Investment Securities

3 Months Ended

Mar. 31, 2013

Investment Securities [Abstract]

INVESTMENT SECURITIES

NOTE 2 - INVESTMENT SECURITIES

The amortized cost and estimated fair values of investment securities are as follows at March 31, 2013 and December 31, 2012:

	(Expressed in thousands)
	March 31, 2013
			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
Securities available-for-sale:
Obligations of U.S. Government corporations and agencies	$	45,593	$	101	$	(14	)	$	45,680
Obligations of states and political subdivisions		50,608		3,183		(107	)		53,684
Mortgage-backed securities		75,573		1,037		(336	)		76,274
Equity securities		185		30		—			215
Total available-for-sale	$	171,959	$	4,351	$	(457	)	$	175,853
	(Expressed in thousands)
	December 31, 2012
			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
Securities available-for-sale:
Obligations of U.S. Government corporations and agencies		47,101	$	201	$	(7	)	$	47,295
Obligations of states and political subdivisions		48,393		3,692		(55	)		52,030
Mortgage-backed securities		77,513		1,218		(53	)		78,678
Equity securities		183		22		—			205
Total available-for-sale		173,190		5,133		(115	)		178,208

The Company’s investment securities portfolio contains unrealized losses of direct obligations of the U.S. Government agency securities, including mortgage-related instruments issued or backed by the full faith and credit of the United States government or are generally viewed as having the implied guarantee of the U.S. government, and debt obligations of a U.S. state or political subdivision.

On a quarterly basis, the Company evaluates the severity and duration of impairment for its investment securities portfolio and the Company’s ability to hold the securities till they recover. Generally, impairment is considered other than temporary when an investment security has sustained a decline in market value for a period of twelve months. The Company has concluded that any impairment of its investment securities portfolio is not other than temporary but is the result of interest rate changes that are not expected to result in the noncollection of principal and interest during the period. There are 37 positions that are temporarily impaired at March 31, 2013.

The following tables show the Company’s gross unrealized losses and fair value, aggregated by investment category and length of time, that the individual securities have been in a continuous unrealized loss position, at March 31, 2013 and December 31, 2012:

	(Expressed in thousands)
	March 31, 2013
	Less than Twelve Months					Twelve Months or Greater					Total
			Gross					Gross					Gross
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
U.S. Government corporations and agencies	$	7,986	$	(14	)	$	—	$	—		$	7,986	$	(14	)
Obligations of states and political subdivisions		5,568		(107	)		—		—			5,568		(107	)
Mortgage-backed securities		37,400		(335	)		76		(1	)		37,476		(336	)
Total	$	50,954	$	(456	)	$	76	$	(1	)	$	51,030	$	(457	)

	(Expressed in thousands)
	December 31, 2012
	Less than Twelve Months					Twelve Months or Greater					Total
			Gross					Gross					Gross
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
U.S. Government corporations and agencies		6,993	$	(7	)	$	—	$	—		$	6,993	$	(7	)
Obligations of states and political subdivisions		2,721		(55	)		—		—			2,721		(55	)
Mortgage-backed securities		23,752		(52	)		82		(1	)		23,834		(53	)
Total	$	33,466	$	(114	)	$	82	$	(1	)	$	33,548	$	(115	)

The amortized cost and fair value of investment securities available for sale at March 31, 2013, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	(Expressed in thousands)
	March 31, 2013
	Amortized		Fair
	Cost		Value
Due in one year or less	$	973	$	986
Due after one year through five years		7,480		7,570
Due after five years through ten years		61,196		62,390
Due after ten years		26,552		28,418
		96,201		99,364
Mortgage-backed securities		75,573		76,274
Equity securities		185		215
Total	$	171,959	$	175,853

Proceeds from sales of securities available-for-sale during the three month periods ended March 31, 2013 and 2012, were $200 and $10,230, respectively. Gross gains of $14 and gross losses of $-0- were realized during the three months ended March 31, 2013 and gross gains of $297 and gross losses of $297 were realized during the three months ended March 31, 2012. Assets carried at $63,469,000 and $65,418,000 at March 31, 2013 and December 31, 2012, respectively, were pledged to secure United States Government and other public funds and for other purposes as required or permitted by law.

The maturity distribution using book value including accretion of discounts and amortization of premiums and approximate yield of investment securities at March 31, 2013 and December 31, 2012 are presented in the following table. Tax equivalent yield basis was used on tax exempt obligations. Approximate yield was calculated using a weighted average of yield to maturities. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

(dollars in thousands)	March 31, 2013							December 31, 2012
	Amortized		Fair					Amortized		Fair
	Cost		Value		Yield			Cost		Value		Yield
U.S. Government corporations and agencies
Within One Year	$	2	$	2		0.01	%	$	10	$	10		0.01	%
After One But Within Five Years		6,000		6,011		1.88			6,000		6,034		1.88
After Five But Within Ten Years		39,588		39,664		1.70			41,088		41,248		1.75
After Ten Years		3		3		0.86			3		3		0.87
		45,593		45,680		1.72			47,101		47,295		1.77
States & Political Subdivisions
Within One Year		971		983		4.99			970		990		4.98
After One But Within Five Years		1,480		1,560		6.13			1,101		1,158		5.92
After Five But Within Ten Years		21,608		22,726		5.14			19,439		20,633		5.23
After Ten Years		26,549		28,415		5.77			26,883		29,249		5.90
		50,608		53,684		5.50			48,393		52,030		5.62
Mortgage-Backed Securities		75,573		76,274		2.10			77,513		78,678		2.01
Equity Securities		185		215		3.81			183		205		1.97
Total	$	171,959	$	175,853		3.04	%	$	173,190	$	178,208		3.00	%