NOTE 2 - INVESTMENT SECURITIES

12 Months Ended

Dec. 31, 2012

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

2. INVESTMENT SECURITIES

The amortized cost of investment securities and their estimated fair value were as follows (in thousands):

	As of December 31, 2012
			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
Available-for-Sale:
Obligations of U.S. government sponsored agencies	$	21,003	$	115	$	—		$	21,118
Obligations of state and political subdivisions		10,698		499		—			11,197
Government sponsored agency mortgage-backed securities		239,543		6,152		(64	)		245,631
Corporate debt securities		6,000		—		(1,244	)		4,756
Equity securities		3,000		113		—			3,113
	$	280,244	$	6,879	$	(1,308	)	$	285,815
Held-to-Maturity:
Government sponsored agency mortgage-backed securities	$	6	$	—	$	—		$	6

	As of December 31, 2011
			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
Available-for-Sale:
Obligations of U.S. government sponsored agencies	$	15,042	$	192	$	—		$	15,234
Obligations of state and political subdivisions		13,811		696		(52	)		14,455
Government sponsored agency mortgage-backed securities		270,337		5,212		(345	)		275,204
Corporate debt securities		6,000		—		(1,768	)		4,232
Equity securities		3,000		80		—			3,080
	$	308,190	$	6,180	$	(2,165	)	$	312,205
Held-to-Maturity:
Government sponsored agency mortgage-backed securities	$	6	$	—	$	—		$	6

Net unrealized gains on available-for-sale securities totaling $5,571,000 and $4,015,000 were recorded, net of $2,284,000 and$1,647,000 in tax benefits, as accumulated other comprehensive gain within stockholders’ equity at December 31, 2012 and 2011, respectively. All government sponsored agency mortgage-backed securities are residential mortgages for the years ended December 31, 2012 and 2011.

For the year ended December 31, 2012 and 2011 there were $1,886,000 and $1,687,000, respectively, in gross realized gains on sales or calls of available for sale securities. For the year ended December 31, 2010 there were no gross realized gains on sales or calls of available for sale securities. For the year ended December 31, 2012 and 2011 there were $9,000 and $10,000, respectively, in gross realized losses on sales or calls of securities categorized as available for sale securities. For the year ended December 31, 2010 there were no gross realized losses on sales or calls of securities categorized as available for sale securities. For the year ended December 31, 2012, 2011 and 2010 there were $133,047,000, $101,940,000 and $25,730,000, respectively, in gross proceeds from sales or calls of available for sale securities. There were no sales or transfers of held to maturity securities for the year ended December 31, 2012, 2011 and 2010. For the year ended December 31, 2012, 2011 and 2010 there were no gross proceeds from maturities or calls of held to maturity securities.

The following tables show gross unrealized losses and the estimated fair value of available-for-sale investment securities, aggregated by investment category, for investment securities that are in an unrealized loss position (in thousands). Unrealized losses for held-to-maturity investment securities during the same period were not significant.

	As of December 31, 2012
	Less than 12 Months					12 Months or Longer					Total
	Estimated Fair		Unrealized			Estimated Fair		Unrealized			Estimated Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
Description of Securities
Government sponsored agency mortgage-backed securities	$	34,878	$	(64	)	$	—	$	—		$	34,878	$	(64	)
Corporate debt securities		—		—			4,756		(1,244	)		4,756		(1,244	)
Total impaired
securities	$	34,878	$	(64	)	$	4,756	$	(1,244	)	$	39,634	$	(1,308	)

	As of December 31, 2011
	Less than 12 Months					12 Months or Longer					Total
	Estimated		Unrealized			Estimated		Unrealized			Estimated		Unrealized
	Fair Value		Losses			Fair Value		Losses			Fair Value		Losses
Description of Securities
Obligations of states and political subdivisions	$	714	$	(4	)	$	572	$	(48	)	$	1,286	$	(52	)
Government sponsored agency mortgage-backed securities		96,629		(336	)		16,858		(9	)		113,487		(345	)
Corporate debt securities		—		—			4,232		(1,768	)		4,232		(1,768	)
Total impaired
securities	$	97,343	$	(340	)	$	21,662	$	(1,825	)	$	119,005	$	(2,165	)

Obligations of States and Political Subdivisions. Management believes that the unrealized losses on the Company’s investment in obligations of states and political subdivisions is caused by interest rate changes and other market conditions, and is not attributable to changes in credit quality. The Company has the ability and intent to hold these investments until at least a recovery of fair value or to maturity or call and expects to collect all amounts due. The Company does not consider these securities to be other-than-temporarily impaired at December 31, 2011.

Government Sponsored Agency Mortgage Backed Securities. Management believes that the unrealized losses on the Company’s investment in government sponsored agency mortgage-backed securities is caused by interest rate changes and other market conditions and is not attributable to changes in credit quality. These investments include two securities which were in a loss position for less than twelve months, none of which are individually significant. Additionally, the contractual cash flows of these investments are guaranteed by an agency of the U.S. government and thus it is expected that the securities would not be settled at any price less than the amortized cost of the Company’s investment. The Company has the ability and intent to hold those investments until at least a recovery of fair value or until maturity. The Company does not consider these investments to be other-than-temporarily impaired at December 31, 2012 or 2011.

Corporate Debt Securities. As of December 31, 2012, there were two corporate debt securities in a loss position for twelve months or more. There is a current active market for these securities and management believes that the unrealized losses on the Company’s investment in these corporate debt securities is due to the yield of the securities and is not attributable to changes in credit quality. The two corporate debt securities are each a $3,000,000 single-issuer trust preferred security issued by two separate large publicly-traded financial institutions. The securities are tied to the front-end of the yield curve, three-month LIBOR (a short-term interest rate) and have a spread over that. The Company has the ability and intent to hold these securities and expects a full recovery of value. The Company does not consider these investments to be other-than-temporarily impaired at December 31, 2012 or 2011.

Maturities. The Company invests in government sponsored agency mortgage-backed securities (“MBSs”) and collateralized mortgage obligations (“CMOs”) issued by the FNMA, the Federal Home Loan Mortgage Corporation and Government National Mortgage Association. Actual maturities of the MBSs and CMOs and other securities may differ from contractual maturities because borrowers have the right to prepay mortgages without penalty or call obligations with or without call penalties. The Company uses the “Wall Street” consensus average life at the time the security is purchased to schedule maturities of these MBSs and CMOs and adjusts scheduled maturities periodically based upon changes in the Wall Street estimates.

Contractual maturities of held-to-maturity and available-for-sale securities (other than equity securities with an amortized cost and fair value of approximately $3,000,000 and $3,113,000) at December 31, 2012, are shown below (in thousands).

	Held-to-Maturity				Available-for-Sale
	Amortized Cost		Estimated				Estimated Fair Value
	(Carrying		Fair		Amortized		(Carrying
	Amount)		Value		Costs		Amount)
Due in 1 year or less	$	6	$	6	$	25,481	$	25,828
Due after 1 year through 5 years		—		—		204,478		210,504
Due after 5 years through 10 years		—		—		38,070		38,256
Due after 10 years		—		—		9,215		8,114
	$	6	$	6	$	277,244	$	282,702

At December 31, 2012 and 2011, securities having fair value amounts of approximately $276,308,000 and $302,852,000, respectively, were pledged to secure public deposits, short-term borrowings, treasury tax and loan balances and for other purposes required by law or contract.