Securities

3 Months Ended

Mar. 31, 2012

Securities [Abstract]

SECURITIES

NOTE H: SECURITIES

The amortized cost and fair value of securities available for sale and held for investment at March 31, 2012 and December 31, 2011 are summarized as follows:

	March 31, 2012
	Gross Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
SECURITIES AVAILABLE FOR SALE
U.S. Treasury securities and obligations of U.S. Government Sponsored Entities	$	1,699	$	19	$	—		$	1,718
Mortgage-backed securities of U.S Government Sponsored Entities		151,891		3,010		(114	)		154,787
Collateralized mortgage obligations of U.S. Government Sponsored Entities		336,313		6,033		(258	)		342,088
Private collateralized mortgage obligations		74,630		867		(634	)		74,863
Obligations of state and political subdivisions Other		1,097		62		—			1,159
	$	565,630	$	9,991	$	(1,006	)	$	574,615
SECURITIES HELD FOR INVESTMENT
Collateralized mortgage obligations of U.S. Government Sponsored Entities	$	8,943	$	—	$	(127	)	$	8,816
Private collateralized mortgage obligations		1,697		39		—			1,736
Obligations of state and political subdivisions		6,661		677		—			7,338
Other		1,500		36		—			1,536
	$	18,801	$	752	$	(127	)	$	19,426

	December 31, 2011
	Gross Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
SECURITIES AVAILABLE FOR SALE
U.S. Treasury securities and obligations of U.S. Government Sponsored Entities	$	1,699	$	25	$	—		$	1,724
Mortgage-backed securities of Government Sponsored Entities		135,665		2,819		(37	)		138,447
Collateralized mortgage obligations of Government Sponsored Entities		428,139		9,111		(316	)		436,934
Private collateralized mortgage obligations		73,247		330		(3,487	)		70,090
Obligations of state and political subdivisions		1,097		70		—			1,167
	$	639,847	$	12,355	$	(3,840	)	$	648,362
SECURITIES HELD FOR INVESTMENT
Collateralized mortgage obligations of Government Sponsored Entities	$	10,475	$	—	$	(136	)	$	10,339
Private collateralized mortgage obligations		1,840		40		—			1,880
Obligations of state and political subdivisions		6,662		570		—			7,232
Other		1,000		36		—			1,036
	$	19,977	$	646	$	(136	)	$	20,487

Proceeds from sales of securities during the three month period ended March 31, 2012 were $111,717,000 with gross gains of $3,374,000 and gross losses of $0. No sales of securities occurred during the three month period ended March 31, 2011.

Securities with a carrying value of $84,489,000 and fair value of $84,526,000 at March 31, 2012 were pledged as collateral for United States Treasury deposits, and other public and trust deposits. Securities with a carrying value and fair value of $149,507,000 were pledged as collateral for repurchase agreements.

The amortized cost and fair value of securities at March 31, 2012, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or repay obligations with or without call or prepayment penalties.

	Held for Investment				Available for Sale
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In thousands)
Due in less than one year	$	—	$	—	$	499	$	505
Due after one year through five years		127		127		1,405		1,434
Due after five years through ten years		1,503		1,629		892		938
Due after ten years		5,031		5,582		—		—
		6,661		7,338		2,796		2,877
Mortgage-backed securities of Government Sponsored Entities		—		—		151,891		154,787
Collateralized mortgage obligations of Government Sponsored Entities		8,943		8,816		336,313		342,088
Private collateralized mortgage obligations		1,697		1,736		74,630		74,863
No contractual maturity		1,500		1,536		—		—
	$	18,801	$	19,426	$	565,630	$	574,615

The estimated fair value of a security is determined based on market quotations when available or, if not available, by using quoted market prices for similar securities, pricing models or discounted cash flows analyses, using observable market data where available. The tables below indicate the amount of securities with unrealized losses and period of time for which these losses were outstanding at March 31, 2012 and December 31, 2011, respectively.

	March 31, 2012
	Less than 12 months					12 months or longer					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(In thousands)
Mortgage-backed securities of U.S. Government Sponsored Entities	$	23,601	$	(114	)	$	—	$	—		$	23,601	$	(114	)
Collateralized mortgage obligations of U.S. Government Sponsored Entities		61,337		(385	)		—		—			61,337		(385	)
Private collateralized mortgage obligations		9,315		(150	)		26,778		(484	)		36,093		(634	)
Total temporarily impaired securities	$	94,253	$	(649	)	$	26,778	$	(484	)	$	121,031	$	(1,133	)

	December 31, 2011
	Less than 12 months					12 months or longer					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(In thousands)
Mortgage-backed securities of U.S. Government Sponsored Entities	$	18,800	$	(37	)	$	—	$	—		$	18,800	$	(37	)
Collateralized mortgage obligations of U.S. Government Sponsored Entities		59,913		(452	)		—		—			59,913		(452	)
Private collateralized mortgage obligations		32,615		(2,001	)		27,282		(1,486	)		59,897		(3,487	)
Total temporarily impaired securities	$	111,328	$	(2,490	)	$	27,282	$	(1,486	)	$	138,610	$	(3,976	)

Approximately $0.6 million of $1.1 million of the unrealized losses at March 31, 2012 pertain to private label securities secured by collateral originated in 2005 and prior. Their fair value is $36.1 million as of March 31, 2012 and is attributable to a combination of factors, including relative changes in interest rates since the time of purchase and decreased liquidity for investment securities in general. The collateral underlying these mortgage investments are 30- and 15-year fixed and 10/1 adjustable rate mortgages loans with low loan to values, subordination and historically have had minimal foreclosures and losses. Based on its assessment of these factors, management believes that the unrealized losses on these debt security holdings are a function of changes in investment spreads and interest rate movements and not changes in credit quality. Management expects to recover the entire amortized cost basis of these securities.

At March 31, 2012, the Company also had $0.5 million of unrealized losses on mortgage-backed securities of government sponsored entities having a fair value of $84.9 million that were attributable to a combination of factors, including relative changes in interest rates since the time of purchase and decreased liquidity for investment securities in general. The contractual cash flows for these securities are guaranteed by U.S. government agencies and U.S. government-sponsored enterprises. Based on its assessment of these factors, management believes that the unrealized losses on these debt security holdings are a function of changes in investment spreads and interest rate movements and not changes in credit quality. Management expects to recover the entire amortized cost basis of these securities.

As of March 31, 2012, the Company does not intend to sell nor is it anticipated that it would be required to sell any of its investment securities that have losses. Therefore, management does not consider any investment to be other-than-temporarily impaired at March 31, 2012.

Included in other assets was $12.0 million at March 31, 2012 of Federal Home Loan Bank and Federal Reserve Bank stock stated at par value. At March 31, 2012, the Company has not identified events or changes in circumstances which may have a significant adverse effect on the fair value of the $12.0 million of cost method investment securities.