Note 3. Securities

The amortized cost, unrealized gains and losses and fair values of securities classified available for sale are summarized as follows:

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
December 31, 2012:	(dollars in thousands)
U.S. Treasury securities	$	103,353	$	1,303	$	—		$	104,656
Obligations of U.S. government corporations and agencies	363,583		6,616		(5		)	370,194
Obligations of states and political subdivisions	274,350		6,176		(238		)	280,288
Residential mortgage-backed securities	210,139		7,576		—			217,715
Corporate debt securities	24,601		139		(26		)	24,714
	976,026		21,810		(269		)	997,567
Mutual funds and other equity securities	2,451		1,479		—			3,930

	$	978,477	$	23,289	$	(269	)	$	1,001,497

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
December 31, 2011:	(dollars in thousands)
U.S. Treasury securities	$	45,550	$	485	$	—		$	46,035
Obligations of U.S. government corporations and agencies	339,983		9,083		(35		)	349,031
Obligations of states and political subdivisions	149,368		5,193		(124		)	154,437
Residential mortgage-backed securities	271,787		6,374		(46		)	278,115
Corporate debt securities	2,532		73		(22		)	2,583
	809,220		21,208		(227		)	830,201
Mutual funds and other equity securities	219		1,329		—			1,548

	$	809,439	$	22,537	$	(227	)	$	831,749

The amortized cost and fair value of debt securities available for sale as of December 31, 2012, by contractual maturity, are shown below. Mutual funds and other equity securities do not have stated maturity dates and therefore are not included in the following maturity summary. Mortgages underlying the residential mortgage-backed securities may be called or prepaid without penalties; therefore, actual maturities could differ from the contractual maturities. All residential mortgage-backed securities were issued by U.S. government agencies and corporations.

	Amortized		Fair
	Cost		Value
	(dollars in thousands)
Due in one year or less	$	140,695	$	141,997
Due after one year through five years	548,425		557,505
Due after five years through ten years	217,700		225,070
Due after ten years	69,206		72,995
	$	976,026	$	997,567

Realized gains and losses related to sales of securities are summarized as follows:

	For the Years Ended December 31,
	2012			2011			2010
	(dollars in thousands)
Gross security gains	$	1,602		$	174		$	1,025
Gross security (losses)	(5		)	(4		)	(7		)

Net security gains	$	1,597		$	170		$	1,018

The tax provision for these net realized gains and losses was $0.6 million for the year ended December 31, 2012. It was insignificant for the year ended December 31, 2011 and was $0.4 million for the year ended December 31, 2010.

Investment securities with carrying amounts of $489.1 million and $359.9 million on December 31, 2012 and 2011, respectively, were pledged as collateral on public deposits, securities sold under agreements to repurchase and for other purposes as required or permitted by law.

Information pertaining to securities with gross unrealized losses at December 31, 2012 and 2011 aggregated by investment category and length of time that individual securities have been in a continuous loss position follows:

	Continuous unrealized losses existing for less than 12 months, gross				Continuous unrealized losses existing greater than 12 months, gross				Total, gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
December 31, 2012:	(dollars in thousands)
Obligations of U.S. government corporations and agencies	$	10,155	$	5	$	—	$	—	$	10,155	$	5
Obligations of states and political subdivisions	37,958		189		3,311		49		41,269		238
Corporate debt securities	15,207		26		—		—		15,207		26
Total temporarily impaired securities	$	63,320	$	220	$	3,311	$	49	$	66,631	$	269

	Continuous unrealized losses existing for less than 12 months, gross				Continuous unrealized losses existing greater than 12 months, gross				Total, gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Losses		Value		Losses		Value		Losses
December 31, 2011:	(dollars in thousands)
Obligations of U.S. government corporations and agencies	$	15,615	$	35	$	—	$	—	$	15,615	$	35
Obligations of states and political subdivisions	21,037		124		—		—		21,037		124
Residential mortgage-backed securities	16,428		46		—		—		16,428		46
Corporate debt securities	455		22						455		22
Total temporarily impaired securities	$	53,535	$	227	$	—	$	—	$	53,535	$	227

The total number of securities in the investment portfolio in an unrealized loss position as of December 31, 2012 was 110, and represented a loss of 0.40% of the aggregate carrying value. Based upon a review of unrealized loss circumstances, the unrealized losses resulted from changes in market interest rates and liquidity, not from changes in the probability of receiving the contractual cash flows. The Company does not intend to sell the securities and it is more-likely-than-not that the Company will recover the amortized cost prior to being required to sell the securities. Full collection of the amounts due according to the contractual terms of the securities is expected; therefore, the Company does not consider these investments to be other-than-temporarily impaired at December 31, 2012.

Management evaluates securities for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. Consideration is given to the length of time and extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, and whether the Company has the intent to sell the security and it is more-likely-than-not we will have to sell the security before recovery of its cost basis.