INVESTMENT SECURITIES

12 Months Ended

Dec. 31, 2011

Investment Securities [Abstract]

Investment Securities

NOTE B – INVESTMENT SECURITIES

The following table sets forth the amortized cost and estimated fair values of the Bank's investment securities at December 31, 2011 and 2010.

	2011
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Held-to-Maturity Securities:	(in thousands)
State and municipals	$	43,091	$	2,906	$	-		$	45,997
Pass-through mortgage securities		6,851		551		-			7,402
Collateralized mortgage obligations		12,143		535		-			12,678
	$	62,085	$	3,992	$	-		$	66,077
Available-for-Sale Securities:
U.S. government agencies	$	5,000	$	113	$	-		$	5,113
State and municipals		292,662		20,580		(47	)		313,195
Pass-through mortgage securities		68,060		5,726		-			73,786
Collateralized mortgage obligations		489,546		12,933		(617	)		501,862
	$	855,268	$	39,352	$	(664	)	$	893,956
	2010
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Held-to-Maturity Securities:	(in thousands)
State and municipals	$	49,294	$	1,632	$	(132	)	$	50,794
Pass-through mortgage securities		11,025		638		-			11,663
Collateralized mortgage obligations		26,259		1,044		-			27,303
	$	86,578	$	3,314	$	(132	)	$	89,760
Available-for-Sale Securities:
U.S. government agencies	$	5,000	$	155	$	-		$	5,155
State and municipals		221,832		1,793		(8,013	)		215,612
Pass-through mortgage securities		76,036		4,470		(35	)		80,471
Collateralized mortgage obligations		346,410		6,796		(1,329	)		351,877
	$	649,278	$	13,214	$	(9,377	)	$	653,115

At December 31, 2011 and 2010, investment securities with a carrying value of $290,658,000 and $258,404,000, respectively, were pledged as collateral to secure public deposits and borrowed funds.

Securities With Unrealized Losses.The following tables set forth securities with unrealized losses at December 31, 2011 and 2010, presented by length of time the securities have been in a continuous unrealized loss position.

	2011
	Less than 12 Months					Total
	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
	(in thousands)
State and municipals	$	6,176	$	(47	)	$	6,176	$	(47	)
Collateralized mortgage obligations		66,357		(617	)		66,357		(617	)
Total temporarily impaired	$	72,533	$	(664	)	$	72,533	$	(664	)

	2010
	Less than 12 Months					12 Months or More					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Loss			Value		Loss			Value		Loss
	(in thousands)
State and municipals	$	145,559	$	(8,106	)	$	508	$	(39	)	$	146,067	$	(8,145	)
Pass-through mortgage securities		7,451		(35	)		-		-			7,451		(35	)
Collateralized mortgage obligations		68,778		(1,329	)		-		-			68,778		(1,329	)
Total temporarily impaired	$	221,788	$	(9,470	)	$	508	$	(39	)	$	222,296	$	(9,509	)

Because the unrealized losses reflected in the preceding tables are attributable to changes in interest rates and not credit losses, and because management does not have the intent to sell these securities and it is not likely that it will be required to sell the securities before their anticipated recovery, the Bank does not consider these securities to be other-than-temporarily impaired at December 31, 2011.

Sales of Available-for-Sale Securities.Sales of available-for-sale securities were as follows:

	2011		2010			2009
	(in thousands)
Proceeds	$	4,610	$	78,504		$	50,697
Gains	$	138	$	1,885		$	1,428
Losses		-		(166	)		-
Net gains	$	138	$	1,719		$	1,428

The tax provision related to these net realized gains was $55,000, $682,000 and $567,000 in 2011, 2010 and 2009, respectively.

Maturities.  The following table sets forth by maturity the amortized cost and fair value of the investment securities portfolio at December 31, 2011.  State and municipal securities are included in the table at the earlier of their stated maturity or, if applicable, their pre-refunded date.  The mortgage-backed securities shown in the table are expected to have substantial periodic repayments.

	Amortized Cost		Fair Value
Held-to-Maturity Securities	(in thousands)
Within one year	$	2,296	$	2,317
One to five years		10,919		11,594
Five to ten years		25,304		27,184
Beyond ten years		4,572		4,902
Mortgage-backed securities		18,994		20,080
	$	62,085	$	66,077
Available-for-Sale Securities
Within one year	$	2,002	$	2,021
One to five years		8,219		8,577
Five to ten years		28,466		30,055
Beyond ten years		258,975		277,655
Mortgage-backed securities		557,606		575,648
	$	855,268	$	893,956