FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2014

Fair Value Measurements for Items Measured at Fair Value

Under ASC 820, fair value measurements for items measured at fair value on a recurring and nonrecurring basis at March 31, 2014 and 2013 included:

			Quoted Prices
			in Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	Fair Value		Assets		Inputs		Inputs
(Dollars in thousands)	Measurements		(Level 1)		(Level 2)		(Level 3)
March 31, 2014
Available for sale securities (3)	$	658,512	$	100	$	658,412	$	0
Loans available for sale (4)		11,038		0		11,038		0
Loans (1)		20,659		0		10,104		10,555
Other real estate owned (2)		6,369		0		883		5,486

March 31, 2013
Available for sale securities (3)	$	649,196	$	1,202	$	647,994	$	0
Loans available for sale (4)		24,206		0		24,206		0
Loans (1)		22,601		0		10,889		11,712
Other real estate owned (2)		10,850		0		3,389		7,461

(1)

See Note F. Nonrecurring fair value adjustments to loans identified as impaired reflect full or partial write-downs that are based on the loan's observable market price or current appraised value of the collateral in accordance with ASC 310.

(2)

Fair value is measured on a nonrecurring basis in accordance with ASC 360.

(3) See Note D for further detail of fair value of individual investment categories.

(4) Recurring fair value basis determined using observable market data.

Summary of Carrying Value and Fair Value of Company's Financial Instruments

The carrying amount and fair value of the Company's other significant financial instruments that are not measured at fair value on a recurring basis in the balance sheet as of March 31, 2014 and 2013 is as follows:

			Quoted Prices
			in Active		Significant
			Markets for		Other		Significant
			Identical		Observable		Unobservable
	Carrying		Assets		Inputs		Inputs
(Dollars in thousands)	Amount		(Level 1)		(Level 2)		(Level 3)
At March 31, 2014
Financial Assets
Loans, net	$	1,272,325	$	0	$	0	$	1,273,150
Financial Liabilities
Deposit liabilities		1,819,795		0		0		1,820,689
Borrowings		50,000		0		53,584		0
Subordinated debt		53,610		0		42,888		0

At March 31, 2013
Financial Assets
Loans, net	$	1,179,669	$	0	$	0	$	1,200,845
Financial Liabilities
Deposit liabilities		1,762,164		0		0		1,764,018
Borrowings		50,000		0		55,299		0
Subordinated debt		53,610		0		37,527		0

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

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