INVESTMENT SECURITIES

12 Months Ended

Dec. 31, 2014

Investments, Debt and Equity Securities [Abstract]

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

NOTE 5—INVESTMENT SECURITIES

The following tables present information related to the Company’s portfolio of securities available-for-sale and held-to-maturity at December 31, 2014 and 2013.

	Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses				Fair Value
	December 31, 2014
	(Dollars in Thousands)
Investment Securities Available-for-Sale:
Federal agency obligations		$	32,650		$	217		$	(50	)		$	32,817
Residential mortgage pass-through securities			58,836			1,531			(11	)			60,356
Commercial mortgage pass-through securities			3,042			4			—				3,046
Obligations of U.S. states and political subdivisions			8,201			205			—				8,406
Trust preferred securities			16,086			489			(269	)			16,306
Corporate bonds and notes			119,838			5,950			(11	)			125,777
Asset-backed securities			27,393			140			(31	)			27,502
Certificates of deposit			2,098			27			(2	)			2,123
Equity securities			376			—			(69	)			307
Other securities			12,941			33			(82	)			12,892
Total		$	281,461		$	8,596		$	(525	)		$	289,532
Investment Securities Held-to-Maturity:
U.S. Treasury and agency securities		$	28,264		$	920		$	—			$	29,184
Federal agency obligations			27,103			322			(28	)			27,397
Residential mortgage-backed securities			5,955			28			—				5,983
Commercial mortgage-backed securities			4,266			50			—				4,316
Obligations of U.S. states and political subdivisions			120,144			4,512			(60	)			124,596
Corporate bonds and notes			38,950			1,026			(7	)			39,969
Total		$	224,682		$	6,858		$	(95	)		$	231,445
Total investment securities		$	506,143		$	15,454		$	(620	)		$	520,977

	Amortized Cost			Gross Unrealized Gains			Gross Unrealized Losses				Fair Value
	December 31, 2013
	(Dollars in Thousands)
Investment Securities Available-for-Sale:
U.S. Treasury and agency securities		$	14,344		$	—		$	(825	)		$	13,519
Federal agency obligations			20,567			29			(655	)			19,941
Residential mortgage pass-through securities			48,312			791			(229	)			48,874
Commercial mortgage pass-through securities			7,145			3			(157	)			6,991
Obligations of U.S. states and political subdivisions			30,804			711			(55	)			31,460
Trust preferred securities			19,763			150			(510	)			19,403
Corporate bonds and notes			154,182			4,930			(482	)			158,630
Asset-backed securities			15,733			246			—				15,979
Certificates of deposit			2,250			32			(20	)			2,262
Equity securities			376			—			(89	)			287
Other securities			5,671			68			(15	)			5,724
Total		$	319,147		$	6,960		$	(3,037	)		$	323,070
Investment Securities Held-to-Maturity:
U.S. Treasury and agency securities		$	28,056		$	—		$	(1,019	)		$	27,037
Federal agency obligations			15,249			23			(389	)			14,883
Residential mortgage-backed securities			2,246			—			(64	)			2,182
Commercial mortgage-backed securities			4,417			41			(62	)			4,396
Obligations of U.S. states and political subdivisions			127,418			1,303			(3,688	)			125,033
Corporate bonds and notes			37,900			149			(622	)			37,427
Total		$	215,286		$	1,516		$	(5,844	)		$	210,958
Total investment securities		$	534,433		$	8,476		$	(8,881	)		$	534,028

The available-for-sale securities are reported at fair value with unrealized gains or losses included in equity, net of taxes. Accordingly, the carrying value of such securities reflects their fair value at the balance sheet date. Fair value is based upon either quoted market prices, or in certain cases where there is limited activity in the market for a particular instrument, assumptions are made to determine their fair value. See Note 21 of the Notes to Consolidated Financial Statements for a further discussion.

During 2013, the Company transferred from its available-for-sale category to its held-to-maturity category $138.3 million of securities. Transfers of securities from the available-for-sale category to the held-to-maturity category are made at fair value at the date of transfer. The unrealized holding gain or loss at the date of transfer remains in accumulated other comprehensive income and in the carrying value of the held-to-maturity investment security. Premiums or discounts on investment securities are amortized or accreted using the effective interest method over the life of the security as an adjustment of yield. Unrealized holding gains or losses that remain in accumulated other comprehensive income are amortized or accreted over the remaining life of the security as an adjustment of yield, offsetting the related amortization of the premium or accretion of the discount.

The following table presents information for investments in securities available-for-sale and held-to-maturity at December 31, 2014, based on scheduled maturities. Actual maturities can be expected to differ from scheduled maturities due to prepayment or early call options of the issuer. Securities not due at a single maturity date are shown separately.

	December 31, 2014
	Amortized Cost			Fair Value
	(Dollars in Thousands)
Investment Securities Available-for-Sale:
Due in one year or less		$	12,903		$	13,054
Due after one year through five years			42,369			43,670
Due after five years through ten years			93,793			98,615
Due after ten years			57,201			57,592
Residential mortgage pass-through securities			58,836			60,356
Commercial mortgage pass-through securities			3,042			3,046
Equity securities			376			307
Other securities			12,941			12,892
Total		$	281,461		$	289,532
Investment Securities Held-to-Maturity:
Due in one year or less		$	5,001		$	5,054
Due after one year through five years			9,211			9,367
Due after five years through ten years			70,030			72,302
Due after ten years			130,219			134,423
Residential mortgage-backed securities			5,955			5,983
Commercial mortgage-backed securities			4,266			4,316
Total		$	224,682		$	231,445
Total investment securities		$	506,143		$	520,977

Gross gains and losses from the sales calls and maturities of investment securities for the years ended December 31, 2014, 2013 and 2012 were as follows:

(Dollars in Thousands)	Years Ended December 31,
	2014				2013				2012
Proceeds		$	81,844			$	122,165			$	130,059
Gross gains on sales of investment securities			2,837				2,451				2,905
Gross losses on sales of investment securities			19				88				23
Net gains on sales of investment securities			2,818				2,363				2,882
Less: tax provision on net gains			(986	)			(645	)			(879	)
Net gains on sales of investment securities		$	1,832			$	1,718			$	2,003

Other-than-Temporarily Impaired Investments

Summary of Other-than-Temporary Impairment Charges

	Years Ended December 31,
	2014			2013			2012
	(Dollars in Thousands)
One variable rate private label CMO		$	—		$	—		$	484
Pooled trust preferred securities			—			628			68
Principal losses on a variable rate CMO			—			24			318
Total other-than-temporary impairment charges		$	—		$	652		$	870

The Company performs regular analysis on the available-for-sale securities portfolio to determine whether a decline in fair value indicates that an investment is other-than-temporarily impaired in accordance with FASB ASC 320-10. FASB ASC 320-10 requires companies to record other-than- temporary impairment (“OTTI”) charges, through earnings, if they have the intent to sell, or more likely than not be required to sell, an impaired debt security before recovery of its amortized cost basis. If the Company intends to sell or it is more likely than not it will be required to sell the security before recovery of its amortized cost basis, less any current period credit loss, the OTTI is recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its estimated fair value at the balance sheet date. If the Company does not intend to sell the security and it is more likely than not that the entity will be required to sell the security before recovery of its amortized cost basis less any current period loss, and as such, it determines that a decline in fair value is other than temporary, the OTTI is separated into the amount representing the credit loss and the amount related to all other factors. The amount of the OTTI related to the credit loss is determined based on the present value of cash flows expected to be collected and is recognized in earnings. The amount of the total OTTI related to other factors is recognized in other comprehensive income, net of applicable taxes. The previous amortized cost basis less the OTTI recognized in earnings becomes the new amortized cost basis of the investment.

The Company reviews all securities for potential recognition of other-than-temporary impairment. The Company maintains a watch list for the identification and monitoring of securities experiencing problems that require a heightened level of review. This could include credit rating downgrades.

The Company’s assessment of whether an investment in the portfolio of assets is other than temporary includes factors such as whether the issuer has defaulted on scheduled payments, announced restructuring and/or filed for bankruptcy, has disclosed severe liquidity problems that cannot be resolved, disclosed deteriorating financial condition or sustained significant losses.

The following table presents detailed information for each single issue trust preferred security held by the Company at December 31, 2014, of which all but one has at least one rating below investment grade.

Issuer	Class/ Tranche		Amortized Cost			Fair Value			Gross Unrealized Gain (Loss)			Lowest Credit Rating Assigned
	(dollars in thousands)
Countrywide Capital IV		n/a		$	1,771		$	1,805		34			BB
Countrywide Capital V		n/a			2,747			2,833		86			BB
Countrywide Capital V		n/a			250			257		7			BB
Nationsbank Cap Trust III		n/a			1,575			1,306		(269	)		BB
Morgan Stanley Cap Trust IV		n/a			2,500			2,535		35			BB
Morgan Stanley Cap Trust IV		n/a			1,743			1,773		30			BB
Goldman Sachs		n/a			1,000			1,185		185			BB
Stifel Financial		n/a			4,500			4,612		112			BBB	-
Total				$	16,086		$	16,306		220

During 2013, the one pooled trust preferred security (“Pooled TRUP”), incurred an other-than-temporary impairment charge of $628,000 and subsequently was sold at its book value. As such, there were 0 OTTI charges taken for the year ended December 31, 2014.

Temporarily Impaired Investments

For all other securities, the Company does not believe that the unrealized losses, which were comprised of 54 and 170 investment securities as of December 31, 2014 and December 31, 2013, respectively, represent an other-than-temporary impairment. The gross unrealized losses associated with U.S. Treasury and agency securities, federal agency obligations, mortgage-backed securities, corporate bonds, tax- exempt securities, asset-backed securities, trust preferred securities, mutual funds and equity securities are not considered to be other than temporary because these unrealized losses are related to changes in interest rates and do not affect the expected cash flows of the underlying collateral or issuer.

Factors affecting the market price include credit risk, market risk, interest rates, economic cycles, and liquidity risk. The magnitude of any unrealized loss may be affected by the relative concentration of the Company’s investment in any one issuer or industry. The Company has established policies to reduce exposure through diversification of concentration of the investment portfolio including limits on concentrations to any one issuer. The Company believes the investment portfolio is prudently diversified.

The decline in value is related to a change in interest rates and subsequent change in credit spreads required for these issues affecting market price. All issues are performing and are expected to continue to perform in accordance with their respective contractual terms and conditions. Short to intermediate average durations and in certain cases monthly principal payments should reduce further market value exposure to increases in rates.

The Company evaluates all securities with unrealized losses quarterly to determine whether the loss is other than temporary. Unrealized losses in the corporate debt securities category consists primarily of senior unsecured corporate debt securities issued by large financial institutions, insurance companies and other corporate issuers. Single issuer corporate trust preferred securities are also included, and in the case of one holding the market valuation loss is largely based upon the floating rate coupon and corresponding market valuation. That trust preferred issuer, nor any other corporate issuers, have defaulted on interest payments. The unrealized loss in equity securities consists of losses on other bank equities. The decline in fair value is due in large part to the lack of an active trading market for these securities, changes in market credit spreads and rating agency downgrades. Management concluded that these securities were not other-than-temporarily impaired at December 31, 2014.

In determining that the securities giving rise to the previously mentioned unrealized losses were not other than temporary, the Company evaluated the factors cited above, which the Company considers when assessing whether a security is other-than-temporarily impaired. In making these evaluations the Company must exercise considerable judgment. Accordingly, there can be no assurance that the actual results will not differ from the Company’s judgments and that such differences may not require the future recognition of other-than-temporary impairment charges that could have a material effect on the Company’s financial position and results of operations. In addition, the value of, and the realization of any loss on, an investment security is subject to numerous risks as cited above.

The following tables indicate gross unrealized losses not recognized in income and fair value, aggregated by investment category and the length of time individual securities have been in a continuous unrealized loss position at December 31, 2014 and 2013:

	December 31, 2014
	Total							Less than 12 Months							12 Months or Longer
	Fair Value			Unrealized Losses				Fair Value			Unrealized Losses				Fair Value			Unrealized Losses
	(Dollars in Thousands)
Investment Securities Available-for-Sale:
Federal agency obligation		$	6,755		$	(50	)		$	2,770		$	(9	)		$	3,985		$	(41	)
Residential mortgage pass-through securities			5,694			(11	)			5,694			(11	)			—			—
Trust preferred securities			1,307			(269	)			—			—				1,307			(269	)
Corporate bonds and notes			1,961			(11	)			1,961			(11	)			—			—
Asset-backed securities			9,773			(31	)			9,773			(31	)			—			—
Certificates of deposit			369			(2	)			369			(2	)			—			—
Equity securities			307			(69	)			—			—				307			(69	)
Other securities			5,417			(82	)			1,978			(21	)			3,439			(61	)
Total		$	31,583		$	(525	)		$	22,545		$	(85	)		$	9,038		$	(440	)
Investment Securities Held-to-Maturity:
Federal agency obligation			3,228			(28	)			3,228			(28	)			—			—
Obligations of U.S. states and political subdivisions			8,341			(60	)			1,401			(3	)			6,940			(57	)
Corporate bonds and notes			993			(7	)			993			(7	)			—			—
Total			12,562			(95	)			5,622			(38	)			6,940			(57	)
Total Temporarily Impaired Securities		$	44,145		$	(620	)		$	28,167		$	(123	)		$	15,978		$	(497	)

	December 31, 2013
	Total							Less than 12 Months							12 Months or Longer
	Fair Value			Unrealized Losses				Fair Value			Unrealized Losses				Fair Value			Unrealized Losses
	(Dollars in Thousands)
Investment Securities Available-for-Sale:
U.S. Treasury and agency securities		$	13,519		$	(825	)		$	13,519		$	(825	)		$	—		$	—
Federal agency obligation			17,200			(655	)			17,200			(655	)			—			—
Residential mortgage pass-through securities			18,293			(229	)			18,293			(229	)			—			—
Commercial mortgage pass-through securities			2,924			(157	)			2,924			(157	)			—			—
Obligations of U.S. states and political subdivisions			4,199			(55	)			4,199			(55	)			—			—
Trust preferred securities			5,306			(510	)			4,031			(211	)			1,275			(299	)
Corporate bonds and notes			32,498			(482	)			30,533			(448	)			1,965			(34	)
Certificates of deposit			552			(20	)			552			(20	)			—			—
Equity securities			287			(89	)			—			—				287			(89	)
Other securities			985			(15	)			—			—				985			(15	)
Total			95,763			(3,037	)			91,251			(2,600	)			4,512			(437	)
Investment Securities Held-to-Maturity:
U.S. Treasury and agency securities			27,037			(1,019	)			27,037			(1,019	)			—			—
Federal agency obligation			13,492			(389	)			13,197			(388	)			295			(1	)
Residential mortgage pass-through securities			2,182			(64	)			2,182			(64	)			—			—
Commercial mortgage-backed securities			1,395			(62	)			1,395			(62	)			—			—
Obligations of U.S. states and political subdivisions			66,034			(3,688	)			57,072			(2,957	)			8,962			(731	)
Corporate bonds and notes			27,210			(622	)			27,210			(622	)			—			—
Total			137,350			(5,844	)			128,093			(5,112	)			9,257			(732	)
Total Temporarily Impaired Securities		$	233,113		$	(8,881	)		$	219,344		$	(7,712	)		$	13,769		$	(1,169	)