.

The following table shows investments 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:

	March 31, 2012
	Available-for-Sale						Held-to-Maturity
	Amortized Cost			Fair Value			Amortized Cost			Fair Value
Due in one year or less		$	94		$	95		$	-		$	-
Due after one year through five years			22,479			22,002			-			-
Due after five years through ten years			55			56			-			-
Due after ten years			37			37			-			-
			22,665			22,190			-			-
Mortgage-backed securities (1)			5,786			5,761			281,417			291,663
Total investment securities		$	28,451		$	27,951		$	281,417		$	291,663

(1)   Includes an interest only strip security of $2,790

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 March 31, 2012 and December 31, 2011 are as follows:

	March 31, 2012
	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	$	149	$	(1	)	$	448	$	(72	)	$	597	$	(73	)
Municipal securities		-		-			2,039		(27	)		2,039		(27	)
Corporate notes		19,546		(454	)		-		-			19,546		(454	)
Total investment securities available-for-sale	$	19,695	$	(455	)	$	2,487	$	(99	)	$	22,182	$	(554	)

	December 31, 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:
U.S. Treasury and
government agencies	$	1,001	$	(1	)	$	-	$	-		$	1,001	$	(1	)
Mortgage-backed securities		166		(1	)		412		(106	)		578		(107	)
Municipal securities		-		-			2,000		(71	)		2,000		(71	)
Corporate notes		19,218		(783	)		-		-			19,218		(783	)
Total investment securities available-for-sale	$	20,385	$	(785	)	$	2,412	$	(177	)	$	22,797	$	(962	)

At March 31, 2012 there were eight available for sale investment securities in the less than twelve month category and eight available for sale investment securities in the twelve month or more category.  At December 31, 2011, there were ten 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, due to changes in economic conditions and the liquidity of the market and not credit quality.  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.

At March 31, 2012 and December 31, 2011, the Bancorp had pledged investment securities aggregating $221,884 and $311,442, respectively as collateral for borrowings.