LOW INCOME HOUSING PROJECT INVESTMENTS

The Company’s investment in Low Income Housing Projects that generate Low Income Housing Tax Credits (“LIHTC”) at June 30, 2014 was $26.6 million with a recorded liability of $22.1 million in funding obligations. The Company has invested in three separate LIHTC projects which provide the Company with tax credits and operating loss tax benefits over a period of approximately 15 years. None of the original investment will be repaid. The investment in LIHTC projects is being accounted for using the proportional amortization method, under which the Company amortizes the initial cost of the investment in proportion to the amount of the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense (benefit).

The following table presents the Company's investments in low income housing projects as of the date indicated:



	June 30, 2014
	(Dollars in thousands)
Original investment value	$	27,543
Current recorded investment	26,624
Unfunded liability obligation	22,091
Tax credits and benefits (1)	1,629
Amortization of investments (2)	1,101
Net income tax benefit (3)	528


(1)	This amount reflects anticipated tax credits and tax benefits for the year ended December 31, 2014.


(2)	The amortization amount reduces the tax credits and benefits anticipated for the year ended December 31, 2014.


(3)	This amount represents the net tax benefit expected to be realized for the year ended December 31, 2014 in determining the Company's effective tax rate as of June 30, 2014.