10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

FORM 10-Q

(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended June 30, 2015

OR

(  ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from  to ____________

Commission File Number: 0-19065 

SANDY SPRING BANCORP, INC. 

(Exact name of registrant as specified in its charter)

Maryland52-1532952 

(State of incorporation)          (I.R.S. Employer Identification Number)

17801 Georgia Avenue, Olney, Maryland 20832 

           (Address of principal executive office)          (Zip Code)

301-774-6400

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to filing requirements for the past 90 days.

Yes [X]      No [  ]                                                                 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes [X]      No [  ]                                                                 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [  ] Accelerated filer [X] Non-accelerated filer [  ]   Smaller reporting company [  ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)

Yes [  ]      No [X]                                                                 

The number of outstanding shares of common stock outstanding as of August 3, 2015

Common stock, $1.00 par value – 24,566,838 shares

SANDY SPRING BANCORP, INC.
TABLE OF CONTENTS
		Page
PART I - FINANCIAL INFORMATION
Item1. FINANCIAL STATEMENTS
	Condensed Consolidated Statements of Condition - Unaudited at
	June 30, 2015 and December 31, 2014	4
	Condensed Consolidated Statements of Income - Unaudited for the Three and Six  Months
	Ended June 30, 2015 and 2014	5
	Condensed Consolidated Statements of Comprehensive Income – Unaudited for
	the Three and Six Months Ended June 30, 2015 and 2014	6
	Condensed Consolidated Statements of Cash Flows – Unaudited for the Six
	Months Ended June 30, 2015 and 2014	7
	Condensed Consolidated Statements of Changes in Stockholders’ Equity – Unaudited for the
	Six Months Ended June 30, 2015 and 2014	8
	Notes to Condensed Consolidated Financial Statements	9
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
	FINANCIAL CONDITION AND RESULTS OF OPERATIONS	35
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES
	ABOUT MARKET RISK	59
Item 4. CONTROLS AND PROCEDURES		59
PART II - OTHER INFORMATION
Item 1.LEGAL PROCEEDINGS		59
Item 1A. RISK FACTORS		59
Item 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		59
Item 3.    DEFAULTS UPON SENIOR SECURITIES		60
Item 4.    MINE SAFETY DISCLOSURES		60
Item 5.    OTHER INFORMATION		60
Item 6.    EXHIBITS		60
SIGNATURES		61

2

Forward-Looking Statements

This Quarterly Report on Form 10-Q, as well as other periodic reports filed with the Securities and Exchange Commission, and written or oral communications made from time to time by or on behalf of Sandy Spring Bancorp and its subsidiaries (the “Company”), may contain statements relating to future events or future results of the Company that are considered “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by the use of words such as “believe,” “expect,” “anticipate,”  “plan,” “estimate,” “intend” and “potential,” or words of similar meaning, or future or conditional verbs such as “should,” “could,” or “may.”  Forward-looking statements include statements of our goals, intentions and expectations; statements regarding our business plans, prospects, growth and operating strategies; statements regarding the quality of our loan and investment portfolios; and estimates of our risks and future costs and benefits.

Forward-looking statements reflect our expectation or prediction of future conditions, events or results based on information currently available. These forward-looking statements are subject to significant risks and uncertainties that may cause actual results to differ materially from those in such statements.  These risk and uncertainties include, but are not limited to, the risks identified in Item 1A of the Company’s 2014 Annual Report on Form 10-K, Item 1A of Part II of this report and the following:

·general business and economic conditions nationally or in the markets that the Company serves could adversely affect, among other things, real estate prices, unemployment levels, and consumer and business confidence, which could lead to decreases in the demand for loans, deposits and other financial services that we provide and increases in loan delinquencies and defaults;

·changes or volatility in the capital markets and interest rates may adversely impact the value of securities, loans, deposits and other financial instruments and the interest rate sensitivity of our balance sheet as well as our liquidity;

·our liquidity requirements could be adversely affected by changes in our assets and liabilities;

·our investment securities portfolio is subject to credit risk, market risk, and liquidity risk as well as changes in the estimates we use to value certain of the securities in our portfolio;

·the effect of legislative or regulatory developments including changes in laws concerning taxes, banking, securities, insurance and other aspects of the financial services industry;

·competitive factors among financial services companies, including product and pricing pressures and our ability to attract, develop and retain qualified banking professionals;

·the effect of changes in accounting policies and practices, as may be adopted by the Financial Accounting Standards Board, the Securities and Exchange Commission, the Public Company Accounting Oversight Board and other regulatory agencies; and

·the effect of fiscal and governmental policies of the United States federal government.

Forward-looking statements speak only as of the date of this report.  The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date of this report or to reflect the occurrence of unanticipated events except as required by federal securities laws.

3

Part I
Item 1. FINANCIAL STATEMENTS
Sandy Spring Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION - UNAUDITED
			June 30,		December 31,
(Dollars in thousands)			2015		2014
Assets
	Cash and due from banks		$	53,569	$	52,804
	Federal funds sold			472		473
	Interest-bearing deposits with banks			35,601		42,940
		Cash and cash equivalents		89,642		96,217
	Residential mortgage loans held for sale (at fair value)			19,445		10,512
	Investments available-for-sale (at fair value)			625,819		672,209
	Investments held-to-maturity -- fair value of $217,880 and $222,260 at June 30, 2015
		and December 31, 2014, respectively		216,866		219,973
	Other equity securities			35,599		41,437
	Total loans and leases			3,288,865		3,127,392
		Less: allowance for loan and lease losses		(38,713)		(37,802)
	Net loans and leases			3,250,152		3,089,590
	Premises and equipment, net			51,609		49,402
	Other real estate owned			4,514		3,195
	Accrued interest receivable			13,144		12,634
	Goodwill			84,171		84,171
	Other intangible assets, net			296		510
	Other assets			116,110		117,282
Total assets			$	4,507,367	$	4,397,132
Liabilities
	Noninterest-bearing deposits		$	1,092,413	$	993,737
	Interest-bearing deposits			2,154,933		2,072,772
		Total deposits		3,247,346		3,066,509
	Securities sold under retail repurchase agreements and federal funds purchased			111,817		74,432
	Advances from FHLB			550,000		655,000
	Subordinated debentures			35,000		35,000
	Accrued interest payable and other liabilities			44,331		44,440
		Total liabilities		3,988,494		3,875,381
Stockholders' Equity
	Common stock -- par value $1.00; shares authorized 50,000,000; shares
		issued and outstanding 24,562,471 and 25,044,877 at June 30, 2015 and
		December 31, 2014, respectively		24,562		25,045
	Additional paid in capital			181,504		194,647
	Retained earnings			313,399		302,882
	Accumulated other comprehensive loss			(592)		(823)
		Total stockholders' equity		518,873		521,751
Total liabilities and stockholders' equity			$	4,507,367	$	4,397,132
The accompanying notes are an integral part of these statements

4

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
				Three Months Ended				Six Months Ended
				June 30,				June 30,
(Dollars in thousands, except per share data)				2015		2014		2015		2014
Interest Income:
	Interest and fees on loans and leases			$	33,031	$	30,706	$	65,170	$	60,440
	Interest on loans held for sale				132		71		208		130
	Interest on deposits with banks				22		22		44		42
	Interest and dividends on investment securities:
		Taxable			3,850		3,876		7,427		7,992
		Exempt from federal income taxes			1,814		2,316		4,072		4,637
			Total interest income		38,849		36,991		76,921		73,241
Interest Expense:
Interest on deposits					1,367		1,193		2,561		2,377
Interest on retail repurchase agreements and federal funds purchased					60		37		110		75
Interest on advances from FHLB					3,266		3,233		6,502		6,451
Interest on subordinated debt					223		219		442		437
			Total interest expense		4,916		4,682		9,615		9,340
Net interest income					33,933		32,309		67,306		63,901
Provision (credit) for loan and lease losses					1,218		158		1,815		(824)
			Net interest income after provision (credit) for loan and lease losses		32,715		32,151		65,491		64,725
Non-interest Income:
	Investment securities gains				19		-		19		-
	Service charges on deposit accounts				1,839		2,089		3,721		4,061
	Mortgage banking activities				822		570		2,000		886
	Wealth management income				5,161		4,741		10,077		9,207
	Insurance agency commissions				881		961		2,499		2,601
	Income from bank owned life insurance				606		608		1,319		1,206
	Visa check fees				1,220		1,169		2,277		2,147
	Other income				1,561		1,556		3,356		2,835
			Total non-interest income		12,109		11,694		25,268		22,943
Non-interest Expenses:
	Salaries and employee benefits				17,534		16,474		34,833		32,829
	Occupancy expense of premises				3,173		3,274		6,662		6,746
	Equipment expenses				1,490		1,262		2,863		2,518
	Marketing				942		802		1,473		1,344
	Outside data services				1,102		1,216		2,363		2,432
	FDIC insurance				654		573		1,285		1,093
	Amortization of intangible assets				106		224		213		594
	Litigation expenses				162		6,128		362		6,128
	Other expenses				4,314		4,188		8,667		8,006
			Total non-interest expenses		29,477		34,141		58,721		61,690
Income before income taxes					15,347		9,704		32,038		25,978
Income tax expense					5,014		2,722		10,480		8,068
			Net income	$	10,333	$	6,982	$	21,558	$	17,910
Net Income Per Share Amounts:
Basic net income per share				$	0.42	$	0.28	$	0.87	$	0.72
Diluted net income per share				$	0.42	$	0.28	$	0.87	$	0.71
Dividends declared per share				$	0.22	$	0.18	$	0.44	$	0.36
The accompanying notes are an integral part of these statements

5

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - UNAUDITED
				Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)				2015		2014		2015		2014
Net income				$	10,333	$	6,982	$	21,558	$	17,910
	Other comprehensive income:
	Investments available-for-sale:
		Net change in unrealized gains (losses) on investments available-for-sale			(4,819)		6,361		(185)		13,493
			Related income tax (expense) benefit		1,915		(2,522)		74		(5,345)
		Net investment gains reclassified into earnings			19		-		19		-
			Related income tax expense		(8)		-		(8)		-
			Net effect on other comprehensive income (loss) for the period		(2,893)		3,839		(100)		8,148
	Defined benefit pension plan:
		Recognition of unrealized gain			259		68		551		116
			Related income tax expense		(104)		(24)		(220)		(61)
			Net effect on other comprehensive income for the period		155		44		331		55
	Total other comprehensive income (loss)				(2,738)		3,883		231		8,203
Comprehensive income				$	7,595	$	10,865	$	21,789	$	26,113
The accompanying notes are an integral part of these statements

6

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED
				Six Months Ended June 30,
(Dollars in thousands)				2015		2014
Operating activities:
Net income				$	21,558	$	17,910
Adjustments to reconcile net income to net cash provided by operating activities:
		Depreciation and amortization			3,504		3,673
		Provision (credit) for loan and lease losses			1,815		(824)
		Share based compensation expense			941		853
		Deferred income tax expense			116		1,029
		Origination of loans held for sale			(109,045)		(59,566)
		Proceeds from sales of loans held for sale			101,688		59,704
		Gains on sales of loans held for sale			(1,576)		(815)
		Loss on sales of other real estate owned			-		(2)
		Investment securities gains			(19)		-
		Net (increase) decrease in accrued interest receivable			(510)		261
		Net increase in other assets			(65)		(4,580)
		Net increase (decrease) in accrued expenses and other liabilities			(162)		4,472
		Other – net			2,069		2,427
			Net cash provided by operating activities		20,314		24,542
Investing activities:
	Purchases of investments held-to-maturity				(2,100)		-
	Net proceeds from other equity securities				5,838		4,560
	Proceeds from maturities, calls and principal payments of investments held-to-maturity				4,786		680
	Proceeds from maturities, calls and principal payments of investments available-for-sale				45,249		42,228
	Net increase in loans and leases				(163,717)		(127,333)
	Proceeds from the sales of other real estate owned				-		32
	Expenditures for premises and equipment				(4,559)		(1,795)
			Net cash used in investing activities		(114,503)		(81,628)
Financing activities:
	Net increase in deposits				180,837		161,445
	Net increase in retail repurchase agreements and federal funds purchased				37,385		19,075
	Proceeds from advances from FHLB				1,174,000		980,000
	Repayment of advances from FHLB				(1,279,000)		(1,058,000)
	Proceeds from issuance of common stock				13		34
	Tax benefits associated with share based compensation				335		-
	Repurchase of common stock				(14,915)		-
	Dividends paid				(11,041)		(9,094)
			Net cash (used) provided by financing activities		87,614		93,460
Net increase (decrease) in cash and cash equivalents					(6,575)		36,374
Cash and cash equivalents at beginning of period					96,217		74,427
Cash and cash equivalents at end of period				$	89,642	$	110,801
Supplemental Disclosures:
	Interest payments			$	9,619	$	9,358
	Income tax payments				9,876		10,151
	Transfers from loans to other real estate owned				1,340		671
The accompanying notes are an integral part of these statements

7

SANDY SPRING BANCORP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - UNAUDITED
`								Accumulated
				Additional				Other		Total
		Common		Paid-In		Retained		Comprehensive		Stockholders’
(Dollars in thousands, except per share data)		Stock		Capital		Earnings		Income (Loss)		Equity
Balances at January 1, 2015		$	25,045	$	194,647	$	302,882	$	(823)	$	521,751
	Net income		-		-		21,558		-		21,558
	Other comprehensive income, net of tax		-		-		-		231		231
Common stock dividends -  $0.44 per share			-		-		(11,041)		-		(11,041)
Stock compensation expense			-		941		-		-		941
Common stock issued pursuant to:
	Stock option plan - 26,695 shares		26		365		-		-		391
	Directors stock purchase plan - 837 shares		1		21		-		-		22
	Employee stock purchase plan - 12,613 shares		12		264		-		-		276
	Restricted stock - 52,921 shares		53		(394)		-		-		(341)
Purchase of treasury shares - 575,472 shares			(575)		(14,340)		-		-		(14,915)
Balances at June 30, 2015		$	24,562	$	181,504	$	313,399	$	(592)	$	518,873
Balance at January 1, 2014		$	24,990	$	193,445	$	283,898	$	(2,970)	$	499,363
	Net income		-		-		17,910		-		17,910
	Other comprehensive income, net of tax		-		-		-		8,203		8,203
Common stock dividends -  $0.36 per share			-		-		(9,094)		-		(9,094)
Stock compensation expense			-		853		-		-		853
Common stock issued pursuant to:
	Stock option plan - 13,721 shares		14		174		-		-		188
	Employee stock purchase plan - 11,423 shares		11		229		-		-		240
	Restricted stock - 54,535 shares		55		(449)		-		-		(394)
Balances at June 30, 2014		$	25,070	$	194,252	$	292,714	$	5,233	$	517,269
The accompanying notes are an integral part of these statements

8

Sandy Spring Bancorp, Inc. and Subsidiaries

Notes to the CONDENSED Consolidated Financial Statements - UNAUDITED

Note 1 – Significant Accounting Policies

Nature of Operations

Sandy Spring Bancorp (the “Company”), a Maryland corporation, is the bank holding company for Sandy Spring Bank (the “Bank”), which conducts a full-service commercial banking, mortgage banking and trust business. Services to individuals and businesses include accepting deposits, extending real estate, consumer and commercial loans and lines of credit, general insurance, personal trust, and investment and wealth management services. The Company operates in the  Maryland counties of Anne Arundel, Carroll, Frederick, Howard, Montgomery, and Prince George's, and in Arlington, Fairfax and Loudoun counties in Virginia. The Company offers investment and wealth management services through the Bank’s subsidiary, West Financial Services.  Insurance products are available to clients through Sandy Spring Insurance, and Neff & Associates, which are agencies of Sandy Spring Insurance Corporation.

Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”) and prevailing practices within the financial services industry for interim financial information and Rule 10-01 of Regulation S-X.  Accordingly, they do not include all of the information and notes required for complete financial statements and prevailing practices within the banking industry.  The following summary of significant accounting policies of the Company is presented to assist the reader in understanding the financial and other data presented in this report.  Operating results for the three and six months ended June 30, 2015 are not necessarily indicative of the results that may be expected for any future periods or for the year ending December 31, 2015. In the opinion of management, all adjustments (comprising only normal recurring accruals) necessary for a fair presentation of the results of the interim periods have been included. Certain reclassifications have been made to prior period amounts, as necessary, to conform to the current period presentation.  The Company has evaluated subsequent events through the date of the issuance of its financial statements.

These statements should be read in conjunction with the financial statements and accompanying notes included in the Company’s 2014 Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on March 6, 2015.  There have been no significant changes to the Company’s accounting policies as disclosed in the 2014 Annual Report on Form 10-K. 

Principles of Consolidation

The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Sandy Spring Bank and its subsidiaries, Sandy Spring Insurance Corporation and West Financial Services, Inc. Consolidation has resulted in the elimination of all intercompany accounts and transactions. 

Use of Estimates

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, and affect the reported amounts of revenues earned and expenses incurred during the reporting period. Actual results could differ from those estimates. Estimates that could change significantly relate to the provision for loan and lease losses and the related allowance, determination of impaired loans and the related measurement of impairment, potential impairment of goodwill or other intangible assets, valuation of investment securities and the determination of whether impaired securities are other-than-temporarily impaired, valuation of other real estate owned, prepayment rates, valuation of share-based compensation, the assessment that a liability should be recognized with respect to any matters under litigation, the calculation of current and deferred income taxes and the actuarial projections related to pension expense and the related liability.

Cash Flows

For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks, federal funds sold and interest-bearing deposits with banks (items with stated original maturity of three months or less).

9

Pending Accounting Pronouncements

The FASB issued a standard in May 2014 that provides accounting guidance for all revenue arising from contracts with customers and affects all entities that enter into contracts to provide goods or services to customers.  The guidance also provides for a model for the measurement and recognition of gains and losses on the sale of certain nonfinancial assets, such as property and equipment, including real estate.  This standard may affect an entity’s financial statements, business processes and internal control over financial reporting.  The guidance is effective for the first interim or annual period beginning after December 15, 2017.  The guidance must be adopted using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach.  The Company is assessing this guidance to determine its impact on the Company’s financial position, results of operations and cash flows.

Note 2 – Investments

Investments available-for-sale

The amortized cost and estimated fair values of investments available-for-sale at the dates indicated are presented in the following table:

			June 30, 2015								December 31, 2014
					Gross		Gross		Estimated				Gross		Gross		Estimated
			Amortized		Unrealized		Unrealized		Fair		Amortized		Unrealized		Unrealized		Fair
(In thousands)			Cost		Gains		Losses		Value		Cost		Gains		Losses		Value
U.S. government agencies			$	139,542	$	122	$	(1,684)	$	137,980	$	144,497	$	-	$	(2,818)	$	141,679
State and municipal				153,769		8,185		(1)		161,953		157,603		9,453		(4)		167,052
Mortgage-backed				317,433		8,794		(2,082)		324,145		354,631		9,824		(2,936)		361,519
Trust preferred				1,111		-		(93)		1,018		1,348		-		(112)		1,236
	Total debt securities			611,855		17,101		(3,860)		625,096		658,079		19,277		(5,870)		671,486
Marketable equity securities				723		-		-		723		723		-		-		723
		Total investments available-for-sale	$	612,578	$	17,101	$	(3,860)	$	625,819	$	658,802	$	19,277	$	(5,870)	$	672,209

Any unrealized losses in the U.S. government agencies, state and municipal, mortgage-backed or corporate debt investment securities at June 30, 2015 are not the result of credit related events but due to changes in interest rates.   These declines are considered temporary in nature and are expected to decline over time and recover as these securities approach maturity.

The mortgage-backed securities portfolio at June 30, 2015 is composed entirely of either the most senior tranches of GNMA, FNMA or FHLMC collateralized mortgage obligations ($150.6 million), or GNMA, FNMA or FHLMC mortgage-backed securities ($173.5 million).  The Company does not intend to sell these securities and has sufficient liquidity to hold these securities for an adequate period of time, which may be maturity, to allow for any anticipated recovery in fair value. 

At June 30, 2015 the trust preferred portfolio consisted of one pooled trust preferred security.  The pooled trust preferred security, which is backed by debt issued by banks and thrifts, totals $1.1 million with a fair value of $1.0 million.  The fair value of this security was determined by management through the use of a third party valuation specialist due to the limited trading activity for this security. 

The income valuation approach technique (present value) used maximizes the use of relevant observable inputs and minimizes the use of unobservable inputs.  The methodology and significant assumptions employed by the specialist to determine fair value included:

·Evaluation of the structural terms as established in the indenture;

·Detailed credit and structural evaluation for each piece of issuer collateral in the pool;

·Overall default (.61%), recovery and prepayment (2%)/amortization probabilities by issuers in the pool;

·Identification  of adverse conditions specifically related to the security, industry and geographical area;

·Projection of estimated cash flows that incorporate default expectations and loss severities;

·Review of  historical and implied volatility of the fair value of the security;

·Evaluation of credit risk concentrations;

·Evaluation of the length of time and the extent to which the fair value has been less than the amortized cost; and

·A discount rate of 11.5% was established using credit adjusted financial institution spreads for comparably rated institutions and a liquidity adjustment that considered the previously noted characteristics.

10

As a result of this evaluation, it was determined that the pooled trust preferred security had not incurred any credit-related other-than-temporary impairment (“OTTI”) for the quarter ended June 30, 2015.  Non-credit related OTTI on this security, which is not expected to be sold and which the Company has the ability to hold until maturity, was $0.1 million at June 30, 2015.  This non-credit related OTTI was recognized in other comprehensive income (“OCI”) at June 30, 2015. 

The methodology and significant inputs used to measure the amount related to credit loss consisted of the following:

·Default rates were developed based on the financial condition of the trust preferred issuers in the pool and the payment or deferral status.  Conditional default rates were estimated based on the payment characteristics of the security and the financial condition of the issuers in the pool.  Near term and future defaults are estimated using third party industry data in addition to a review of key financial ratios and other pertinent data on the financial stability of the underlying issuer;

·Loss severity is forecasted based on the type of impairment using research performed by third parties; 

·The security contains one level of subordination below the senior tranche, with the senior tranche receiving the spread from the subordinate bonds.  Given recent performance, it is not expected that the senior tranche will receive its full interest and principal at the bond’s maturity date;

·Credit ratings of the underlying issuers are reviewed in conjunction with the development of the default rates applied to determine the credit amounts related to the credit loss; and

·Potential prepayments are estimated based on terms and rates of the underlying trust preferred securities to determine the impact of excess spread on the credit enhancement, the removal of the strongest institutions from the underlying pool and any impact that prepayments might have on diversity and concentration.

The following table provides the activity of OTTI on investment securities due to credit losses recognized in earnings for the period indicated:

(In thousands)		OTTI Losses
Cumulative credit losses on investment securities, through December 31, 2014	$	531
Additions for credit losses not previously recognized		-
Cumulative credit losses on investment securities, through June 30, 2015	$	531

11

Gross unrealized losses and fair value by length of time that the individual available-for-sale securities have been in an unrealized loss position at the dates indicated are presented in the following table:

		June 30, 2015
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			10	$	108,274	$	605	$	1,079	$	1,684
State and municipal			2		1,410		1		-		1
Mortgage-backed			22		111,424		250		1,832		2,082
Trust preferred			1		1,111		-		93		93
	Total		35	$	222,219	$	856	$	3,004	$	3,860

		December 31, 2014
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			14	$	141,679	$	60	$	2,758	$	2,818
State and municipal			2		1,409		4		-		4
Mortgage-backed			20		108,902		58		2,878		2,936
Trust preferred			1		1,236		-		112		112
	Total		37	$	253,226	$	122	$	5,748	$	5,870

The amortized cost and estimated fair values of debt securities available-for-sale by contractual maturity at the dates indicated are provided in the following table.  The Company has allocated mortgage-backed securities into the four maturity groupings reflected in the following table using the expected average life of the individual securities based on statistics provided by independent third party industry sources.  Expected maturities will differ from contractual maturities as borrowers may have the right to prepay obligations with or without prepayment penalties.

		June 30, 2015				December 31, 2014
				Estimated				Estimated
		Amortized		Fair		Amortized		Fair
(In thousands)		Cost		Value		Cost		Value
Due in one year or less		$	690	$	701	$	691	$	714
Due after one year through five years			116,702		118,680		47,900		49,385
Due after five years through ten years			247,330		254,687		332,841		340,852
Due after ten years			247,133		251,028		276,647		280,535
	Total debt securities available for sale	$	611,855	$	625,096	$	658,079	$	671,486

At June 30, 2015 and December 31, 2014, investments available-for-sale with a book value of $229.0 million and $212.9 million, respectively, were pledged as collateral for certain government deposits and for other purposes as required or permitted by law. The outstanding balance of no single issuer, except for U.S. Agencies securities, exceeded ten percent of stockholders' equity at June 30, 2015 and December 31, 2014.

12

Investments held-to-maturity    

The amortized cost and estimated fair values of investments held-to-maturity at the dates indicated are presented in the following table:

		June 30, 2015								December 31, 2014
				Gross		Gross		Estimated				Gross		Gross		Estimated
		Amortized		Unrealized		Unrealized		Fair		Amortized		Unrealized		Unrealized		Fair
(In thousands)		Cost		Gains		Losses		Value		Cost		Gains		Losses		Value
U.S. government agencies		$	64,515	$	-	$	(1,340)	$	63,175	$	64,512	$	-	$	(1,734)	$	62,778
State and municipal			150,069		3,454		(1,126)		152,397		155,261		4,321		(325)		159,257
Mortgage-backed			182		26		-		208		200		25		-		225
Corporate debt			2,100		-		-		2,100		-		-		-		-
	Total investments held-to-maturity	$	216,866	$	3,480	$	(2,466)	$	217,880	$	219,973	$	4,346	$	(2,059)	$	222,260

Gross unrealized losses and fair value by length of time that the individual held-to-maturity securities have been in a continuous unrealized loss position at the dates indicated are presented in the following tables:

		June 30, 2015
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			8	$	63,175	$	533	$	807	$	1,340
State and municipal			63		55,987		874		252		1,126
	Total		71	$	119,162	$	1,407	$	1,059	$	2,466

		December 31, 2014
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			8	$	62,778	$	-	$	1,734	$	1,734
State and municipal			41		32,027		18		307		325
	Total		49	$	94,805	$	18	$	2,041	$	2,059

The Company intends to hold these securities until they reach maturity.

The amortized cost and estimated fair values of debt securities held-to-maturity by contractual maturity at the dates indicated are reflected in the following table. Expected maturities will differ from contractual maturities as borrowers may have the right to prepay obligations with or without prepayment penalties.

		June 30, 2015				December 31, 2014
				Estimated				Estimated
		Amortized		Fair		Amortized		Fair
(In thousands)		Cost		Value		Cost		Value
Due in one year or less		$	846	$	865	$	1,690	$	1,694
Due after one year through five years			10,656		11,013		6,763		6,938
Due after five years through ten years			169,756		170,879		163,252		164,787
Due after ten years			35,608		35,123		48,268		48,841
	Total debt securities held-to-maturity	$	216,866	$	217,880	$	219,973	$	222,260

13

At June 30, 2015 and December 31, 2014, investments held-to-maturity with a book value of $193.3 million and $202.4 million, respectively, were pledged as collateral for certain government deposits and for other purposes as required or permitted by law.  The outstanding balance of no single issuer, except for U.S. Agency securities, exceeded ten percent of stockholders' equity at June 30, 2015 and December 31, 2014.

Equity securities

Other equity securities at the dates indicated are presented in the following table:

(In thousands)		June 30, 2015		December 31, 2014
Federal Reserve Bank stock		$	8,269	$	8,269
Federal Home Loan Bank of Atlanta stock			27,330		33,168
	Total equity securities	$	35,599	$	41,437

Note 3 – Loans and Leases

Outstanding loan balances at June 30, 2015 and December 31, 2014 are net of unearned income including net deferred loan costs of $0.7 million and $0.5 million, respectively.  The loan portfolio segment balances at the dates indicated are presented in the following table:

(In thousands)		June 30, 2015		December 31, 2014
Residential real estate:
	Residential mortgage	$	744,195	$	717,886
	Residential construction		137,134		136,741
Commercial real estate:
	Commercial owner occupied real estate		643,973		611,061
	Commercial investor real estate		694,179		640,193
	Commercial acquisition, development and construction		223,103		205,124
Commercial Business			409,795		390,781
Leases			21		54
Consumer			436,465		425,552
	Total loans and leases	$	3,288,865	$	3,127,392

Note 4 – CREDIT QUALITY ASSESSMENT

Allowance for Loan and Lease Losses

Summary information on the allowance for loan and lease loss activity for the period indicated is provided in the following table:

			Six Months Ended June 30,
(In thousands)			2015		2014
Balance at beginning of year			$	37,802	$	38,766
	Provision for loan and lease losses			1,815		(824)
	Loan and lease charge-offs			(1,837)		(1,176)
	Loan and lease recoveries			933		1,193
		Net (charge-offs) recoveries		(904)		17
Balance at period end			$	38,713	$	37,959

14

The following tables provide information on the activity in the allowance for loan and lease losses by the respective loan portfolio segment for the period indicated:

		For the Six Months Ended June 30, 2015
				Commercial Real Estate										Residential Real Estate
								Commercial
		Commercial		Commercial		Commercial		Owner						Residential		Residential
(Dollars in thousands)		Business		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Balance at beginning of year		$	5,852	$	4,267	$	9,784	$	7,143	$	9	$	3,592	$	6,232	$	923	$	37,802
Provision (credit)			13		(336)		947		584		-		234		318		55		1,815
Charge-offs			(181)		(739)		(90)		(212)		-		(537)		(78)		-		(1,837)
Recoveries			197		580		10		1		-		99		31		15		933
	Net charge-offs		16		(159)		(80)		(211)		-		(438)		(47)		15		(904)
Balance at end of period		$	5,881	$	3,772	$	10,651	$	7,516	$	9	$	3,388	$	6,503	$	993	$	38,713
Total loans and leases		$	409,795	$	223,103	$	694,179	$	643,973	$	21	$	436,465	$	744,195	$	137,134	$	3,288,865
Allowance for loans and leases to total loans and leases ratio			1.44%		1.69%		1.53%		1.17%		42.86%		0.78%		0.87%		0.72%		1.18%
Balance of loans specifically evaluated for impairment		$	4,181	$	194	$	12,126	$	8,423	$	na.	$	na.	$	3,770	$	na.	$	28,694
Allowance for loans specifically evaluated for impairment		$	1,047	$	58	$	715	$	1,066	$	na.	$	na.	$	-	$	na.	$	2,886
Specific allowance to specific loans ratio			25.04%		29.90%		5.90%		12.66%		na.		na.		na.		na.		10.06%
Balance of loans collectively evaluated		$	405,614	$	222,909	$	682,053	$	635,550	$	21	$	436,465	$	740,425	$	137,134	$	3,260,171
Allowance for loans collectively evaluated		$	4,834	$	3,714	$	9,936	$	6,450	$	9	$	3,388	$	6,503	$	993	$	35,827
Collective allowance to collective loans ratio			1.19%		1.67%		1.46%		1.01%		42.86%		0.78%		0.88%		0.72%		1.10%

		For the Year Ended December 31, 2014
				Commercial Real Estate										Residential Real Estate
								Commercial
		Commercial		Commercial		Commercial		Owner						Residential		Residential
(Dollars in thousands)		Business		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Balance at beginning of year		$	6,308	$	3,754	$	9,263	$	6,308	$	16	$	4,142	$	7,819	$	1,156	$	38,766
Provision (credit)			(1,204)		1,042		486		1,094		(7)		119		(1,385)		(308)		(163)
Charge-offs			(729)		(529)		(3)		(265)		-		(834)		(323)		(4)		(2,687)
Recoveries			1,477		-		38		6		-		165		121		79		1,886
	Net charge-offs		748		(529)		35		(259)		-		(669)		(202)		75		(801)
Balance at end of period		$	5,852	$	4,267	$	9,784	$	7,143	$	9	$	3,592	$	6,232	$	923	$	37,802
Total loans and leases		$	390,781	$	205,124	$	640,193	$	611,061	$	54	$	425,552	$	717,886	$	136,741	$	3,127,392
Allowance for loans and leases to total loans and leases ratio			1.50%		2.08%		1.53%		1.17%		16.80%		0.84%		0.87%		0.67%		1.21%
Balance of loans specifically evaluated for impairment		$	3,894	$	2,464	$	10,279	$	8,941	$	na.	$	na.	$	3,535	$	306	$	29,419
Allowance for loans specifically evaluated for impairment		$	788	$	741	$	541	$	824	$	na.	$	na.	$	-	$	-	$	2,894
Specific allowance to specific loans ratio			20.24%		30.07%		5.26%		9.22%		na.		na.		na.		na.		9.84%
Balance of loans collectively evaluated		$	386,887	$	202,660	$	629,914	$	602,120	$	54	$	425,552	$	714,351	$	136,435	$	3,097,973
Allowance for loans collectively evaluated		$	5,064	$	3,526	$	9,243	$	6,319	$	9	$	3,592	$	6,232	$	923	$	34,908
Collective allowance to collective loans ratio			1.31%		1.74%		1.47%		1.05%		16.80%		0.84%		0.87%		0.68%		1.13%

15

The following table provides summary information regarding impaired loans at the dates indicated and for the periods then ended:

(In thousands)		June 30, 2015		December 31, 2014
Impaired loans with a specific allowance		$	9,661	$	11,411
Impaired loans without a specific allowance			19,033		18,008
	Total impaired loans	$	28,694	$	29,419
Allowance for loan and lease losses related to impaired loans		$	2,886	$	2,894
Allowance for loan and lease losses related to loans collectively evaluated			35,827		34,908
	Total allowance for loan and lease losses	$	38,713	$	37,802
Average impaired loans for the period		$	28,769	$	34,331
Contractual interest income due on impaired loans during the period		$	1,326	$	2,339
Interest income on impaired loans recognized on a cash basis		$	324	$	773
Interest income on impaired loans recognized on an accrual basis		$	122	$	280

The following tables present the recorded investment with respect to impaired loans, the associated allowance by the applicable portfolio segment and the principal balance of the impaired loans prior to amounts charged-off at the dates indicated:

			June 30, 2015
					Commercial Real Estate								Total Recorded
									Commercial		All		Investment in
					Commercial		Commercial		Owner		Other		Impaired
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Impaired loans with a specific allowance
		Non-accruing	$	659	$	57	$	2,589	$	4,561	$	-	$	7,866
		Restructured accruing		881		-		-		-		-		881
		Restructured non-accruing		203		-		72		639		-		914
	Balance		$	1,743	$	57	$	2,661	$	5,200	$	-	$	9,661
	Allowance		$	1,047	$	58	$	715	$	1,066	$	-	$	2,886
Impaired loans without a specific allowance
		Non-accruing	$	1,013	$	-	$	7,362	$	1,785	$	-	$	10,160
		Restructured accruing		15		-		2,103		-		2,621		4,739
		Restructured non-accruing		1,410		137		-		1,438		1,149		4,134
	Balance		$	2,438	$	137	$	9,465	$	3,223	$	3,770	$	19,033
Total impaired loans
		Non-accruing	$	1,672	$	57	$	9,951	$	6,346	$	-	$	18,026
		Restructured accruing		896		-		2,103		-		2,621		5,620
		Restructured non-accruing		1,613		137		72		2,077		1,149		5,048
	Balance		$	4,181	$	194	$	12,126	$	8,423	$	3,770	$	28,694
Unpaid principal balance in total impaired loans			$	5,646	$	4,456	$	16,878	$	10,271	$	4,086	$	41,337

16

	June 30, 2015
			Commercial Real Estate								Total Recorded
							Commercial		All		Investment in
			Commercial		Commercial		Owner		Other		Impaired
(In thousands)	Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Average impaired loans for the period	$	4,013	$	1,340	$	10,829	$	8,779	$	3,808	$	28,769
Contractual interest income due on impaired loans during the period	$	207	$	188	$	469	$	366	$	96
Interest income on impaired loans recognized on a cash basis	$	93	$	11	$	15	$	185	$	20
Interest income on impaired loans recognized on an accrual basis	$	29	$	-	$	54	$	-	$	39

			December 31, 2014
					Commercial Real Estate								Total Recorded
									Commercial		All		Investment in
					Commercial		Commercial		Owner		Other		Impaired
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Impaired loans with a specific allowance
		Non-accruing	$	473	$	1,330	$	2,288	$	5,013	$	-	$	9,104
		Restructured accruing		687		-		-		-		-		687
		Restructured non-accruing		308		-		76		1,236		-		1,620
	Balance		$	1,468	$	1,330	$	2,364	$	6,249	$	-	$	11,411
	Allowance		$	788	$	741	$	541	$	824	$	-	$	2,894
Impaired loans without a specific allowance
		Non-accruing	$	1,115	$	-	$	5,792	$	1,769	$	-	$	8,676
		Restructured accruing		23		-		2,123		-		2,664		4,810
		Restructured non-accruing		1,288		1,134		-		923		1,177		4,522
	Balance		$	2,426	$	1,134	$	7,915	$	2,692	$	3,841	$	18,008
Total impaired loans
		Non-accruing	$	1,588	$	1,330	$	8,080	$	6,782	$	-	$	17,780
		Restructured accruing		710		-		2,123		-		2,664		5,497
		Restructured non-accruing		1,596		1,134		76		2,159		1,177		6,142
	Balance		$	3,894	$	2,464	$	10,279	$	8,941	$	3,841	$	29,419
Unpaid principal balance in total impaired loans			$	5,360	$	7,044	$	14,926	$	10,729	$	4,126	$	42,185

	December 31, 2014
			Commercial Real Estate								Total Recorded
							Commercial		All		Investment in
			Commercial		Commercial		Owner		Other		Impaired
(In thousands)	Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Average impaired loans for the period	$	5,308	$	3,651	$	9,327	$	8,963	$	7,082	$	34,331
Contractual interest income due on impaired loans during the period	$	311	$	352	$	730	$	859	$	87
Interest income on impaired loans recognized on a cash basis	$	252	$	39	$	78	$	344	$	60
Interest income on impaired loans recognized on an accrual basis	$	63	$	-	$	111	$	-	$	106

17

Credit Quality

The following tables provide information on the credit quality of the loan portfolio by segment at the dates indicated:

		June 30, 2015
				Commercial Real Estate										Residential Real Estate
								Commercial
				Commercial		Commercial		Owner						Residential		Residential
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Non-performing loans and assets:
	Non-accrual loans and leases	$	3,285	$	194	$	10,023	$	8,423	$	-	$	1,214	$	7,780	$	780	$	31,699
	Loans and leases 90 days past due		-		-		-		-		2		7		-		-		9
	Restructured loans and leases		896		-		2,103		-		-		-		2,621		-		5,620
Total non-performing loans and leases			4,181		194		12,126		8,423		2		1,221		10,401		780		37,328
	Other real estate owned		39		789		-		-		-		690		1,613		1,383		4,514
Total non-performing assets		$	4,220	$	983	$	12,126	$	8,423	$	2	$	1,911	$	12,014	$	2,163	$	41,842

		December 31, 2014
				Commercial Real Estate										Residential Real Estate
								Commercial
				Commercial		Commercial		Owner						Residential		Residential
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Non-performing loans and assets:
	Non-accrual loans and leases	$	3,184	$	2,464	$	8,156	$	8,941	$	-	$	1,668	$	3,012	$	1,105	$	28,530
	Loans and leases 90 days past due		-		-		-		-		-		-		-		-		-
	Restructured loans and leases		710		-		2,123		-		-		-		2,664		-		5,497
Total non-performing loans and leases			3,894		2,464		10,279		8,941		-		1,668		5,676		1,105		34,027
	Other real estate owned		39		365		-		-		-		-		1,408		1,383		3,195
Total non-performing assets		$	3,933	$	2,829	$	10,279	$	8,941	$	-	$	1,668	$	7,084	$	2,488	$	37,222

			June 30, 2015
					Commercial Real Estate										Residential Real Estate
									Commercial
					Commercial		Commercial		Owner						Residential		Residential
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Past due loans and leases
	31-60 days		$	61	$	-	$	85	$	609	$	-	$	1,307	$	3,772	$	-	$	5,834
	61-90 days			-		-		1,440		458		-		643		1,244		-		3,785
	> 90 days			-		-		-		-		2		7		-		-		9
		Total past due		61		-		1,525		1,067		2		1,957		5,016		-		9,628
	Non-accrual loans and leases			3,285		194		10,023		8,423		-		1,214		7,780		780		31,699
	Loans acquired with deteriorated credit quality			1,198		-		-		1,053		-		-		-		-		2,251
	Current loans			405,251		222,909		682,631		633,430		19		433,294		731,399		136,354		3,245,287
		Total loans and leases	$	409,795	$	223,103	$	694,179	$	643,973	$	21	$	436,465	$	744,195	$	137,134	$	3,288,865

18

			December 31, 2014
					Commercial Real Estate										Residential Real Estate
									Commercial
					Commercial		Commercial		Owner						Residential		Residential
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Past due loans and leases
	31-60 days		$	759	$	-	$	2,374	$	2,658	$	11	$	797	$	3,064	$	-	$	9,663
	61-90 days			995		320		1,493		156		-		179		836		-		3,979
	> 90 days			-		-		-		-		-		-		-		-		-
		Total past due		1,754		320		3,867		2,814		11		976		3,900		-		13,642
	Non-accrual loans and leases			3,184		2,464		8,156		8,941		-		1,668		3,012		1,105		28,530
	Loans acquired with deteriorated credit quality			1,238		-		-		1,773		-		-		-		-		3,011
	Current loans			384,605		202,340		628,170		597,533		43		422,908		710,974		135,636		3,082,209
		Total loans and leases	$	390,781	$	205,124	$	640,193	$	611,061	$	54	$	425,552	$	717,886	$	136,741	$	3,127,392

The following tables provide information by credit risk rating indicators for each segment of the commercial loan portfolio at the dates indicated:

		June 30, 2015
				Commercial Real Estate
								Commercial
				Commercial		Commercial		Owner
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Total
	Pass	$	384,562	$	220,747	$	679,253	$	616,435	$	1,900,997
	Special Mention		8,212		698		1,857		6,431		17,198
	Substandard		17,021		1,658		13,069		21,107		52,855
	Doubtful		-		-		-		-		-
Total		$	409,795	$	223,103	$	694,179	$	643,973	$	1,971,050

		Decemeber 31, 2014
				Commercial Real Estate
								Commercial
				Commercial		Commercial		Owner
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Total
	Pass	$	366,367	$	201,642	$	621,511	$	581,575	$	1,771,095
	Special Mention		8,835		698		3,931		7,669		21,133
	Substandard		15,579		2,784		14,751		21,817		54,931
	Doubtful		-		-		-		-		-
Total		$	390,781	$	205,124	$	640,193	$	611,061	$	1,847,159

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Homogeneous loan pools do not have individual loans subjected to internal risk ratings therefore, the credit indicator applied to these pools is based on their delinquency status. The following tables provide information by credit risk rating indicators for those remaining segments of the loan portfolio at the dates indicated:

			June 30, 2015
							Residential Real Estate
							Residential		Residential
(In thousands)			Leasing		Consumer		Mortgage		Construction		Total
	Performing		$	19	$	435,244	$	733,794	$	136,354	$	1,305,411
	Non-performing:
		90 days past due		2		7		-		-		9
		Non-accruing		-		1,214		7,780		780		9,774
		Restructured loans and leases		-		-		2,621		-		2,621
Total			$	21	$	436,465	$	744,195	$	137,134	$	1,317,815

			December 31, 2014
							Residential Real Estate
							Residential		Residential
(In thousands)			Leasing		Consumer		Mortgage		Construction		Total
	Performing		$	54	$	423,884	$	712,210	$	135,636	$	1,271,784
	Non-performing:
		90 days past due		-		-		-		-		-
		Non-accruing		-		1,668		3,012		1,105		5,785
		Restructured loans and leases		-		-		2,664		-		2,664
Total			$	54	$	425,552	$	717,886	$	136,741	$	1,280,233

During the six months ended June 30, 2015, the Company restructured $0.9 million in loans.  No modifications resulted in the reduction of the principal in the associated loan balances.  Restructured loans are subject to periodic credit reviews to determine the necessity and adequacy of a specific loan loss allowance based on the collectability of the recorded investment in the restructured loan.  Loans restructured during 2015 have specific reserves of $0.4 million at June 30, 2015.  For the year ended December 31, 2014, the Company restructured $1.6 million in loans.  Modifications consisted principally of interest rate concessions and no modifications resulted in the reduction of the recorded investment in the associated loan balances.  Loans restructured during 2014 had specific reserves of $0.1 million at December 31, 2014.  Commitments to lend additional funds on loans that have been restructured at June 30, 2015 and December 31, 2014 amounted to $0.3 million and $0.1 million, respectively.

The following table provides the amounts of the restructured loans at the date of restructuring for specific segments of the loan portfolio during the period indicated:

		For the Six Months Ended June 30, 2015
				Commercial Real Estate
								Commercial		All
				Commercial		Commercial		Owner		Other
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Total
Troubled debt restructurings
	Restructured accruing	$	275	$	-	$	-	$	-	$	-	$	275
	Restructured non-accruing		-		-		-		639		-		639
Balance		$	275	$	-	$	-	$	639	$	-	$	914
Specific allowance		$	275	$	-	$	-	$	149	$	-	$	424
Restructured and subsequently defaulted		$	-	$	-	$	-	$	-	$	-	$	-

20

		For the Year Ended December 31, 2014
				Commercial Real Estate
								Commercial		All
				Commercial		Commercial		Owner		Other
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Total
Troubled debt restructurings
	Restructured accruing	$	75	$	-	$	1,284	$	-	$	-	$	1,359
	Restructured non-accruing		92		192		-		-		-		284
Balance		$	167	$	192	$	1,284	$	-	$	-	$	1,643
Specific allowance		$	99	$	-	$	-	$	-	$	-	$	99
Restructured and subsequently defaulted		$	-	$	-	$	-	$	-	$	-	$	-

Other Real Estate Owned

Other real estate owned totaled $4.5 million and $3.2 million at June 30, 2015 and December 31, 2014, respectively.

Note 5 – Goodwill and Other Intangible Assets

The gross carrying amounts and accumulated amortization of intangible assets and goodwill are presented at the dates indicated in the following table:

		June 30, 2015						Weighted		December 31, 2014						Weighted
		Gross				Net		Average		Gross				Net		Average
		Carrying		Accumulated		Carrying		Remaining		Carrying		Accumulated		Carrying		Remaining
(Dollars in thousands)		Amount		Amortization		Amount		Life		Amount		Amortization		Amount		Life
Amortizing intangible assets:
Other identifiable intangibles		$	8,623	$	(8,327)	$	296		1.6 years	$	8,623	$	(8,113)	$	510		1.7 years
	Total amortizing intangible assets	$	8,623	$	(8,327)	$	296			$	8,623	$	(8,113)	$	510
Goodwill		$	84,171			$	84,171			$	84,171			$	84,171

The following table presents the estimated future amortization expense for amortizing intangible assets within the years ending December 31:

(In thousands)		Amount
2015		$	158
2016			94
2017			16
2018			16
Thereafter			12
	Total amortizing intangible assets	$	296

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Note 6 – Deposits

The following table presents the composition of deposits at the dates indicated:

(In thousands)				June 30, 2015		December 31, 2014
Noninterest-bearing deposits				$	1,092,413	$	993,737
Interest-bearing deposits:
	Demand				525,584		534,605
	Money market savings				860,315		828,494
	Regular savings				280,143		264,751
	Time deposits of less than $100,000				245,347		239,857
	Time deposits of $100,000 or more				243,544		205,065
		Total interest-bearing deposits			2,154,933		2,072,772
			Total deposits	$	3,247,346	$	3,066,509

Note 7 – Stockholders’ Equity

The Company re-approved a stock repurchase program in August 2013 that permits the repurchase of up to 5% of the Company’s outstanding shares of common stock at the date the plan was approved or approximately 1.3 million shares.  Repurchases, which will be conducted through open market purchases or privately negotiated transactions, will be made depending on market conditions and other factors.  During the first six months of 2015, the Company repurchased 575,472 shares at an average cost of $25.92 per share or a total of $14.9 million. 

Note 8 – Share Based Compensation

At June 30, 2015, the Company had two share based compensation plans in existence, the 2005 Omnibus Stock Plan (“Omnibus Stock Plan”) and the 2015 Omnibus Incentive Plan (“Omnibus Incentive Plan”).  The Omnibus Stock Plan expired during the second quarter of 2015 but has outstanding options that may still be exercised.  The Omnibus Incentive Plan is described in the following paragraph. 

The Company’s Omnibus Incentive Plan was approved on May 6, 2015 and provides for the granting of non-qualifying stock options to the Company’s directors, and incentive and non-qualifying stock options, stock appreciation rights, restricted stock grants, RSU’s and performance awards to selected key employees on a periodic basis at the discretion of the board.  The Omnibus Incentive Plan authorizes the issuance of up to 1,500,000 shares of common stock, all of which are available for issuance at June 30, 2015, has a term of ten years, and is administered by a committee of at least three directors appointed by the board of directors.  Options granted under the plan have an exercise price which may not be less than 100% of the fair market value of the common stock on the date of the grant and must be exercised within ten years from the date of grant.  The exercise price of stock options must be paid for in full in cash or shares of common stock, or a combination of both.  The board committee has the discretion when making a grant of stock options to impose restrictions on the shares to be purchased upon the exercise of such options.  The Company generally issues authorized but previously unissued shares to satisfy option exercises.  At June 30, 2015, no stock options or awards had been granted from this plan.

The fair values of all of the options granted for the periods indicated have been estimated using a binomial option-pricing model with the weighted-average assumptions for the periods shown are presented in the following table:

	Six Months Ended June 30,
	2015		2014
Dividend yield	3.40	%	3.04	%
Weighted average expected volatility	42.98	%	46.78	%
Weighted average risk-free interest rate	1.42	%	1.56	%
Weighted average expected lives (in years)	5.42		5.08
Weighted average grant-date fair value	$7.63		$8.05

The dividend yield is based on estimated future dividend yields.  The risk-free rate for periods within the contractual term of the share option is based on the U.S. Treasury yield curve in effect at the time of the grant.  Expected volatilities are generally based on historical volatilities.  The expected term of share options granted is generally derived from historical experience.

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Compensation expense is recognized on a straight-line basis over the vesting period of the respective stock option or restricted stock grant. The Company recognized compensation expense of $0.4 million and $0.4 million for the three months ended June 30, 2015 and 2014, respectively, related to the awards of stock options and restricted stock grants.  Compensation expense of $0.9 million and $0.8 million was recognized for the six months ended June 30, 2015 and 2014, respectively.  The intrinsic value of stock options exercised in the six months ended June 30, 2015 and 2014 was $0.3 million and $0.1 million, respectively.  The total of unrecognized compensation cost related to stock options was approximately $0.3 million as of June 30, 2015.  That cost is expected to be recognized over a weighted average period of approximately 2.2 years.  The total of unrecognized compensation cost related to restricted stock was approximately $4.8 million as of June 30, 2015.  That cost is expected to be recognized over a weighted average period of approximately 3.5 years.  The fair value of the options vested during the six months ended June 30, 2015 and 2014, was $0.2 million and $0.2 million, respectively.

In the first quarter of 2015, 21,245 stock options were granted, subject to a three year vesting schedule with one third of the options vesting on April 1^st of each year.  Additionally, 79,860 shares of restricted stock were granted, subject to a five year vesting schedule with one fifth of the shares vesting on April 1^st of each year.

A summary of share option activity for the period indicated is reflected in the following table:

		Number	Weighted		Average	Aggregate
		of	Average		Contractual	Intrinsic
		Common	Exercise		Remaining	Value
		Shares	Share Price		Life(Years)	(in thousands)
Balance at January 1, 2015		224,381	$	20.88		$	1,300
Granted		21,245	$	26.20
Exercised		(26,695)	$	14.68		$	308
Forfeited or expired		(71,708)	$	27.96
Balance at June 30, 2015		147,223	$	19.37	3.7	$	1,268
Exercisable at June 30, 2015		105,984	$	17.26	2.7	$	1,137
Weighted average fair value of options
	granted during the year		$	7.63

A summary of the activity for the Company’s restricted stock for the period indicated is presented in the following table:

	Number	Weighted
	of	Average
	Common	Grant-Date
(In dollars, except share data):	Shares	Fair Value
Restricted stock  at January 1, 2015	226,871	$	21.07
Granted	79,860	$	26.20
Vested	(78,565)	$	19.79
Forfeited	(3,317)	$	22.80
Restricted stock at June 30, 2015	224,849	$	23.31

Note 9 – Pension, Profit Sharing, and Other Employee Benefit Plans

Defined Benefit Pension Plan

The Company has a qualified, noncontributory, defined benefit pension plan (the “Plan”) covering substantially all employees. Benefits after January 1, 2005, are based on the benefit earned as of December 31, 2004, plus benefits earned in future years of service based on the employee’s compensation during each such year. All benefit accruals for employees were frozen as of December 31, 2007 based on past service and thus salary increases and additional years of service after such date  no longer affect the defined benefit provided by the plan although additional vesting may continue to occur.

23

The Company's funding policy is to contribute amounts to the plan sufficient to meet the minimum funding requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended. In addition, the Company contributes additional amounts as it deems appropriate based on benefits attributed to service prior to the date of the plan freeze. The Plan invests primarily in a diversified portfolio of managed fixed income and equity funds.

The components of net periodic benefit cost for the periods indicated are presented in the following table:

		Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)		2015		2014		2015		2014
Interest cost on projected benefit obligation		$	407	$	403	$	817	$	794
Expected return on plan assets			(406)		(493)		(812)		(987)
Recognized net actuarial loss			259		68		551		116
	Net periodic benefit cost	$	260	$	(22)	$	556	$	(77)

Contributions

The decision as to whether or not to make a plan contribution and the amount of any such contribution is dependent on a number of factors. Such factors include the investment performance of the plan assets in the current economy and, since the plan is currently frozen, the remaining investment horizon of the plan.  Given these uncertainties, management continues to monitor the funding level of the pension plan and may make contributions as necessary during 2015.

Note 10 – Net Income per Common Share

The calculation of net income per common share for the periods indicated is presented in the following table:

			Three Months Ended June 30,				Six Months Ended June 30,
(Dollars and amounts in thousands, except per share data)			2015		2014		2015		2014
Net income			$	10,333	$	6,982	$	21,558	$	17,910
Basic:
Basic weighted average EPS shares				24,626		25,062		24,776		25,031
		Basic net income per share	$	0.42	$	0.28	$	0.87	$	0.72
Diluted:
Basic weighted average EPS shares				24,626		25,062		24,776		25,031
Dilutive common stock equivalents				64		65		92		95
	Dilutive EPS shares			24,690		25,127		24,868		25,126
		Diluted net income per share	$	0.42	$	0.28	$	0.87	$	0.71
Anti-dilutive shares				8		65		8		56

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NOTE 11 – OTHER COMPREHENSIVE INCOME

Comprehensive income is defined as net income plus transactions and other occurrences that are the result of non-owner changes in equity.  For condensed financial statements presented for the Company, non-owner changes are comprised of unrealized gains or losses on available-for-sale debt securities and any minimum pension liability adjustments.  These do not have an impact on the Company’s net income.  The following table presents the activity in net accumulated other comprehensive income (loss) and the components of the activity for the periods indicated:

		Unrealized Gains
		(Losses) on
		Investments		Defined Benefit
(In thousands)		Available-for-Sale		Pension Plan		Total
Balance at January 1, 2015		$	8,078	$	(8,901)	$	(823)
	Other comprehensive income before reclassification, net of tax		(100)		-		(100)
	Reclassifications from accumulated other comprehensive income, net of tax		-		331		331
Current period change in other comprehensive income, net of tax			(100)		331		231
Balance at June 30, 2015		$	7,978	$	(8,570)	$	(592)

		Unrealized Gains
		(Losses) on
		Investments		Defined Benefit
(In thousands)		Available-for-Sale		Pension Plan		Total
Balance at January 1, 2014		$	358	$	(3,328)	$	(2,970)
	Other comprehensive income before reclassification, net of tax		8,148		-		8,148
	Reclassifications from accumulated other comprehensive income, net of tax		-		55		55
Current period change in other comprehensive income, net of tax			8,148		55		8,203
Balance at June 30, 2014		$	8,506	$	(3,273)	$	5,233

The following table provides the information on the reclassification adjustments out of accumulated other comprehensive income for the periods indicated:

				For the Six Months Ended June 30,
(In thousands)				2015		2014
Unrealized gains/(losses) on investments available-for-sale
	Affected line item in the Statements of Income:
	Investment securities gains			$	19		$	-
	Income before taxes				19			-
	Tax expense				8			-
	Net income			$	11		$	-
Amortization of defined benefit pension plan items
	Affected line item in the Statements of Income:
		Recognized actuarial loss (1)		$	551		$	116
			Income before taxes		551			116
			Tax expense		220			61
			Net income	$	331		$	55
(1)  This amount is included in the computation of net periodic benefit cost, see Note 9

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Note 12 – Financial Instruments with Off-balance Sheet Risk and Derivatives

The Company has entered into interest rate swaps (“swaps”) to facilitate customer transactions and meet their financing needs. These swaps qualify as derivatives, but are not designated as hedging instruments. Interest rate swap contracts involve the risk of dealing with counterparties and their ability to meet contractual terms. When the fair value of a derivative instrument contract is positive, this generally indicates that the counterparty or customer owes the Company, and results in credit risk to the Company. When the fair value of a derivative instrument contract is negative, the Company owes the customer or counterparty and therefore, has no credit risk.  The notional value of commercial loan swaps outstanding was $20.4 million with a fair value of $1.4 million as of June 30, 2015 compared to $20.9 million with a fair value of $1.5 million as of December 31, 2014.  The offsetting nature of the swaps results in a neutral effect on the Company’s operations.Fair values of the swaps are carried as both gross assets and gross liabilities in the condensed consolidated statements of condition.  The associated net gains and losses on the swaps are recorded in other non-interest income.

Note 13 – Litigation

The Company and its subsidiaries are subject in the ordinary course of business to various pending or threatened legal proceedings in which claims for monetary damages are asserted.  During 2014, the Company accrued $6.5 million for litigation expenses as a result of an adverse jury verdict rendered in the second quarter of 2014 associated with the actions of a former employee of CommerceFirst Bank, which was acquired in 2012.  The Company is currently in the process of appealing the decision.  As a result of the appeal process, an additional $0.4 million in legal expenses have been accrued in the first six months of 2015.

After consultation with legal counsel, management does not anticipate that the ultimate liability, if any, arising out of  any other legal matters will have a material adverse effect on the Company's financial condition, operating results or liquidity.

Note 14 – Fair Value

Generally accepted accounting principles provide entities the option to measure eligible financial assets, financial liabilities and commitments at fair value (i.e. the fair value option), on an instrument-by-instrument basis, that are otherwise not permitted to be accounted for at fair value under other accounting standards.  The election to use the fair value option is available when an entity first recognizes a financial asset or financial liability or upon entering into a commitment.  Subsequent changes in fair value must be recorded in earnings.  The Company applies the fair value option on residential mortgage loans held for sale.  The fair value option on residential mortgage loans allows the recognition of gains on sale of mortgage loans to more accurately reflect the timing and economics of the transaction.

The standard for fair value measurement establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value.  The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).  The three levels of the fair value hierarchy are described below.

Basis of Fair Value Measurement:

Level 1- Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2- Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3- Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e. supported by little or no market activity).  Changes to interest rates may result in changes in the cash flows due to prepayments or extinguishments.  Accordingly, this could result in higher or lower measurements of the fair values.

A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. 

Assets and Liabilities

Mortgage loans held for sale

Mortgage loans held for sale are valued based on quotations from the secondary market for similar instruments and are classified as Level 2 of the fair value hierarchy. 

26

Investments available-for-sale

U.S. government agencies, mortgage-backed securities and corporate debt

Valuations are based on active market data and use of evaluated broker pricing models that vary based by asset class and includes available trade, bid, and other market information.  Generally, the methodology includes broker quotes, proprietary models, descriptive terms and conditions databases coupled with extensive quality control programs.  Multiple quality control evaluation processes review available market, credit and deal level information to support the evaluation of the security.  If there is a lack of objectively verifiable information available to support the valuation, the evaluation of the security is discontinued.  Additionally, proprietary models and pricing systems, mathematical tools, actual transacted prices, integration of market developments and experienced evaluators are used to determine the value of a security based on a hierarchy of market information regarding a security or securities with similar characteristics.  The Company does not adjust the quoted price for such securities.  Such instruments are generally classified within Level 2 of the fair value hierarchy.

State and municipal securities

Proprietary valuation matrices are used for valuing all tax-exempt municipals that can incorporate changes in the municipal market as they occur.  Market evaluation models include the ability to value bank qualified municipals and general market municipals that can be broken down further according to insurer, credit support, state of issuance and rating to incorporate additional spreads and municipal curves.  Taxable municipals are valued using a third party model that incorporates a methodology that captures the trading nuances associated with these bonds.  Such instruments are generally classified within Level 2 of the fair value hierarchy.

Trust preferred securities

In active markets, these types of instruments are valued based on quoted market prices that are readily accessible at the measurement date and are classified within Level 1 of the fair value hierarchy. Positions that are not traded in active markets or are subject to transfer restrictions are valued or adjusted to reflect illiquidity and/or non-transferability, and such adjustments are generally based on available market evidence.  In the absence of such evidence, management uses a process that employs certain assumptions to determine the present value. For further information, refer to Note 2 – Investments. Positions that are not traded in active markets or are subject to transfer restrictions are classified within Level 3 of the fair value hierarchy. 

Interest rate swap agreements

Interest rate swap agreements are measured by alternative pricing sources with reasonable levels of price transparency in markets that are not active.  Based on the complex nature of interest rate swap agreements, the markets these instruments trade in are not as efficient and are less liquid than that of the more mature Level 1 markets.  These markets do however have comparable, observable inputs in which an alternative pricing source values these assets in order to arrive at a fair market value.  These characteristics classify interest rate swap agreements as Level 2.

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Assets Measured at Fair Value on a Recurring Basis

The following tables set forth the Company’s financial assets and liabilities at the dates indicated that were accounted for or disclosed at fair value.  Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

			June 30, 2015
			Quoted Prices in				Significant
			Active Markets for		Significant Other		Unobservable
			Identical Assets		Observable Inputs		Inputs
(In thousands)			(Level 1)		(Level 2)		(Level 3)		Total
Assets
	Residential mortgage loans held for sale		$	-	$	19,445	$	-	$	19,445
	Investments available-for-sale:
		U.S. government agencies		-		137,980		-		137,980
		State and municipal		-		161,953		-		161,953
		Mortgage-backed		-		324,145		-		324,145
		Trust preferred		-		-		1,018		1,018
		Marketable equity securities		-		723		-		723
	Interest rate swap agreements			-		1,390		-		1,390
Liabilities
	Interest rate swap agreements		$	-	$	(1,390)	$	-	$	(1,390)

			December 31, 2014
			Quoted Prices in				Significant
			Active Markets for		Significant Other		Unobservable
			Identical Assets		Observable Inputs		Inputs
(In thousands)			(Level 1)		(Level 2)		(Level 3)		Total
Assets
	Residential mortgage loans held for sale		$	-	$	10,512	$	-	$	10,512
	Investments available-for-sale:
		U.S. government agencies		-		141,679		-		141,679
		State and municipal		-		167,052		-		167,052
		Mortgage-backed		-		361,519		-		361,519
		Trust preferred		-		-		1,236		1,236
		Marketable equity securities		-		723		-		723
	Interest rate swap agreements			-		1,501		-		1,501
Liabilities
	Interest rate swap agreements		$	-	$	(1,501)	$	-	$	(1,501)

28

The following table provides unrealized losses included in assets measured in the Condensed Consolidated Statements of Condition at fair value on a recurring basis for the period indicated:

			Significant
			Unobservable
			Inputs
(In thousands)			(Level 3)
Investments available-for-sale:
	Balance at January 1, 2015		$	1,236
		Principal redemption		(218)
	Balance at June 30, 2015		$	1,018

Assets Measured at Fair Value on a Nonrecurring Basis

The following table sets forth the Company’s financial assets subject to fair value adjustments (impairment) on a nonrecurring basis at the date indicated that are valued at the lower of cost or market.  Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

		June 30, 2015
		Quoted Prices in		Significant
		Active Markets		Other		Significant
		for Identical		Observable		Unobservable
(In thousands)		Assets  (Level 1)		Inputs (Level 2)		Inputs (Level 3)		Total		Total Losses
Impaired loans		$	-	$	-	$	6,913	$	6,913	$	10,304
Other real estate owned			-		-		4,514		4,514		(268)
	Total	$	-	$	-	$	11,427	$	11,427	$	10,036

		December 31, 2014
		Quoted Prices in		Significant
		Active Markets		Other		Significant
		for Identical		Observable		Unobservable
(In thousands)		Assets  (Level 1)		Inputs (Level 2)		Inputs (Level 3)		Total		Total Losses
Impaired loans		$	-	$	-	$	7,819	$	7,819	$	13,893
Other real estate owned			-		-		3,195		3,195		(247)
	Total	$	-	$	-	$	11,014	$	11,014	$	13,646

At June 30, 2015, impaired loans totaling $28.7 million were written down to fair value of $25.8 million as a result of specific loan loss allowances of $2.9 million associated with the impaired loans which was included in the allowance for loan losses.  Impaired loans totaling $29.4 million were written down to fair value of $26.5 million at December 31, 2014 as a result of specific loan loss allowances of $2.9 million associated with the impaired loans.

Loan impairment is measured using the present value of expected cash flows, the loan’s observable market price or the fair value of the collateral (less selling costs) if the loans are collateral dependent.  Collateral may be real estate and/or business assets including equipment, inventory and/or accounts receivable.  The value of business equipment, inventory and accounts receivable collateral is based on net book value on the business’ financial statements and, if necessary, discounted based on management’s review and analysis. Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and client’s business.  Impaired loans are reviewed and evaluated on at least a quarterly basis for additional impairment and adjusted accordingly, based on the factors identified above. Valuation techniques are consistent with those techniques applied in prior periods.

29

Other real estate owned (“OREO”) is adjusted to fair value upon transfer of the loans to OREO.  Subsequently, OREO is carried at the lower of carrying value or fair value.  The estimated fair value for other real estate owned included in Level 3 is determined by independent market based appraisals and other available market information, less cost to sell, that may be reduced further based on market expectations or an executed sales agreement.  If the fair value of the collateral deteriorates subsequent to initial recognition, the Company records the OREO as a non-recurring Level 3 adjustment.  Valuation techniques are consistent with those techniques applied in prior periods.

Fair Value of Financial Instruments

The Company discloses fair value information about financial instruments for which it is practicable to estimate the value, whether or not such financial instruments are recognized on the balance sheet.  Fair value is the amount at which a financial instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation, and is best evidenced by a quoted market price, if one exists.

Quoted market prices, where available, are shown as estimates of fair market values. Because no quoted market prices are available for a significant portion of the Company's financial instruments, the fair value of such instruments has been derived based on the amount and timing of future cash flows and estimated discount rates.

Present value techniques used in estimating the fair value of many of the Company's financial instruments are significantly affected by the assumptions used. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate cash settlement of the instrument. Additionally, the accompanying estimates of fair values are only representative of the fair values of the individual financial assets and liabilities, and should not be considered an indication of the fair value of the Company.

30

The carrying amounts and fair values of the Company’s financial instruments at the dates indicated are presented in the following table:

					Fair Value Measurements
	June 30, 2015				Quoted Prices in
			Estimated		Active Markets for		Significant Other		Significant
	Carrying		Fair		Identical Assets		Observable Inputs		Unobservable Inputs
(In thousands)	Amount		Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets
Investments held-to-maturity and other equity securities	$	252,465	$	253,479	$	-	$	253,479	$	-
Loans, net of allowance		3,250,152		3,279,656		-		-		3,279,656
Other assets		89,617		89,617		-		89,617		-
Financial Liabilities
Time Deposits	$	488,891	$	489,419	$	-	$	489,419	$	-
Securities sold under retail repurchase agreements and
federal funds purchased		111,817		111,817		-		111,817		-
Advances from FHLB		550,000		572,615		-		572,615		-
Subordinated debentures		35,000		13,108		-		-		13,108

					Fair Value Measurements
	December 31, 2014				Quoted Prices in
			Estimated		Active Markets for		Significant Other		Significant
	Carrying		Fair		Identical Assets		Observable Inputs		Unobservable Inputs
(In thousands)	Amount		Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets
Investments held-to-maturity and other equity securities	$	261,410	$	263,697	$	-	$	263,697	$	-
Loans, net of allowance		3,089,590		3,118,635		-		-		3,118,635
Other assets		88,657		88,657		-		88,657		-
Financial Liabilities
Time Deposits	$	444,921	$	444,729	$	-	$	444,729	$	-
Securities sold under retail repurchase agreements and
federal funds purchased		74,432		74,432		-		74,432		-
Advances from FHLB		655,000		679,163		-		679,163		-
Subordinated debentures		35,000		13,276		-		-		13,276

The following methods and assumptions were used to estimate the fair value of each category of financial instruments for which it is practicable to estimate that value:

Cash and Temporary Investments:  The carrying amounts of cash and cash equivalents approximate their fair value and have been excluded from the table above.

Investments:The fair value of marketable securities is based on quoted market prices, prices quoted for similar instruments, and prices obtained from independent pricing services.

Loans:For certain categories of loans, such as mortgage, installment and commercial loans, the fair value is estimated by discounting the expected future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and similar remaining maturities.  Expected cash flows were projected based on contractual cash flows, adjusted for estimated prepayments.

Accrued interest receivable:  The carrying value of accrued interest receivable approximates fair value due to the short-term duration and has been excluded from the table above.

Other assets:The investment in bank-owned life insurance represents the cash surrender value of the policies at June 30, 2015 and December 31, 2014 as determined by the each insurance carrier.  The carrying value of accrued interest receivable approximates fair values due to the short-term duration.

31

Deposits:  The fair value of demand, money market savings and regular savings deposits, which have no stated maturity, were considered equal to their carrying amount, representing the amount payable on demand. While management believes that the Bank’s core deposit relationships provide a relatively stable, low-cost funding source that has a substantial intangible value separate from the value of the deposit balances, these estimated fair values do not include the intangible value of core deposit relationships, which comprise a significant portion of the Bank’s deposit base.

Short-term borrowings:The carrying values of short-term borrowings, including overnight, securities sold under agreements to repurchase and federal funds purchased approximates the fair values due to the short maturities of those instruments.

Long-term borrowings: The fair value of the Federal Home Loan Bank of Atlanta (“FHLB”) advances and subordinated debentures was estimated by computing the discounted value of contractual cash flows payable at current interest rates for obligations with similar remaining terms.  The Company's credit risk is not material to calculation of fair value because the FHLB borrowings are collateralized. The Company classifies advances from the Federal Home Loan Bank of Atlanta within Level 2 of the fair value hierarchy since the fair value of such borrowings is based on rates currently available for borrowings with similar terms and remaining maturities. Subordinated debentures are classified as Level 3 in the fair value hierarchy due to the lack of market activity of such instruments.

Accrued interest payable: The carrying value of accrued interest payable approximates fair value due to the short-term duration and has been excluded from the previous table.

Note 15 - Segment Reporting

Currently, the Company conducts business in three operating segments—Community Banking, Insurance and Investment Management.  Each of the operating segments is a strategic business unit that offers different products and services.  The Insurance and Investment Management segments were businesses that were acquired in separate transactions where management of acquisition was retained.  The accounting policies of the segments are the same as those of the Company.  However, the segment data reflect inter-segment transactions and balances.

The Community Banking segment is conducted through Sandy Spring Bank and involves delivering a broad range of financial products and services, including various loan and deposit products to both individuals and businesses.  Parent company income is included in the Community Banking segment, as the majority of effort of these functions is related to this segment.  Major revenue sources include net interest income, gains on sales of mortgage loans, trust income, fees on sales of investment products and service charges on deposit accounts.  Expenses include personnel, occupancy, marketing, equipment and other expenses.  Non-cash charges associated with amortization of intangibles related to the acquired entities was not significant for the three and six ended June 30, 2015 and 2014, respectively. 

The Insurance segment is conducted through Sandy Spring Insurance Corporation, a subsidiary of the Bank, and offers annuities as an alternative to traditional deposit accounts.  Sandy Spring Insurance Corporation operates Sandy Spring Insurance, a general insurance agency located in Annapolis, Maryland, and Neff and Associates, located in Ocean City, Maryland.  Major sources of revenue are insurance commissions from commercial lines, personal lines, and medical liability lines.  Expenses include personnel and support charges.  Non-cash charges associated with amortization of intangibles related to the acquired entities was not significant for the three and six ended June 30, 2015 and 2014, respectively. 

The Investment Management segment is conducted through West Financial Services, Inc., a subsidiary of the Bank.  This asset management and financial planning firm, located in McLean, Virginia, provides comprehensive investment management and financial planning to individuals, families, small businesses and associations including cash flow analysis, investment review, tax planning, retirement planning, insurance analysis and estate planning.  West Financial currently has approximately $1.1 billion in assets under management.  Major revenue sources include non-interest income earned on the above services.  Expenses include personnel and support charges.  Non-cash charges associated with amortization of intangibles related to the acquired entities was not significant for the three and six ended June 30, 2015 and 2014, respectively.

32

Information for the operating segments and reconciliation of the information to the condensed consolidated financial statements for the periods indicated is presented in the following tables:

	Three Months Ended June 30, 2015
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	38,849	$	-	$	2	$	(2)	$	38,849
Interest expense		4,918		-		-		(2)		4,916
Provision for loan and lease losses		1,218		-		-		-		1,218
Noninterest income		24,945		984		1,754		(15,574)		12,109
Noninterest expenses		42,958		1,169		924		(15,574)		29,477
Income before income taxes		14,700		(185)		832		-		15,347
Income tax expense		4,763		(74)		325		-		5,014
Net income	$	9,937	$	(111)	$	507	$	-	$	10,333
Assets	$	4,508,858	$	5,647	$	10,672	$	(17,810)	$	4,507,367

	Three Months Ended June 30, 2014
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	36,991	$	3	$	5	$	(8)	$	36,991
Interest expense		4,690		-		-		(8)		4,682
Provision for loan and lease losses		158		-		-		-		158
Non-interest income		12,108		1,045		1,717		(3,176)		11,694
Non-interest expenses		35,305		1,125		887		(3,176)		34,141
Income before income taxes		8,946		(77)		835		-		9,704
Income tax expense		2,427		(30)		325		-		2,722
Net income	$	6,519	$	(47)	$	510	$	-	$	6,982
Assets	$	4,257,129	$	6,025	$	10,927	$	(39,739)	$	4,234,342

	Six Months Ended June 30, 2015
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	76,920	$	1	$	3	$	(3)	$	76,921
Interest expense		9,618		-		-		(3)		9,615
Provision for loan and lease losses		1,815		-		-		-		1,815
Noninterest income		34,781		2,678		3,564		(15,755)		25,268
Noninterest expenses		69,975		2,552		1,949		(15,755)		58,721
Income before income taxes		30,293		127		1,618		-		32,038
Income tax expense		9,797		52		631		-		10,480
Net income	$	20,496	$	75	$	987	$	-	$	21,558
Assets	$	4,508,858	$	5,647	$	10,672	$	(17,810)	$	4,507,367

33

	Six Months Ended June 30, 2014
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	73,241	$	5	$	9	$	(14)	$	73,241
Interest expense		9,354		-		-		(14)		9,340
Provision (credit) for loan and lease losses		(824)		-		-		-		(824)
Non-interest income		20,123		2,776		3,395		(3,351)		22,943
Non-interest expenses		60,917		2,317		1,807		(3,351)		61,690
Income before income taxes		23,917		464		1,597		-		25,978
Income tax expense		7,258		188		622		-		8,068
Net income	$	16,659	$	276	$	975	$	-	$	17,910
Assets	$	4,257,129	$	6,025	$	10,927	$	(39,739)	$	4,234,342

34

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

The Company

Sandy Spring Bancorp, Inc. (the “Company") is the bank holding company for Sandy Spring Bank (the "Bank"). The Company is registered as a bank holding company pursuant to the Bank Holding Company Act of 1956, as amended (the "Holding Company Act"). As such, the Company is subject to supervision and regulation by the Board of Governors of the Federal Reserve System (the "Federal Reserve"). The Company began operating in 1988. The Bank traces its origin to 1868, making it among the oldest institutions in the region. The Bank is independent, community oriented, and conducts a full-service commercial banking business through 44 community offices located in Central Maryland and Northern Virginia. The Bank is a state chartered bank subject to supervision and regulation by the Federal Reserve and the State of Maryland. The Bank's deposit accounts are insured by the Deposit Insurance Fund administered by the Federal Deposit Insurance Corporation (the "FDIC") to the maximum permitted by law. The Bank is a member of the Federal Reserve System and is an Equal Housing Lender. The Company, the Bank, and its other subsidiaries are Affirmative Action/Equal Opportunity Employers.

With $4.5 billion in assets, the Company is a community banking organization that focuses its lending and other services on businesses and consumers in the local market area. Through its subsidiaries, Sandy Spring Insurance Corporation and West Financial Services, Inc., Sandy Spring Bank  offers a comprehensive menu of insurance and investment management services.

Overview

Net income for the Company for the second quarter of 2015 totaled $10.3 million ($0.42 per diluted share) as compared to net income of $7.0 million ($0.28 per diluted share) for the second quarter of 2014. For the first six months of 2015, net income totaled $21.6 million ($0.87 per diluted share), compared to net income of $17.9 million ($0.71 per diluted share), for the first six months of 2014. During the second quarter of 2014, the Company recognized accrued litigation expenses of $6.1 million due to an adverse jury verdict. These results reflect the following events:

·Average total loans for the second quarter of 2015 increased 12% compared to the second quarter of 2014 due to organic growth in each of the three major portfolio segments.

·Combined noninterest-bearing and interest-bearing transaction account balances increased 11% to $1.6 billion at June 30, 2015 as compared to $1.5 billion at June 30,2014.

·The provision for loan and lease losses was a charge of $1.2 million for the second quarter of 2015 as compared to a charge of $0.2 million for the second quarter of 2014 and a charge of $0.6 million for the first quarter of 2015. The increase in the provision for the second quarter of 2015 was driven primarily by loan growth over the prior year period.

·The net interest margin was 3.42% in the second quarter of 2015, compared to 3.48% for the second quarter of 2014 and 3.44% for the first quarter of 2015. The decrease compared to the prior year’s quarter was the result of declining loan yields, primarily in the commercial loan portfolio.

·Non-interest income increased $0.4 million or 4% for the second quarter of 2015 compared to the second quarter of 2014 due largely to increases in wealth management income and income from mortgage banking activities.

·During the first six months of 2015, the Company repurchased 575,472 shares of its common stock at an average price of $25.92 per share as part of its existing share repurchase program.

In the first six months of 2015, the Mid-Atlantic region in which the Company operates continued to show economic improvement. While the national economy improved during the first half of the year, international economic concerns together with volatile oil prices impeded both the regional and national economic outlook. Positive trends in housing, consumer spending and unemployment have been offset by concerns over a lack of wage growth and the strength of the dollar compared to other major currencies. These factors have caused uncertainty on the part of both large and small businesses and have thus restricted economic expansion. Slowing economic growth and stock market declines in China together with continuing default concerns in Greece and Puerto Rico have served as underlying volatility factors in financial markets. Together with state and municipal budget challenges across the country, these factors have caused enough economic uncertainty, particularly among individual consumers and small and medium-sized businesses, to suppress confidence and thus constrain the pace of economic expansion. Despite this challenging business environment, the Company has emphasized the fundamentals of community banking as it has maintained strong levels of liquidity and capital while overall credit quality has continued to improve.

35

Liquidity remained strong due to the borrowing lines with the Federal Home Loan Bank of Atlanta and the Federal Reserve and the size and composition of the investment portfolio.

The Company’s non-performing assets decreased to $41.8 million at June 30, 2015 from $43.7 million at June 30, 2014. This decrease was due primarily to problem loan pay-offs and a reduction in restructured loans. Non-performing assets represented 0.93% of total assets at June 30, 2015 compared to 1.03% at June 30, 2014.  The ratio of net charge-offs to average loans and leases was insignificant for the second quarter of 2015, compared to 0.03% for the prior year quarter.

Non-interest income increased 4% in the second quarter of 2015 compared to the second quarter of 2014. This increase was driven by a 9% increase in wealth management income due primarily to higher assets under management. Income from mortgage banking activities increased 44% for the quarter due primarily to higher volumes of loan originations.

Non-interest expenses decreased 14% in the second quarter of 2015 compared to the prior year quarter due mainly to litigation expenses incurred in the second quarter of 2014. Excluding such expenses, non-interest expenses increased 5% due to higher salaries and benefits and other non-interest expenses.

Total assets at June 30, 2015 increased 3% compared to December 31, 2014. Loan balances increased 5% compared to the prior year end due to growth of 7% in commercial loans while both consumer and residential mortgage loans increased 3% compared to the prior year end. Customer funding sources, which include deposits plus other short-term borrowings from core customers, increased 7% compared to balances at December 31, 2014. The increase in customer funding sources was driven primarily by increases of 10% in certificates of deposit, 6% in noninterest-bearing and interest-bearing transaction accounts and 6% in regular savings accounts. Retail repurchase agreements also increased 50% as the Company increased its emphasis on the sale of cash management services.  The Company continued to manage its net interest margin, primarily by utilizing short-term FHLB borrowings, deposit growth and retail repurchase agreements to fund loans during this extended period of historically low interest rates.  During the same period, stockholders’ equity decreased $3 million to $519 million as the payment of dividends and repurchases of stock under the Company’s share repurchase program exceeded net income during the period. 

36

Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES
		Six Months Ended June 30,
				2015						2014
					Annualized						Annualized
	Average		(1)		Average		Average		(1)		Average
(Dollars in thousands and tax-equivalent)	Balances		Interest		Yield/Rate		Balances		Interest		Yield/Rate
Assets
Residential mortgage loans	$	729,343	$	12,279	3.37	%	$	640,155	$	11,061	3.46	%
Residential construction loans		134,849		2,489	3.72			140,147		2,612	3.76
Commercial ADC loans		212,257		4,862	4.62			165,319		4,253	5.19
Commercial investor real estate loans		657,088		15,350	4.71			566,275		13,872	4.94
Commercial owner occupied real estate loans		618,100		15,200	4.96			582,042		14,213	5.08
Commercial business loans		390,853		8,507	4.39			349,162		8,091	4.67
Leasing		36		1	3.76			459		12	5.22
Consumer loans		429,746		7,106	3.35			383,983		6,326	3.34
Total loans and leases (2)		3,172,272		65,794	4.18			2,827,542		60,440	4.34
Loans held for sale		10,583		208	3.94			6,083		130	4.28
Taxable securities		617,861		7,722	2.50			699,460		8,715	2.49
Tax-exempt securities (3)		294,024		6,305	4.29			302,398		6,527	4.32
Interest-bearing deposits with banks		35,273		44	0.25			33,853		42	0.25
Federal funds sold		473		1	0.22			475		-	0.22
Total interest-earning assets		4,130,486		80,074	3.90			3,869,811		75,854	3.96
Less:  allowance for loan and lease losses		(37,833)						(38,864)
Cash and due from banks		46,663						45,268
Premises and equipment, net		51,127						45,787
Other assets		215,567						209,535
Total assets	$	4,406,010					$	4,131,537
Liabilities and Stockholders' Equity
Interest-bearing demand deposits	$	525,692		207	0.08	%	$	468,677		194	0.08	%
Regular savings deposits		274,220		71	0.05			255,667		97	0.08
Money market savings deposits		832,549		590	0.14			871,464		546	0.13
Time deposits		455,147		1,693	0.75			462,591		1,540	0.67
Total interest-bearing deposits		2,087,608		2,561	0.25			2,058,399		2,377	0.23
Other borrowings		98,228		110	0.23			65,889		75	0.23
Advances from FHLB		614,254		6,502	2.13			573,619		6,451	2.27
Subordinated debentures		35,000		442	2.53			35,000		437	2.50
Total interest-bearing liabilities		2,835,090		9,615	0.68			2,732,907		9,340	0.69
Noninterest-bearing demand deposits		1,004,965						862,830
Other liabilities		46,824						27,984
Stockholders' equity		519,131						507,816
Total liabilities and stockholders' equity	$	4,406,010					$	4,131,537
Net interest income and spread			$	70,459	3.22	%			$	66,514	3.27	%
Less: tax-equivalent adjustment				3,153						2,613
Net interest income			$	67,306					$	63,901
Interest income/earning assets					3.90	%					3.96	%
Interest expense/earning assets					0.47						0.48
Net interest margin					3.43	%					3.48	%
(1) Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 39.88% for 2015 and  2014. The annualized taxable-equivalent
adjustments utilized in the above table to compute yields aggregated to $3.2 million and $2.6 million in 2015 and 2014, respectively.
(2) Non-accrual loans are included in the average balances.
(3) Includes only investments that are exempt from federal taxes.

37

Results of Operations

For the Six Months Ended June 30, 2015 Compared to the Six Months Ended June 30, 2014

Net income for the Company for the first six months of 2015 totaled $21.6 million ($0.87 per diluted share) compared to net income of $17.9 million ($0.71 per diluted share) for the first six months of 2014.

Net Interest Income

The largest source of the Company’s operating revenue is net interest income, which is the difference between the interest earned on interest-earning assets and the interest paid on interest-bearing liabilities. For purposes of this discussion and analysis, the interest earned on tax-exempt investment securities has been adjusted to an amount comparable to interest subject to normal income taxes. The result is referred to as tax-equivalent interest income and tax-equivalent net interest income. The following discussion of net interest income should be considered in conjunction with the review of the information provided in the preceding table.

Net interest income for the first six months of 2015 was $67.3 million compared to $63.9 million for the first six months of 2014. On a tax-equivalent basis, net interest income for the first six months of 2015 was $70.5 million compared to $66.5 million for the first six months of 2014, an increase of 6%. The preceding table provides an analysis of net interest income performance that reflects a net interest margin that decreased to 3.43% for the first six months of 2015 compared to 3.48% for the prior year period.  Year-to-date 2015 average interest-earning assets increased by 7% while average interest-bearing liabilities increased 4% compared to the year ago period.  Average noninterest-bearing deposits increased 16% in the first six months of 2015 while the percentage of average noninterest-bearing deposits to total deposits increased to 32% for the first six months of 2015 compared to 30% for the first six months of 2014.The decrease in the net interest margin was caused by the effect of lower rates on interest-earning assets that exceeded the benefit of lower rates on interest-bearing deposits and borrowings and the increase in noninterest-bearing deposits.

Effect of Volume and Rate Changes on Net Interest Income

The following table analyzes the reasons for the changes from year-to-year in the principal elements that comprise net interest income:

			2015 vs. 2014							2014 vs. 2013
			Increase						Increase
			Or		Due to Change In Average:*				Or		Due to Change In Average:*
(Dollars in thousands and tax equivalent)			(Decrease)		Volume		Rate		(Decrease)		Volume		Rate
Interest income from earning assets:
	Loans and leases		$	5,354	$	7,598	$	(2,244)	$	1,582	$	5,680	$	(4,098)
	Loans held for sale			78		89		(11)		(532)		(681)		149
	Securities			(1,215)		(1,382)		167		124		(700)		824
	Other earning assets			3		3		-		(1)		(1)		-
Total interest income				4,220		6,308		(2,088)		1,173		4,298		(3,125)
Interest expense on funding of earning assets:
	Interest-bearing demand deposits			13		15		(2)		11		21		(10)
	Regular savings deposits			(26)		8		(34)		(9)		8		(17)
	Money market savings deposits			44		(21)		65		(243)		(11)		(232)
	Time deposits			153		(26)		179		(233)		(140)		(93)
Total borrowings				91		721		(630)		14		1,333		(1,319)
	Total interest expense			275		697		(422)		(460)		1,211		(1,671)
		Net interest income	$	3,945	$	5,611	$	(1,666)	$	1,633	$	3,087	$	(1,454)
* Variances that are the combined effect of volume and rate, but cannot be separately identified,  are allocated to the volume and rate variances
	based on their respective relative amounts.

38

Interest Income

The Company's total tax-equivalent interest income for the first six months of 2015 increased 6% compared to the first six months of 2014. The previous table shows that, in 2015, the increase in average loans and leases more than offset the decline in earning asset yields with respect to the loan portfolio.

The average balance of the loan portfolio increased 12% for the first six months of 2015 compared to the prior year period. This growth was primarily in the commercial investor real estate and residential mortgage portfolios. These increases were driven by organic loan growth as the regional economy improved. The yield on average loans and leases decreased by 16 basis points due to the pay-off of higher rate loans and the origination of new loans at comparatively lower rates. The decline in the portfolio yield was driven primarily by a decrease of 24 basis points in the yield on the commercial loan portfolio together with a decrease of 9 basis points in the yield in the residential mortgage portfolio.

The average yield on total investment securities increased 4 basis points while the average balance of the portfolio decreased 9% for the first six months of 2015 compared to the first six months of 2014. The increase in the yield on investments was due primarily to a change in the mix of the overall portfolio as principal amortization reduced the relative size of the lower-yielding mortgage-backed securities while the balance of tax-exempt securities remained essentially unchanged.

Interest Expense

Interest expense increased 3% in the first six months of 2015 compared to the first half of 2014. The increase in the expense was due to the cost of interest-bearing deposits increasing primarily due to growth in the average balances at relatively the same rates, while the increase in the average balances of Federal Home Loan Bank advances was largely offset by a 14 basis point decrease in the average rates paid. Average deposits increased 6% in the first six months of 2015 compared to the prior year period. This increase was primarily due to increases of $199 million or 15% in average noninterest-bearing and interest-bearing checking accounts together with an increase of $19 million or 7% in regular savings accounts as clients kept funds in short-term instruments to preserve liquidity.  This growth was partially offset by a decrease in average certificates of deposit of $7 million or 2% in the first six months of 2015 compared to the prior year-to-date. Average balances of money market accounts decreased 4% in the first six months of 2015 compared to the first six months of 2014 as clients generally maintained liquidity.

Non-interest Income 

Non-interest income amounts and trends are presented in the following table for the years indicated:

			Six Months Ended June 30,				2015/2014		2015/2014
(Dollars in thousands)			2015		2014		$ Change			% Change
	Securities gains		$	19	$	-	$	19		-
	Service charges on deposit accounts			3,721		4,061		(340)		(8.4)	%
	Mortgage banking activities			2,000		886		1,114		125.7
	Wealth management income			10,077		9,207		870		9.4
	Insurance agency commissions			2,499		2,601		(102)		(3.9)
	Income from bank owned life insurance			1,319		1,206		113		9.4
	Bank card fees			2,277		2,147		130		6.1
	Other income			3,356		2,835		521		18.4
		Total non-interest income	$	25,268	$	22,943	$	2,325		10.1

39

Total non-interest income was $25.3 million for the first six months of 2015 compared to $22.9 million for the first six months of 2014. The primary drivers of non-interest income for the first six months of 2015 were increases in wealth management income, income from mortgage banking activities and other non-interest income. Further detail by type of non-interest income follows:

·Wealth management income is comprised of income from trust and estate services, investment management fees earned by West Financial Services, the Company’s investment management subsidiary, and fees on sales on investment products and services. Trust services fees increased 15% for the first six months of 2015 compared to the prior year period due to an increase in assets under management and one-time estate fees.  Investment management fees in West Financial Services increased 5% in 2015 compared to the first six months of 2014, also due to higher assets under management.  Fees on sales of investment products increased 5% for the first six months of 2015 compared to the prior year period, due to higher assets under management. Overall total assets under management increased to $2.9 billion at June 30, 2015 compared to $2.7 billion at June 30, 2014 as a result of positive market movements and additions from new and existing clients.

·Income from mortgage banking activities increased in 2015 compared to 2014 due primarily to higher loan origination volumes from refinancing activity as mortgage rates remained at historic lows.

·Other non-interest income increased during 2015 compared to 2014 due mainly to increases in loan prepayment fees and gains on sales of SBA loans.

·Income from bank owned life insurance increased in the first six months of 2015 compared to the first half of 2014 due primarily to policy proceeds recognized during 2015.

·Income from service charges on deposits decreased due to a decrease in return check charges for 2015 compared to the prior year period.

·Insurance agency commissions decreased due primarily to a decline in annual contingency commissions based on policy performance.

·Income from bank card fees increased 6% due to a higher volume of electronic transactions.

Non-interest Expense

Non-interest expense amounts and trends are presented in the following table for the years indicated:

		Six Months Ended June 30,				2015/2014		2015/2014
(Dollars in thousands)		2015		2014		$ Change			% Change
Salaries and employee benefits		$	34,833	$	32,829	$	2,004		6.1	%
Occupancy expense of premises			6,662		6,746		(84)		(1.2)
Equipment expenses			2,863		2,518		345		13.7
Marketing			1,473		1,344		129		9.6
Outside data services			2,363		2,432		(69)		(2.8)
FDIC insurance			1,285		1,093		192		17.6
Amortization of intangible assets			213		594		(381)		(64.1)
Litigation Expenses			362		6,128		(5,766)		(94.1)
Professional fees			2,408		2,206		202		9.2
Other real estate owned			14		9		5		55.6
Other expenses			6,245		5,791		454		7.8
	Total non-interest expense	$	58,721	$	61,690	$	(2,969)		(4.8)

Non-interest expenses totaled $58.7 million in the first six months of 2015 compared to $61.7 million in the first six months of 2014, a decrease of 5%. Excluding the litigation expenses from both years, non-interest expenses increased 5% compared to the prior year period. This increase in expenses was driven primarily by higher salaries and benefits and other non-interest expenses, which were partially offset by a decrease in intangibles amortization.  Further detail by category of non-interest expense follows:

·Salaries and employee benefits, the largest component of non-interest expenses, increased in the first six months of 2015 due primarily to higher compensation expenses as a result of merit increases and increased health insurance expenses. In addition, pension expense increased over the first six months of 2014 due to a change in actuarial assumptions.  The average number of full-time equivalent employees was 718 in the first six months of 2015 compared to 722 in the prior year period.

·Equipment expenses increased in 2015 compared to 2014 due to higher software amortization expense.

·FDIC expenses increased in 2015 compared to 2014 due to growth in assets.

40

·Intangibles amortization decreased in 2015 due to the costs of prior year acquisitions being fully amortized during the period.

·Other non-interest expenses increased in 2015 compared to the prior year-to-date due mainly to an increase in fraudulent bankcard activity.

·Marketing expenses increased in 2015 due to increases in targeted advertising initiatives.

Income Taxes

The Company had income tax expense of $10.5 million in the first six months of 2015, compared to income tax expense of $8.1 million in the first six months of 2014. The resulting effective tax rates were 33% for the first six months of 2015 compared to 31% for the first six months of 2014. The effective rate increased in 2015 compared to 2014 due to tax exempt income comprising a lower proportion of income before taxes.

41

Results of Operations

For the Three Months Ended June 30, 2015 Compared to the Three Months Ended June 30, 2014

Net income for the Company for the second quarter of 2015 totaled $10.3 million ($0.42 per diluted share) compared to net income of $7.0 million ($0.28 per diluted share) for the second quarter of 2014.

Net Interest Income

The largest source of the Company’s operating revenue is net interest income, which is the difference between the interest earned on interest-earning assets and the interest paid on interest-bearing liabilities. For purposes of this discussion and analysis, the interest earned on tax-exempt investment securities has been adjusted to an amount comparable to interest subject to normal income taxes. The result is referred to as tax-equivalent interest income and tax-equivalent net interest income. The following discussion of net interest income should be considered in conjunction with the review of the information provided in the preceding table.

Net interest income for the second quarter of 2015 was $33.9 million compared to $32.3 million for the second quarter of 2014. On a tax-equivalent basis, net interest income for the second quarter of 2015 was $35.5 million compared to $33.6 million for the second quarter of 2014, an increase of 6%. The preceding table provides an analysis of net interest income performance that reflects a net interest margin that decreased to 3.42% for the second quarter of 2015 compared to 3.48% for the prior year period.  Quarterly average interest-earning assets increased by 7% and average interest-bearing liabilities increased 5% compared to the second quarter of 2014.  Average noninterest-bearing deposits increased 14% for the quarter compared to the same quarter of the prior year.  The percentage of average noninterest-bearing deposits to total deposits increased to 33% for the second quarter of 2015 compared to 30% for the second quarter of 2014. The decrease in the net interest margin was caused by the effect of lower rates on interest-earning assets that exceeded the benefit of lower rates on interest-bearing deposits and borrowings and the increase in noninterest-bearing deposits.

42

Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES
		Three Months Ended June 30,
				2015						2014
					Annualized						Annualized
	Average		(1)		Average		Average		(1)		Average
(Dollars in thousands and tax-equivalent)	Balances		Interest		Yield/Rate		Balances		Interest		Yield/Rate
Assets
Residential mortgage loans	$	734,382	$	6,155	3.35	%	$	652,232	$	5,614	3.44	%
Residential construction loans		137,216		1,268	3.71			145,968		1,359	3.73
Commercial ADC loans		218,341		2,525	4.64			168,063		2,180	5.20
Commercial investor real estate loans		668,883		7,771	4.66			575,283		7,139	4.98
Commercial owner occupied real estate loans		624,407		7,669	4.93			579,953		7,146	5.09
Commercial business loans		398,510		4,369	4.40			348,597		4,054	4.69
Leasing		28		-	1.49			352		6	6.30
Consumer loans		434,011		3,606	3.35			390,076		3,208	3.32
Total loans and leases (2)		3,215,778		33,363	4.16			2,860,524		30,706	4.34
Loans held for sale		14,075		132	3.76			6,940		71	4.12
Taxable securities		606,581		3,786	2.50			688,793		4,263	2.48
Tax-exempt securities (3)		291,656		3,135	4.30			302,342		3,260	4.32
Interest-bearing deposits with banks		34,400		22	0.25			34,770		22	0.25
Federal funds sold		473		-	0.22			474		-	0.22
Total interest-earning assets		4,162,963		40,438	3.89			3,893,843		38,322	3.97
Less:  allowance for loan and lease losses		(38,217)						(38,342)
Cash and due from banks		46,894						44,987
Premises and equipment, net		51,591						45,696
Other assets		215,439						211,375
Total assets	$	4,438,670					$	4,157,559
Liabilities and Stockholders' Equity
Interest-bearing demand deposits	$	527,307		101	0.08	%	$	477,018		102	0.09	%
Regular savings deposits		278,199		37	0.05	%		262,078		49	0.07	%
Money market savings deposits		833,382		317	0.15	%		865,134		273	0.13	%
Time deposits		466,632		912	0.78	%		461,812		769	0.67	%
Total interest-bearing deposits		2,105,520		1,367	0.26	%		2,066,042		1,193	0.23	%
Other borrowings		106,180		60	0.23	%		68,880		37	0.22	%
Advances from FHLB		605,714		3,266	2.16	%		546,615		3,233	2.37	%
Subordinated debentures		35,000		223	2.55	%		35,000		219	2.50	%
Total interest-bearing liabilities		2,852,414		4,916	0.69	%		2,716,537		4,682	0.69	%
Noninterest-bearing demand deposits		1,023,042						899,287
Other liabilities		46,274						29,997
Stockholders' equity		516,940						511,738
Total liabilities and stockholders' equity	$	4,438,670					$	4,157,559
Net interest income and spread			$	35,522	3.20	%			$	33,640	3.28	%
Less: tax-equivalent adjustment				1,589						1,331
Net interest income			$	33,933					$	32,309
Interest income/earning assets					3.89	%					3.97	%
Interest expense/earning assets					0.47						0.49
Net interest margin					3.42	%					3.48	%
(1) Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 39.88% for 2015 and  2014. The annualized taxable-equivalent
adjustments utilized in the above table to compute yields aggregated to $1.6 million and $1.3 million in 2015 and 2014, respectively.
(2) Non-accrual loans are included in the average balances.
(3) Includes only investments that are exempt from federal taxes.

43

Interest Income

The Company's total tax-equivalent interest income increased 6% for the second quarter of 2015 compared to the prior year quarter. The previous table shows that, in 2015, the increase in average loans and leases more than offset the decline in earning asset yields with respect to the loan portfolio.

The average balance of the loan portfolio increased 12% for the second quarter of 2015 compared to the second quarter of 2014. This growth was primarily in the commercial investor real estate and residential mortgage portfolios. These increases were driven by organic loan growth, as the regional economy improved, together with the possibility of Federal Reserve action to increase interest rates by the end of 2015. The yield on average loans and leases decreased by 18 basis points due to the continued prevailing low interest rate environment as relatively higher rate loans were paid off and new loans were originated at comparatively lower rates. The decline in the portfolio yield was driven primarily by a decrease of 29 basis points in the yield on the commercial loan portfolio together with a decrease of 9 basis points in the yield in the residential mortgage portfolio.

The average yield on total investment securities increased 5 basis points while the average balance of the portfolio decreased 9% for the second quarter of 2015 compared to the second quarter of 2014. The increase in the yield on investments was due primarily to a change in the mix of the overall portfolio as principal amortization reduced the relative size of the lower-yielding mortgage-backed securities while the balance of tax-exempt securities remained essentially unchanged.

Interest Expense

Interest expense increased $0.2 million or 5% in the second quarter of 2015 compared to the second quarter of 2014 primarily due to growth in interest-bearing deposits together with an increase of 3 basis points in the cost of such deposits. Higher average balances of Federal Home Loan Bank advances was largely offset by a 21 basis point decrease in the average rates paid. Average deposits increased 6% in the second quarter of 2015 compared to the prior year quarter. This increase was primarily due to increases of $174 million or 13% in average noninterest-bearing and interest-bearing checking accounts together with an increase of $16 million or 6% in regular savings accounts.  Average certificates of deposit increased 1% in the second quarter of 2015 compared to the prior year quarter as the Company increased rates offered on selected products in response to a rise in rates paid as part of the Company’s liquidity management program. Average balances of money market accounts decreased 4% in the second quarter of 2015 compared to the second quarter of 2014 as clients generally maintained liquidity.

Non-interest Income 

Non-interest income amounts and trends are presented in the following table for the years indicated:

			Three Months Ended June 30,				2015/2014		2015/2014
(Dollars in thousands)			2015		2014		$ Change			% Change
	Securities gains		$	19	$	-	$	19		-	%
	Service charges on deposit accounts			1,839		2,089		(250)		(12.0)
	Mortgage banking activities			822		570		252		44.2
	Wealth management income			5,161		4,741		420		8.9
	Insurance agency commissions			881		961		(80)		(8.3)
	Income from bank owned life insurance			606		608		(2)		(0.3)
	Bank card fees			1,220		1,169		51		4.4
	Other income			1,561		1,556		5		0.3
		Total non-interest income	$	12,109	$	11,694	$	415		3.5

44

Total non-interest income was $12.1 million for the second quarter of 2015 compared to $11.7 million for the second quarter of 2014. The primary drivers of non-interest income for the second quarter of 2015 were increases in wealth management income and income from mortgage banking activities. Further detail by type of non-interest income follows:

·Wealth management income is comprised of income from trust and estate services, investment management fees earned by West Financial Services, the Company’s investment management subsidiary, and fees on sales on investment products and services. Trust services fees increased 13% for the second quarter compared to the prior year period due to an increase in assets under management and one-time estate fees.  Investment management fees in West Financial Services increased 2% for the second quarter of 2015 compared to the second quarter of 2014, as higher assets under management were somewhat offset by lower average fees. Fees on sales of investment products increased 11% for the second quarter compared to the prior year quarter, also due to growth in assets under management. Overall total assets under management increased to $2.9 billion at June 30, 2015 compared to $2.7 billion at June 30, 2014 as a result of positive market movements and additions from new and existing clients.

·Income from mortgage banking activities increased in 2015 compared 2014 due primarily to higher loan origination volumes as mortgage rates remained at historic lows.

·Other non-interest income increased during 2015 compared to 2014 due mainly to increases in loan prepayment fees and gains on sales of SBA loans.

·Income from service charges on deposits decreased 12% in 2015 compared to 2014 due to a decline in return check charges.

·Bank card fees increased 4% over the prior year quarter due to an increased volume of electronic transactions.

Non-interest Expense

Non-interest expense amounts and trends are presented in the following table for the years indicated:

		Three Months Ended June 30,				2015/2014		2015/2014
(Dollars in thousands)		2015		2014		$ Change			% Change
Salaries and employee benefits		$	17,534	$	16,474	$	1,060		6.4	%
Occupancy expense of premises			3,173		3,274		(101)		(3.1)
Equipment expenses			1,490		1,262		228		18.1
Marketing			942		802		140		17.5
Outside data services			1,102		1,216		(114)		(9.4)
FDIC insurance			654		573		81		14.1
Amortization of intangible assets			106		224		(118)		(52.7)
Litigation expenses			162		6,128		(5,966)		(97.4)
Professional fees			1,199		1,292		(93)		(7.2)
Other real estate owned			4		9		(5)		(55.6)
Other expenses			3,111		2,887		224		7.8
	Total non-interest expense	$	29,477	$	34,141	$	(4,664)		(13.7)

Non-interest expenses totaled $29.5 million in the second quarter of 2015 compared to $34.1 million in the second quarter of 2014, a decrease of 14%. This decrease in expenses was due to $6.1 million in litigation expenses resulting from an adverse jury verdict in the second quarter of 2014. Excluding such expenses, non-interest expenses for the second quarter increased 5% over the prior year quarter. This increase was driven primarily by higher salaries and benefits, equipment and marketing expenses.  Further detail by category of non-interest expense follows:

·Salaries and employee benefits, the largest component of non-interest expenses, increased in 2015 due primarily to higher compensation expenses as a result of merit increases and increased health insurance expenses. In addition, pension expense increased over 2014 due to a change in actuarial assumptions.  The average number of full-time equivalent employees was 722 in the second quarter of 2015 compared to 723 in the second quarter of 2014.

·Equipment expenses increased in 2015 compared to 2014 due to higher software amortization expense.

·FDIC expenses increased in 2015 compared to 2014 due to growth in assets.

·Intangibles amortization decreased in 2015 due to the costs of prior year acquisitions being fully amortized during the period.

·Marketing expenses increased in 2015 due to increases in targeted advertising initiatives.

45

Operating Expense Performance

Management views the GAAP efficiency ratio as an important financial measure of expense performance and cost management.  The ratio expresses the level of non-interest expenses as a percentage of total revenue (net interest income plus total non-interest income).  Lower ratios indicate improved productivity.

Non-GAAP Financial Measures

The Company also uses a traditional efficiency ratio that is a non-GAAP financial measure of operating expense control and efficiency of operations.  Management believes that its traditional ratio better focuses attention on the operating performance of the Company over time than does a GAAP ratio, and is highly useful in comparing period-to-period operating performance of the Company’s core business operations.  It is used by management as part of its assessment of its performance in managing non-interest expenses.  However, this measure is supplemental, and is not a substitute for an analysis of performance based on GAAP measures.  The reader is cautioned that the non-GAAP efficiency ratio used by the Company may not be comparable to GAAP or non-GAAP efficiency ratios reported by other financial institutions.

In general, the efficiency ratio is non-interest expenses as a percentage of net interest income plus non-interest income.  Non-interest expenses used in the calculation of the non-GAAP efficiency ratio exclude goodwill impairment losses, the amortization of intangibles, and non-recurring expenses.  Income for the non-GAAP ratio includes the favorable effect of tax-exempt income, and excludes securities gains and losses, which vary widely from period to period without appreciably affecting operating expenses, and non-recurring gains.  The measure is different from the GAAP efficiency ratio, which also is presented in this report.  The GAAP measure is calculated using non-interest expense and income amounts as shown on the face of the Consolidated Statements of Income.  The GAAP and non-GAAP efficiency ratios are reconciled and provided in the following table. The GAAP efficiency ratio improved in the second of 2015 compared to the second of the 2014 due to the litigation expenses mentioned previously. The non-GAAP efficiency ratio remained essentially the same in the second quarter of 2015 compared to the second quarter of 2014.

In addition, the Company uses pre-tax, pre-provision income as a measure of the level of recurring income before taxes. Management believes this provides financial statement users with a useful metric of the run-rate of revenues and expenses which is readily comparable to other financial institutions. This measure is calculated by adding (subtracting) the provision (credit) for loan and lease losses, and the provision for income taxes back to net income.

46

GAAP and Non-GAAP Efficiency Ratios

				Three Months Ended				Six Months Ended
				June 30,				June 30,
(Dollars in thousands)				2015		2014		2015		2014
Pre-tax pre-provision income:
Net income				$	10,333	$	6,982	$	21,558	$	17,910
	Plus non-GAAP adjustment:
		Litigation expenses			162		6,128		362		6,128
		Income taxes			5,014		2,722		10,480		8,068
		Provision (credit) for loan and lease losses			1,218		158		1,815		(824)
Pre-tax pre-provision income				$	16,727	$	15,990	$	34,215	$	31,282
Efficiency ratio - GAAP basis:
Non-interest expenses				$	29,477	$	34,141	$	58,721	$	61,690
Net interest income plus non-interest income				$	46,042	$	44,003	$	92,574	$	86,844
Efficiency ratio - GAAP basis:					64.02%		77.59%		63.43%		71.04%
Efficiency ratio - Non-GAAP basis:
Non-interest expenses				$	29,477	$	34,141	$	58,721	$	61,690
	Less non-GAAP adjustment:
		Amortization of intangible assets			106		224		213		594
		Litigation expenses			162		6,128		362		6,128
Non-interest expenses -  as adjusted				$	29,209	$	27,789	$	58,146	$	54,968
Net interest income plus non-interest income				$	46,042	$	44,003	$	92,574	$	86,844
	Plus non-GAAP adjustment:
		Tax-equivalent income			1,589		1,331		3,153		2,613
	Less non-GAAP adjustments:
			Securities gains		19		-		-		-
	Net interest income plus non-interest income - as adjusted			$	47,612	$	45,334	$	95,727	$	89,457
Non-GAAP efficiency ratio					61.35%		61.30%		60.74%		61.45%

Income Taxes

The Company had income tax expense of $5.0 million in the second quarter of 2015, compared to income tax expense of $2.7 million in the second quarter of 2014. The resulting effective tax rate was 33% for the second quarter of 2015 and 28% for the second quarter of 2014. The effective rate increased in 2015 compared to 2014 due to tax exempt income comprising a lower proportion of income before taxes.

FINANCIAL CONDITION

The Company's total assets were $4.5 billion at June 30, 2015, an increase of $110 million or 3% compared to December 31, 2014. Total loans increased 5% compared to the fourth quarter of 2014. This increase was funded by a 6% decrease in the investment portfolio and a 6% increase in deposits.

47

Analysis of Loans and Leases

A comparison of the loan portfolio at the dates indicated is presented in the following table:

		June 30, 2015				December 31, 2014				Period-to-Period Change
(Dollars in thousands)		Amount		%		Amount		%		$ Change		% Change
Residential real estate:
	Residential mortgage	$	744,195	22.6	%	$	717,886	22.9	%	$	26,309	3.7	%
	Residential construction		137,134	4.2			136,741	4.4			393	0.3
Commercial real estate:
	Commercial owner occupied real estate		643,973	19.6			611,061	19.5			32,912	5.4
	Commercial investor real estate		694,179	21.1			640,193	20.5			53,986	8.4
	Commercial acquisition, development and construction		223,103	6.8			205,124	6.6			17,979	8.8
Commercial Business			409,795	12.4			390,781	12.5			19,014	4.9
Leases			21	-			54	-			(33)	(61.1)
Consumer			436,465	13.3			425,552	13.6			10,913	2.6
	Total loans and leases	$	3,288,865	100.0	%	$	3,127,392	100.0	%	$	161,473	5.2

Total loans and leases, excluding loans held for sale, increased 5% at June 30, 2015 compared to December 31, 2014. The commercial loan portfolio increased 7% at June 30, 2015 compared to the prior year end due primarily to increases in all categories of commercial lending.

The residential real estate portfolio, which is comprised of residential construction and permanent residential mortgage loans, increased 3% at June 30, 2015 compared to December 31, 2014. This increase was due to a 4% increase in permanent residential mortgages, most of which are loans on 1-4 family dwellings.

The consumer loan portfolio increased 3% at June 30, 2015 compared to December 31, 2014, primarily due to growth in home equity lines of credit.

Analysis of Investment Securities

The composition of investment securities at the periods indicated is presented in the following table:

			June 30, 2015				December 31, 2014				Period-to-Period Change
(Dollars in thousands)			Amount		%		Amount		%		$Change		%
Available-for-Sale:
U.S. government agencies and corporations	U.S. government agencies and corporations		$	137,980	15.7	%	$	141,679	15.2	%	$	(3,699)	(2.6)	%
State and municipal	State and municipal			161,953	18.5			167,052	17.9			(5,099)	(3.1)
Mortgage-backed	Mortgage-backed			324,145	37.0			361,519	38.7			(37,374)	(10.3)
Trust preferred	Trust preferred			1,018	0.1			1,236	0.1			(218)	(17.6)
Marketable equity securities	Marketable equity securities			723	-			723	0.1			-	-
		Total available-for-sale securities		625,819	71.3			672,209	72.0			(46,390)	(6.9)
Held-to-Maturity and Other Equity
U.S. government agencies and corporations	U.S. government agencies and corporations			64,515	7.3			64,512	6.9			3	-
State and municipal	State and municipal			150,069	17.1			155,261	16.6			(5,192)	(3.3)
Mortgage-backed	Mortgage-backed			182	-			200	-			(18)	(9.0)
	Corporate debt			2,100	0.2			-	-			2,100	100.0
Other equity securities	Other equity securities			35,599	4.1			41,437	4.5			(5,838)	(14.1)
		Total held-to-maturity and other equity		252,465	28.7			261,410	28.0			(8,945)	(3.5)
Total Securities			$	878,284	100.0	%	$	933,619	100.0	%	$	(55,335)	(5.9)

Available-for-sale securities decreased 7% at June 30, 2015 compared to December 31, 2014 due to amortization of mortgage-backed securities and calls, while held-to-maturity and other equity securities decreased 3% due to calls and maturities and the redemption of FHLB stock.

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The investment portfolio consists primarily of U.S. Agency securities, U.S. Agency mortgage-backed securities, U.S. Agency collateralized mortgage obligations and state and municipal securities. The duration of the portfolio was 3.2 years at June 30, 2015 and 3.4 years at December 31, 2014. The Company considers the duration of the portfolio to be adequate for liquidity purposes. This investment strategy has resulted in a portfolio with low credit risk that would provide the required liquidity needed to meet increased loan demand. The portfolio is monitored on a continuing basis with consideration given to interest rate trends and the structure of the yield curve and with constant assessment of economic projections and analysis.

At June 30, 2015, the trust preferred portfolio included one pooled trust preferred security backed by debt issued by banks and thrifts, which totaled $1.1 million, with a fair value of $1.0 million.  The fair value of this security was determined by a third party valuation specialist due to the limited trading activity for this security in the marketplace.  The specialist used an income valuation approach technique (present value) that maximizes the use of relevant observable inputs and minimizes the use of unobservable inputs.  The methodology, observable inputs and significant assumptions employed by the specialist to determine fair value are provided in Note 2 – Investments in the Notes to the Condensed Consolidated Financial Statements.

As a result of this valuation, it was determined that the pooled trust preferred security had not incurred any credit-related OTTI for the three months ended June 30, 2015. Cumulative credit-related OTTI of $0.5 million has been recognized in earnings through June 30, 2015. Non-credit related OTTI on this security, which is not expected to be sold and which the Company has the ability to hold until maturity, was $0.1 million at June 30, 2015.  This non-credit related OTTI was recognized in accumulated other comprehensive income (“OCI”) at June 30, 2015. 

Other Earning Assets

Residential mortgage loans held for sale increased $8 million to $19 million as of June 30, 2015 from $11 million as of December 31, 2014 due to higher mortgage loan origination volumes resulting from low market interest rates.  The aggregate of federal funds sold and interest-bearing deposits with banks decreased $7 million to $36 million at June 30, 2015 compared to December 31, 2014.

Deposits

The composition of deposits at the periods indicated is presented in the following table:

			June 30, 2015				December 31, 2014				Period-to-Period Change
(Dollars in thousands)			Amount		%		Amount		%		$ Change		% Change
Noninterest-bearing deposits			$	1,092,413	33.6	%	$	993,737	32.4	%	$	98,676	9.9	%
Interest-bearing deposits:
	Demand			525,584	16.2			534,605	17.4			(9,021)	(1.7)
	Money market savings			860,315	26.5			828,494	27.0			31,821	3.8
	Regular savings			280,143	8.6			264,751	8.6			15,392	5.8
	Time deposits of less than $100,000			245,347	7.6			239,857	7.8			5,490	2.3
	Time deposits of $100,000 or more			243,544	7.5			205,065	6.8			38,479	18.8
		Total interest-bearing deposits		2,154,933	66.4			2,072,772	67.6			82,161	4.0
Total deposits			$	3,247,346	100.0	%	$	3,066,509	100.0	%	$	180,837	5.9

Deposits and Borrowings

Total deposits increased $181 million or 6% at June 30, 2015 compared to December 31, 2014. This increase was due primarily to a 10% increase in noninterest-bearing checking accounts compared to the prior year end. In addition, certificates of deposit also increased 10% compared to December 31, 2014. Money market accounts increased 4% and regular savings accounts increased 6% compared to December 31, 2014. The activity in these deposit products can be attributed primarily to clients’ emphasis on safety and liquidity considering the current extended period of low interest rates. Total borrowings decreased 9% at June 30, 2015 compared to December 31, 2014.

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Capital Management

Management monitors historical and projected earnings, dividends and asset growth, as well as risks associated with the various types of on and off-balance sheet assets and liabilities, in order to determine appropriate capital levels. During the first six months of 2015, total stockholders' equity decreased to $519 million at June 30, 2015 compared to $522 million at December 31, 2014 as the payment of dividends and stock repurchases exceeded net income during the period.  The ratio of average equity to average assets was 11.78% for the first six months of 2015, as compared to 12.29% for the first six months of 2014.

Bank holding companies and banks are required to maintain capital ratios in accordance with guidelines adopted by the federal bank regulators. These guidelines are commonly known as Risk-Based Capital guidelines. The actual regulatory ratios and required ratios for capital adequacy, in addition to the ratios required to be categorized as “well capitalized”, are summarized for the Company in the following table.

Risk-Based Capital Ratios

			Minimum
	Ratios at		Regulatory
	June 30, 2015	December 31, 2014	Requirements
Total Capital to risk-weighted assets	14.65%	15.06%	8.00%
Tier 1 Capital to risk-weighted assets	13.54%	13.95%	6.00%
Common Equity Tier 1 Capital	12.53%	n.a.	4.50%
Tier 1 Leverage	10.83%	11.26%	4.00%

Tier 1 capital of $472 million and total qualifying capital of $510 million each included $35.0 million in trust preferred securities that are considered regulatory capital for purposes of determining the Company’s Tier 1 capital ratio.  As of June 30, 2015, the most recent notification from the Bank’s primary regulator categorized the Bank as a "well-capitalized" institution under the prompt corrective action rules of the Federal Deposit Insurance Act.  Designation as a well-capitalized institution under these regulations is not a recommendation or endorsement of the Company or the Bank by federal bank regulators.

 In July 2013, the Federal Reserve Board approved revisions to its capital adequacy guidelines and prompt corrective action rules that implement the revised standards of the Basel Committee on Banking Supervision, commonly called Basel III, and address relevant provisions of the Dodd-Frank Act. The rules include new risk-based capital and leverage ratios, which were effective January 1, 2015, and revise the definition of what constitutes “capital” for calculating those ratios. The new minimum capital level requirements applicable to the Company and the Bank are: (1) a new common equity Tier 1 capital ratio of 4.5%; (2) a Tier 1 capital ratio of 6% (increased from 4%); (3) a total capital ratio of 8% (unchanged from current rules); and (4) a Tier 1 leverage ratio of 4%.  The rules eliminate the inclusion of certain instruments, such as trust preferred securities, from Tier 1 capital. Instruments issued prior to May 19, 2010 are grandfathered for companies with consolidated assets of $15 billion or less. The rules also establish a “capital conservation buffer” of 2.5% above the new regulatory minimum capital requirements, which must consist entirely of common equity Tier 1 capital. The new capital conservation buffer requirement will be phased in beginning in January 2016 at 0.625% of risk-weighted assets and will increase by that amount each year until fully implemented in January 2019. An institution will be subject to limitations on paying dividends, engaging in share repurchases, and paying discretionary bonuses to executive officers if its capital level falls below the buffer amount. These limitations establish a maximum percentage of eligible retained income that could be utilized for such action.

Tangible Common Equity

Tangible equity, tangible assets and tangible book value per share are non-GAAP financial measures calculated using GAAP amounts. Tangible common equity and tangible assets exclude the balances of goodwill and other intangible assets from stockholder’s equity and total assets, respectively. Management believes that this non-GAAP financial measure provides information to investors that may be useful in understanding our financial condition.  Because not all companies use the same calculation of tangible equity and tangible assets, this presentation may not be comparable to other similarly titled measures calculated by other companies.  A reconciliation of the non-GAAP ratio of tangible equity to tangible assets and tangible book value per share are provided in the following table.

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Tangible Common Equity Ratio – Non-GAAP

(Dollars in thousands, except per share data)		June 30, 2015		December 31, 2014
Tangible common equity ratio:
Total stockholders' equity		$	518,873	$	521,751
	Accumulated other comprehensive income (loss)		592		823
	Goodwill		(84,171)		(84,171)
	Other intangible assets, net		(296)		(510)
Tangible common equity		$	434,998	$	437,893
Total assets		$	4,507,367	$	4,397,132
	Goodwill		(84,171)		(84,171)
	Other intangible assets, net		(296)		(510)
Tangible assets		$	4,422,900	$	4,312,451
Tangible common equity ratio			9.84%		10.15%
Tangible book value per share		$	17.71	$	17.48

Credit Risk

The fundamental lending business of the Company is based on understanding, measuring and controlling the credit risk inherent in the loan portfolio.  The Company’s loan and lease portfolio is subject to varying degrees of credit risk.  Credit risk entails both general risks, which are inherent in the process of lending, and risk specific to individual borrowers.  The Company’s credit risk is mitigated through portfolio diversification, which limits exposure to any single customer, industry or collateral type.  Typically, each consumer and residential lending product has a generally predictable level of credit losses based on historical loss experience.  Home mortgage and home equity loans and lines generally have the lowest credit loss experience.  Loans secured by personal property, such as auto loans, generally experience medium credit losses.  Unsecured loan products, such as personal revolving credit, have the highest credit loss experience and for that reason, the Company has chosen not to engage in a significant amount of this type of lending.  Credit risk in commercial lending can vary significantly, as losses as a percentage of outstanding loans can shift widely during economic cycles and are particularly sensitive to changing economic conditions.  Generally, improving economic conditions result in improved operating results on the part of commercial customers, enhancing their ability to meet their particular debt service requirements.  Improvements, if any, in operating cash flows can be offset by the impact of rising interest rates that may occur during improved economic times.  Inconsistent economic conditions may have an adverse effect on the operating results of commercial customers, reducing their ability to meet debt service obligations. 

Current economic data has shown that while the Mid-Atlantic region remains one of the stronger markets in the nation, the Company is continuing to deal with the challenging economy and its resulting effects on its borrowers, particularly in the real estate sector. Total non-performing loans increased 10% to $37 million at June 30, 2015 compared to the balance at December 31, 2014. While the diversification of the lending portfolio among different commercial, residential and consumer product lines along with different market conditions of the D.C. suburbs, Northern Virginia and Baltimore metropolitan area has mitigated some of the risks in the portfolio, local economic conditions and levels of non-performing loans may continue to be influenced by the volatility being experienced in various business sectors of the economy on both a regional and national level.

To control and manage credit risk, management has a credit process in place to reasonably ensure that credit standards are maintained along with an in-house loan administration accompanied by oversight and review procedures.  The primary purpose of loan underwriting is the evaluation of specific lending risks and involves the analysis of the borrower’s ability to service the debt as well as the assessment of the value of the underlying collateral.  Oversight and review procedures include the monitoring of portfolio credit quality, early identification of potential problem credits and the aggressive management of problem credits.  As part of the oversight and review process, the Company maintains an allowance for loan and lease losses (the “allowance”).

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The allowance represents an estimation of the losses that are inherent in the loan and lease portfolio.  The adequacy of the allowance is determined through careful and ongoing evaluation of the credit portfolio, and involves consideration of a number of factors, as outlined below, to establish an adequate allowance for loan losses.  Determination of the allowance is inherently subjective and requires significant estimates, including estimated losses on pools of homogeneous loans and leases based on historical loss experience and consideration of current economic trends, which may be susceptible to significant change.  Loans and leases deemed uncollectible are charged against the allowance, while recoveries are credited to the allowance.  Management adjusts the level of the allowance through the provision for loan and lease losses, which is recorded as a current period operating expense.

The methodology for assessing the appropriateness of the allowance includes:  (1) a general allowance that reflects historical losses, as adjusted, by credit category, and (2) a specific allowance for impaired credits on an individual or portfolio basis.  This methodology is further described in “Note 1 – Significant Accounting Policies” of the Notes to the Consolidated Financial Statements included in the Company’s 2014 Annual Report on Form 10-K. The amount of the allowance is reviewed monthly and approved quarterly by the Risk Committee of the board of directors.

The Company recognizes a collateral dependent lending relationship as non-performing when either the loan becomes 90 days delinquent or as a result of factors (such as bankruptcy, interruption of cash flows, etc.) considered at the monthly credit committee meeting. When a commercial loan is placed on non-accrual status, it is considered to be impaired and all accrued but unpaid interest is reversed.  Classification as an impaired loan is based on a determination that the Company may not collect all principal and interest payments according to contractual terms. Impaired loans exclude large groups of smaller-balance homogeneous loans that are collectively evaluated for impairment such as leases, residential real estate and consumer loans.  Typically, all payments received on non-accrual loans are applied to the remaining principal balance of the loans.  Integral to the assessment of the allowance process is an evaluation that is performed to determine whether a specific allowance on an impaired loan is warranted and, when losses are confirmed, a charge-off is taken to reduce the loan to its net realizable value. Any further collateral deterioration results in either further specific allowances being established or additional charge-offs.  At such time an action plan is agreed upon for the particular loan and an appraisal will be ordered depending on the time elapsed since the prior appraisal, the loan balance and/or the result of the internal evaluation.  A current appraisal on large loans is usually obtained if the appraisal on file is more than 12 months old and there has been a material change in market conditions, zoning, physical use or the adequacy of the collateral based on an internal evaluation.  The Company’s policy is to strictly adhere to regulatory appraisal standards.  If an appraisal is ordered, no more than a 30 day turnaround is requested from the appraiser, who is selected by Credit Administration from an approved appraiser list. After receipt of the updated appraisal, the assigned credit officer will recommend to the Chief Credit Officer whether a specific allowance or a charge-off should be taken. The Chief Credit Officer has the authority to approve a specific allowance or charge-off between monthly credit committee meetings to insure that there are no significant time lapses during this process.

The Company’s methodology for evaluating whether a loan is impaired begins with risk-rating credits on an individual basis and includes consideration of the borrower’s overall financial condition, payment record and available cash resources that may include the sufficiency of collateral value and, in a select few cases, verifiable support from financial guarantors.  In measuring impairment, the Company looks primarily to the discounted cash flows of the project itself or to the value of the collateral as the primary sources of repayment of the loan.  The Company may consider the existence of guarantees and the financial strength and wherewithal of the guarantors involved in any loan relationship. Guarantees may be considered as a source of repayment based on the guarantor’s financial condition and respective payment capacity.  Accordingly, absent a verifiable payment capacity, a guarantee alone would not be sufficient to avoid classifying the loan as impaired.

Management has established a credit process that dictates that structured procedures be performed to monitor these loans between the receipt of an original appraisal and the updated appraisal.  These procedures include the following:

·An internal evaluation is updated quarterly to include borrower financial statements and/or cash flow projections.

·The borrower may be contacted for a meeting to discuss an updated or revised action plan which may include a request for additional collateral.

·Re-verification of the documentation supporting the Company’s position with respect to the collateral securing the loan.

·At the monthly credit committee meeting the loan may be downgraded and a specific allowance may be decided upon in advance of the receipt of the appraisal.

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·Upon receipt of the updated appraisal (or based on an updated internal financial evaluation) the loan balance is compared to the appraisal and a specific allowance is decided upon for the particular loan, typically for the amount of the difference between the appraisal and the loan balance.

·The Company will specifically reserve for or charge-off the excess of the loan amount over the amount of the appraisal net of closing costs. In certain cases the Company may establish a larger reserve due to knowledge of current market conditions or the existence of an offer for the collateral that will facilitate a more timely resolution of the loan.

If an updated appraisal is received subsequent to the preliminary determination of a specific allowance or partial charge-off, and it is less than the initial appraisal used in the initial charge-off, an additional specific allowance or charge-off is taken on the related credit. Partially charged-off loans are not written back up based on updated appraisals and always remain on non-accrual with any and all subsequent payments applied to the remaining balance of the loan as principal reductions. No interest income is recognized on loans that have been partially charged-off.

Loans that have their terms restructured (e.g., interest rates, loan maturity date, payment and amortization period, etc.) in circumstances that provide payment relief or other concessions, to a borrower experiencing financial difficulty are considered troubled debt restructured loans (TDR’s). All restructurings that constitute concessions to a borrower experiencing financial difficulties are considered impaired loans and may either be in accruing status or non-accruing status.  Non-accruing restructured loans may return to accruing status provided there is a sufficient period of payment performance in accordance with the restructure terms.  Loans may be removed from disclosure as an impaired loan if their revised loans terms are considered to be consistent with terms that can be obtained in the credit market for loans with comparable risk. 

The Company may extend the maturity of a performing or current loan that may have some inherent weakness associated with the loan. However, the Company generally follows a policy of not extending maturities on non-performing loans under existing terms. Maturity date extensions only occur under revised terms that clearly place the Company in a position to increase the likelihood of or assure full collection of the loan under the contractual terms and /or terms at the time of the extension that may eliminate or mitigate the inherent weakness in the loan.  These terms may incorporate, but are not limited to additional assignment of collateral, significant balance curtailments/liquidations and assignments of additional project cash flows.  Guarantees may be a consideration in the extension of loan maturities.  As a general matter, the Company does not view extension of a loan to be a satisfactory approach to resolving non-performing credits.  On an exception basis, certain performing loans that have displayed some inherent weakness in the underlying collateral values, an inability to comply with certain loan covenants which are not affecting the performance of the credit or other identified weakness may be extended.

Collateral values or estimates of discounted cash flows (inclusive of any potential cash flow from guarantees) are evaluated to estimate the probability and severity of potential losses. The actual occurrence and severity of losses involving impaired credits can differ substantially from estimates.

The determination of the allowance requires significant judgment, and estimates of probable losses in the loan and lease portfolio can vary significantly from the amounts actually observed.  While management uses available information to recognize probable losses, future additions to the allowance may be necessary based on changes in the credits comprising the portfolio and changes in the financial condition of borrowers, such as may result from changes in economic conditions. In addition, federal and state regulatory agencies, as an integral part of their examination process, and independent consultants engaged by the Bank, periodically review the loan and lease portfolio and the allowance.  Such reviews may result in adjustments to the allowance based upon their analysis of the information available at the time of each examination.

The Company makes provisions for loan and lease losses in amounts necessary to maintain the allowance at an appropriate level, as established by use of the allowance methodology previously discussed. The provision for loan and lease losses was a charge of $1.8 million for the first six months of 2015 compared to a credit of $0.8 million for the first six months of 2014.   Historical net charge-offs represent a principal component in the application of the Company’s allowance methodology.  The charge to the provision in the first six months of 2015 was driven primarily by growth in the loan portfolio. The credit to the provision in the first six months of 2014 was driven by a decline in historical losses, improvement in the overall credit quality of the loan portfolio and problem loan resolutions and recoveries whose impact more than offset the effect of loan growth.

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Substantially all of the fixed-rate residential mortgage loans originated by the Company are sold in the secondary mortgage market. Concurrent with such sales, the Company is required to make customary representations and warranties to the purchasers about the mortgage loans and the manner in which they were originated. The related sale agreements grant the purchasers recourse back to the Company, which could require the Company to repurchase loans or to share in any losses incurred by the purchasers. This recourse exposure typically extends for a period of nine to eighteen months after the sale of the loan although the time frame for repurchase requests can extend for an indefinite period.  Such transactions could be due to a number of causes including borrower fraud or early payment default. The Company has seen a very limited number of repurchase and indemnity demands from purchasers for such events and routinely monitors its exposure in this regard. The Company maintains a liability of $0.5 million for probable losses due to repurchases. The Company believes that this reserve is adequate.

Allowance for Loan and Lease Losses

During the second quarter of 2015, there were no changes in the Company’s methodology for assessing the appropriateness of the allowance for loan and lease losses from the prior year. Variations can occur over time in the estimation of the allowance as a result of the credit performance of borrowers.No portion of the allowance was unallocated at June 30, 2015 or December 31, 2014.

At June 30, 2015, total non-performing loans and leases were $37.3 million, or 1.13% of total loans and leases, compared to $34.0 million, or 1.09% of total loans and leases, at December 31, 2014.  The allowance represented 104% of non-performing loans and leases at June 30, 2015 as compared to 111% at December 31, 2014. The allowance for loan and lease losses as a percent of total loans and leases was 1.18% at June 30, 2015 as compared to 1.21% at December 31, 2014. 

Continued analysis of the actual loss history on the problem credits in 2014 and 2015 provided an indication that the coverage of the inherent losses on the problem credits was adequate. The Company continues to monitor the impact of the economic conditions on our commercial customers, the reduced inflow of non-accruals and criticized loans in addition to the significant decline in early stage delinquencies.  The improvement in these credit metrics supports management’s outlook for continued improved credit quality performance.

The balance of impaired loans was $28.7 million, with specific allowances of $2.9 million against those loans at June 30, 2015, as compared to $29.4 million with allowances of $2.9 million, at December 31, 2014.

The Company's borrowers are concentrated in nine counties in Maryland, three counties in Virginia and in Washington D.C.  Commercial and residential mortgages, including home equity loans and lines, represented 76% of total loans and leases at June 30, 2015 and at December 31, 2014.  Certain loan terms may create concentrations of credit risk and increase the Company’s exposure to loss. These include terms that permit the deferral of principal payments or payments that are smaller than normal interest accruals (negative amortization); loans with high loan-to-value ratios; loans, such as option adjustable-rate mortgages, that may expose the borrower to future increases in repayments that are in excess of increases that would result solely from increases in market interest rates; and interest-only loans.  The Company does not make loans that provide for negative amortization or option adjustable-rate mortgages.

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Summary of Loan and Lease Loss Experience

The following table presents the activity in the allowance for loan and lease losses for the periods:

			Six Months Ended		Year Ended
(Dollars in thousands)			June 30, 2015		December 31, 2014
Balance, January 1			$	37,802	$	38,766
Provision for loan and lease losses				1,815		(163)
Loan charge-offs:
Residential real estate:
	Residential mortgage			(78)		(323)
	Residential construction			-		(4)
Commercial real estate:
	Commercial investor			(90)		(3)
	Commercial owner occupied			(212)		(265)
	Commercial AD&C			(739)		(529)
Commercial business				(181)		(729)
Leases				-		-
Consumer				(537)		(834)
	Total charge-offs			(1,837)		(2,687)
Loan recoveries:
Residential real estate:
	Residential mortgage			31		121
	Residential construction			15		79
Commercial real estate:
	Commercial investor			10		38
	Commercial owner occupied			1		6
	Commercial AD&C			580		-
Commercial business				197		1,477
Leases				-		-
Consumer				99		165
	Total recoveries			933		1,886
	Net charge-offs			(904)		(801)
		Balance, period end	$	38,713	$	37,802
Net charge-offs to average loans and leases				0.06%		0.03%
Allowance for loan losses to loans				1.18%		1.21%

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Analysis of Credit Risk

The following table presents information with respect to non-performing assets and 90-day delinquencies for the periods indicated:

(Dollars in thousands)			June 30, 2015		December 31, 2014
Non-accrual loans and leases:
Residential real estate:
	Residential mortgage		$	7,780	$	3,012
	Residential construction			780		1,105
Commercial real estate:
	Commercial investor			10,023		8,156
	Commercial owner occupied			8,423		8,941
	Commercial AD&C			194		2,464
Commercial business				3,285		3,184
Leases				-		-
Consumer				1,214		1,668
		Total non-accrual loans and leases		31,699		28,530
Loans and leases 90 days past due
Residential real estate:
	Residential mortgage			-		-
	Residential construction			-		-
Commercial real estate:
	Commercial investor			-		-
	Commercial owner occupied			-		-
	Commercial AD&C			-		-
Commercial business				-		-
Leases				2		-
Consumer				7		-
	Total 90 days past due loans and leases			9		-
Restructured loans and leases (accruing)				5,620		5,497
	Total non-performing loans and leases			37,328		34,027
Other real estate owned, net				4,514		3,195
	Total non-performing assets		$	41,842	$	37,222

Market Risk Management

The Company's net income is largely dependent on its net interest income.  Net interest income is susceptible to interest rate risk to the extent that interest-bearing liabilities mature or re-price on a different basis than interest-earning assets.  When interest-bearing liabilities mature or re-price more quickly than interest-earning assets in a given period, a significant increase in market rates of interest could adversely affect net interest income.  Similarly, when interest-earning assets mature or re-price more quickly than interest-bearing liabilities, falling interest rates could result in a decrease in net interest income. Net interest income is also affected by changes in the portion of interest-earning assets that are funded by interest-bearing liabilities rather than by other sources of funds, such as noninterest-bearing deposits and stockholders' equity.

The Company’s interest rate risk management goals are (1) to increase net interest income at a growth rate consistent with the growth rate of total assets, and (2) to minimize fluctuations in net interest margin as a percentage of interest-earning assets.  Management attempts to achieve these goals by balancing, within policy limits, the volume of floating-rate liabilities with a similar volume of floating-rate assets; by keeping the average maturity of fixed-rate asset and liability contracts reasonably matched; by maintaining a pool of administered core deposits; and by adjusting pricing rates to market conditions on a continuing basis.

56

The Company’s board of directors has established a comprehensive interest rate risk management policy, which is administered by management’s Asset Liability Management Committee (“ALCO”). The policy establishes limits on risk, which are quantitative measures of the percentage change in net interest income (a measure of net interest income at risk) and the fair value of equity capital (a measure of economic value of equity or “EVE” at risk) resulting from a hypothetical change in U.S. Treasury interest rates for maturities from one day to thirty years. The Company measures the potential adverse impacts that changing interest rates may have on its short-term earnings, long-term value, and liquidity by employing simulation analysis through the use of computer modeling. The simulation model captures optionality factors such as call features and interest rate caps and floors imbedded in investment and loan portfolio contracts. As with any method of gauging interest rate risk, there are certain shortcomings inherent in the interest rate modeling methodology used by the Company. When interest rates change, actual movements in different categories of interest-earning assets and interest-bearing liabilities, loan prepayments, and withdrawals of time and other deposits, may deviate significantly from assumptions used in the model.  As an example, certain money market deposit accounts are assumed to reprice at 100% of the interest rate change in each of the up rate shock scenarios even though this is not a contractual requirement.  As a practical matter, management would likely lag the impact of any upward movement in market rates on these accounts as a mechanism to manage the bank’s net interest margin.  Finally, the methodology does not measure or reflect the impact that higher rates may have on adjustable-rate loan customers’ ability to service their debts, or the impact of rate changes on demand for loan, lease, and deposit products.

The Company prepares a current base case and eight alternative simulations at least once a quarter and reports the analysis to the board of directors.  In addition, more frequent forecasts are produced when interest rates are particularly uncertain or when other business conditions so dictate.

The statement of condition is subject to quarterly testing for eight alternative interest rate shock possibilities to indicate the inherent interest rate risk.  Average interest rates are shocked by +/- 100, 200, 300, and 400 basis points (“bp”), although the Company may elect not to use particular scenarios that it determines are impractical in a current rate environment.  It is management’s goal to structure the balance sheet so that net interest earnings at risk over a twelve-month period and the economic value of equity at risk do not exceed policy guidelines at the various interest rate shock levels.

The Company augments its quarterly interest rate shock analysis with alternative external interest rate scenarios on a monthly basis. These alternative interest rate scenarios may include non-parallel rate ramps and non-parallel yield curve twists.  If a measure of risk produced by the alternative simulations of the entire balance sheet violates policy guidelines, ALCO is required to develop a plan to restore the measure of risk to a level that complies with policy limits within two quarters.

Measures of net interest income at risk produced by simulation analysis are indicators of an institution’s short-term performance in alternative rate environments.  These measures are typically based upon a relatively brief period, usually one year.  They do not necessarily indicate the long-term prospects or economic value of the institution.

Estimated Changes in Net Interest Income
Change in Interest Rates:	+ 400 bp	+ 300 bp	+ 200 bp	+ 100 bp	- 100 bp	- 200 bp	-300 bp	-400 bp
Policy Limit	23.50%	17.50%	15.00%	10.00%	10.00%	15.00%	17.50%	23.50%
June 30, 2015	(2.37%)	(0.74%)	0.47%	0.17%	N/A	N/A	N/A	N/A
December 31, 2014	(5.12%)	(2.62%)	(0.89%)	(0.52%)	N/A	N/A	N/A	N/A

As shown above, measures of net interest income at risk improved from December 31, 2014 at all rising interest rate shock levels. All measures remained well within prescribed policy limits.

The decrease in the risk position with respect to net interest income from December 31, 2014 to June 30, 2015 was the result of a decline in short-term FHLB borrowings which will reduce the Company’s exposure to increases in interest rates.  The decline in short-term borrowings was partially offset by an increase in repurchase agreements.

The measures of equity value at risk indicate the ongoing economic value of the Company by considering the effects of changes in interest rates on all of the Company’s cash flows, and by discounting the cash flows to estimate the present value of assets and liabilities.  The difference between these discounted values of the assets and liabilities is the economic value of equity, which, in theory, approximates the fair value of the Company’s net assets.

57

Estimated Changes in Economic Value of Equity (EVE)
Change in Interest Rates:	+ 400 bp	+ 300 bp	+ 200 bp	+ 100 bp	- 100 bp	- 200 bp	-300 bp	-400 bp
Policy Limit	35.00%	25.00%	20.00%	10.00%	10.00%	20.00%	25.00%	35.00%
June 30, 2015	(8.47%)	(5.91%)	(3.07%)	(1.81%)	N/A	N/A	N/A	N/A
December 31, 2014	(9.97%)	(6.75%)	(4.17%)	(1.97%)	N/A	N/A	N/A	N/A

Measures of the economic value of equity (“EVE”) at risk improved from December 31, 2014 to June 30, 2015 in all rising shock scenarios. The positive impact in EVE was driven by longer durations on several deposit categories, especially noninterest-bearing and interest-bearing checking accounts and time deposits, resulting in higher market value premiums should rates increase.

Liquidity Management

Liquidity is measured by a financial institution's ability to raise funds through loan and lease repayments, maturing investments, deposit growth, borrowed funds, capital and the sale of highly marketable assets such as investment securities and residential mortgage loans. The Company's liquidity position, considering both internal and external sources available, exceeded anticipated short-term and long-term needs at June 30, 2015.  Management considers core deposits, defined to include all deposits other than time deposits of $100 thousand or more, to be a relatively stable funding source. Core deposits equaled 71% of total interest-earning assets at June 30, 2015. In addition, loan and lease payments, maturities, calls and pay downs of securities, deposit growth and earnings contribute a flow of funds available to meet liquidity requirements. In assessing liquidity, management considers operating requirements, the seasonality of deposit flows, investment, loan and deposit maturities and calls, expected funding of loans and deposit withdrawals, and the market values of available-for-sale investments, so that sufficient funds are available on short notice to meet obligations as they arise and to ensure that the Company is able to pursue new business opportunities.

Liquidity is measured using an approach designed to take into account, in addition to factors already discussed above, the Company’s growth and mortgage banking activities.  Also considered are changes in the liquidity of the investment portfolio due to fluctuations in interest rates.  Under this approach, implemented by the Funds Management Subcommittee of ALCO under formal policy guidelines, the Company’s liquidity position is measured weekly, looking forward at thirty day intervals from thirty (30) to three hundred sixty (360) days.  The measurement is based upon the projection of funds sold or purchased position, along with ratios and trends developed to measure dependence on purchased funds and core growth.  Resulting projections as of June 30, 2015, show short-term investments exceeding short-term borrowings by $24 million over the subsequent 360 days.  This projected excess of liquidity versus requirements provides the Company with flexibility in how it funds loans and other earning assets. 

The Company also has external sources of funds, which can be drawn upon when required.  The main sources of external liquidity are available lines of credit with the Federal Home Loan Bank of Atlanta and the Federal Reserve. The line of credit with the Federal Home Loan Bank of Atlanta totaled $1.3 billion, of which $1.2 billion was available for borrowing based on pledged collateral, with $550 million borrowed against it as of June 30, 2015. The line of credit at the Federal Reserve totaled $335 million, all of which was available for borrowing based on pledged collateral, with no borrowings against it as of June 30, 2015.  Other external sources of liquidity available to the Company in the form of unsecured lines of credit granted by correspondent banks totaled $55 million at June 30, 2015, against which there were no outstanding borrowings.  In addition, the Company had a secured line of credit with a correspondent bank of $20 million as of June 30, 2015. Based upon its liquidity analysis, including external sources of liquidity available, management believes the liquidity position was appropriate at June 30, 2015.

The parent company (“Bancorp”) is a separate legal entity from the Bank and must provide for its own liquidity. In addition to its operating expenses, Bancorp is responsible for funding stock repurchases and paying any dividends declared to its common shareholders and interest and principal on outstanding debt. Bancorp’s primary source of income is dividends received from the Bank. The amount of dividends that the Bank may declare and pay to Bancorp in any calendar year, without the receipt of prior approval from the Federal Reserve, cannot exceed net income for that year to date plus retained net income (as defined) for the preceding two calendar years. Based on this requirement, as of June 30, 2015, the Bank could have declared a dividend of $39 million to Bancorp. At June 30, 2015, Bancorp had liquid assets of $15 million.

58

Arrangements to fund credit products or guarantee financing take the form of loan commitments (including lines of credit on revolving credit structures) and letters of credit.  Approvals for these arrangements are obtained in the same manner as loans.  Generally, cash flows, collateral value and risk assessment are considered when determining the amount and structure of credit arrangements.

Commitments to extend credit in the form of consumer, commercial real estate and business at the dates indicated were as follows:

			June 30,	December 31,
(In thousands)		2015		2014
Commercial		$	234,223	$	212,628
Real estate-development and construction			81,817		100,264
Real estate-residential mortgage			30,529		12,667
Lines of credit, principally home equity and business lines			857,704		810,552
Standby letters of credit			60,073		58,144
	Total Commitments to extend credit and available credit lines	$	1,264,346	$	1,194,255

Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

See “Financial Condition - Market Risk and Interest Rate Sensitivity” in Management’s Discussion and Analysis of Financial Condition and Results of Operations, above, which is incorporated herein by reference. 

Item 4.  CONTROLS AND PROCEDURES

The Company’s management, under the supervision and with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, evaluated as of the last day of the period covered by this report, the effectiveness of the design and operation of the Company’s disclosure controls and procedures, as defined in Rule 13a-15 under the Securities Exchange Act of 1934. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective. There were no changes in the Company’s internal controls over financial reporting (as defined in Rule 13a-15 under the Securities Act of 1934) during the three months ended June 30, 2015, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

In the normal course of business, the Company becomes involved in litigation arising from the banking, financial and other activities it conducts.  Management, after consultation with legal counsel, does not anticipate that the ultimate liability, if any, arising from these matters will have a material effect on the Company’s financial condition, operating results or liquidity.

Item 1A. Risk Factors

There have been no material changes in the risk factors as discussed in the 2014 Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The Company re-approved a stock repurchase program in August 2013 that permits the repurchase of up to 5% of the Company’s outstanding shares of common stock or approximately 1,260,000 shares.  Repurchases which will be conducted through open market purchases or privately negotiated transactions, will be made depending on market conditions and other factors.  The following table provides information regarding repurchase transactions executed during the quarter ended June 30, 2015.

59

			Total number of Shares	Maximum Number that
			Purchased as part of	May Yet Be Purchased
	Total Number of	Average Price Paid	Publicly Announced Plans	Under the Plans or
Period	Shares Purchased	per Share	or Programs	Programs
April 1, 2015 through
April 30, 2015	100,576	$26.25	100,576	759,008
May 1, 2015 through
May 31, 2015	110,302	$26.19	110,302	648,706
June 1, 2015 through
June 30, 2015	13,225	$26.37	13,225	635,481

Item 3. Defaults Upon Senior Securities – None

Item 4.  Mine Safety Disclosures – Not applicable

Item 5. Other Information - None

Item 6. Exhibits

               Exhibit 31(a)                         Certification of Chief Executive Officer

               Exhibit 31(b)                         Certification of Chief Financial Officer

               Exhibit 32(a)                         Certification of Chief Executive Officer pursuant to 18 U.S. Section 1350

               Exhibit 32(b)                         Certification of Chief Financial Officer pursuant to 18 U.S. Section 1350

               Exhibit 101                            The following materials from the Sandy Spring Bancorp, Inc. Quarterly Report on Form 10-Q for the quarter end  June 30, 2015 formatted in Extensible Business Reporting Language (XBRL): (i) the Condensed Consolidated Statements of Condition; (ii) The Condensed Consolidated Statements of Income; (iii) The Condensed Consolidated Statements of Comprehensive Income; (iv) The Condensed Consolidated Statements of Cash Flows; (v) The Condensed Consolidated Statements of Changes in Stockholders’ Equity; (vi) related notes.

60

Signatures

Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the Registrant has duly caused this quarterly report to be signed on its behalf by the undersigned, thereunto duly authorized.

SANDY SPRING BANCORP, INC.

(Registrant)

By: /s/ Daniel J. Schrider                   

Daniel J. Schrider

President and Chief Executive Officer

Date: August 6, 2015

By: /s/ Philip J. Mantua                     

Philip J. Mantua

Executive Vice President and Chief Financial Officer

Date: August 6, 2015

61

EX-31

 

Exhibit 31 (a)

CERTIFICATION 

Rule 13a-14(a) / 15d-14(a) Certifications

I, Daniel J. Schrider, Chief Executive Officer of Sandy Spring Bancorp, Inc. (“Bancorp”), certify that:

1.I have reviewed this quarterly report on Form 10-Q of Sandy Spring Bancorp, Inc.

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a    material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d--15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such  disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based upon such evaluation; and

d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 6, 2015                                                                                          /s/Daniel J. Schrider

Daniel J. Schrider

Chief Executive Officer

EX-31

 

Exhibit 31 (b)

                                                                                    CERTIFICATION

I, Philip J. Mantua, Executive Vice President and Chief Financial Officer of Sandy Spring Bancorp, Inc. (“Bancorp”), certify that:

1.I have reviewed this quarterly report on Form 10-Q of Sandy Spring Bancorp, Inc.

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a    material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d--15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such  disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based upon such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 6, 2015                                                                                          /s/Philip J. Mantua

Philip J. Mantua

Executive Vice President and

Chief Financial Officer

EX-32

 

Exhibit 32(a)

18 U.S.C. Section 1350 Certification

I hereby certify pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge and belief, that the accompanying Form 10-Q of Sandy Spring Bancorp, Inc. (“Bancorp”) for the quarterly period ended June 30, 2015, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934(15 U.S.C. 78m or 78o(d)); and that the information contained in this Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Bancorp.

By:       /s/ Daniel J. Schrider___________ 

             Daniel J. Schrider

             Chief Executive Officer

             Date: August 6, 2015

EX-32

 

Exhibit 32(a)

18 U.S.C. Section 1350 Certification

I hereby certify pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge and belief, that the accompanying Form 10-Q of Sandy Spring Bancorp, Inc. (“Bancorp”) for the quarterly period ended June 30, 2015, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934(15 U.S.C. 78m or 78o(d)); and that the information contained in this Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Bancorp.

By:       /s/ Philip J. Mantua___________ 

             Philip J. Mantua

             Chief Financial Officer

             Date: August 6, 2015

XML

Investments (Gross Unrealized Losses and Fair Value by Length of Time of Available-For-Sale Securities) (Detail) $ in Thousands	Jun. 30, 2015 USD ($) Securities	Dec. 31, 2014 USD ($) Securities
Schedule Of Available For Sale Securities [Line Items]
Fair Value	$ 222,219	$ 253,226
Less than 12 months	856	122
More than 12 months	3,004	5,748
Total Unrealized Losses	$ 3,860	$ 5,870
Available-for-Sale Securities
Schedule Of Available For Sale Securities [Line Items]
Number of securities | Securities	35	37
U.S. Government Agencies
Schedule Of Available For Sale Securities [Line Items]
Fair Value	$ 108,274	$ 141,679
Less than 12 months	605	60
More than 12 months	1,079	2,758
Total Unrealized Losses	$ 1,684	$ 2,818
U.S. Government Agencies | Available-for-Sale Securities
Schedule Of Available For Sale Securities [Line Items]
Number of securities | Securities	10	14
State and municipal
Schedule Of Available For Sale Securities [Line Items]
Fair Value	$ 1,410	$ 1,409
Less than 12 months	1	4
More than 12 months	0	0
Total Unrealized Losses	$ 1	$ 4
State and municipal | Available-for-Sale Securities
Schedule Of Available For Sale Securities [Line Items]
Number of securities | Securities	2	2
Mortgage-Backed
Schedule Of Available For Sale Securities [Line Items]
Fair Value	$ 111,424	$ 108,902
Less than 12 months	250	58
More than 12 months	1,832	2,878
Total Unrealized Losses	$ 2,082	$ 2,936
Mortgage-Backed | Available-for-Sale Securities
Schedule Of Available For Sale Securities [Line Items]
Number of securities | Securities	22	20
Trust Preferred
Schedule Of Available For Sale Securities [Line Items]
Fair Value	$ 1,111	$ 1,236
Less than 12 months	0	0
More than 12 months	93	112
Total Unrealized Losses	$ 93	$ 112
Trust Preferred | Available-for-Sale Securities
Schedule Of Available For Sale Securities [Line Items]
Number of securities | Securities	1	1

XML

Credit Quality Assessment (Credit Quality of Loan Portfolio) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	$ 9,628	$ 13,642
Non-accrual loans and leases	31,699	28,530
Current loans	3,245,287	3,082,209
Total loans and leases	3,288,865	3,127,392
Receivables Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Loans aquired with deteriorated credit quality	2,251	3,011
Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	61	1,754
Non-accrual loans and leases	3,285	3,184
Current loans	405,251	384,605
Total loans and leases	409,795	390,781
Commercial | Receivables Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Loans aquired with deteriorated credit quality	1,198	1,238
Leases
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	2	11
Non-accrual loans and leases	0	0
Current loans	19	43
Total loans and leases	21	54
Leases | Receivables Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Loans aquired with deteriorated credit quality	0	0
Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	1,957	976
Non-accrual loans and leases	1,214	1,668
Current loans	433,294	422,908
Total loans and leases	436,465	425,552
Consumer | Receivables Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Loans aquired with deteriorated credit quality	0	0
Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	320
Non-accrual loans and leases	194	2,464
Current loans	222,909	202,340
Total loans and leases	223,103	205,124
Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction | Receivables Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Loans aquired with deteriorated credit quality	0	0
Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	1,525	3,867
Non-accrual loans and leases	10,023	8,156
Current loans	682,631	628,170
Total loans and leases	694,179	640,193
Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate | Receivables Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Loans aquired with deteriorated credit quality	0	0
Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	1,067	2,814
Non-accrual loans and leases	8,423	8,941
Current loans	633,430	597,533
Total loans and leases	643,973	611,061
Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate | Receivables Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Loans aquired with deteriorated credit quality	1,053	1,773
Residential Real Estate Portfolio Segment | Residential Mortgage
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	5,016	3,900
Non-accrual loans and leases	7,780	3,012
Current loans	731,399	710,974
Total loans and leases	744,195	717,886
Residential Real Estate Portfolio Segment | Residential Mortgage | Receivables Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Loans aquired with deteriorated credit quality	0	0
Residential Real Estate Portfolio Segment | Residential Construction
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	0
Non-accrual loans and leases	780	1,105
Current loans	136,354	135,636
Total loans and leases	137,134	136,741
Residential Real Estate Portfolio Segment | Residential Construction | Receivables Acquired with Deteriorated Credit Quality [Member]
Financing Receivable Recorded Investment Past Due [Line Items]
Loans aquired with deteriorated credit quality	0	0
31-60 days
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	5,834	9,663
31-60 days | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	61	759
31-60 days | Leases
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	11
31-60 days | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	1,307	797
31-60 days | Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	0
31-60 days | Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	85	2,374
31-60 days | Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	609	2,658
31-60 days | Residential Real Estate Portfolio Segment | Residential Mortgage
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	3,772	3,064
31-60 days | Residential Real Estate Portfolio Segment | Residential Construction
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	0
61-90 days
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	3,785	3,979
61-90 days | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	995
61-90 days | Leases
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	0
61-90 days | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	643	179
61-90 days | Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	320
61-90 days | Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	1,440	1,493
61-90 days | Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	458	156
61-90 days | Residential Real Estate Portfolio Segment | Residential Mortgage
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	1,244	836
61-90 days | Residential Real Estate Portfolio Segment | Residential Construction
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	0
> 90 days
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	9	0
> 90 days | Commercial
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	0
> 90 days | Leases
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	2	0
> 90 days | Consumer
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	7	0
> 90 days | Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	0
> 90 days | Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	0
> 90 days | Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	0
> 90 days | Residential Real Estate Portfolio Segment | Residential Mortgage
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	0	0
> 90 days | Residential Real Estate Portfolio Segment | Residential Construction
Financing Receivable Recorded Investment Past Due [Line Items]
Total past due	$ 0	$ 0

XML

Credit Quality Assessment (Summary Information on Allowance for Loan and Lease Loss Activity) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Credit Quality Assessment [Abstract]
Balance at beginning of year			$ 37,802	$ 38,766	$ 38,766
Provision (credit) for loan and lease losses	$ 1,218	$ 158	1,815	(824)
Loan and lease charge-offs			(1,837)	(1,176)	(2,687)
Loan and lease recoveries			933	1,193	1,886
Net charge-offs			(904)	17	(801)
Balance at period end	$ 38,713	$ 37,959	$ 38,713	$ 37,959	$ 37,802

XML

Financial Instruments with Off-Balance Sheet Risk and Derivatives (Company's Interest Rate Swaps) (Detail) - Swap - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Derivative [Line Items]
Notional Amount	$ 20,400,000	$ 20,900,000
Estimated Fair Value	$ 1,400,000	$ 1,500,000

XML

Credit Quality Assessment (Credit Risk Rating Indicators for Each Segment of Commercial Loan Portfolio) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	$ 3,288,865	$ 3,127,392
Commercial
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	409,795	390,781
Pass | Commercial
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	384,562	366,367
Special Mention | Commercial
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	8,212	8,835
Substandard | Commercial
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	17,021	15,579
Doubtful | Commercial
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	0	0
Commercial Portfolio Segment [Member]
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	1,971,050	1,847,159
Commercial Portfolio Segment [Member] | Pass
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	1,900,997	1,771,095
Commercial Portfolio Segment [Member] | Special Mention
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	17,198	21,133
Commercial Portfolio Segment [Member] | Substandard
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	52,855	54,931
Commercial Portfolio Segment [Member] | Doubtful
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	0	0
Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	223,103	205,124
Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	694,179	640,193
Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	643,973	611,061
Commercial Real Estate Portfolio Segment | Pass | Commercial Acquisition, Development and Construction
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	220,747	201,642
Commercial Real Estate Portfolio Segment | Pass | Commercial Investor Real Estate
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	679,253	621,511
Commercial Real Estate Portfolio Segment | Pass | Commercial Owner Occupied Real Estate
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	616,435	581,575
Commercial Real Estate Portfolio Segment | Special Mention | Commercial Acquisition, Development and Construction
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	698	698
Commercial Real Estate Portfolio Segment | Special Mention | Commercial Investor Real Estate
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	1,857	3,931
Commercial Real Estate Portfolio Segment | Special Mention | Commercial Owner Occupied Real Estate
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	6,431	7,669
Commercial Real Estate Portfolio Segment | Substandard | Commercial Acquisition, Development and Construction
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	1,658	2,784
Commercial Real Estate Portfolio Segment | Substandard | Commercial Investor Real Estate
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	13,069	14,751
Commercial Real Estate Portfolio Segment | Substandard | Commercial Owner Occupied Real Estate
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	21,107	21,817
Commercial Real Estate Portfolio Segment | Doubtful | Commercial Acquisition, Development and Construction
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	0	0
Commercial Real Estate Portfolio Segment | Doubtful | Commercial Investor Real Estate
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	0	0
Commercial Real Estate Portfolio Segment | Doubtful | Commercial Owner Occupied Real Estate
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	$ 0	$ 0

XML

Segment Reporting (Operating Segments and Reconciliation of Information to Condensed Consolidated Financial Statements) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Segment Reporting Information [Line Items]
Interest income	$ 38,849	$ 36,991	$ 76,921	$ 73,241
Interest expense	4,916	4,682	9,615	9,340
Provision (credit) for loan and lease losses	1,218	158	1,815	(824)
Non-interest income	12,109	11,694	25,268	22,943
Non-interest Expense	29,477	34,141	58,721	61,690
Income before income taxes	15,347	9,704	32,038	25,978
Income tax expense	5,014	2,722	10,480	8,068
Net income	10,333	6,982	21,558	17,910
Assets	4,507,367	4,234,342	4,507,367	4,234,342	$ 4,397,132
Community Banking
Segment Reporting Information [Line Items]
Interest income	38,849	36,991	76,920	73,241
Interest expense	4,918	4,690	9,618	9,354
Provision (credit) for loan and lease losses	1,218	158	1,815	(824)
Non-interest income	24,945	12,108	34,781	20,123
Non-interest Expense	42,958	35,305	69,975	60,917
Income before income taxes	14,700	8,946	30,293	23,917
Income tax expense	4,763	2,427	9,797	7,258
Net income	9,937	6,519	20,496	16,659
Assets	4,508,858	4,257,129	4,508,858	4,257,129
Insurance
Segment Reporting Information [Line Items]
Interest income	0	3	1	5
Interest expense	0	0	0	0
Provision (credit) for loan and lease losses	0	0	0	0
Non-interest income	984	1,045	2,678	2,776
Non-interest Expense	1,169	1,125	2,552	2,317
Income before income taxes	(185)	(77)	127	464
Income tax expense	(74)	(30)	52	188
Net income	(111)	(47)	75	276
Assets	5,647	6,025	5,647	6,025
Investment Management
Segment Reporting Information [Line Items]
Interest income	2	5	3	9
Interest expense	0	0	0	0
Provision (credit) for loan and lease losses	0	0	0	0
Non-interest income	1,754	1,717	3,564	3,395
Non-interest Expense	924	887	1,949	1,807
Income before income taxes	832	835	1,618	1,597
Income tax expense	325	325	631	622
Net income	507	510	987	975
Assets	10,672	10,927	10,672	10,927
Intersegment Elimination
Segment Reporting Information [Line Items]
Interest income	(2)	(8)	(3)	(14)
Interest expense	(2)	(8)	(3)	(14)
Provision (credit) for loan and lease losses	0	0	0	0
Non-interest income	(15,574)	(3,176)	(15,755)	(3,351)
Non-interest Expense	(15,574)	(3,176)	(15,755)	(3,351)
Income before income taxes	0	0	0	0
Income tax expense	0	0	0	0
Net income	0	0	0	0
Assets	$ (17,810)	$ (39,739)	$ (17,810)	$ (39,739)

XML

Loans and Leases (Loan Portfolio Segment Balances) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans and leases	$ 3,288,865	$ 3,127,392
Commercial
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans and leases	409,795	390,781
Leases
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans and leases	21	54
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans and leases	436,465	425,552
Commercial Real Estate Portfolio Segment [Member] | Commercial Owner Occupied Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans and leases	643,973	611,061
Commercial Real Estate Portfolio Segment [Member] | Commercial Investor Real Estate
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans and leases	694,179	640,193
Commercial Real Estate Portfolio Segment [Member] | Commercial Acquisition, Development and Construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans and leases	223,103	205,124
Residential Real Estate Portfolio Segment [Member] | Residential Mortgage
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans and leases	744,195	717,886
Residential Real Estate Portfolio Segment [Member] | Residential Construction
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total loans and leases	$ 137,134	$ 136,741

XML

OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

6 Months Ended

Jun. 30, 2015

Other Comprehensive Income Loss [Abstract]

Net Accumulated Other Comprehensive Income (Loss)

The following table presents the activity in net accumulated other comprehensive income (loss) and the components of the activity for the periods indicated:

		Unrealized Gains
		(Losses) on
		Investments		Defined Benefit
(In thousands)		Available-for-Sale		Pension Plan		Total
Balance at January 1, 2015		$	8,078	$	(8,901)	$	(823)
	Other comprehensive income before reclassification, net of tax		(100)		-		(100)
	Reclassifications from accumulated other comprehensive income, net of tax		-		331		331
Current period change in other comprehensive income, net of tax			(100)		331		231
Balance at June 30, 2015		$	7,978	$	(8,570)	$	(592)

		Unrealized Gains
		(Losses) on
		Investments		Defined Benefit
(In thousands)		Available-for-Sale		Pension Plan		Total
Balance at January 1, 2014		$	358	$	(3,328)	$	(2,970)
	Other comprehensive income before reclassification, net of tax		8,148		-		8,148
	Reclassifications from accumulated other comprehensive income, net of tax		-		55		55
Current period change in other comprehensive income, net of tax			8,148		55		8,203
Balance at June 30, 2014		$	8,506	$	(3,273)	$	5,233

Schedule of Amounts Recognized in Other Comprehensive Income (Loss)

The following table provides the information on the reclassification adjustments out of accumulated other comprehensive income for the periods indicated:

				For the Six Months Ended June 30,
(In thousands)				2015		2014
Unrealized gains/(losses) on investments available-for-sale
	Affected line item in the Statements of Income:
	Investment securities gains			$	19		$	-
	Income before taxes				19			-
	Tax expense				8			-
	Net income			$	11		$	-
Amortization of defined benefit pension plan items
	Affected line item in the Statements of Income:
		Recognized actuarial loss (1)		$	551		$	116
			Income before taxes		551			116
			Tax expense		220			61
			Net income	$	331		$	55
(1) This amount is included in the computation of net periodic benefit cost, see Note 9

XML

Fair Value (Financial Assets and Liabilities at Dates Indicated that Were Accounted for or Disclosed at Fair Value) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Residential mortgage loans held for sale (at fair value)	$ 19,445	$ 10,512
Investments available-for-sale (at fair value)	625,819	672,209
Marketable Equity Securities
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	723	723
Fair Value, Measurements, Recurring | Residential Mortgage Loans Held For Sale
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Residential mortgage loans held for sale (at fair value)	19,445	10,512
Fair Value, Measurements, Recurring | U.S. Government Agencies
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	137,980	141,679
Fair Value, Measurements, Recurring | State and municipal
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	161,953	167,052
Fair Value, Measurements, Recurring | Mortgage-Backed
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	324,145	361,519
Fair Value, Measurements, Recurring | Trust Preferred
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	1,018	1,236
Fair Value, Measurements, Recurring | Marketable Equity Securities
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	723	723
Fair Value, Measurements, Recurring | Interest Rate Swap Agreements
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Other assets	1,390	1,501
Other liabilities	(1,390)	(1,501)
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Residential Mortgage Loans Held For Sale
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Residential mortgage loans held for sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Government Agencies
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | State and municipal
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Mortgage-Backed
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Trust Preferred
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Marketable Equity Securities
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Interest Rate Swap Agreements
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Other assets	0	0
Other liabilities	0	0
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Residential Mortgage Loans Held For Sale
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Residential mortgage loans held for sale (at fair value)	19,445	10,512
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | U.S. Government Agencies
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	137,980	141,679
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | State and municipal
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	161,953	167,052
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Mortgage-Backed
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	324,145	361,519
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Trust Preferred
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Marketable Equity Securities
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	723	723
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Interest Rate Swap Agreements
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Other assets	1,390	1,501
Other liabilities	(1,390)	(1,501)
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Residential Mortgage Loans Held For Sale
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Residential mortgage loans held for sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | U.S. Government Agencies
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | State and municipal
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Mortgage-Backed
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Trust Preferred
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	1,018	1,236
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Marketable Equity Securities
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Investments available-for-sale (at fair value)	0	0
Fair Value, Measurements, Recurring | Significant Unobservable Inputs (Level 3) | Interest Rate Swap Agreements
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Other assets	0	0
Other liabilities	$ 0	$ 0

XML

Credit Quality Assessment (Troubled Debt Restructured Loans for Specific Segments of the Loan Portfolio) (Detail) - Troubled Debt Restructuring - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Financing Receivable Modifications [Line Items]
Restructured accruing	$ 275	$ 1,359
Restructured non-accruing	639	284
Balance	914	1,643
Specific allowance	424	99
Restructured and subsequently defaulted	0	0
Commercial
Financing Receivable Modifications [Line Items]
Restructured accruing	275	75
Restructured non-accruing	0	92
Balance	275	167
Specific allowance	275	99
Restructured and subsequently defaulted	0	0
All Other
Financing Receivable Modifications [Line Items]
Restructured accruing	0	0
Restructured non-accruing	0	0
Balance	0	0
Specific allowance	0	0
Restructured and subsequently defaulted	0	0
Commercial Portfolio Segment | Commercial Acquisition, Development and Construction
Financing Receivable Modifications [Line Items]
Restructured accruing	0	0
Restructured non-accruing	0	192
Balance	0	192
Specific allowance	0	0
Restructured and subsequently defaulted	0	0
Commercial Portfolio Segment | Commercial Investor Real Estate
Financing Receivable Modifications [Line Items]
Restructured accruing	0	1,284
Restructured non-accruing	0	0
Balance	0	1,284
Specific allowance	0	0
Restructured and subsequently defaulted	0	0
Commercial Portfolio Segment | Commercial Owner Occupied Real Estate
Financing Receivable Modifications [Line Items]
Restructured accruing	0	0
Restructured non-accruing	639	0
Balance	639	0
Specific allowance	149	0
Restructured and subsequently defaulted	$ 0	$ 0

XML

Fair Value (Carrying Amounts and Fair Values of Company's Financial Instruments) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Financial Liabilities
Securities sold under retail repurchase agreements and federal funds purchased	$ 111,817	$ 74,432
Advances from FHLB	550,000	655,000
Subordinated debentures	35,000	35,000
Reported Value Measurement [Member]
Financial Assets
Investments held-to-maturity and other equity securities	252,465	261,410
Loans, net of allowance	3,250,152	3,089,590
Other assets	89,617	88,657
Financial Liabilities
Time Deposits	488,891	444,921
Securities sold under retail repurchase agreements and federal funds purchased	111,817	74,432
Advances from FHLB	550,000	655,000
Subordinated debentures	35,000	35,000
Estimate of Fair Value Measurement [Member]
Financial Assets
Investments held-to-maturity and other equity securities	253,479	263,697
Loans, net of allowance	3,279,656	3,118,635
Other assets	89,617	88,657
Financial Liabilities
Time Deposits	489,419	444,729
Securities sold under retail repurchase agreements and federal funds purchased	111,817	74,432
Advances from FHLB	572,615	679,163
Subordinated debentures	13,108	13,276
Quoted Prices in Active Markets for Identical Assets (Level 1)
Financial Assets
Investments held-to-maturity and other equity securities	0	0
Loans, net of allowance	0	0
Other assets	0	0
Financial Liabilities
Time Deposits	0	0
Securities sold under retail repurchase agreements and federal funds purchased	0	0
Advances from FHLB	0	0
Subordinated debentures	0	0
Significant Other Observable Inputs (Level 2)
Financial Assets
Investments held-to-maturity and other equity securities	253,479	263,697
Loans, net of allowance	0	0
Other assets	89,617	88,657
Financial Liabilities
Time Deposits	489,419	444,729
Securities sold under retail repurchase agreements and federal funds purchased	111,817	74,432
Advances from FHLB	572,615	679,163
Subordinated debentures	0	0
Significant Unobservable Inputs (Level 3)
Financial Assets
Investments held-to-maturity and other equity securities	0	0
Loans, net of allowance	3,279,656	3,118,635
Other assets	0	0
Financial Liabilities
Time Deposits	0	0
Securities sold under retail repurchase agreements and federal funds purchased	0	0
Advances from FHLB	0	0
Subordinated debentures	$ 13,108	$ 13,276

XML

Segment Reporting (Additional Information) (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Segment Reporting Information [Line Items]
Amortization of intangible assets	$ 106,000	$ 224,000	$ 213,000	$ 594,000
Investment Management
Segment Reporting Information [Line Items]
Assets under management	$ 1,100,000		$ 1,100,000

XML

Litigation (Detail) - CommerceFirst Bank - USD ($)	6 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Loss Contingencies [Line Items]
Loss Contingency Accrual		$ 6,500,000
Business Acquisition, Effective Date of Acquisition	Dec. 31, 2012
Loss Contingency Accrual, Increase (Decrease)	$ 400,000

XML

INVESTMENTS (Tables)

6 Months Ended

Jun. 30, 2015

Amortized cost and Estimated fair values of Investments Available-for-sale

Investments available-for-sale

The amortized cost and estimated fair values of investments available-for-sale at the dates indicated are presented in the following table:

			June 30, 2015								December 31, 2014
					Gross		Gross		Estimated				Gross		Gross		Estimated
			Amortized		Unrealized		Unrealized		Fair		Amortized		Unrealized		Unrealized		Fair
(In thousands)			Cost		Gains		Losses		Value		Cost		Gains		Losses		Value
U.S. government agencies			$	139,542	$	122	$	(1,684)	$	137,980	$	144,497	$	-	$	(2,818)	$	141,679
State and municipal				153,769		8,185		(1)		161,953		157,603		9,453		(4)		167,052
Mortgage-backed				317,433		8,794		(2,082)		324,145		354,631		9,824		(2,936)		361,519
Trust preferred				1,111		-		(93)		1,018		1,348		-		(112)		1,236
	Total debt securities			611,855		17,101		(3,860)		625,096		658,079		19,277		(5,870)		671,486
Marketable equity securities				723		-		-		723		723		-		-		723
		Total investments available-for-sale	$	612,578	$	17,101	$	(3,860)	$	625,819	$	658,802	$	19,277	$	(5,870)	$	672,209

Activity of OTTI on investment Securities Due to Credit Losses Recognized in Earnings

The following table provides the activity of OTTI on investment securities due to credit losses recognized in earnings for the period indicated:

(In thousands)		OTTI Losses
Cumulative credit losses on investment securities, through December 31, 2014	$	531
Additions for credit losses not previously recognized		-
Cumulative credit losses on investment securities, through June 30, 2015	$	531

Amortized Cost and Estimated Fair Values of Investments Held-To-Maturity

Investments held-to-maturity

The amortized cost and estimated fair values of investments held-to-maturity at the dates indicated are presented in the following table:

		June 30, 2015								December 31, 2014
				Gross		Gross		Estimated				Gross		Gross		Estimated
		Amortized		Unrealized		Unrealized		Fair		Amortized		Unrealized		Unrealized		Fair
(In thousands)		Cost		Gains		Losses		Value		Cost		Gains		Losses		Value
U.S. government agencies		$	64,515	$	-	$	(1,340)	$	63,175	$	64,512	$	-	$	(1,734)	$	62,778
State and municipal			150,069		3,454		(1,126)		152,397		155,261		4,321		(325)		159,257
Mortgage-backed			182		26		-		208		200		25		-		225
Corporate debt			2,100		-		-		2,100		-		-		-		-
	Total investments held-to-maturity	$	216,866	$	3,480	$	(2,466)	$	217,880	$	219,973	$	4,346	$	(2,059)	$	222,260

Other Equity Securities

Equity securities

Other equity securities at the dates indicated are presented in the following table:

(In thousands)		June 30, 2015		December 31, 2014
Federal Reserve Bank stock		$	8,269	$	8,269
Federal Home Loan Bank of Atlanta stock			27,330		33,168
	Total equity securities	$	35,599	$	41,437

Available-for-Sale Securities

Gross Unrealized Losses and Fair Value by Length of Time

Gross unrealized losses and fair value by length of time that the individual available-for-sale securities have been in an unrealized loss position at the dates indicated are presented in the following table:

		June 30, 2015
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			10	$	108,274	$	605	$	1,079	$	1,684
State and municipal			2		1,410		1		-		1
Mortgage-backed			22		111,424		250		1,832		2,082
Trust preferred			1		1,111		-		93		93
	Total		35	$	222,219	$	856	$	3,004	$	3,860

		December 31, 2014
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			14	$	141,679	$	60	$	2,758	$	2,818
State and municipal			2		1,409		4		-		4
Mortgage-backed			20		108,902		58		2,878		2,936
Trust preferred			1		1,236		-		112		112
	Total		37	$	253,226	$	122	$	5,748	$	5,870

Amortized Cost and Estimated Fair Values of Investment Securities

The amortized cost and estimated fair values of debt securities available-for-sale by contractual maturity at the dates indicated are provided in the following table. The Company has allocated mortgage-backed securities into the four maturity groupings reflected in the following table using the expected average life of the individual securities based on statistics provided by independent third party industry sources. Expected maturities will differ from contractual maturities as borrowers may have the right to prepay obligations with or without prepayment penalties.

		June 30, 2015				December 31, 2014
				Estimated				Estimated
		Amortized		Fair		Amortized		Fair
(In thousands)		Cost		Value		Cost		Value
Due in one year or less		$	690	$	701	$	691	$	714
Due after one year through five years			116,702		118,680		47,900		49,385
Due after five years through ten years			247,330		254,687		332,841		340,852
Due after ten years			247,133		251,028		276,647		280,535
	Total debt securities available for sale	$	611,855	$	625,096	$	658,079	$	671,486

Held-to-Maturity Securities

Gross Unrealized Losses and Fair Value by Length of Time

Gross unrealized losses and fair value by length of time that the individual held-to-maturity securities have been in a continuous unrealized loss position at the dates indicated are presented in the following tables:

		June 30, 2015
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			8	$	63,175	$	533	$	807	$	1,340
State and municipal			63		55,987		874		252		1,126
	Total		71	$	119,162	$	1,407	$	1,059	$	2,466

		December 31, 2014
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			8	$	62,778	$	-	$	1,734	$	1,734
State and municipal			41		32,027		18		307		325
	Total		49	$	94,805	$	18	$	2,041	$	2,059

Amortized Cost and Estimated Fair Values of Investment Securities

The amortized cost and estimated fair values of debt securities held-to-maturity by contractual maturity at the dates indicated are reflected in the following table. Expected maturities will differ from contractual maturities as borrowers may have the right to prepay obligations with or without prepayment penalties.

		June 30, 2015				December 31, 2014
				Estimated				Estimated
		Amortized		Fair		Amortized		Fair
(In thousands)		Cost		Value		Cost		Value
Due in one year or less		$	846	$	865	$	1,690	$	1,694
Due after one year through five years			10,656		11,013		6,763		6,938
Due after five years through ten years			169,756		170,879		163,252		164,787
Due after ten years			35,608		35,123		48,268		48,841
	Total debt securities held-to-maturity	$	216,866	$	217,880	$	219,973	$	222,260

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Credit Quality Assessment (Summary of Impaired Loans) (Detail) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Credit Quality Assessment [Abstract]
Impaired loans with a specific allowance	$ 9,661	$ 11,411
Impaired loans without a specific allowance	19,033	18,008
Total impaired loans	28,694	29,419
Allowance for loan and lease losses related to impaired loans	2,886	2,894
Allowance for loan and lease losses related to loans collectively evaluated	35,827	34,908
Total allowance for loan and lease losses	38,713	37,802
Average impaired loans for the period	28,769	34,331
Contractual interest income due on impaired loans during the period	1,326	2,339
Interest income on impaired loans recognized on a cash basis	324	773
Interest income on impaired loans recognized on an accrual basis	$ 122	$ 280

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Investments (Gross Unrealized Losses and Fair Value by Length of Time for Held-To-Maturity Securities) (Detail) $ in Thousands	Jun. 30, 2015 USD ($) Securities	Dec. 31, 2014 USD ($) Securities
Schedule Of Held To Maturity Securities [Line Items]
Fair Value	$ 119,162	$ 94,805
Less than 12 months	1,407	18
More than 12 months	1,059	2,041
Total Unrealized Losses	$ 2,466	$ 2,059
Held-to-Maturity Securities
Schedule Of Held To Maturity Securities [Line Items]
Number of securities | Securities	71	49
U.S. government agencies
Schedule Of Held To Maturity Securities [Line Items]
Fair Value	$ 63,175	$ 62,778
Less than 12 months	533	0
More than 12 months	807	1,734
Total Unrealized Losses	$ 1,340	$ 1,734
U.S. government agencies | Held-to-Maturity Securities
Schedule Of Held To Maturity Securities [Line Items]
Number of securities | Securities	8	8
State and municipal
Schedule Of Held To Maturity Securities [Line Items]
Fair Value	$ 55,987	$ 32,027
Less than 12 months	874	18
More than 12 months	252	307
Total Unrealized Losses	$ 1,126	$ 325
State and municipal | Held-to-Maturity Securities
Schedule Of Held To Maturity Securities [Line Items]
Number of securities | Securities	63	41

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Fair Value (Assets Measured at Fair Value on Nonrecurring Basis) (Detail) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	$ 11,427	$ 11,014
Fair value measured on nonrecurring basis losses	10,036	13,646
Impaired loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	6,913	7,819
Fair value measured on nonrecurring basis losses	10,304	13,893
Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	4,514	3,195
Fair value measured on nonrecurring basis losses	(268)	(247)
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Impaired loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Significant Other Observable Inputs (Level 2) | Impaired loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Significant Other Observable Inputs (Level 2) | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	0	0
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	11,427	11,014
Significant Unobservable Inputs (Level 3) | Impaired loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	6,913	7,819
Significant Unobservable Inputs (Level 3) | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, nonrecurring	$ 4,514	$ 3,195

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Investments (Amortized Cost and Estimated Fair Values of Investments Available-for-sale) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	$ 612,578	$ 658,802
Gross Unrealized Gains	17,101	19,277
Gross Unrealized Losses	(3,860)	(5,870)
Estimated Fair Value	625,819	672,209
Marketable Equity Securities
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	723	723
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Estimated Fair Value	723	723
Debt Securities
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	611,855	658,079
Gross Unrealized Gains	17,101	19,277
Gross Unrealized Losses	(3,860)	(5,870)
Estimated Fair Value	625,096	671,486
Debt Securities | U.S. Government Agencies
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	139,542	144,497
Gross Unrealized Gains	122	0
Gross Unrealized Losses	(1,684)	(2,818)
Estimated Fair Value	137,980	141,679
Debt Securities | State and municipal
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	153,769	157,603
Gross Unrealized Gains	8,185	9,453
Gross Unrealized Losses	(1)	(4)
Estimated Fair Value	161,953	167,052
Debt Securities | Mortgage-Backed
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	317,433	354,631
Gross Unrealized Gains	8,794	9,824
Gross Unrealized Losses	(2,082)	(2,936)
Estimated Fair Value	324,145	361,519
Debt Securities | Trust Preferred
Schedule Of Available For Sale Securities [Line Items]
Amortized Cost	1,111	1,348
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(93)	(112)
Estimated Fair Value	$ 1,018	$ 1,236

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Credit Quality Assessment (Impaired Loans by Portfolio) (Detail) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Financing Receivable Impaired [Line Items]
Average impaired loans for the period	$ 28,769	$ 34,331
Contractual interest income due on impaired loans during the period	1,326	2,339
Interest income on impaired loans recognized on a cash basis	324	773
Interest income on impaired loans recognized on an accrual basis	122	280
Commercial
Financing Receivable Impaired [Line Items]
Average impaired loans for the period	4,013	5,308
Contractual interest income due on impaired loans during the period	207	311
Interest income on impaired loans recognized on a cash basis	93	252
Interest income on impaired loans recognized on an accrual basis	29	63
All Other
Financing Receivable Impaired [Line Items]
Average impaired loans for the period	3,808	7,082
Contractual interest income due on impaired loans during the period	96	87
Interest income on impaired loans recognized on a cash basis	20	60
Interest income on impaired loans recognized on an accrual basis	39	106
Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction
Financing Receivable Impaired [Line Items]
Average impaired loans for the period	1,340	3,651
Contractual interest income due on impaired loans during the period	188	352
Interest income on impaired loans recognized on a cash basis	11	39
Interest income on impaired loans recognized on an accrual basis	0	0
Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate
Financing Receivable Impaired [Line Items]
Average impaired loans for the period	10,829	9,327
Contractual interest income due on impaired loans during the period	469	730
Interest income on impaired loans recognized on a cash basis	15	78
Interest income on impaired loans recognized on an accrual basis	54	111
Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate
Financing Receivable Impaired [Line Items]
Average impaired loans for the period	8,779	8,963
Contractual interest income due on impaired loans during the period	366	859
Interest income on impaired loans recognized on a cash basis	185	344
Interest income on impaired loans recognized on an accrual basis	$ 0	$ 0

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Net Income Per Share (Calculation of Net Income per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Earnings Per Share [Abstract]
Net income	$ 10,333	$ 6,982	$ 21,558	$ 17,910
Basic:
Basic weighted average EPS shares	24,626	25,062	24,776	25,031
Basic net income per share	$ 0.42	$ 0.28	$ 0.87	$ 0.72
Diluted:
Basic weighted average EPS shares	24,626	25,062	24,776	25,031
Dilutive common stock equivalents	64	65	92	95
Dilutive EPS shares	24,690	25,127	24,868	25,126
Diluted net income per share	$ 0.42	$ 0.28	$ 0.87	$ 0.71
Anti-dilutive shares	8	65	8	56

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Stockholders' Equity (Additional Information) (Detail) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2015	Aug. 31, 2013
Stockholders Equity Note [Line Items]
Treasury Stock, Shares, Acquired	575,472
Treasury Stock Value Acquired Cost Method	$ 14,915
Repurchase Program
Stockholders Equity Note [Line Items]
Share Repurchase Program Shares Authorized To Acquire Outstanding Common Stock Percentage		5.00%
Repurchase of outstanding shares of common stock under Stock Repurchase Program		1,300,000
Treasury Stock, Shares, Acquired	575,472
Stock Repurchased, Average Cost Per Share	$ 25.92

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Credit Quality Assessment (Additional Information) (Detail) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Restructured accruing	$ 900,000	$ 1,600,000
Other real estate owned	4,514,000	3,195,000
Restructured Loans
Accounts, Notes, Loans and Financing Receivable [Line Items]
Specific allowance	400,000	100,000
Additional Financing Receivable Troubled Debt Restructurings Restructured	$ 300,000	$ 100,000

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SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2015

Accounting Policies [Abstract]

Significant Accounting Policies

Note 1 – Significant Accounting Policies

Nature of Operations

Sandy Spring Bancorp (the “Company”), a Maryland corporation, is the bank holding company for Sandy Spring Bank (the “Bank”), which conducts a full-service commercial banking, mortgage banking and trust business. Services to individuals and businesses include accepting deposits, extending real estate, consumer and commercial loans and lines of credit, general insurance, personal trust, and investment and wealth management services. The Company operates in the Maryland counties of Anne Arundel, Carroll, Frederick, Howard, Montgomery, and Prince George's, and in Arlington, Fairfax and Loudoun counties in Virginia. The Company offers investment and wealth management services through the Bank’s subsidiary, West Financial Services. Insurance products are available to clients through Sandy Spring Insurance, and Neff & Associates, which are agencies of Sandy Spring Insurance Corporation.

Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”) and prevailing practices within the financial services industry for interim financial information and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and notes required for complete financial statements and prevailing practices within the banking industry. The following summary of significant accounting policies of the Company is presented to assist the reader in understanding the financial and other data presented in this report. Operating results for the three and six months ended June 30, 2015 are not necessarily indicative of the results that may be expected for any future periods or for the year ending December 31, 2015. In the opinion of management, all adjustments (comprising only normal recurring accruals) necessary for a fair presentation of the results of the interim periods have been included. Certain reclassifications have been made to prior period amounts, as necessary, to conform to the current period presentation. The Company has evaluated subsequent events through the date of the issuance of its financial statements.

These statements should be read in conjunction with the financial statements and accompanying notes included in the Company’s 2014 Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on March 6, 2015. There have been no significant changes to the Company’s accounting policies as disclosed in the 2014 Annual Report on Form 10-K.

Principles of Consolidation

The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Sandy Spring Bank and its subsidiaries, Sandy Spring Insurance Corporation and West Financial Services, Inc. Consolidation has resulted in the elimination of all intercompany accounts and transactions.

Use of Estimates

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, and affect the reported amounts of revenues earned and expenses incurred during the reporting period. Actual results could differ from those estimates. Estimates that could change significantly relate to the provision for loan and lease losses and the related allowance, determination of impaired loans and the related measurement of impairment, potential impairment of goodwill or other intangible assets, valuation of investment securities and the determination of whether impaired securities are other-than-temporarily impaired, valuation of other real estate owned, prepayment rates, valuation of share-based compensation, the assessment that a liability should be recognized with respect to any matters under litigation, the calculation of current and deferred income taxes and the actuarial projections related to pension expense and the related liability.

Cash Flows

For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks, federal funds sold and interest-bearing deposits with banks (items with stated original maturity of three months or less).

Pending Accounting Pronouncements

The FASB issued a standard in May 2014 that provides accounting guidance for all revenue arising from contracts with customers and affects all entities that enter into contracts to provide goods or services to customers. The guidance also provides for a model for the measurement and recognition of gains and losses on the sale of certain nonfinancial assets, such as property and equipment, including real estate. This standard may affect an entity’s financial statements, business processes and internal control over financial reporting. The guidance is effective for the first interim or annual period beginning after December 15, 2017. The guidance must be adopted using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. The Company is assessing this guidance to determine its impact on the Company’s financial position, results of operations and cash flows.

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Share Based Compensation (Additional Information) (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Exercise period			5 years 5 months 1 day	5 years 29 days
Options exercised intrinsic value			$ 308,000
Stock Options Granted, Net of Forfeitures			21,245
2015 Omnibus Stock Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share Based Compensation Arrangement By Share Based Payment Award Description			The Company’s Omnibus Incentive Plan was approved on May 6, 2015 and provides for the granting of non-qualifying stock options to the Company’s directors, and incentive and non-qualifying stock options, stock appreciation rights, restricted stock grants, RSU’s and performance awards to selected key employees on a periodic basis at the discretion of the board.
Common stock, shares authorizes	1,500,000		1,500,000
Common stock, shares available for issuance	1,500,000		1,500,000
Term of share based compensation plan			10 years
Minimum grant price percentage			100.00%
2015 Omnibus Stock Plan | Maximum
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Exercise period			10 years
Stock Options and Restricted Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Recognized Compensation expense	$ 400,000	$ 400,000
Stock Option
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized Compensation expense	300,000		$ 300,000
Expected cost recognition weighted average period			2 years 2 months 12 days
Options exercised intrinsic value			$ 300,000	$ 100,000
Fair value of shares vested			$ 200,000	$ 200,000
Stock Options Granted			21,245
Vesting period			3 years
Restricted Stock
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unrecognized Compensation expense	$ 4,800,000		$ 4,800,000
Expected cost recognition weighted average period			3 years 6 months
Stock Options Granted			79,860
Vesting period			5 years

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Investments (Amortized Cost and Estimated Fair Values of Debt Securities Held-To-Maturity by Contractual Maturity) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Amortized Cost
Due in one year or less	$ 846	$ 1,690
Due after one year through five years	10,656	6,763
Due after five years through ten years	169,756	163,252
Due after ten years	35,608	48,268
Total debt securities held-to-maturity	216,866	219,973
Estimated Fair Value
Due in one year or less	865	1,694
Due after one year through five years	11,013	6,938
Due after five years through ten years	170,879	164,787
Due after ten years	35,123	48,841
Total debt securities held-to-maturity	$ 217,880	$ 222,260

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DEPOSITS (Tables)

6 Months Ended

Jun. 30, 2015

Deposits [Abstract]

Composition of Deposits

The following table presents the composition of deposits at the dates indicated:

(In thousands)				June 30, 2015		December 31, 2014
Noninterest-bearing deposits				$	1,092,413	$	993,737
Interest-bearing deposits:
	Demand				525,584		534,605
	Money market savings				860,315		828,494
	Regular savings				280,143		264,751
	Time deposits of less than $100,000				245,347		239,857
	Time deposits of $100,000 or more				243,544		205,065
		Total interest-bearing deposits			2,154,933		2,072,772
			Total deposits	$	3,247,346	$	3,066,509

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GOODWILL AND OTHER INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Gross Carrying Amounts and Accumulated Amortization of Intangible Assets and Goodwill

The gross carrying amounts and accumulated amortization of intangible assets and goodwill are presented at the dates indicated in the following table:

		June 30, 2015						Weighted		December 31, 2014						Weighted
		Gross				Net		Average		Gross				Net		Average
		Carrying		Accumulated		Carrying		Remaining		Carrying		Accumulated		Carrying		Remaining
(Dollars in thousands)		Amount		Amortization		Amount		Life		Amount		Amortization		Amount		Life
Amortizing intangible assets:
Other identifiable intangibles		$	8,623	$	(8,327)	$	296		1.6 years	$	8,623	$	(8,113)	$	510		1.7 years
	Total amortizing intangible assets	$	8,623	$	(8,327)	$	296			$	8,623	$	(8,113)	$	510
Goodwill		$	84,171			$	84,171			$	84,171			$	84,171

Estimated Future Amortization Expense for Amortizing Intangibles

The following table presents the estimated future amortization expense for amortizing intangible assets within the years ending December 31:

(In thousands)		Amount
2015		$	158
2016			94
2017			16
2018			16
Thereafter			12
	Total amortizing intangible assets	$	296

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Credit Quality Assessment (Information by Credit Risk Rating Indicators for Those Remaining Segments of Loan Portfolio) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	$ 3,288,865	$ 3,127,392
Leases
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	21	54
Consumer
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	436,465	425,552
Residential Real Estate Portfolio Segment | Residential Mortgage
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	744,195	717,886
Residential Real Estate Portfolio Segment | Residential Construction
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	137,134	136,741
Performing Financing Receivable
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	1,305,411	1,271,784
Performing Financing Receivable | Leases
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	19	54
Performing Financing Receivable | Consumer
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	435,244	423,884
Performing Financing Receivable | Residential Real Estate Portfolio Segment | Residential Mortgage
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	733,794	712,210
Performing Financing Receivable | Residential Real Estate Portfolio Segment | Residential Construction
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	136,354	135,636
Homogeneous Loan Pools
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	1,317,815	1,280,233
Homogeneous Loan Pools | Nonperforming Financing Receivable | Loans 90 Days Or More Past Due
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	9	0
Homogeneous Loan Pools | Nonperforming Financing Receivable | Non Accrual Loans
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	9,774	5,785
Homogeneous Loan Pools | Nonperforming Financing Receivable | Restructured Loans
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	2,621	2,664
Homogeneous Loan Pools | Nonperforming Financing Receivable | Leases | Loans 90 Days Or More Past Due
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	2	0
Homogeneous Loan Pools | Nonperforming Financing Receivable | Leases | Non Accrual Loans
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	0	0
Homogeneous Loan Pools | Nonperforming Financing Receivable | Leases | Restructured Loans
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	0	0
Homogeneous Loan Pools | Nonperforming Financing Receivable | Consumer | Loans 90 Days Or More Past Due
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	7	0
Homogeneous Loan Pools | Nonperforming Financing Receivable | Consumer | Non Accrual Loans
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	1,214	1,668
Homogeneous Loan Pools | Nonperforming Financing Receivable | Consumer | Restructured Loans
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	0	0
Homogeneous Loan Pools | Nonperforming Financing Receivable | Residential Real Estate Portfolio Segment | Residential Mortgage | Loans 90 Days Or More Past Due
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	0	0
Homogeneous Loan Pools | Nonperforming Financing Receivable | Residential Real Estate Portfolio Segment | Residential Mortgage | Non Accrual Loans
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	7,780	3,012
Homogeneous Loan Pools | Nonperforming Financing Receivable | Residential Real Estate Portfolio Segment | Residential Mortgage | Restructured Loans
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	2,621	2,664
Homogeneous Loan Pools | Nonperforming Financing Receivable | Residential Real Estate Portfolio Segment | Residential Construction | Loans 90 Days Or More Past Due
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	0	0
Homogeneous Loan Pools | Nonperforming Financing Receivable | Residential Real Estate Portfolio Segment | Residential Construction | Non Accrual Loans
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	780	1,105
Homogeneous Loan Pools | Nonperforming Financing Receivable | Residential Real Estate Portfolio Segment | Residential Construction | Restructured Loans
Financing Receivable Recorded Investment [Line Items]
Total loans and leases	$ 0	$ 0

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Investments (Other Equity Securities) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Other Securities Owned [Line Items]
Federal Reserve Bank stock	$ 8,269	$ 8,269
Total equity securities	35,599	41,437
Atlantic Central Bankers Bank Stock
Other Securities Owned [Line Items]
Federal Home Loan Bank of Atlanta stock	$ 27,330	$ 33,168

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SHARE BASED COMPENSATION (Tables)

6 Months Ended

Jun. 30, 2015

Share Based Compensation [Abstract]

Fair Values of all Options Granted Estimated Using Binomial Option-Pricing Model with Weighted-average Assumptions

The fair values of all of the options granted for the periods indicated have been estimated using a binomial option-pricing model with the weighted-average assumptions for the periods shown are presented in the following table:

	Six Months Ended June 30,
	2015		2014
Dividend yield	3.40	%	3.04	%
Weighted average expected volatility	42.98	%	46.78	%
Weighted average risk-free interest rate	1.42	%	1.56	%
Weighted average expected lives (in years)	5.42		5.08
Weighted average grant-date fair value	$7.63		$8.05

Summary of Share Option Activity

A summary of share option activity for the period indicated is reflected in the following table:

		Number	Weighted		Average	Aggregate
		of	Average		Contractual	Intrinsic
		Common	Exercise		Remaining	Value
		Shares	Share Price		Life(Years)	(in thousands)
Balance at January 1, 2015		224,381	$	20.88		$	1,300
Granted		21,245	$	26.20
Exercised		(26,695)	$	14.68		$	308
Forfeited or expired		(71,708)	$	27.96
Balance at June 30, 2015		147,223	$	19.37	3.7	$	1,268
Exercisable at June 30, 2015		105,984	$	17.26	2.7	$	1,137
Weighted average fair value of options
	granted during the year		$	7.63

Summary of Activity for Company's Non-Vested Options

A summary of the activity for the Company’s restricted stock for the period indicated is presented in the following table:

	Number	Weighted
	of	Average
	Common	Grant-Date
(In dollars, except share data):	Shares	Fair Value
Restricted stock at January 1, 2015	226,871	$	21.07
Granted	79,860	$	26.20
Vested	(78,565)	$	19.79
Forfeited	(3,317)	$	22.80
Restricted stock at June 30, 2015	224,849	$	23.31

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PENSION, PROFIT SHARING, AND OTHER EMPLOYEE BENEFIT PLANS (Tables)

6 Months Ended

Jun. 30, 2015

Pension, Profit Sharing, and Other Employee Benefit Plans [Abstract]

Net Periodic Benefit Cost

The components of net periodic benefit cost for the periods indicated are presented in the following table:

		Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)		2015		2014		2015		2014
Interest cost on projected benefit obligation		$	407	$	403	$	817	$	794
Expected return on plan assets			(406)		(493)		(812)		(987)
Recognized net actuarial loss			259		68		551		116
	Net periodic benefit cost	$	260	$	(22)	$	556	$	(77)

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CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Statement Of Stockholders Equity [Abstract]
Common stock dividends, per share	$ 0.44	$ 0.36
Stock option plan, shares	26,695	13,721
Employee stock purchase plan, shares	12,613	11,423
Director stock purchase plan, shares	837
Restricted stock, shares	52,921	54,535
Treasury Stock, Shares, Acquired	575,472

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NET INCOME PER COMMON SHARE (Tables)

6 Months Ended

Jun. 30, 2015

Earnings Per Share [Abstract]

Calculation of Net Income Per Common Share

The calculation of net income per common share for the periods indicated is presented in the following table:

			Three Months Ended June 30,				Six Months Ended June 30,
(Dollars and amounts in thousands, except per share data)			2015		2014		2015		2014
Net income			$	10,333	$	6,982	$	21,558	$	17,910
Basic:
Basic weighted average EPS shares				24,626		25,062		24,776		25,031
		Basic net income per share	$	0.42	$	0.28	$	0.87	$	0.72
Diluted:
Basic weighted average EPS shares				24,626		25,062		24,776		25,031
Dilutive common stock equivalents				64		65		92		95
	Dilutive EPS shares			24,690		25,127		24,868		25,126
		Diluted net income per share	$	0.42	$	0.28	$	0.87	$	0.71
Anti-dilutive shares				8		65		8		56

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Investments (Amortized Cost and Estimated Fair Values of investment securities Available-For-Sale by Contractual Maturity) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Amortized Cost
Due in one year or less	$ 690	$ 691
Due after one year through five years	116,702	47,900
Due after five years through ten years	247,330	332,841
Due after ten years	247,133	276,647
Total debt securities available for sale	611,855	658,079
Estimated Fair Value
Due in one year or less	701	714
Due after one year through five years	118,680	49,385
Due after five years through ten years	254,687	340,852
Due after ten years	251,028	280,535
Estimated Fair Value	$ 625,096	$ 671,486

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Credit Quality Assessment (Credit Quality of Loan Portfolio by Segment) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Financing Receivable Recorded Investment [Line Items]
Non-accrual loans and leases	$ 31,699	$ 28,530
Loans and leases 90 days past due	9	0
Restructured loans and leases	5,620	5,497
Total non-performing loans and leases	37,328	34,027
Other real estate owned	4,514	3,195
Total non-performing assets	41,842	37,222
Commercial
Financing Receivable Recorded Investment [Line Items]
Non-accrual loans and leases	3,285	3,184
Loans and leases 90 days past due	0	0
Restructured loans and leases	896	710
Total non-performing loans and leases	4,181	3,894
Other real estate owned	39	39
Total non-performing assets	4,220	3,933
Leases
Financing Receivable Recorded Investment [Line Items]
Non-accrual loans and leases	0	0
Loans and leases 90 days past due	2	0
Restructured loans and leases	0	0
Total non-performing loans and leases	2	0
Other real estate owned	0	0
Total non-performing assets	2	0
Consumer
Financing Receivable Recorded Investment [Line Items]
Non-accrual loans and leases	1,214	1,668
Loans and leases 90 days past due	7	0
Restructured loans and leases	0	0
Total non-performing loans and leases	1,221	1,668
Other real estate owned	690	0
Total non-performing assets	1,911	1,668
Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction
Financing Receivable Recorded Investment [Line Items]
Non-accrual loans and leases	194	2,464
Loans and leases 90 days past due	0	0
Restructured loans and leases	0	0
Total non-performing loans and leases	194	2,464
Other real estate owned	789	365
Total non-performing assets	983	2,829
Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate
Financing Receivable Recorded Investment [Line Items]
Non-accrual loans and leases	10,023	8,156
Loans and leases 90 days past due	0	0
Restructured loans and leases	2,103	2,123
Total non-performing loans and leases	12,126	10,279
Other real estate owned	0	0
Total non-performing assets	12,126	10,279
Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate
Financing Receivable Recorded Investment [Line Items]
Non-accrual loans and leases	8,423	8,941
Loans and leases 90 days past due	0	0
Restructured loans and leases	0	0
Total non-performing loans and leases	8,423	8,941
Other real estate owned	0	0
Total non-performing assets	8,423	8,941
Residential Real Estate Portfolio Segment | Residential Mortgage
Financing Receivable Recorded Investment [Line Items]
Non-accrual loans and leases	7,780	3,012
Loans and leases 90 days past due	0	0
Restructured loans and leases	2,621	2,664
Total non-performing loans and leases	10,401	5,676
Other real estate owned	1,613	1,408
Total non-performing assets	12,014	7,084
Residential Real Estate Portfolio Segment | Residential Construction
Financing Receivable Recorded Investment [Line Items]
Non-accrual loans and leases	780	1,105
Loans and leases 90 days past due	0	0
Restructured loans and leases	0	0
Total non-performing loans and leases	780	1,105
Other real estate owned	1,383	1,383
Total non-performing assets	$ 2,163	$ 2,488

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Fair Value (Additional Information) (Detail) - USD ($)	Jun. 30, 2015	Dec. 31, 2014
Fair Value Disclosures [Abstract]
Impaired loans	$ 28,694,000	$ 29,419,000
Impaired loans fair value	25,800,000	26,500,000
Specific loan loss reserves	$ 2,900,000	$ 2,900,000

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CONSOLIDATED STATEMENTS OF CONDITION - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Assets
Cash and due from banks	$ 53,569	$ 52,804
Federal funds sold	472	473
Interest-bearing deposits with banks	35,601	42,940
Cash and cash equivalents	89,642	96,217
Residential mortgage loans held for sale (at fair value)	19,445	10,512
Investments available-for-sale (at fair value)	625,819	672,209
Investments held-to-maturity -- fair value of $217,880 and $222,260 at June 30, 2015 and December 31, 2014, respectively	216,866	219,973
Other equity securities	35,599	41,437
Total loans and leases	3,288,865	3,127,392
Less: allowance for loan and lease losses	(38,713)	(37,802)
Net loans and leases	3,250,152	3,089,590
Premises and equipment, net	51,609	49,402
Other real estate owned	4,514	3,195
Accrued interest receivable	13,144	12,634
Goodwill	84,171	84,171
Other intangible assets, net	296	510
Other assets	116,110	117,282
Total assets	4,507,367	4,397,132
Liabilities
Noninterest-bearing deposits	1,092,413	993,737
Interest-bearing deposits	2,154,933	2,072,772
Total deposits	3,247,346	3,066,509
Securities sold under retail repurchase agreements and federal funds purchased	111,817	74,432
Advances from FHLB	550,000	655,000
Subordinated debentures	35,000	35,000
Accrued interest payable and other liabilities	44,331	44,440
Total liabilities	3,988,494	3,875,381
Stockholders Equity
Common stock -- par value $1.00; shares authorized 50,000,000; shares issued and outstanding 24,562,471 and 25,044,877 at June 30, 2015 and December 31, 2014, respectively	24,562	25,045
Additional paid in capital	181,504	194,647
Retained earnings	313,399	302,882
Accumulated other comprehensive loss	(592)	(823)
Total stockholders equity	518,873	521,751
Total liabilities and stockholders equity	$ 4,507,367	$ 4,397,132

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Loans and Leases (Additional Information) (Detail) - USD ($)	Jun. 30, 2015	Dec. 31, 2014
Loans and Leases [Abstract]
Unearned income and deferred fees	$ 700,000	$ 500,000

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Operating activities:
Net income	$ 21,558	$ 17,910
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	3,504	3,673
Provision (credit) for loan and lease losses	1,815	(824)
Share based compensation expense	941	853
Deferred income tax expense	116	1,029
Origination of loans held for sale	(109,045)	(59,566)
Proceeds from sales of loans held for sale	101,688	59,704
Gains on sales of loans held for sale	(1,576)	(815)
Loss on sales of other real estate owned	0	(2)
Investment securities gains	(19)	0
Net (increase) decrease in accrued interest receivable	(510)	261
Net (increase) decrease in other assets	(65)	(4,580)
Net increase (decrease) in accrued expenses and other liabilities	(162)	4,472
Other - net	2,069	2,427
Net cash provided by operating activities	20,314	24,542
Investing activities:
Purchases of investments held-to-maturity	(2,100)	0
Proceeds from sales of investment available-for-sale	5,838	4,560
Proceeds from maturities, calls and principal payments of investments held-to-maturity	4,786	680
Proceeds from maturities, calls and principal payments of investments available-for-sale	45,249	42,228
Net increase in loans and leases	(163,717)	(127,333)
Proceeds from the sales of other real estate owned	0	32
Expenditures for premises and equipment	(4,559)	(1,795)
Net cash used in investing activities	(114,503)	(81,628)
Financing activities:
Net increase (decrease) in deposits	180,837	161,445
Net increase (decrease) in retail repurchase agreements and federal funds purchased	37,385	19,075
Proceeds from advances from FHLB	1,174,000	980,000
Repayment of advances from FHLB	(1,279,000)	(1,058,000)
Proceeds from issuance of common stock	13	34
Tax benefits associated with shared based compensation	335	0
Repurchase of common stock	(14,915)	0
Dividends paid	(11,041)	(9,094)
Net cash provided by financing activities	87,614	93,460
Net increase (decrease) in cash and cash equivalents	(6,575)	36,374
Cash and cash equivalents at beginning of period	96,217	74,427
Cash and cash equivalents at end of period	89,642	110,801
Supplemental Disclosures:
Interest payments	9,619	9,358
Income tax payments	9,876	10,151
Transfers from loans to other real estate owned	$ 1,340	$ 671

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GOODWILL AND OTHER INTANGIBLE ASSETS (Estimated Future Amortization Expense for Amortizing Intangibles) (Detail) $ in Thousands	Jun. 30, 2015 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2015	$ 158
2016	94
2017	16
2018	16
Thereafter	12
Total amortizing intangible assets	$ 296

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SEGMENT REPORTING (Tables)

6 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Operating Segments and Reconciliation of Information to Condensed Consolidated Financial Statements

Information for the operating segments and reconciliation of the information to the condensed consolidated financial statements for the periods indicated is presented in the following tables:

	Three Months Ended June 30, 2015
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	38,849	$	-	$	2	$	(2)	$	38,849
Interest expense		4,918		-		-		(2)		4,916
Provision for loan and lease losses		1,218		-		-		-		1,218
Noninterest income		24,945		984		1,754		(15,574)		12,109
Noninterest expenses		42,958		1,169		924		(15,574)		29,477
Income before income taxes		14,700		(185)		832		-		15,347
Income tax expense		4,763		(74)		325		-		5,014
Net income	$	9,937	$	(111)	$	507	$	-	$	10,333
Assets	$	4,508,858	$	5,647	$	10,672	$	(17,810)	$	4,507,367

	Three Months Ended June 30, 2014
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	36,991	$	3	$	5	$	(8)	$	36,991
Interest expense		4,690		-		-		(8)		4,682
Provision for loan and lease losses		158		-		-		-		158
Non-interest income		12,108		1,045		1,717		(3,176)		11,694
Non-interest expenses		35,305		1,125		887		(3,176)		34,141
Income before income taxes		8,946		(77)		835		-		9,704
Income tax expense		2,427		(30)		325		-		2,722
Net income	$	6,519	$	(47)	$	510	$	-	$	6,982
Assets	$	4,257,129	$	6,025	$	10,927	$	(39,739)	$	4,234,342

	Six Months Ended June 30, 2015
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	76,920	$	1	$	3	$	(3)	$	76,921
Interest expense		9,618		-		-		(3)		9,615
Provision for loan and lease losses		1,815		-		-		-		1,815
Noninterest income		34,781		2,678		3,564		(15,755)		25,268
Noninterest expenses		69,975		2,552		1,949		(15,755)		58,721
Income before income taxes		30,293		127		1,618		-		32,038
Income tax expense		9,797		52		631		-		10,480
Net income	$	20,496	$	75	$	987	$	-	$	21,558
Assets	$	4,508,858	$	5,647	$	10,672	$	(17,810)	$	4,507,367

	Six Months Ended June 30, 2014
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	73,241	$	5	$	9	$	(14)	$	73,241
Interest expense		9,354		-		-		(14)		9,340
Provision (credit) for loan and lease losses		(824)		-		-		-		(824)
Non-interest income		20,123		2,776		3,395		(3,351)		22,943
Non-interest expenses		60,917		2,317		1,807		(3,351)		61,690
Income before income taxes		23,917		464		1,597		-		25,978
Income tax expense		7,258		188		622		-		8,068
Net income	$	16,659	$	276	$	975	$	-	$	17,910
Assets	$	4,257,129	$	6,025	$	10,927	$	(39,739)	$	4,234,342

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Share Based Compensation (Summary of Activity for Company's Restricted Stock) (Detail) - $ / shares	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Weighted Average Grant-Date Fair Value
Granted	$ 7.63	$ 8.05
Restricted Stock
Number of Shares
Restricted stock at January 1, 2015	226,871
Granted	79,860
Vested	(78,565)
Forfeited	(3,317)
Restricted stock at March 31, 2015	224,849
Weighted Average Grant-Date Fair Value
Restricted stock at January 1, 2015	$ 21.07
Granted	26.2
Vested	19.79
Forfeited	22.8
Restricted stock at March 31, 2015	$ 23.31

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FAIR VALUE

6 Months Ended

Jun. 30, 2015

Fair Value Disclosures [Abstract]

FAIR VALUE

Note 14 – Fair Value

Generally accepted accounting principles provide entities the option to measure eligible financial assets, financial liabilities and commitments at fair value (i.e. the fair value option), on an instrument-by-instrument basis, that are otherwise not permitted to be accounted for at fair value under other accounting standards. The election to use the fair value option is available when an entity first recognizes a financial asset or financial liability or upon entering into a commitment. Subsequent changes in fair value must be recorded in earnings. The Company applies the fair value option on residential mortgage loans held for sale. The fair value option on residential mortgage loans allows the recognition of gains on sale of mortgage loans to more accurately reflect the timing and economics of the transaction.

The standard for fair value measurement establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below.

Basis of Fair Value Measurement:

Level 1- Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2- Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3- Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e. supported by little or no market activity). Changes to interest rates may result in changes in the cash flows due to prepayments or extinguishments. Accordingly, this could result in higher or lower measurements of the fair values.

A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement.

Assets and Liabilities

Mortgage loans held for sale

Mortgage loans held for sale are valued based on quotations from the secondary market for similar instruments and are classified as Level 2 of the fair value hierarchy.

Investments available-for-sale

U.S. government agencies, mortgage-backed securities and corporate debt

Valuations are based on active market data and use of evaluated broker pricing models that vary based by asset class and includes available trade, bid, and other market information. Generally, the methodology includes broker quotes, proprietary models, descriptive terms and conditions databases coupled with extensive quality control programs. Multiple quality control evaluation processes review available market, credit and deal level information to support the evaluation of the security. If there is a lack of objectively verifiable information available to support the valuation, the evaluation of the security is discontinued. Additionally, proprietary models and pricing systems, mathematical tools, actual transacted prices, integration of market developments and experienced evaluators are used to determine the value of a security based on a hierarchy of market information regarding a security or securities with similar characteristics. The Company does not adjust the quoted price for such securities. Such instruments are generally classified within Level 2 of the fair value hierarchy.

State and municipal securities

Proprietary valuation matrices are used for valuing all tax-exempt municipals that can incorporate changes in the municipal market as they occur. Market evaluation models include the ability to value bank qualified municipals and general market municipals that can be broken down further according to insurer, credit support, state of issuance and rating to incorporate additional spreads and municipal curves. Taxable municipals are valued using a third party model that incorporates a methodology that captures the trading nuances associated with these bonds. Such instruments are generally classified within Level 2 of the fair value hierarchy.

Trust preferred securities

In active markets, these types of instruments are valued based on quoted market prices that are readily accessible at the measurement date and are classified within Level 1 of the fair value hierarchy. Positions that are not traded in active markets or are subject to transfer restrictions are valued or adjusted to reflect illiquidity and/or non-transferability, and such adjustments are generally based on available market evidence. In the absence of such evidence, management uses a process that employs certain assumptions to determine the present value. For further information, refer to Note 2 – Investments. Positions that are not traded in active markets or are subject to transfer restrictions are classified within Level 3 of the fair value hierarchy.

Interest rate swap agreements

Interest rate swap agreements are measured by alternative pricing sources with reasonable levels of price transparency in markets that are not active. Based on the complex nature of interest rate swap agreements, the markets these instruments trade in are not as efficient and are less liquid than that of the more mature Level 1 markets. These markets do however have comparable, observable inputs in which an alternative pricing source values these assets in order to arrive at a fair market value. These characteristics classify interest rate swap agreements as Level 2.

Assets Measured at Fair Value on a Recurring Basis

The following tables set forth the Company’s financial assets and liabilities at the dates indicated that were accounted for or disclosed at fair value. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

			June 30, 2015
			Quoted Prices in				Significant
			Active Markets for		Significant Other		Unobservable
			Identical Assets		Observable Inputs		Inputs
(In thousands)			(Level 1)		(Level 2)		(Level 3)		Total
Assets
	Residential mortgage loans held for sale		$	-	$	19,445	$	-	$	19,445
	Investments available-for-sale:
		U.S. government agencies		-		137,980		-		137,980
		State and municipal		-		161,953		-		161,953
		Mortgage-backed		-		324,145		-		324,145
		Trust preferred		-		-		1,018		1,018
		Marketable equity securities		-		723		-		723
	Interest rate swap agreements			-		1,390		-		1,390
Liabilities
	Interest rate swap agreements		$	-	$	(1,390)	$	-	$	(1,390)

			December 31, 2014
			Quoted Prices in				Significant
			Active Markets for		Significant Other		Unobservable
			Identical Assets		Observable Inputs		Inputs
(In thousands)			(Level 1)		(Level 2)		(Level 3)		Total
Assets
	Residential mortgage loans held for sale		$	-	$	10,512	$	-	$	10,512
	Investments available-for-sale:
		U.S. government agencies		-		141,679		-		141,679
		State and municipal		-		167,052		-		167,052
		Mortgage-backed		-		361,519		-		361,519
		Trust preferred		-		-		1,236		1,236
		Marketable equity securities		-		723		-		723
	Interest rate swap agreements			-		1,501		-		1,501
Liabilities
	Interest rate swap agreements		$	-	$	(1,501)	$	-	$	(1,501)

The following table provides unrealized losses included in assets measured in the Condensed Consolidated Statements of Condition at fair value on a recurring basis for the period indicated:

			Significant
			Unobservable
			Inputs
(In thousands)			(Level 3)
Investments available-for-sale:
	Balance at January 1, 2015		$	1,236
		Principal redemption		(218)
	Balance at June 30, 2015		$	1,018

Assets Measured at Fair Value on a Nonrecurring Basis

The following table sets forth the Company’s financial assets subject to fair value adjustments (impairment) on a nonrecurring basis at the date indicated that are valued at the lower of cost or market. Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

		June 30, 2015
		Quoted Prices in		Significant
		Active Markets		Other		Significant
		for Identical		Observable		Unobservable
(In thousands)		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)		Total		Total Losses
Impaired loans		$	-	$	-	$	6,913	$	6,913	$	10,304
Other real estate owned			-		-		4,514		4,514		(268)
	Total	$	-	$	-	$	11,427	$	11,427	$	10,036

		December 31, 2014
		Quoted Prices in		Significant
		Active Markets		Other		Significant
		for Identical		Observable		Unobservable
(In thousands)		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)		Total		Total Losses
Impaired loans		$	-	$	-	$	7,819	$	7,819	$	13,893
Other real estate owned			-		-		3,195		3,195		(247)
	Total	$	-	$	-	$	11,014	$	11,014	$	13,646

At June 30, 2015, impaired loans totaling $28.7 million were written down to fair value of $25.8 million as a result of specific loan loss allowances of $2.9 million associated with the impaired loans which was included in the allowance for loan losses. Impaired loans totaling $29.4 million were written down to fair value of $26.5 million at December 31, 2014 as a result of specific loan loss allowances of $2.9 million associated with the impaired loans.

Loan impairment is measured using the present value of expected cash flows, the loan’s observable market price or the fair value of the collateral (less selling costs) if the loans are collateral dependent. Collateral may be real estate and/or business assets including equipment, inventory and/or accounts receivable. The value of business equipment, inventory and accounts receivable collateral is based on net book value on the business’ financial statements and, if necessary, discounted based on management’s review and analysis. Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and client’s business. Impaired loans are reviewed and evaluated on at least a quarterly basis for additional impairment and adjusted accordingly, based on the factors identified above. Valuation techniques are consistent with those techniques applied in prior periods.

Other real estate owned (“OREO”) is adjusted to fair value upon transfer of the loans to OREO. Subsequently, OREO is carried at the lower of carrying value or fair value. The estimated fair value for other real estate owned included in Level 3 is determined by independent market based appraisals and other available market information, less cost to sell, that may be reduced further based on market expectations or an executed sales agreement. If the fair value of the collateral deteriorates subsequent to initial recognition, the Company records the OREO as a non-recurring Level 3 adjustment. Valuation techniques are consistent with those techniques applied in prior periods.

Fair Value of Financial Instruments

The Company discloses fair value information about financial instruments for which it is practicable to estimate the value, whether or not such financial instruments are recognized on the balance sheet. Fair value is the amount at which a financial instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation, and is best evidenced by a quoted market price, if one exists.

Quoted market prices, where available, are shown as estimates of fair market values. Because no quoted market prices are available for a significant portion of the Company's financial instruments, the fair value of such instruments has been derived based on the amount and timing of future cash flows and estimated discount rates.

Present value techniques used in estimating the fair value of many of the Company's financial instruments are significantly affected by the assumptions used. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate cash settlement of the instrument. Additionally, the accompanying estimates of fair values are only representative of the fair values of the individual financial assets and liabilities, and should not be considered an indication of the fair value of the Company.

The carrying amounts and fair values of the Company’s financial instruments at the dates indicated are presented in the following table:

					Fair Value Measurements
	June 30, 2015				Quoted Prices in
			Estimated		Active Markets for		Significant Other		Significant
	Carrying		Fair		Identical Assets		Observable Inputs		Unobservable Inputs
(In thousands)	Amount		Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets
Investments held-to-maturity and other equity securities	$	252,465	$	253,479	$	-	$	253,479	$	-
Loans, net of allowance		3,250,152		3,279,656		-		-		3,279,656
Other assets		89,617		89,617		-		89,617		-
Financial Liabilities
Time Deposits	$	488,891	$	489,419	$	-	$	489,419	$	-
Securities sold under retail repurchase agreements and
federal funds purchased		111,817		111,817		-		111,817		-
Advances from FHLB		550,000		572,615		-		572,615		-
Subordinated debentures		35,000		13,108		-		-		13,108

					Fair Value Measurements
	December 31, 2014				Quoted Prices in
			Estimated		Active Markets for		Significant Other		Significant
	Carrying		Fair		Identical Assets		Observable Inputs		Unobservable Inputs
(In thousands)	Amount		Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets
Investments held-to-maturity and other equity securities	$	261,410	$	263,697	$	-	$	263,697	$	-
Loans, net of allowance		3,089,590		3,118,635		-		-		3,118,635
Other assets		88,657		88,657		-		88,657		-
Financial Liabilities
Time Deposits	$	444,921	$	444,729	$	-	$	444,729	$	-
Securities sold under retail repurchase agreements and
federal funds purchased		74,432		74,432		-		74,432		-
Advances from FHLB		655,000		679,163		-		679,163		-
Subordinated debentures		35,000		13,276		-		-		13,276

The following methods and assumptions were used to estimate the fair value of each category of financial instruments for which it is practicable to estimate that value:

Cash and Temporary Investments: The carrying amounts of cash and cash equivalents approximate their fair value and have been excluded from the table above.

Investments:The fair value of marketable securities is based on quoted market prices, prices quoted for similar instruments, and prices obtained from independent pricing services.

Loans:For certain categories of loans, such as mortgage, installment and commercial loans, the fair value is estimated by discounting the expected future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and similar remaining maturities. Expected cash flows were projected based on contractual cash flows, adjusted for estimated prepayments.

Accrued interest receivable: The carrying value of accrued interest receivable approximates fair value due to the short-term duration and has been excluded from the table above.

Other assets:The investment in bank-owned life insurance represents the cash surrender value of the policies at June 30, 2015 and December 31, 2014 as determined by the each insurance carrier. The carrying value of accrued interest receivable approximates fair values due to the short-term duration.

Deposits: The fair value of demand, money market savings and regular savings deposits, which have no stated maturity, were considered equal to their carrying amount, representing the amount payable on demand. While management believes that the Bank’s core deposit relationships provide a relatively stable, low-cost funding source that has a substantial intangible value separate from the value of the deposit balances, these estimated fair values do not include the intangible value of core deposit relationships, which comprise a significant portion of the Bank’s deposit base.

Short-term borrowings:The carrying values of short-term borrowings, including overnight, securities sold under agreements to repurchase and federal funds purchased approximates the fair values due to the short maturities of those instruments.

Long-term borrowings: The fair value of the Federal Home Loan Bank of Atlanta (“FHLB”) advances and subordinated debentures was estimated by computing the discounted value of contractual cash flows payable at current interest rates for obligations with similar remaining terms. The Company's credit risk is not material to calculation of fair value because the FHLB borrowings are collateralized. The Company classifies advances from the Federal Home Loan Bank of Atlanta within Level 2 of the fair value hierarchy since the fair value of such borrowings is based on rates currently available for borrowings with similar terms and remaining maturities. Subordinated debentures are classified as Level 3 in the fair value hierarchy due to the lack of market activity of such instruments.

Accrued interest payable: The carrying value of accrued interest payable approximates fair value due to the short-term duration and has been excluded from the previous table.

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Investments (Additional Information) (Detail) - USD ($)	6 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Investment [Line Items]
Overall default probabilities percentage	0.61%
Recovery and prepayment probabilities percentage	2.00%
Discount rate assumption	11.50%
Non-credit related OTTI recognized in other comprehensive income ("OCI")	$ 100,000
Investments available-for-sale book value	229,000,000	$ 212,900,000
Investments held-to-maturity book value	193,300,000	$ 202,400,000
Banks and Financial Institutions
Investment [Line Items]
Trust preferred portfolio Fair Value	1,000,000
Trust preferred portfolio	1,100,000
Government National Mortgage Association Certificates and Obligations, Federal National Mortgage Association Certificates and Obligations, and Federal Home Loan Mortgage Corporation Certificates and Obligations [Member] | Collateralized Mortgage Obligations [Member]
Investment [Line Items]
Mortgage-backed portfolio	150,600,000
Government National Mortgage Association Certificates and Obligations, Federal National Mortgage Association Certificates and Obligations, and Federal Home Loan Mortgage Corporation Certificates and Obligations [Member] | Mortgage Backed Securities [Member]
Investment [Line Items]
Mortgage-backed portfolio	$ 173,500,000

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SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2015

Accounting Policies [Abstract]

Nature of Operations

Nature of Operations

Sandy Spring Bancorp (the “Company”), a Maryland corporation, is the bank holding company for Sandy Spring Bank (the “Bank”), which conducts a full-service commercial banking, mortgage banking and trust business. Services to individuals and businesses include accepting deposits, extending real estate, consumer and commercial loans and lines of credit, general insurance, personal trust, and investment and wealth management services. The Company operates in the Maryland counties of Anne Arundel, Carroll, Frederick, Howard, Montgomery, and Prince George's, and in Arlington, Fairfax and Loudoun counties in Virginia. The Company offers investment and wealth management services through the Bank’s subsidiary, West Financial Services. Insurance products are available to clients through Sandy Spring Insurance, and Neff & Associates, which are agencies of Sandy Spring Insurance Corporation.

Basis of Presentation

Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”) and prevailing practices within the financial services industry for interim financial information and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and notes required for complete financial statements and prevailing practices within the banking industry. The following summary of significant accounting policies of the Company is presented to assist the reader in understanding the financial and other data presented in this report. Operating results for the three and six months ended June 30, 2015 are not necessarily indicative of the results that may be expected for any future periods or for the year ending December 31, 2015. In the opinion of management, all adjustments (comprising only normal recurring accruals) necessary for a fair presentation of the results of the interim periods have been included. Certain reclassifications have been made to prior period amounts, as necessary, to conform to the current period presentation. The Company has evaluated subsequent events through the date of the issuance of its financial statements.

These statements should be read in conjunction with the financial statements and accompanying notes included in the Company’s 2014 Annual Report on Form 10-K as filed with the Securities and Exchange Commission (“SEC”) on March 6, 2015. There have been no significant changes to the Company’s accounting policies as disclosed in the 2014 Annual Report on Form 10-K.

Principles of Consolidation

Principles of Consolidation

The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Sandy Spring Bank and its subsidiaries, Sandy Spring Insurance Corporation and West Financial Services, Inc. Consolidation has resulted in the elimination of all intercompany accounts and transactions.

Use of Estimates

Use of Estimates

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, and affect the reported amounts of revenues earned and expenses incurred during the reporting period. Actual results could differ from those estimates. Estimates that could change significantly relate to the provision for loan and lease losses and the related allowance, determination of impaired loans and the related measurement of impairment, potential impairment of goodwill or other intangible assets, valuation of investment securities and the determination of whether impaired securities are other-than-temporarily impaired, valuation of other real estate owned, prepayment rates, valuation of share-based compensation, the assessment that a liability should be recognized with respect to any matters under litigation, the calculation of current and deferred income taxes and the actuarial projections related to pension expense and the related liability.

Cash Flows

Cash Flows

For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks, federal funds sold and interest-bearing deposits with banks (items with stated original maturity of three months or less).

Adopted Accounting Pronouncements

Pending Accounting Pronouncements

The FASB issued a standard in May 2014 that provides accounting guidance for all revenue arising from contracts with customers and affects all entities that enter into contracts to provide goods or services to customers. The guidance also provides for a model for the measurement and recognition of gains and losses on the sale of certain nonfinancial assets, such as property and equipment, including real estate. This standard may affect an entity’s financial statements, business processes and internal control over financial reporting. The guidance is effective for the first interim or annual period beginning after December 15, 2017. The guidance must be adopted using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. The Company is assessing this guidance to determine its impact on the Company’s financial position, results of operations and cash flows.

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Other Comprehensive Income (Loss) (Net Accumulated Other Comprehensive Income (Loss)) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance			$ (823)	$ (2,970)
Other comprehensive income before reclassification, net of tax			(100)	8,148
Reclassifications from accumulated other comprehensive income, net of tax			331	55
Total other comprehensive income (loss)	$ (2,738)	$ 3,883	231	8,203
Ending Balance	(592)	5,233	(592)	5,233
Unrealized Gains (Losses) on Investments Available-for-Sale
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance			8,078	358
Other comprehensive income before reclassification, net of tax			(100)	8,148
Reclassifications from accumulated other comprehensive income, net of tax			0	0
Total other comprehensive income (loss)			(100)	8,148
Ending Balance	7,978	8,506	7,978	8,506
Defined Benefit Pension Plan
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance			(8,901)	(3,328)
Other comprehensive income before reclassification, net of tax			0	0
Reclassifications from accumulated other comprehensive income, net of tax			331	55
Total other comprehensive income (loss)			331	55
Ending Balance	$ (8,570)	$ (3,273)	$ (8,570)	$ (3,273)

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CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($)	Total	Common Stock	Additional Paid-In Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)
Balances at Dec. 31, 2013	$ 499,363,000	$ 24,990,000	$ 193,445,000	$ 283,898,000	$ (2,970,000)
Net income	17,910,000	0	0	17,910,000	0
Other comprehensive loss, net of tax	8,203,000	0	0	0	8,203,000
Common stock dividends - $0.44 and $0.36 per share at June 30, 2015 and 2014, respectively	(9,094,000)	0	0	(9,094,000)	0
Stock compensation expense	853,000	0	853,000	0	0
Common stock issued pursuant to:
Stock option plan - 26,695 and 13,721 shares at June 30, 2015 and 2014, respectively	188,000	14,000	174,000	0	0
Employee stock purchase plan - 12,613 and 11,423 shares at June 30, 2015 and 2014, respectively	240,000	11,000	229,000	0	0
Restricted stock - 52,921 and 54,535 shares at June 30, 2015 and 2014, respectively	(394,000)	55,000	(449,000)	0	0
Balances at Jun. 30, 2014	517,269,000	25,070,000	194,252,000	292,714,000	5,233,000
Balances at Dec. 31, 2014	521,751,000	25,045,000	194,647,000	302,882,000	(823,000)
Net income	21,558,000	0	0	21,558,000	0
Other comprehensive loss, net of tax	231,000	0	0	0	231,000
Common stock dividends - $0.44 and $0.36 per share at June 30, 2015 and 2014, respectively	(11,041,000)	0	0	(11,041,000)	0
Stock compensation expense	941,000	0	941,000	0	0
Common stock issued pursuant to:
Stock option plan - 26,695 and 13,721 shares at June 30, 2015 and 2014, respectively	391,000	26,000	365,000	0	0
Directors stock purchase plan - 837 shares	22,000	1,000	21,000	0	0
Employee stock purchase plan - 12,613 and 11,423 shares at June 30, 2015 and 2014, respectively	276,000	12,000	264,000	0	0
Restricted stock - 52,921 and 54,535 shares at June 30, 2015 and 2014, respectively	(341,000)	53,000	(394,000)	0	0
Purchase of treasury shares - 575,472 shares	(14,915,000)	(575,000)	(14,340,000)	0	0
Balances at Jun. 30, 2015	$ 518,873,000	$ 24,562,000	$ 181,504,000	$ 313,399,000	$ (592,000)

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CONSOLIDATED STATEMENTS OF CONDITION (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Statement Of Financial Position [Abstract]
Investments held-to-maturity, fair value	$ 217,880	$ 222,260
Common stock, par value	$ 1	$ 1
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	24,562,471	25,044,877
Common stock, shares outstanding	24,562,471	25,044,877

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PENSION, PROFIT SHARING, AND OTHER EMPLOYEE BENEFIT PLANS

6 Months Ended

Jun. 30, 2015

Pension, Profit Sharing, and Other Employee Benefit Plans [Abstract]

PENSION, PROFIT SHARING, AND OTHER EMPLOYEE BENEFIT PLANS

Note 9 – Pension, Profit Sharing, and Other Employee Benefit Plans

Defined Benefit Pension Plan

The Company has a qualified, noncontributory, defined benefit pension plan (the “Plan”) covering substantially all employees. Benefits after January 1, 2005, are based on the benefit earned as of December 31, 2004, plus benefits earned in future years of service based on the employee’s compensation during each such year. All benefit accruals for employees were frozen as of December 31, 2007 based on past service and thus salary increases and additional years of service after such date no longer affect the defined benefit provided by the plan although additional vesting may continue to occur.

The Company's funding policy is to contribute amounts to the plan sufficient to meet the minimum funding requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended. In addition, the Company contributes additional amounts as it deems appropriate based on benefits attributed to service prior to the date of the plan freeze. The Plan invests primarily in a diversified portfolio of managed fixed income and equity funds.

The components of net periodic benefit cost for the periods indicated are presented in the following table:

		Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)		2015		2014		2015		2014
Interest cost on projected benefit obligation		$	407	$	403	$	817	$	794
Expected return on plan assets			(406)		(493)		(812)		(987)
Recognized net actuarial loss			259		68		551		116
	Net periodic benefit cost	$	260	$	(22)	$	556	$	(77)

Contributions

The decision as to whether or not to make a plan contribution and the amount of any such contribution is dependent on a number of factors. Such factors include the investment performance of the plan assets in the current economy and, since the plan is currently frozen, the remaining investment horizon of the plan. Given these uncertainties, management continues to monitor the funding level of the pension plan and may make contributions as necessary during 2015.

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Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Aug. 03, 2015
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q2
Trading Symbol	SASR
Entity Common Stock, Shares Outstanding		24,566,838
Entity Registrant Name	SANDY SPRING BANCORP INC
Entity Central Index Key	0000824410
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer

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NET INCOME PER COMMON SHARE

6 Months Ended

Jun. 30, 2015

Earnings Per Share [Abstract]

NET INCOME PER COMMON SHARE

Note 10 – Net Income per Common Share

The calculation of net income per common share for the periods indicated is presented in the following table:

			Three Months Ended June 30,				Six Months Ended June 30,
(Dollars and amounts in thousands, except per share data)			2015		2014		2015		2014
Net income			$	10,333	$	6,982	$	21,558	$	17,910
Basic:
Basic weighted average EPS shares				24,626		25,062		24,776		25,031
		Basic net income per share	$	0.42	$	0.28	$	0.87	$	0.72
Diluted:
Basic weighted average EPS shares				24,626		25,062		24,776		25,031
Dilutive common stock equivalents				64		65		92		95
	Dilutive EPS shares			24,690		25,127		24,868		25,126
		Diluted net income per share	$	0.42	$	0.28	$	0.87	$	0.71
Anti-dilutive shares				8		65		8		56

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CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Interest Income:
Interest and fees on loans and leases	$ 33,031	$ 30,706	$ 65,170	$ 60,440
Interest on loans held for sale	132	71	208	130
Interest on deposits with banks	22	22	44	42
Interest and dividends on investment securities:
Taxable	3,850	3,876	7,427	7,992
Exempt from federal income taxes	1,814	2,316	4,072	4,637
Total interest income	38,849	36,991	76,921	73,241
Interest Expense:
Interest on deposits	1,367	1,193	2,561	2,377
Interest on retail repurchase agreements and federal funds purchased	60	37	110	75
Interest on advances from FHLB	3,266	3,233	6,502	6,451
Interest on subordinated debt	223	219	442	437
Total interest expense	4,916	4,682	9,615	9,340
Net interest income	33,933	32,309	67,306	63,901
Provision (credit) for loan and lease losses	1,218	158	1,815	(824)
Net interest income after provision (credit) for loan and lease losses	32,715	32,151	65,491	64,725
Non-interest Income:
Investment securities gains	19	0	19	0
Service charges on deposit accounts	1,839	2,089	3,721	4,061
Mortgage banking activities	822	570	2,000	886
Wealth management income	5,161	4,741	10,077	9,207
Insurance agency commissions	881	961	2,499	2,601
Income from bank owned life insurance	606	608	1,319	1,206
Visa check fees	1,220	1,169	2,277	2,147
Other income	1,561	1,556	3,356	2,835
Total non-interest income	12,109	11,694	25,268	22,943
Non-interest Expenses:
Salaries and employee benefits	17,534	16,474	34,833	32,829
Occupancy expense of premises	3,173	3,274	6,662	6,746
Equipment expenses	1,490	1,262	2,863	2,518
Marketing	942	802	1,473	1,344
Outside data services	1,102	1,216	2,363	2,432
FDIC insurance	654	573	1,285	1,093
Amortization of intangible assets	106	224	213	594
Litigation Expense	162	6,128	362	6,128
Other Expense	4,314	4,188	8,667	8,006
Total non-interest expenses	29,477	34,141	58,721	61,690
Income before income taxes	15,347	9,704	32,038	25,978
Income tax expense	5,014	2,722	10,480	8,068
Net income	$ 10,333	$ 6,982	$ 21,558	$ 17,910
Net Income Per Share Amounts:
Basic net income per share	$ 0.42	$ 0.28	$ 0.87	$ 0.72
Diluted net income per share	0.42	0.28	0.87	0.71
Dividends declared per share	$ 0.22	$ 0.18	$ 0.44	$ 0.36

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CREDIT QUALITY ASSESSMENT

6 Months Ended

Jun. 30, 2015

Credit Quality Assessment [Abstract]

CREDIT QUALITY ASSESSMENT

Note 4 – CREDIT QUALITY ASSESSMENT

Allowance for Loan and Lease Losses

Summary information on the allowance for loan and lease loss activity for the period indicated is provided in the following table:

			Six Months Ended June 30,
(In thousands)			2015		2014
Balance at beginning of year			$	37,802	$	38,766
	Provision for loan and lease losses			1,815		(824)
	Loan and lease charge-offs			(1,837)		(1,176)
	Loan and lease recoveries			933		1,193
		Net (charge-offs) recoveries		(904)		17
Balance at period end			$	38,713	$	37,959

The following tables provide information on the activity in the allowance for loan and lease losses by the respective loan portfolio segment for the period indicated:

		For the Six Months Ended June 30, 2015
				Commercial Real Estate										Residential Real Estate
								Commercial
		Commercial		Commercial		Commercial		Owner						Residential		Residential
(Dollars in thousands)		Business		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Balance at beginning of year		$	5,852	$	4,267	$	9,784	$	7,143	$	9	$	3,592	$	6,232	$	923	$	37,802
Provision (credit)			13		(336)		947		584		-		234		318		55		1,815
Charge-offs			(181)		(739)		(90)		(212)		-		(537)		(78)		-		(1,837)
Recoveries			197		580		10		1		-		99		31		15		933
	Net charge-offs		16		(159)		(80)		(211)		-		(438)		(47)		15		(904)
Balance at end of period		$	5,881	$	3,772	$	10,651	$	7,516	$	9	$	3,388	$	6,503	$	993	$	38,713
Total loans and leases		$	409,795	$	223,103	$	694,179	$	643,973	$	21	$	436,465	$	744,195	$	137,134	$	3,288,865
Allowance for loans and leases to total loans and leases ratio			1.44%		1.69%		1.53%		1.17%		42.86%		0.78%		0.87%		0.72%		1.18%
Balance of loans specifically evaluated for impairment		$	4,181	$	194	$	12,126	$	8,423	$	na.	$	na.	$	3,770	$	na.	$	28,694
Allowance for loans specifically evaluated for impairment		$	1,047	$	58	$	715	$	1,066	$	na.	$	na.	$	-	$	na.	$	2,886
Specific allowance to specific loans ratio			25.04%		29.90%		5.90%		12.66%		na.		na.		na.		na.		10.06%
Balance of loans collectively evaluated		$	405,614	$	222,909	$	682,053	$	635,550	$	21	$	436,465	$	740,425	$	137,134	$	3,260,171
Allowance for loans collectively evaluated		$	4,834	$	3,714	$	9,936	$	6,450	$	9	$	3,388	$	6,503	$	993	$	35,827
Collective allowance to collective loans ratio			1.19%		1.67%		1.46%		1.01%		42.86%		0.78%		0.88%		0.72%		1.10%

		For the Year Ended December 31, 2014
				Commercial Real Estate										Residential Real Estate
								Commercial
		Commercial		Commercial		Commercial		Owner						Residential		Residential
(Dollars in thousands)		Business		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Balance at beginning of year		$	6,308	$	3,754	$	9,263	$	6,308	$	16	$	4,142	$	7,819	$	1,156	$	38,766
Provision (credit)			(1,204)		1,042		486		1,094		(7)		119		(1,385)		(308)		(163)
Charge-offs			(729)		(529)		(3)		(265)		-		(834)		(323)		(4)		(2,687)
Recoveries			1,477		-		38		6		-		165		121		79		1,886
	Net charge-offs		748		(529)		35		(259)		-		(669)		(202)		75		(801)
Balance at end of period		$	5,852	$	4,267	$	9,784	$	7,143	$	9	$	3,592	$	6,232	$	923	$	37,802
Total loans and leases		$	390,781	$	205,124	$	640,193	$	611,061	$	54	$	425,552	$	717,886	$	136,741	$	3,127,392
Allowance for loans and leases to total loans and leases ratio			1.50%		2.08%		1.53%		1.17%		16.80%		0.84%		0.87%		0.67%		1.21%
Balance of loans specifically evaluated for impairment		$	3,894	$	2,464	$	10,279	$	8,941	$	na.	$	na.	$	3,535	$	306	$	29,419
Allowance for loans specifically evaluated for impairment		$	788	$	741	$	541	$	824	$	na.	$	na.	$	-	$	-	$	2,894
Specific allowance to specific loans ratio			20.24%		30.07%		5.26%		9.22%		na.		na.		na.		na.		9.84%
Balance of loans collectively evaluated		$	386,887	$	202,660	$	629,914	$	602,120	$	54	$	425,552	$	714,351	$	136,435	$	3,097,973
Allowance for loans collectively evaluated		$	5,064	$	3,526	$	9,243	$	6,319	$	9	$	3,592	$	6,232	$	923	$	34,908
Collective allowance to collective loans ratio			1.31%		1.74%		1.47%		1.05%		16.80%		0.84%		0.87%		0.68%		1.13%

The following table provides summary information regarding impaired loans at the dates indicated and for the periods then ended:

(In thousands)		June 30, 2015		December 31, 2014
Impaired loans with a specific allowance		$	9,661	$	11,411
Impaired loans without a specific allowance			19,033		18,008
	Total impaired loans	$	28,694	$	29,419
Allowance for loan and lease losses related to impaired loans		$	2,886	$	2,894
Allowance for loan and lease losses related to loans collectively evaluated			35,827		34,908
	Total allowance for loan and lease losses	$	38,713	$	37,802
Average impaired loans for the period		$	28,769	$	34,331
Contractual interest income due on impaired loans during the period		$	1,326	$	2,339
Interest income on impaired loans recognized on a cash basis		$	324	$	773
Interest income on impaired loans recognized on an accrual basis		$	122	$	280

The following tables present the recorded investment with respect to impaired loans, the associated allowance by the applicable portfolio segment and the principal balance of the impaired loans prior to amounts charged-off at the dates indicated:

			June 30, 2015
					Commercial Real Estate								Total Recorded
									Commercial		All		Investment in
					Commercial		Commercial		Owner		Other		Impaired
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Impaired loans with a specific allowance
		Non-accruing	$	659	$	57	$	2,589	$	4,561	$	-	$	7,866
		Restructured accruing		881		-		-		-		-		881
		Restructured non-accruing		203		-		72		639		-		914
	Balance		$	1,743	$	57	$	2,661	$	5,200	$	-	$	9,661
	Allowance		$	1,047	$	58	$	715	$	1,066	$	-	$	2,886
Impaired loans without a specific allowance
		Non-accruing	$	1,013	$	-	$	7,362	$	1,785	$	-	$	10,160
		Restructured accruing		15		-		2,103		-		2,621		4,739
		Restructured non-accruing		1,410		137		-		1,438		1,149		4,134
	Balance		$	2,438	$	137	$	9,465	$	3,223	$	3,770	$	19,033
Total impaired loans
		Non-accruing	$	1,672	$	57	$	9,951	$	6,346	$	-	$	18,026
		Restructured accruing		896		-		2,103		-		2,621		5,620
		Restructured non-accruing		1,613		137		72		2,077		1,149		5,048
	Balance		$	4,181	$	194	$	12,126	$	8,423	$	3,770	$	28,694
Unpaid principal balance in total impaired loans			$	5,646	$	4,456	$	16,878	$	10,271	$	4,086	$	41,337

	June 30, 2015
			Commercial Real Estate								Total Recorded
							Commercial		All		Investment in
			Commercial		Commercial		Owner		Other		Impaired
(In thousands)	Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Average impaired loans for the period	$	4,013	$	1,340	$	10,829	$	8,779	$	3,808	$	28,769
Contractual interest income due on impaired loans during the period	$	207	$	188	$	469	$	366	$	96
Interest income on impaired loans recognized on a cash basis	$	93	$	11	$	15	$	185	$	20
Interest income on impaired loans recognized on an accrual basis	$	29	$	-	$	54	$	-	$	39

			December 31, 2014
					Commercial Real Estate								Total Recorded
									Commercial		All		Investment in
					Commercial		Commercial		Owner		Other		Impaired
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Impaired loans with a specific allowance
		Non-accruing	$	473	$	1,330	$	2,288	$	5,013	$	-	$	9,104
		Restructured accruing		687		-		-		-		-		687
		Restructured non-accruing		308		-		76		1,236		-		1,620
	Balance		$	1,468	$	1,330	$	2,364	$	6,249	$	-	$	11,411
	Allowance		$	788	$	741	$	541	$	824	$	-	$	2,894
Impaired loans without a specific allowance
		Non-accruing	$	1,115	$	-	$	5,792	$	1,769	$	-	$	8,676
		Restructured accruing		23		-		2,123		-		2,664		4,810
		Restructured non-accruing		1,288		1,134		-		923		1,177		4,522
	Balance		$	2,426	$	1,134	$	7,915	$	2,692	$	3,841	$	18,008
Total impaired loans
		Non-accruing	$	1,588	$	1,330	$	8,080	$	6,782	$	-	$	17,780
		Restructured accruing		710		-		2,123		-		2,664		5,497
		Restructured non-accruing		1,596		1,134		76		2,159		1,177		6,142
	Balance		$	3,894	$	2,464	$	10,279	$	8,941	$	3,841	$	29,419
Unpaid principal balance in total impaired loans			$	5,360	$	7,044	$	14,926	$	10,729	$	4,126	$	42,185

	December 31, 2014
			Commercial Real Estate								Total Recorded
							Commercial		All		Investment in
			Commercial		Commercial		Owner		Other		Impaired
(In thousands)	Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Average impaired loans for the period	$	5,308	$	3,651	$	9,327	$	8,963	$	7,082	$	34,331
Contractual interest income due on impaired loans during the period	$	311	$	352	$	730	$	859	$	87
Interest income on impaired loans recognized on a cash basis	$	252	$	39	$	78	$	344	$	60
Interest income on impaired loans recognized on an accrual basis	$	63	$	-	$	111	$	-	$	106

Credit Quality

The following tables provide information on the credit quality of the loan portfolio by segment at the dates indicated:

		June 30, 2015
				Commercial Real Estate										Residential Real Estate
								Commercial
				Commercial		Commercial		Owner						Residential		Residential
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Non-performing loans and assets:
	Non-accrual loans and leases	$	3,285	$	194	$	10,023	$	8,423	$	-	$	1,214	$	7,780	$	780	$	31,699
	Loans and leases 90 days past due		-		-		-		-		2		7		-		-		9
	Restructured loans and leases		896		-		2,103		-		-		-		2,621		-		5,620
Total non-performing loans and leases			4,181		194		12,126		8,423		2		1,221		10,401		780		37,328
	Other real estate owned		39		789		-		-		-		690		1,613		1,383		4,514
Total non-performing assets		$	4,220	$	983	$	12,126	$	8,423	$	2	$	1,911	$	12,014	$	2,163	$	41,842

		December 31, 2014
				Commercial Real Estate										Residential Real Estate
								Commercial
				Commercial		Commercial		Owner						Residential		Residential
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Non-performing loans and assets:
	Non-accrual loans and leases	$	3,184	$	2,464	$	8,156	$	8,941	$	-	$	1,668	$	3,012	$	1,105	$	28,530
	Loans and leases 90 days past due		-		-		-		-		-		-		-		-		-
	Restructured loans and leases		710		-		2,123		-		-		-		2,664		-		5,497
Total non-performing loans and leases			3,894		2,464		10,279		8,941		-		1,668		5,676		1,105		34,027
	Other real estate owned		39		365		-		-		-		-		1,408		1,383		3,195
Total non-performing assets		$	3,933	$	2,829	$	10,279	$	8,941	$	-	$	1,668	$	7,084	$	2,488	$	37,222

			June 30, 2015
					Commercial Real Estate										Residential Real Estate
									Commercial
					Commercial		Commercial		Owner						Residential		Residential
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Past due loans and leases
	31-60 days		$	61	$	-	$	85	$	609	$	-	$	1,307	$	3,772	$	-	$	5,834
	61-90 days			-		-		1,440		458		-		643		1,244		-		3,785
	> 90 days			-		-		-		-		2		7		-		-		9
		Total past due		61		-		1,525		1,067		2		1,957		5,016		-		9,628
	Non-accrual loans and leases			3,285		194		10,023		8,423		-		1,214		7,780		780		31,699
	Loans acquired with deteriorated credit quality			1,198		-		-		1,053		-		-		-		-		2,251
	Current loans			405,251		222,909		682,631		633,430		19		433,294		731,399		136,354		3,245,287
		Total loans and leases	$	409,795	$	223,103	$	694,179	$	643,973	$	21	$	436,465	$	744,195	$	137,134	$	3,288,865

			December 31, 2014
					Commercial Real Estate										Residential Real Estate
									Commercial
					Commercial		Commercial		Owner						Residential		Residential
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Past due loans and leases
	31-60 days		$	759	$	-	$	2,374	$	2,658	$	11	$	797	$	3,064	$	-	$	9,663
	61-90 days			995		320		1,493		156		-		179		836		-		3,979
	> 90 days			-		-		-		-		-		-		-		-		-
		Total past due		1,754		320		3,867		2,814		11		976		3,900		-		13,642
	Non-accrual loans and leases			3,184		2,464		8,156		8,941		-		1,668		3,012		1,105		28,530
	Loans acquired with deteriorated credit quality			1,238		-		-		1,773		-		-		-		-		3,011
	Current loans			384,605		202,340		628,170		597,533		43		422,908		710,974		135,636		3,082,209
		Total loans and leases	$	390,781	$	205,124	$	640,193	$	611,061	$	54	$	425,552	$	717,886	$	136,741	$	3,127,392

The following tables provide information by credit risk rating indicators for each segment of the commercial loan portfolio at the dates indicated:

		June 30, 2015
				Commercial Real Estate
								Commercial
				Commercial		Commercial		Owner
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Total
	Pass	$	384,562	$	220,747	$	679,253	$	616,435	$	1,900,997
	Special Mention		8,212		698		1,857		6,431		17,198
	Substandard		17,021		1,658		13,069		21,107		52,855
	Doubtful		-		-		-		-		-
Total		$	409,795	$	223,103	$	694,179	$	643,973	$	1,971,050

		Decemeber 31, 2014
				Commercial Real Estate
								Commercial
				Commercial		Commercial		Owner
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Total
	Pass	$	366,367	$	201,642	$	621,511	$	581,575	$	1,771,095
	Special Mention		8,835		698		3,931		7,669		21,133
	Substandard		15,579		2,784		14,751		21,817		54,931
	Doubtful		-		-		-		-		-
Total		$	390,781	$	205,124	$	640,193	$	611,061	$	1,847,159

Homogeneous loan pools do not have individual loans subjected to internal risk ratings therefore, the credit indicator applied to these pools is based on their delinquency status. The following tables provide information by credit risk rating indicators for those remaining segments of the loan portfolio at the dates indicated:

			June 30, 2015
							Residential Real Estate
							Residential		Residential
(In thousands)			Leasing		Consumer		Mortgage		Construction		Total
	Performing		$	19	$	435,244	$	733,794	$	136,354	$	1,305,411
	Non-performing:
		90 days past due		2		7		-		-		9
		Non-accruing		-		1,214		7,780		780		9,774
		Restructured loans and leases		-		-		2,621		-		2,621
Total			$	21	$	436,465	$	744,195	$	137,134	$	1,317,815

			December 31, 2014
							Residential Real Estate
							Residential		Residential
(In thousands)			Leasing		Consumer		Mortgage		Construction		Total
	Performing		$	54	$	423,884	$	712,210	$	135,636	$	1,271,784
	Non-performing:
		90 days past due		-		-		-		-		-
		Non-accruing		-		1,668		3,012		1,105		5,785
		Restructured loans and leases		-		-		2,664		-		2,664
Total			$	54	$	425,552	$	717,886	$	136,741	$	1,280,233

During the six months ended June 30, 2015, the Company restructured $0.9 million in loans. No modifications resulted in the reduction of the principal in the associated loan balances. Restructured loans are subject to periodic credit reviews to determine the necessity and adequacy of a specific loan loss allowance based on the collectability of the recorded investment in the restructured loan. Loans restructured during 2015have specific reserves of $0.4 million at June 30, 2015. For the year ended December 31, 2014, the Company restructured $1.6 million in loans. Modifications consisted principally of interest rate concessions and no modifications resulted in the reduction of the recorded investment in the associated loan balances. Loans restructured during 2014 had specific reserves of $0.1 million at December 31, 2014. Commitments to lend additional funds on loans that have been restructured at June 30, 2015 and December 31, 2014 amounted to $0.3 million and $0.1 million, respectively.

The following table provides the amounts of the restructured loans at the date of restructuring for specific segments of the loan portfolio during the period indicated:

		For the Six Months Ended June 30, 2015
				Commercial Real Estate
								Commercial		All
				Commercial		Commercial		Owner		Other
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Total
Troubled debt restructurings
	Restructured accruing	$	275	$	-	$	-	$	-	$	-	$	275
	Restructured non-accruing		-		-		-		639		-		639
Balance		$	275	$	-	$	-	$	639	$	-	$	914
Specific allowance		$	275	$	-	$	-	$	149	$	-	$	424
Restructured and subsequently defaulted		$	-	$	-	$	-	$	-	$	-	$	-

		For the Year Ended December 31, 2014
				Commercial Real Estate
								Commercial		All
				Commercial		Commercial		Owner		Other
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Total
Troubled debt restructurings
	Restructured accruing	$	75	$	-	$	1,284	$	-	$	-	$	1,359
	Restructured non-accruing		92		192		-		-		-		284
Balance		$	167	$	192	$	1,284	$	-	$	-	$	1,643
Specific allowance		$	99	$	-	$	-	$	-	$	-	$	99
Restructured and subsequently defaulted		$	-	$	-	$	-	$	-	$	-	$	-

Other Real Estate Owned

Other real estate owned totaled $4.5 million and $3.2 million at June 30, 2015 and December 31, 2014, respectively.

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LOANS AND LEASES

6 Months Ended

Jun. 30, 2015

Receivables [Abstract]

LOANS AND LEASES

Note 3 – Loans and Leases

Outstanding loan balances at June 30, 2015 and December 31, 2014 are net of unearned income including net deferred loan costs of $0.7 million and $0.5 million, respectively. The loan portfolio segment balances at the dates indicated are presented in the following table:

(In thousands)		June 30, 2015		December 31, 2014
Residential real estate:
	Residential mortgage	$	744,195	$	717,886
	Residential construction		137,134		136,741
Commercial real estate:
	Commercial owner occupied real estate		643,973		611,061
	Commercial investor real estate		694,179		640,193
	Commercial acquisition, development and construction		223,103		205,124
Commercial Business			409,795		390,781
Leases			21		54
Consumer			436,465		425,552
	Total loans and leases	$	3,288,865	$	3,127,392

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SEGMENT REPORTING

6 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

SEGMENT REPORTING

Note 15 - Segment Reporting

Currently, the Company conducts business in three operating segments—Community Banking, Insurance and Investment Management. Each of the operating segments is a strategic business unit that offers different products and services. The Insurance and Investment Management segments were businesses that were acquired in separate transactions where management of acquisition was retained. The accounting policies of the segments are the same as those of the Company. However, the segment data reflect inter-segment transactions and balances.

The Community Banking segment is conducted through Sandy Spring Bank and involves delivering a broad range of financial products and services, including various loan and deposit products to both individuals and businesses. Parent company income is included in the Community Banking segment, as the majority of effort of these functions is related to this segment. Major revenue sources include net interest income, gains on sales of mortgage loans, trust income, fees on sales of investment products and service charges on deposit accounts. Expenses include personnel, occupancy, marketing, equipment and other expenses. Non-cash charges associated with amortization of intangibles related to the acquired entities was not significant for the three and six ended June 30, 2015 and 2014, respectively.

The Insurance segment is conducted through Sandy Spring Insurance Corporation, a subsidiary of the Bank, and offers annuities as an alternative to traditional deposit accounts. Sandy Spring Insurance Corporation operates Sandy Spring Insurance, a general insurance agency located in Annapolis, Maryland, and Neff and Associates, located in Ocean City, Maryland. Major sources of revenue are insurance commissions from commercial lines, personal lines, and medical liability lines. Expenses include personnel and support charges. Non-cash charges associated with amortization of intangibles related to the acquired entities was not significant for the three and six ended June 30, 2015 and 2014, respectively.

The Investment Management segment is conducted through West Financial Services, Inc., a subsidiary of the Bank. This asset management and financial planning firm, located in McLean, Virginia, provides comprehensive investment management and financial planning to individuals, families, small businesses and associations including cash flow analysis, investment review, tax planning, retirement planning, insurance analysis and estate planning. West Financial currently has approximately $1.1 billion in assets under management. Major revenue sources include non-interest income earned on the above services. Expenses include personnel and support charges. Non-cash charges associated with amortization of intangibles related to the acquired entities was not significant for the three and six ended June 30, 2015 and 2014, respectively.

Information for the operating segments and reconciliation of the information to the condensed consolidated financial statements for the periods indicated is presented in the following tables:

	Three Months Ended June 30, 2015
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	38,849	$	-	$	2	$	(2)	$	38,849
Interest expense		4,918		-		-		(2)		4,916
Provision for loan and lease losses		1,218		-		-		-		1,218
Noninterest income		24,945		984		1,754		(15,574)		12,109
Noninterest expenses		42,958		1,169		924		(15,574)		29,477
Income before income taxes		14,700		(185)		832		-		15,347
Income tax expense		4,763		(74)		325		-		5,014
Net income	$	9,937	$	(111)	$	507	$	-	$	10,333
Assets	$	4,508,858	$	5,647	$	10,672	$	(17,810)	$	4,507,367

	Three Months Ended June 30, 2014
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	36,991	$	3	$	5	$	(8)	$	36,991
Interest expense		4,690		-		-		(8)		4,682
Provision for loan and lease losses		158		-		-		-		158
Non-interest income		12,108		1,045		1,717		(3,176)		11,694
Non-interest expenses		35,305		1,125		887		(3,176)		34,141
Income before income taxes		8,946		(77)		835		-		9,704
Income tax expense		2,427		(30)		325		-		2,722
Net income	$	6,519	$	(47)	$	510	$	-	$	6,982
Assets	$	4,257,129	$	6,025	$	10,927	$	(39,739)	$	4,234,342

	Six Months Ended June 30, 2015
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	76,920	$	1	$	3	$	(3)	$	76,921
Interest expense		9,618		-		-		(3)		9,615
Provision for loan and lease losses		1,815		-		-		-		1,815
Noninterest income		34,781		2,678		3,564		(15,755)		25,268
Noninterest expenses		69,975		2,552		1,949		(15,755)		58,721
Income before income taxes		30,293		127		1,618		-		32,038
Income tax expense		9,797		52		631		-		10,480
Net income	$	20,496	$	75	$	987	$	-	$	21,558
Assets	$	4,508,858	$	5,647	$	10,672	$	(17,810)	$	4,507,367

	Six Months Ended June 30, 2014
	Community				Investment		Inter-Segment
(In thousands)	Banking		Insurance		Mgmt.		Elimination		Total
Interest income	$	73,241	$	5	$	9	$	(14)	$	73,241
Interest expense		9,354		-		-		(14)		9,340
Provision (credit) for loan and lease losses		(824)		-		-		-		(824)
Non-interest income		20,123		2,776		3,395		(3,351)		22,943
Non-interest expenses		60,917		2,317		1,807		(3,351)		61,690
Income before income taxes		23,917		464		1,597		-		25,978
Income tax expense		7,258		188		622		-		8,068
Net income	$	16,659	$	276	$	975	$	-	$	17,910
Assets	$	4,257,129	$	6,025	$	10,927	$	(39,739)	$	4,234,342

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OTHER COMPREHENSIVE INCOME (LOSS)

6 Months Ended

Jun. 30, 2015

Other Comprehensive Income Loss [Abstract]

OTHER COMPREHENSIVE INCOME (LOSS)

NOTE 11 – OTHER COMPREHENSIVE INCOME

Comprehensive income is defined as net income plus transactions and other occurrences that are the result of non-owner changes in equity. For condensed financial statements presented for the Company, non-owner changes are comprised of unrealized gains or losses on available-for-sale debt securities and any minimum pension liability adjustments. These do not have an impact on the Company’s net income. The following table presents the activity in net accumulated other comprehensive income (loss) and the components of the activity for the periods indicated:

		Unrealized Gains
		(Losses) on
		Investments		Defined Benefit
(In thousands)		Available-for-Sale		Pension Plan		Total
Balance at January 1, 2015		$	8,078	$	(8,901)	$	(823)
	Other comprehensive income before reclassification, net of tax		(100)		-		(100)
	Reclassifications from accumulated other comprehensive income, net of tax		-		331		331
Current period change in other comprehensive income, net of tax			(100)		331		231
Balance at June 30, 2015		$	7,978	$	(8,570)	$	(592)

		Unrealized Gains
		(Losses) on
		Investments		Defined Benefit
(In thousands)		Available-for-Sale		Pension Plan		Total
Balance at January 1, 2014		$	358	$	(3,328)	$	(2,970)
	Other comprehensive income before reclassification, net of tax		8,148		-		8,148
	Reclassifications from accumulated other comprehensive income, net of tax		-		55		55
Current period change in other comprehensive income, net of tax			8,148		55		8,203
Balance at June 30, 2014		$	8,506	$	(3,273)	$	5,233

The following table provides the information on the reclassification adjustments out of accumulated other comprehensive income for the periods indicated:

				For the Six Months Ended June 30,
(In thousands)				2015		2014
Unrealized gains/(losses) on investments available-for-sale
	Affected line item in the Statements of Income:
	Investment securities gains			$	19		$	-
	Income before taxes				19			-
	Tax expense				8			-
	Net income			$	11		$	-
Amortization of defined benefit pension plan items
	Affected line item in the Statements of Income:
		Recognized actuarial loss (1)		$	551		$	116
			Income before taxes		551			116
			Tax expense		220			61
			Net income	$	331		$	55
(1) This amount is included in the computation of net periodic benefit cost, see Note 9

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STOCKHOLDERS' EQUITY

6 Months Ended

Jun. 30, 2015

Stockholders' Equity Note [Abstract]

STOCKHOLDERS EQUITY

Note 7 – Stockholders’ Equity

The Company re-approved a stock repurchase program in August 2013 that permits the repurchase of up to 5% of the Company’s outstanding shares of common stock at the date the plan was approved or approximately 1.3 million shares. Repurchases, which will be conducted through open market purchases or privately negotiated transactions, will be made depending on market conditions and other factors. During the first six months of 2015, the Company repurchased 575,472 shares at an average cost of $25.92 per share or a total of $14.9 million.

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Deposits (Composition of Deposits) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Disclosure Composition Of Deposits [Abstract]
Noninterest-bearing deposits	$ 1,092,413	$ 993,737
Interest-bearing deposits:
Demand	525,584	534,605
Money market savings	860,315	828,494
Regular savings	280,143	264,751
Time deposits of less than $100,000	245,347	239,857
Time deposits of $100,000 or more	243,544	205,065
Total interest-bearing deposits	2,154,933	2,072,772
Total deposits	$ 3,247,346	$ 3,066,509

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GOODWILL AND OTHER INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER INTANGIBLE ASSETS

Note 5 – Goodwill and Other Intangible Assets

The gross carrying amounts and accumulated amortization of intangible assets and goodwill are presented at the dates indicated in the following table:

		June 30, 2015						Weighted		December 31, 2014						Weighted
		Gross				Net		Average		Gross				Net		Average
		Carrying		Accumulated		Carrying		Remaining		Carrying		Accumulated		Carrying		Remaining
(Dollars in thousands)		Amount		Amortization		Amount		Life		Amount		Amortization		Amount		Life
Amortizing intangible assets:
Other identifiable intangibles		$	8,623	$	(8,327)	$	296		1.6 years	$	8,623	$	(8,113)	$	510		1.7 years
	Total amortizing intangible assets	$	8,623	$	(8,327)	$	296			$	8,623	$	(8,113)	$	510
Goodwill		$	84,171			$	84,171			$	84,171			$	84,171

The following table presents the estimated future amortization expense for amortizing intangible assets within the years ending December 31:

(In thousands)		Amount
2015		$	158
2016			94
2017			16
2018			16
Thereafter			12
	Total amortizing intangible assets	$	296

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DEPOSITS

6 Months Ended

Jun. 30, 2015

Deposits [Abstract]

DEPOSITS

Note 6 – Deposits

The following table presents the composition of deposits at the dates indicated:

(In thousands)				June 30, 2015		December 31, 2014
Noninterest-bearing deposits				$	1,092,413	$	993,737
Interest-bearing deposits:
	Demand				525,584		534,605
	Money market savings				860,315		828,494
	Regular savings				280,143		264,751
	Time deposits of less than $100,000				245,347		239,857
	Time deposits of $100,000 or more				243,544		205,065
		Total interest-bearing deposits			2,154,933		2,072,772
			Total deposits	$	3,247,346	$	3,066,509

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SHARE BASED COMPENSATION

6 Months Ended

Jun. 30, 2015

Share Based Compensation [Abstract]

SHARE BASED COMPENSATION

Note 8 – Share Based Compensation

At June 30, 2015, the Company had two share based compensation plans in existence, the 2005 Omnibus Stock Plan (“Omnibus Stock Plan”) and the 2015 Omnibus Incentive Plan (“Omnibus Incentive Plan”). The Omnibus Stock Plan expired during the second quarter of 2015 but has outstanding options that may still be exercised. The Omnibus Incentive Plan is described in the following paragraph.

The Company’s Omnibus Incentive Plan was approved on May 6, 2015 and provides for the granting of non-qualifying stock options to the Company’s directors, and incentive and non-qualifying stock options, stock appreciation rights, restricted stock grants, RSU’s and performance awards to selected key employees on a periodic basis at the discretion of the board. The Omnibus Incentive Plan authorizes the issuance of up to 1,500,000 shares of common stock,all of which are available for issuance at June 30, 2015, has a term of ten years, and is administered by a committee of at least three directors appointed by the board of directors. Options granted under the plan have an exercise price which may not be less than 100% of the fair market value of the common stock on the date of the grant and must be exercised within ten years from the date of grant. The exercise price of stock options must be paid for in full in cash or shares of common stock, or a combination of both. The board committee has the discretion when making a grant of stock options to impose restrictions on the shares to be purchased upon the exercise of such options. The Company generally issues authorized but previously unissued shares to satisfy option exercises. At June 30, 2015, no stock options or awards had been granted from this plan.

The fair values of all of the options granted for the periods indicated have been estimated using a binomial option-pricing model with the weighted-average assumptions for the periods shown are presented in the following table:

	Six Months Ended June 30,
	2015		2014
Dividend yield	3.40	%	3.04	%
Weighted average expected volatility	42.98	%	46.78	%
Weighted average risk-free interest rate	1.42	%	1.56	%
Weighted average expected lives (in years)	5.42		5.08
Weighted average grant-date fair value	$7.63		$8.05

The dividend yield is based on estimated future dividend yields. The risk-free rate for periods within the contractual term of the share option is based on the U.S. Treasury yield curve in effect at the time of the grant. Expected volatilities are generally based on historical volatilities. The expected term of share options granted is generally derived from historical experience.

Compensation expense is recognized on a straight-line basis over the vesting period of the respective stock option or restricted stock grant. The Company recognized compensation expense of $0.4 million and $0.4 million for the three months ended June 30, 2015 and 2014, respectively, related to the awards of stock options and restricted stock grants.Compensation expense of $0.9 million and $0.8 million was recognized for the six months ended June 30, 2015 and 2014, respectively.The intrinsic value of stock options exercised in the six months ended June 30, 2015and 2014was $0.3 million and $0.1 million, respectively. The total of unrecognized compensation cost related to stock options was approximately $0.3 million as of June 30, 2015. That cost is expected to be recognized over a weighted average period of approximately 2.2 years. The total of unrecognized compensation cost related to restricted stock was approximately $4.8 million as of June 30, 2015. That cost is expected to be recognized over a weighted average period of approximately 3.5 years. The fair value of the options vested during the six months ended June 30, 2015 and 2014, was $0.2 million and $0.2 million, respectively.

In the first quarter of 2015, 21,245 stock options were granted, subject to a three year vesting schedule with one third of the options vesting on April 1^st of each year. Additionally, 79,860 shares of restricted stock were granted, subject to a five year vesting schedule with one fifth of the shares vesting on April 1^st of each year.

A summary of share option activity for the period indicated is reflected in the following table:

		Number	Weighted		Average	Aggregate
		of	Average		Contractual	Intrinsic
		Common	Exercise		Remaining	Value
		Shares	Share Price		Life(Years)	(in thousands)
Balance at January 1, 2015		224,381	$	20.88		$	1,300
Granted		21,245	$	26.20
Exercised		(26,695)	$	14.68		$	308
Forfeited or expired		(71,708)	$	27.96
Balance at June 30, 2015		147,223	$	19.37	3.7	$	1,268
Exercisable at June 30, 2015		105,984	$	17.26	2.7	$	1,137
Weighted average fair value of options
	granted during the year		$	7.63

A summary of the activity for the Company’s restricted stock for the period indicated is presented in the following table:

	Number	Weighted
	of	Average
	Common	Grant-Date
(In dollars, except share data):	Shares	Fair Value
Restricted stock at January 1, 2015	226,871	$	21.07
Granted	79,860	$	26.20
Vested	(78,565)	$	19.79
Forfeited	(3,317)	$	22.80
Restricted stock at June 30, 2015	224,849	$	23.31

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Share Based Compensation (Summary of Share Option Activity) (Detail) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Number of Common Shares
Balance at January 1, 2015	224,381
Granted	21,245
Exercised	(26,695)	(13,721)
Forfeited or expired	(71,708)
Balance at March 31, 2015	147,223
Exercisable, Common Shares	105,984
Weighted Average Exercise Share Price
Balance at January 1, 2015	$ 20.88
Granted	26.2
Exercised	14.68
Forfeited or expired	27.96
Balance at March 31, 2015	19.37
Exercisable at December 31, 2014	17.26
Weighted average fair value of options granted during the year	$ 7.63	$ 8.05
Weighted Average Contractual Remaining Life(Years)
Balance at end of period	3 years 8 months 12 days
Exercisable at end of period	2 years 8 months 12 days
Balance at January 1, 2015	$ 1,300
Exercised	308
Balance at March 31, 2015	1,268
Exercisable, Intrinsic Value	$ 1,137

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Pension, Profit Sharing, and Other Employee Benefit Plans (Net Periodic Benefit Cost) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Pension, Profit Sharing, and Other Employee Benefit Plans [Abstract]
Interest cost on projected benefit obligation	$ 407	$ 403	$ 817	$ 794
Expected return on plan assets	(406)	(493)	(812)	(987)
Recognized net actuarial loss	259	68	551	116
Net periodic benefit cost	$ 260	$ (22)	$ 556	$ (77)

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Share Based Compensation (Fair Values of all Options Granted Estimated Using Binomial Option-Pricing Model with Weighted-average Assumptions) (Detail) - $ / shares	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Share Based Compensation [Abstract]
Dividend yield	3.40%	3.04%
Weighted average expected volatility	42.98%	46.78%
Weighted average risk-free interest rate	1.42%	1.56%
Weighted average expected lives (in years)	5 years 5 months 1 day	5 years 29 days
Weighted average grant-date fair value	$ 7.63	$ 8.05

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FAIR VALUE (Tables)

6 Months Ended

Jun. 30, 2015

Fair Value Disclosures [Abstract]

Financial assets and Liabilities at Dates Indicated that were Accounted for at Fair Value

The following tables set forth the Company’s financial assets and liabilities at the dates indicated that were accounted for or disclosed at fair value. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

			June 30, 2015
			Quoted Prices in				Significant
			Active Markets for		Significant Other		Unobservable
			Identical Assets		Observable Inputs		Inputs
(In thousands)			(Level 1)		(Level 2)		(Level 3)		Total
Assets
	Residential mortgage loans held for sale		$	-	$	19,445	$	-	$	19,445
	Investments available-for-sale:
		U.S. government agencies		-		137,980		-		137,980
		State and municipal		-		161,953		-		161,953
		Mortgage-backed		-		324,145		-		324,145
		Trust preferred		-		-		1,018		1,018
		Marketable equity securities		-		723		-		723
	Interest rate swap agreements			-		1,390		-		1,390
Liabilities
	Interest rate swap agreements		$	-	$	(1,390)	$	-	$	(1,390)

			December 31, 2014
			Quoted Prices in				Significant
			Active Markets for		Significant Other		Unobservable
			Identical Assets		Observable Inputs		Inputs
(In thousands)			(Level 1)		(Level 2)		(Level 3)		Total
Assets
	Residential mortgage loans held for sale		$	-	$	10,512	$	-	$	10,512
	Investments available-for-sale:
		U.S. government agencies		-		141,679		-		141,679
		State and municipal		-		167,052		-		167,052
		Mortgage-backed		-		361,519		-		361,519
		Trust preferred		-		-		1,236		1,236
		Marketable equity securities		-		723		-		723
	Interest rate swap agreements			-		1,501		-		1,501
Liabilities
	Interest rate swap agreements		$	-	$	(1,501)	$	-	$	(1,501)

Unrealized Losses Included in Assets Measured in Condensed Consolidated Statements of Condition at Fair Value on a Recurring Basis

The following table provides unrealized losses included in assets measured in the Condensed Consolidated Statements of Condition at fair value on a recurring basis for the period indicated:

			Significant
			Unobservable
			Inputs
(In thousands)			(Level 3)
Investments available-for-sale:
	Balance at January 1, 2015		$	1,236
		Principal redemption		(218)
	Balance at June 30, 2015		$	1,018

Assets Measured at Fair Value on Nonrecurring Basis

The following table sets forth the Company’s financial assets subject to fair value adjustments (impairment) on a nonrecurring basis at the date indicated that are valued at the lower of cost or market. Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

		June 30, 2015
		Quoted Prices in		Significant
		Active Markets		Other		Significant
		for Identical		Observable		Unobservable
(In thousands)		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)		Total		Total Losses
Impaired loans		$	-	$	-	$	6,913	$	6,913	$	10,304
Other real estate owned			-		-		4,514		4,514		(268)
	Total	$	-	$	-	$	11,427	$	11,427	$	10,036

		December 31, 2014
		Quoted Prices in		Significant
		Active Markets		Other		Significant
		for Identical		Observable		Unobservable
(In thousands)		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)		Total		Total Losses
Impaired loans		$	-	$	-	$	7,819	$	7,819	$	13,893
Other real estate owned			-		-		3,195		3,195		(247)
	Total	$	-	$	-	$	11,014	$	11,014	$	13,646

Carrying Amounts And Fair Values of Company's Financial Instruments

The carrying amounts and fair values of the Company’s financial instruments at the dates indicated are presented in the following table:

					Fair Value Measurements
	June 30, 2015				Quoted Prices in
			Estimated		Active Markets for		Significant Other		Significant
	Carrying		Fair		Identical Assets		Observable Inputs		Unobservable Inputs
(In thousands)	Amount		Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets
Investments held-to-maturity and other equity securities	$	252,465	$	253,479	$	-	$	253,479	$	-
Loans, net of allowance		3,250,152		3,279,656		-		-		3,279,656
Other assets		89,617		89,617		-		89,617		-
Financial Liabilities
Time Deposits	$	488,891	$	489,419	$	-	$	489,419	$	-
Securities sold under retail repurchase agreements and
federal funds purchased		111,817		111,817		-		111,817		-
Advances from FHLB		550,000		572,615		-		572,615		-
Subordinated debentures		35,000		13,108		-		-		13,108

					Fair Value Measurements
	December 31, 2014				Quoted Prices in
			Estimated		Active Markets for		Significant Other		Significant
	Carrying		Fair		Identical Assets		Observable Inputs		Unobservable Inputs
(In thousands)	Amount		Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets
Investments held-to-maturity and other equity securities	$	261,410	$	263,697	$	-	$	263,697	$	-
Loans, net of allowance		3,089,590		3,118,635		-		-		3,118,635
Other assets		88,657		88,657		-		88,657		-
Financial Liabilities
Time Deposits	$	444,921	$	444,729	$	-	$	444,729	$	-
Securities sold under retail repurchase agreements and
federal funds purchased		74,432		74,432		-		74,432		-
Advances from FHLB		655,000		679,163		-		679,163		-
Subordinated debentures		35,000		13,276		-		-		13,276

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Credit Quality Assessment (Recorded Investment with Respect to Impaired loans, Associated Allowance by Applicable Portfolio Segment and Principal Balance of Impaired Loans prior to Amounts Charged-off) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	$ 9,661	$ 11,411
Impaired loans without a specific allowance	19,033	18,008
Impaired loans	28,694	29,419
Impaired Financing Receivable, Related Allowance	2,886	2,894
Unpaid principal balance in total impaired loans	41,337	42,185
Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	7,866	9,104
Impaired loans without a specific allowance	10,160	8,676
Impaired loans	18,026	17,780
Restructuring | Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	881	687
Impaired loans without a specific allowance	4,739	4,810
Impaired loans	5,620	5,497
Restructuring | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	914	1,620
Impaired loans without a specific allowance	4,134	4,522
Impaired loans	5,048	6,142
Commercial
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	1,743	1,468
Impaired loans without a specific allowance	2,438	2,426
Impaired loans	4,181	3,894
Impaired Financing Receivable, Related Allowance	1,047	788
Unpaid principal balance in total impaired loans	5,646	5,360
Commercial | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	659	473
Impaired loans without a specific allowance	1,013	1,115
Impaired loans	1,672	1,588
Commercial | Restructuring | Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	881	687
Impaired loans without a specific allowance	15	23
Impaired loans	896	710
Commercial | Restructuring | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	203	308
Impaired loans without a specific allowance	1,410	1,288
Impaired loans	1,613	1,596
All Other
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	0	0
Impaired loans without a specific allowance	3,770	3,841
Impaired loans	3,770	3,841
Impaired Financing Receivable, Related Allowance	0	0
Unpaid principal balance in total impaired loans	4,086	4,126
All Other | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	0	0
Impaired loans without a specific allowance	0	0
Impaired loans	0	0
All Other | Restructuring | Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	0	0
Impaired loans without a specific allowance	2,621	2,664
Impaired loans	2,621	2,664
All Other | Restructuring | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	0	0
Impaired loans without a specific allowance	1,149	1,177
Impaired loans	1,149	1,177
Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	57	1,330
Impaired loans without a specific allowance	137	1,134
Impaired loans	194	2,464
Impaired Financing Receivable, Related Allowance	58	741
Unpaid principal balance in total impaired loans	4,456	7,044
Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	57	1,330
Impaired loans without a specific allowance	0	0
Impaired loans	57	1,330
Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction | Restructuring | Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	0	0
Impaired loans without a specific allowance	0	0
Impaired loans	0	0
Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction | Restructuring | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	0	0
Impaired loans without a specific allowance	137	1,134
Impaired loans	137	1,134
Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	2,661	2,364
Impaired loans without a specific allowance	9,465	7,915
Impaired loans	12,126	10,279
Impaired Financing Receivable, Related Allowance	715	541
Unpaid principal balance in total impaired loans	16,878	14,926
Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	2,589	2,288
Impaired loans without a specific allowance	7,362	5,792
Impaired loans	9,951	8,080
Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate | Restructuring | Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	0	0
Impaired loans without a specific allowance	2,103	2,123
Impaired loans	2,103	2,123
Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate | Restructuring | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	72	76
Impaired loans without a specific allowance	0	0
Impaired loans	72	76
Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	5,200	6,249
Impaired loans without a specific allowance	3,223	2,692
Impaired loans	8,423	8,941
Impaired Financing Receivable, Related Allowance	1,066	824
Unpaid principal balance in total impaired loans	10,271	10,729
Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	4,561	5,013
Impaired loans without a specific allowance	1,785	1,769
Impaired loans	6,346	6,782
Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate | Restructuring | Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	0	0
Impaired loans without a specific allowance	0	0
Impaired loans	0	0
Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate | Restructuring | Non Accrual Loans
Financing Receivable Impaired [Line Items]
Impaired loans with a specific allowance	639	1,236
Impaired loans without a specific allowance	1,438	923
Impaired loans	$ 2,077	$ 2,159

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LITIGATION

6 Months Ended

Jun. 30, 2015

Commitments and Contingencies Disclosure [Abstract]

LITIGATION

Note 13 – Litigation

The Company and its subsidiaries are subject in the ordinary course of business to various pending or threatened legal proceedings in which claims for monetary damages are asserted. During 2014, the Company accrued $6.5 million for litigation expenses as a result of an adverse jury verdict rendered in the second quarter of 2014 associated with the actions of a former employee of CommerceFirst Bank, which was acquired in 2012. The Company is currently in the process of appealing the decision. As a result of the appeal process, an additional $0.4 million in legal expenses have been accrued in the first six months of 2015.

After consultation with legal counsel, management does not anticipate that the ultimate liability, if any, arising out of any other legal matters will have a material adverse effect on the Company's financial condition, operating results or liquidity.

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LOANS AND LEASES (Tables)

6 Months Ended

Jun. 30, 2015

Loans and Leases [Abstract]

Loan Portfolio Segment Balances

The loan portfolio segment balances at the dates indicated are presented in the following table:

(In thousands)		June 30, 2015		December 31, 2014
Residential real estate:
	Residential mortgage	$	744,195	$	717,886
	Residential construction		137,134		136,741
Commercial real estate:
	Commercial owner occupied real estate		643,973		611,061
	Commercial investor real estate		694,179		640,193
	Commercial acquisition, development and construction		223,103		205,124
Commercial Business			409,795		390,781
Leases			21		54
Consumer			436,465		425,552
	Total loans and leases	$	3,288,865	$	3,127,392

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Credit Quality Assessment (Activity in Allowance for Loan and Lease Losses by Respective Loan Portfolio Segment) (Detail) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Financing Receivable Allowance For Credit Losses [Line Items]
Balance at beginning of year	$ 37,802	$ 38,766	$ 38,766
Provision (credit)	1,815		(163)
Charge-offs	(1,837)	(1,176)	(2,687)
Loan and lease recoveries	933	1,193	1,886
Net charge-offs	(904)	17	(801)
Balance at period end	38,713	37,959	37,802
Total loans and leases	$ 3,288,865		$ 3,127,392
Allowance for loans and leases to total loans and leases ratio	1.18%		1.21%
Balance of loans specifically evaluated for impairment	$ 28,694		$ 29,419
Allowance for loans specifically evaluated for impairment	$ 2,886		$ 2,894
Specific allowance to specific loans ratio	10.06%		9.84%
Balance of loans collectively evaluated	$ 3,260,171		$ 3,097,973
Allowance for loans collectively evaluated	$ 35,827		$ 34,908
Collective allowance to collective loans ratio	1.10%		1.13%
Commercial
Financing Receivable Allowance For Credit Losses [Line Items]
Balance at beginning of year	$ 5,852	6,308	$ 6,308
Provision (credit)	13		(1,204)
Charge-offs	(181)		(729)
Loan and lease recoveries	197		1,477
Net charge-offs	16		748
Balance at period end	5,881		5,852
Total loans and leases	$ 409,795		$ 390,781
Allowance for loans and leases to total loans and leases ratio	1.44%		1.50%
Balance of loans specifically evaluated for impairment	$ 4,181		$ 3,894
Allowance for loans specifically evaluated for impairment	$ 1,047		$ 788
Specific allowance to specific loans ratio	25.04%		20.24%
Balance of loans collectively evaluated	$ 405,614		$ 386,887
Allowance for loans collectively evaluated	$ 4,834		$ 5,064
Collective allowance to collective loans ratio	1.19%		1.31%
Leases
Financing Receivable Allowance For Credit Losses [Line Items]
Balance at beginning of year	$ 9	16	$ 16
Provision (credit)	0		(7)
Charge-offs	0		0
Loan and lease recoveries	0		0
Net charge-offs	0		0
Balance at period end	9		9
Total loans and leases	$ 21		$ 54
Allowance for loans and leases to total loans and leases ratio	42.86%		16.80%
Balance of loans collectively evaluated	$ 21		$ 54
Allowance for loans collectively evaluated	$ 9		$ 9
Collective allowance to collective loans ratio	42.86%		16.80%
Consumer
Financing Receivable Allowance For Credit Losses [Line Items]
Balance at beginning of year	$ 3,592	4,142	$ 4,142
Provision (credit)	234		119
Charge-offs	(537)		(834)
Loan and lease recoveries	99		165
Net charge-offs	(438)		(669)
Balance at period end	3,388		3,592
Total loans and leases	$ 436,465		$ 425,552
Allowance for loans and leases to total loans and leases ratio	0.78%		0.84%
Balance of loans collectively evaluated	$ 436,465		$ 425,552
Allowance for loans collectively evaluated	$ 3,388		$ 3,592
Collective allowance to collective loans ratio	0.78%		0.84%
Commercial Real Estate Portfolio Segment | Commercial Acquisition, Development and Construction
Financing Receivable Allowance For Credit Losses [Line Items]
Balance at beginning of year	$ 4,267	3,754	$ 3,754
Provision (credit)	(336)		1,042
Charge-offs	(739)		(529)
Loan and lease recoveries	580		0
Net charge-offs	(159)		(529)
Balance at period end	3,772		4,267
Total loans and leases	$ 223,103		$ 205,124
Allowance for loans and leases to total loans and leases ratio	1.69%		2.08%
Balance of loans specifically evaluated for impairment	$ 194		$ 2,464
Allowance for loans specifically evaluated for impairment	$ 58		$ 741
Specific allowance to specific loans ratio	29.90%		30.07%
Balance of loans collectively evaluated	$ 222,909		$ 202,660
Allowance for loans collectively evaluated	$ 3,714		$ 3,526
Collective allowance to collective loans ratio	1.67%		1.74%
Commercial Real Estate Portfolio Segment | Commercial Investor Real Estate
Financing Receivable Allowance For Credit Losses [Line Items]
Balance at beginning of year	$ 9,784	9,263	$ 9,263
Provision (credit)	947		486
Charge-offs	(90)		(3)
Loan and lease recoveries	10		38
Net charge-offs	(80)		35
Balance at period end	10,651		9,784
Total loans and leases	$ 694,179		$ 640,193
Allowance for loans and leases to total loans and leases ratio	1.53%		1.53%
Balance of loans specifically evaluated for impairment	$ 12,126		$ 10,279
Allowance for loans specifically evaluated for impairment	$ 715		$ 541
Specific allowance to specific loans ratio	5.90%		5.26%
Balance of loans collectively evaluated	$ 682,053		$ 629,914
Allowance for loans collectively evaluated	$ 9,936		$ 9,243
Collective allowance to collective loans ratio	1.46%		1.47%
Commercial Real Estate Portfolio Segment | Commercial Owner Occupied Real Estate
Financing Receivable Allowance For Credit Losses [Line Items]
Balance at beginning of year	$ 7,143	6,308	$ 6,308
Provision (credit)	584		1,094
Charge-offs	(212)		(265)
Loan and lease recoveries	1		6
Net charge-offs	(211)		(259)
Balance at period end	7,516		7,143
Total loans and leases	$ 643,973		$ 611,061
Allowance for loans and leases to total loans and leases ratio	1.17%		1.17%
Balance of loans specifically evaluated for impairment	$ 8,423		$ 8,941
Allowance for loans specifically evaluated for impairment	$ 1,066		$ 824
Specific allowance to specific loans ratio	12.66%		9.22%
Balance of loans collectively evaluated	$ 635,550		$ 602,120
Allowance for loans collectively evaluated	$ 6,450		$ 6,319
Collective allowance to collective loans ratio	1.01%		1.05%
Residential Real Estate Portfolio Segment | Residential Mortgage
Financing Receivable Allowance For Credit Losses [Line Items]
Balance at beginning of year	$ 6,232	7,819	$ 7,819
Provision (credit)	318		(1,385)
Charge-offs	(78)		(323)
Loan and lease recoveries	31		121
Net charge-offs	(47)		(202)
Balance at period end	6,503		6,232
Total loans and leases	$ 744,195		$ 717,886
Allowance for loans and leases to total loans and leases ratio	0.87%		0.87%
Balance of loans specifically evaluated for impairment	$ 3,770		$ 3,535
Allowance for loans specifically evaluated for impairment	0		0
Balance of loans collectively evaluated	740,425		714,351
Allowance for loans collectively evaluated	$ 6,503		$ 6,232
Collective allowance to collective loans ratio	0.88%		0.87%
Residential Real Estate Portfolio Segment | Residential Construction
Financing Receivable Allowance For Credit Losses [Line Items]
Balance at beginning of year	$ 923	$ 1,156	$ 1,156
Provision (credit)	55		(308)
Charge-offs	0		(4)
Loan and lease recoveries	15		79
Net charge-offs	15		75
Balance at period end	993		923
Total loans and leases	$ 137,134		$ 136,741
Allowance for loans and leases to total loans and leases ratio	0.72%		0.67%
Balance of loans specifically evaluated for impairment			$ 306
Allowance for loans specifically evaluated for impairment			0
Balance of loans collectively evaluated	$ 137,134		136,435
Allowance for loans collectively evaluated	$ 993		$ 923
Collective allowance to collective loans ratio	0.72%		0.68%

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Investments (Amortized Cost and Estimated Fair Values of Investments Held-To-Maturity) (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Schedule Of Held To Maturity Securities [Line Items]
Amortized Cost	$ 216,866	$ 219,973
Gross Unrealized Gains	3,480	4,346
Gross Unrealized Losses	(2,466)	(2,059)
Investments held-to-maturity, fair value	217,880	222,260
U.S. Government Agencies
Schedule Of Held To Maturity Securities [Line Items]
Amortized Cost	64,515	64,512
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(1,340)	(1,734)
Investments held-to-maturity, fair value	63,175	62,778
State and municipal
Schedule Of Held To Maturity Securities [Line Items]
Amortized Cost	150,069	155,261
Gross Unrealized Gains	3,454	4,321
Gross Unrealized Losses	(1,126)	(325)
Investments held-to-maturity, fair value	152,397	159,257
Mortgage-Backed
Schedule Of Held To Maturity Securities [Line Items]
Amortized Cost	182	200
Gross Unrealized Gains	26	25
Gross Unrealized Losses	0	0
Investments held-to-maturity, fair value	208	225
Corporate Debt
Schedule Of Held To Maturity Securities [Line Items]
Amortized Cost	2,100	0
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Investments held-to-maturity, fair value	$ 2,100	$ 0

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015		Jun. 30, 2014
Statement of Comprehensive Income [Abstract]
Net income	$ 10,333	$ 6,982	$ 21,558		$ 17,910
Investments available-for-sale:
Net change in unrealized gains (losses) on investments available-for-sale	(4,819)	6,361	(185)		13,493
Related income tax (expense) benefit	1,915	(2,522)	74		(5,345)
Net investment gains reclassified into earnings	19	0	19		0
Related income tax expense	(8)	0	(8)		0
Net effect on other comprehensive income (loss)	(2,893)	3,839	(100)		8,148
Defined benefit pension plan:
Recognition of unrealized gain (loss)	259	68	551	[1]	116	[1]
Related income tax (expense) benefit	(104)	(24)	(220)		(61)
Net effect on other comprehensive income (loss)	155	44	331		55
Total other comprehensive income (loss)	(2,738)	3,883	231		8,203
Comprehensive income	$ 7,595	$ 10,865	$ 21,789		$ 26,113

[1]

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INVESTMENTS

6 Months Ended

Jun. 30, 2015

Investments [Abstract]

INVESTMENTS

Note 2 – Investments

Investments available-for-sale

The amortized cost and estimated fair values of investments available-for-sale at the dates indicated are presented in the following table:

			June 30, 2015								December 31, 2014
					Gross		Gross		Estimated				Gross		Gross		Estimated
			Amortized		Unrealized		Unrealized		Fair		Amortized		Unrealized		Unrealized		Fair
(In thousands)			Cost		Gains		Losses		Value		Cost		Gains		Losses		Value
U.S. government agencies			$	139,542	$	122	$	(1,684)	$	137,980	$	144,497	$	-	$	(2,818)	$	141,679
State and municipal				153,769		8,185		(1)		161,953		157,603		9,453		(4)		167,052
Mortgage-backed				317,433		8,794		(2,082)		324,145		354,631		9,824		(2,936)		361,519
Trust preferred				1,111		-		(93)		1,018		1,348		-		(112)		1,236
	Total debt securities			611,855		17,101		(3,860)		625,096		658,079		19,277		(5,870)		671,486
Marketable equity securities				723		-		-		723		723		-		-		723
		Total investments available-for-sale	$	612,578	$	17,101	$	(3,860)	$	625,819	$	658,802	$	19,277	$	(5,870)	$	672,209

Any unrealized losses in the U.S. government agencies, state and municipal, mortgage-backed or corporate debt investment securities at June 30, 2015 are not the result of credit related events but due to changes in interest rates. These declines are considered temporary in nature and are expected to decline over time and recover as these securities approach maturity.

The mortgage-backed securities portfolio at June 30, 2015 is composed entirely of either the most senior tranches of GNMA, FNMA or FHLMC collateralized mortgage obligations ($150.6 million), or GNMA, FNMA or FHLMC mortgage-backed securities ($173.5million). The Company does not intend to sell these securities and has sufficient liquidity to hold these securities for an adequate period of time, which may be maturity, to allow for any anticipated recovery in fair value.

At June 30, 2015 the trust preferred portfolio consisted of one pooled trust preferred security. The pooled trust preferred security, which is backed by debt issued by banks and thrifts, totals $1.1 million with a fair value of $1.0 million. The fair value of this security was determined by management through the use of a third party valuation specialist due to the limited trading activity for this security.

The income valuation approach technique (present value) used maximizes the use of relevant observable inputs and minimizes the use of unobservable inputs. The methodology and significant assumptions employed by the specialist to determine fair value included:

• Evaluation of the structural terms as established in the indenture;
• Detailed credit and structural evaluation for each piece of issuer collateral in the pool;
• Overall default (.61%), recovery and prepayment (2%)/amortization probabilities by issuers in the pool;
• Identification of adverse conditions specifically related to the security, industry and geographical area;
• Projection of estimated cash flows that incorporate default expectations and loss severities;
• Review of historical and implied volatility of the fair value of the security;
• Evaluation of credit risk concentrations;
• Evaluation of the length of time and the extent to which the fair value has been less than the amortized cost; and
• A discount rate of 11.5% was established using credit adjusted financial institution spreads for comparably rated institutions and a liquidity adjustment that considered the previously noted characteristics.

As a result of this evaluation, it was determined that the pooled trust preferred security had not incurred any credit-related other-than-temporary impairment (“OTTI”) for the quarter ended June 30, 2015. Non-credit related OTTI on this security, which is not expected to be sold and which the Company has the ability to hold until maturity, was $0.1 million at June 30, 2015. This non-credit related OTTI was recognized in other comprehensive income (“OCI”) at June 30, 2015.

The methodology and significant inputs used to measure the amount related to credit loss consisted of the following:

• Default rates were developed based on the financial condition of the trust preferred issuers in the pool and the payment or deferral status. Conditional default rates were estimated based on the payment characteristics of the security and the financial condition of the issuers in the pool. Near term and future defaults are estimated using third party industry data in addition to a review of key financial ratios and other pertinent data on the financial stability of the underlying issuer;
• Loss severity is forecasted based on the type of impairment using research performed by third parties;
• The security contains one level of subordination below the senior tranche, with the senior tranche receiving the spread from the subordinate bonds. Given recent performance, it is not expected that the senior tranche will receive its full interest and principal at the bond’s maturity date;
• Credit ratings of the underlying issuers are reviewed in conjunction with the development of the default rates applied to determine the credit amounts related to the credit loss; and
• Potential prepayments are estimated based on terms and rates of the underlying trust preferred securities to determine the impact of excess spread on the credit enhancement, the removal of the strongest institutions from the underlying pool and any impact that prepayments might have on diversity and concentration.

The following table provides the activity of OTTI on investment securities due to credit losses recognized in earnings for the period indicated:

(In thousands)		OTTI Losses
Cumulative credit losses on investment securities, through December 31, 2014	$	531
Additions for credit losses not previously recognized		-
Cumulative credit losses on investment securities, through June 30, 2015	$	531

Gross unrealized losses and fair value by length of time that the individual available-for-sale securities have been in an unrealized loss position at the dates indicated are presented in the following table:

		June 30, 2015
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			10	$	108,274	$	605	$	1,079	$	1,684
State and municipal			2		1,410		1		-		1
Mortgage-backed			22		111,424		250		1,832		2,082
Trust preferred			1		1,111		-		93		93
	Total		35	$	222,219	$	856	$	3,004	$	3,860

		December 31, 2014
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			14	$	141,679	$	60	$	2,758	$	2,818
State and municipal			2		1,409		4		-		4
Mortgage-backed			20		108,902		58		2,878		2,936
Trust preferred			1		1,236		-		112		112
	Total		37	$	253,226	$	122	$	5,748	$	5,870

The amortized cost and estimated fair values of debt securities available-for-sale by contractual maturity at the dates indicated are provided in the following table. The Company has allocated mortgage-backed securities into the four maturity groupings reflected in the following table using the expected average life of the individual securities based on statistics provided by independent third party industry sources. Expected maturities will differ from contractual maturities as borrowers may have the right to prepay obligations with or without prepayment penalties.

		June 30, 2015				December 31, 2014
				Estimated				Estimated
		Amortized		Fair		Amortized		Fair
(In thousands)		Cost		Value		Cost		Value
Due in one year or less		$	690	$	701	$	691	$	714
Due after one year through five years			116,702		118,680		47,900		49,385
Due after five years through ten years			247,330		254,687		332,841		340,852
Due after ten years			247,133		251,028		276,647		280,535
	Total debt securities available for sale	$	611,855	$	625,096	$	658,079	$	671,486

At June 30, 2015 and December 31, 2014, investments available-for-sale with a book value of $229.0 million and $212.9 million, respectively, were pledged as collateral for certain government deposits and for other purposes as required or permitted by law. The outstanding balance of no single issuer, except for U.S. Agencies securities, exceeded ten percent of stockholders' equity at June 30, 2015 and December 31, 2014.

Investments held-to-maturity

The amortized cost and estimated fair values of investments held-to-maturity at the dates indicated are presented in the following table:

		June 30, 2015								December 31, 2014
				Gross		Gross		Estimated				Gross		Gross		Estimated
		Amortized		Unrealized		Unrealized		Fair		Amortized		Unrealized		Unrealized		Fair
(In thousands)		Cost		Gains		Losses		Value		Cost		Gains		Losses		Value
U.S. government agencies		$	64,515	$	-	$	(1,340)	$	63,175	$	64,512	$	-	$	(1,734)	$	62,778
State and municipal			150,069		3,454		(1,126)		152,397		155,261		4,321		(325)		159,257
Mortgage-backed			182		26		-		208		200		25		-		225
Corporate debt			2,100		-		-		2,100		-		-		-		-
	Total investments held-to-maturity	$	216,866	$	3,480	$	(2,466)	$	217,880	$	219,973	$	4,346	$	(2,059)	$	222,260

Gross unrealized losses and fair value by length of time that the individual held-to-maturity securities have been in a continuous unrealized loss position at the dates indicated are presented in the following tables:

		June 30, 2015
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			8	$	63,175	$	533	$	807	$	1,340
State and municipal			63		55,987		874		252		1,126
	Total		71	$	119,162	$	1,407	$	1,059	$	2,466

		December 31, 2014
						Continuous Unrealized
						Losses Existing for:
		Number								Total
		of				Less than		More than		Unrealized
(Dollars in thousands)		securities		Fair Value		12 months		12 months		Losses
U.S. government agencies			8	$	62,778	$	-	$	1,734	$	1,734
State and municipal			41		32,027		18		307		325
	Total		49	$	94,805	$	18	$	2,041	$	2,059

The Company intends to hold these securities until they reach maturity.

The amortized cost and estimated fair values of debt securities held-to-maturity by contractual maturity at the dates indicated are reflected in the following table. Expected maturities will differ from contractual maturities as borrowers may have the right to prepay obligations with or without prepayment penalties.

		June 30, 2015				December 31, 2014
				Estimated				Estimated
		Amortized		Fair		Amortized		Fair
(In thousands)		Cost		Value		Cost		Value
Due in one year or less		$	846	$	865	$	1,690	$	1,694
Due after one year through five years			10,656		11,013		6,763		6,938
Due after five years through ten years			169,756		170,879		163,252		164,787
Due after ten years			35,608		35,123		48,268		48,841
	Total debt securities held-to-maturity	$	216,866	$	217,880	$	219,973	$	222,260

At June 30, 2015 and December 31, 2014, investments held-to-maturity with a book value of $193.3 million and $202.4 million, respectively, were pledged as collateral for certain government deposits and for other purposes as required or permitted by law. The outstanding balance of no single issuer, except for U.S. Agency securities, exceeded ten percent of stockholders' equity at June 30, 2015 and December 31, 2014.

Equity securities

Other equity securities at the dates indicated are presented in the following table:

(In thousands)		June 30, 2015		December 31, 2014
Federal Reserve Bank stock		$	8,269	$	8,269
Federal Home Loan Bank of Atlanta stock			27,330		33,168
	Total equity securities	$	35,599	$	41,437

XML

GOODWILL AND OTHER INTANGIBLE ASSETS (Gross Carrying Amouns and Accumulated Amortization of Intangible Assets and Goodwill) (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Finite Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 8,623	$ 8,623
Accumulated Amortization	(8,327)	(8,113)
Net Carrying Amount	296	510
Goodwill	84,171	84,171
Other Identifiable Intangible Assets
Finite Lived Intangible Assets [Line Items]
Gross Carrying Amount	8,623	8,623
Accumulated Amortization	(8,327)	(8,113)
Net Carrying Amount	$ 296	$ 510
Other Identifiable Intangible Assets | Weighted average [Member]
Finite Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life	1 year 7 months 6 days	1 year 8 months 12 days

XML

Other Comprehensive Income (Loss) (Reclassification Adjustments Out of Accumulated Other Comprehensive Income) (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015		Jun. 30, 2014
Unrealized gains/(losses) on investments available-for-sale Affected line item in the Statements of Income:
Investment securities gains	$ 19	$ 0	$ 19		$ 0
Income before taxes			19		0
Tax expense			8		0
Net income			11		0
Amortization of defined benefit pension plan items Affected line item in the Statements of Income:
Recognition of unrealized gain (loss)	$ 259	$ 68	551	[1]	116	[1]
Income before taxes			551		116
Tax expense			220		61
Net income			$ 331		$ 55

[1]

XML

CREDIT QUALITY ASSESSMENT (Tables)

6 Months Ended

Jun. 30, 2015

Accounts, Notes, Loans and Financing Receivable [Line Items]

Summary Information on Allowance for Loan and Lease Loss Activity

Summary information on the allowance for loan and lease loss activity for the period indicated is provided in the following table:

			Six Months Ended June 30,
(In thousands)			2015		2014
Balance at beginning of year			$	37,802	$	38,766
	Provision for loan and lease losses			1,815		(824)
	Loan and lease charge-offs			(1,837)		(1,176)
	Loan and lease recoveries			933		1,193
		Net (charge-offs) recoveries		(904)		17
Balance at period end			$	38,713	$	37,959

Activity in Allowance for Loan and Lease Losses by Respective Loan Portfolio Segment

The following tables provide information on the activity in the allowance for loan and lease losses by the respective loan portfolio segment for the period indicated:

		For the Six Months Ended June 30, 2015
				Commercial Real Estate										Residential Real Estate
								Commercial
		Commercial		Commercial		Commercial		Owner						Residential		Residential
(Dollars in thousands)		Business		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Balance at beginning of year		$	5,852	$	4,267	$	9,784	$	7,143	$	9	$	3,592	$	6,232	$	923	$	37,802
Provision (credit)			13		(336)		947		584		-		234		318		55		1,815
Charge-offs			(181)		(739)		(90)		(212)		-		(537)		(78)		-		(1,837)
Recoveries			197		580		10		1		-		99		31		15		933
	Net charge-offs		16		(159)		(80)		(211)		-		(438)		(47)		15		(904)
Balance at end of period		$	5,881	$	3,772	$	10,651	$	7,516	$	9	$	3,388	$	6,503	$	993	$	38,713
Total loans and leases		$	409,795	$	223,103	$	694,179	$	643,973	$	21	$	436,465	$	744,195	$	137,134	$	3,288,865
Allowance for loans and leases to total loans and leases ratio			1.44%		1.69%		1.53%		1.17%		42.86%		0.78%		0.87%		0.72%		1.18%
Balance of loans specifically evaluated for impairment		$	4,181	$	194	$	12,126	$	8,423	$	na.	$	na.	$	3,770	$	na.	$	28,694
Allowance for loans specifically evaluated for impairment		$	1,047	$	58	$	715	$	1,066	$	na.	$	na.	$	-	$	na.	$	2,886
Specific allowance to specific loans ratio			25.04%		29.90%		5.90%		12.66%		na.		na.		na.		na.		10.06%
Balance of loans collectively evaluated		$	405,614	$	222,909	$	682,053	$	635,550	$	21	$	436,465	$	740,425	$	137,134	$	3,260,171
Allowance for loans collectively evaluated		$	4,834	$	3,714	$	9,936	$	6,450	$	9	$	3,388	$	6,503	$	993	$	35,827
Collective allowance to collective loans ratio			1.19%		1.67%		1.46%		1.01%		42.86%		0.78%		0.88%		0.72%		1.10%

		For the Year Ended December 31, 2014
				Commercial Real Estate										Residential Real Estate
								Commercial
		Commercial		Commercial		Commercial		Owner						Residential		Residential
(Dollars in thousands)		Business		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Balance at beginning of year		$	6,308	$	3,754	$	9,263	$	6,308	$	16	$	4,142	$	7,819	$	1,156	$	38,766
Provision (credit)			(1,204)		1,042		486		1,094		(7)		119		(1,385)		(308)		(163)
Charge-offs			(729)		(529)		(3)		(265)		-		(834)		(323)		(4)		(2,687)
Recoveries			1,477		-		38		6		-		165		121		79		1,886
	Net charge-offs		748		(529)		35		(259)		-		(669)		(202)		75		(801)
Balance at end of period		$	5,852	$	4,267	$	9,784	$	7,143	$	9	$	3,592	$	6,232	$	923	$	37,802
Total loans and leases		$	390,781	$	205,124	$	640,193	$	611,061	$	54	$	425,552	$	717,886	$	136,741	$	3,127,392
Allowance for loans and leases to total loans and leases ratio			1.50%		2.08%		1.53%		1.17%		16.80%		0.84%		0.87%		0.67%		1.21%
Balance of loans specifically evaluated for impairment		$	3,894	$	2,464	$	10,279	$	8,941	$	na.	$	na.	$	3,535	$	306	$	29,419
Allowance for loans specifically evaluated for impairment		$	788	$	741	$	541	$	824	$	na.	$	na.	$	-	$	-	$	2,894
Specific allowance to specific loans ratio			20.24%		30.07%		5.26%		9.22%		na.		na.		na.		na.		9.84%
Balance of loans collectively evaluated		$	386,887	$	202,660	$	629,914	$	602,120	$	54	$	425,552	$	714,351	$	136,435	$	3,097,973
Allowance for loans collectively evaluated		$	5,064	$	3,526	$	9,243	$	6,319	$	9	$	3,592	$	6,232	$	923	$	34,908
Collective allowance to collective loans ratio			1.31%		1.74%		1.47%		1.05%		16.80%		0.84%		0.87%		0.68%		1.13%

Summary of Impaired Loans

The following table provides summary information regarding impaired loans at the dates indicated and for the periods then ended:

(In thousands)		June 30, 2015		December 31, 2014
Impaired loans with a specific allowance		$	9,661	$	11,411
Impaired loans without a specific allowance			19,033		18,008
	Total impaired loans	$	28,694	$	29,419
Allowance for loan and lease losses related to impaired loans		$	2,886	$	2,894
Allowance for loan and lease losses related to loans collectively evaluated			35,827		34,908
	Total allowance for loan and lease losses	$	38,713	$	37,802
Average impaired loans for the period		$	28,769	$	34,331
Contractual interest income due on impaired loans during the period		$	1,326	$	2,339
Interest income on impaired loans recognized on a cash basis		$	324	$	773
Interest income on impaired loans recognized on an accrual basis		$	122	$	280

Recorded Investment with Respect to Impaired loans, Associated Allowance by Applicable Portfolio Segment and Principal Balance of Impaired Loans Prior to Amounts Charged-Off

The following tables present the recorded investment with respect to impaired loans, the associated allowance by the applicable portfolio segment and the principal balance of the impaired loans prior to amounts charged-off at the dates indicated:

			June 30, 2015
					Commercial Real Estate								Total Recorded
									Commercial		All		Investment in
					Commercial		Commercial		Owner		Other		Impaired
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Impaired loans with a specific allowance
		Non-accruing	$	659	$	57	$	2,589	$	4,561	$	-	$	7,866
		Restructured accruing		881		-		-		-		-		881
		Restructured non-accruing		203		-		72		639		-		914
	Balance		$	1,743	$	57	$	2,661	$	5,200	$	-	$	9,661
	Allowance		$	1,047	$	58	$	715	$	1,066	$	-	$	2,886
Impaired loans without a specific allowance
		Non-accruing	$	1,013	$	-	$	7,362	$	1,785	$	-	$	10,160
		Restructured accruing		15		-		2,103		-		2,621		4,739
		Restructured non-accruing		1,410		137		-		1,438		1,149		4,134
	Balance		$	2,438	$	137	$	9,465	$	3,223	$	3,770	$	19,033
Total impaired loans
		Non-accruing	$	1,672	$	57	$	9,951	$	6,346	$	-	$	18,026
		Restructured accruing		896		-		2,103		-		2,621		5,620
		Restructured non-accruing		1,613		137		72		2,077		1,149		5,048
	Balance		$	4,181	$	194	$	12,126	$	8,423	$	3,770	$	28,694
Unpaid principal balance in total impaired loans			$	5,646	$	4,456	$	16,878	$	10,271	$	4,086	$	41,337

	June 30, 2015
			Commercial Real Estate								Total Recorded
							Commercial		All		Investment in
			Commercial		Commercial		Owner		Other		Impaired
(In thousands)	Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Average impaired loans for the period	$	4,013	$	1,340	$	10,829	$	8,779	$	3,808	$	28,769
Contractual interest income due on impaired loans during the period	$	207	$	188	$	469	$	366	$	96
Interest income on impaired loans recognized on a cash basis	$	93	$	11	$	15	$	185	$	20
Interest income on impaired loans recognized on an accrual basis	$	29	$	-	$	54	$	-	$	39

			December 31, 2014
					Commercial Real Estate								Total Recorded
									Commercial		All		Investment in
					Commercial		Commercial		Owner		Other		Impaired
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Impaired loans with a specific allowance
		Non-accruing	$	473	$	1,330	$	2,288	$	5,013	$	-	$	9,104
		Restructured accruing		687		-		-		-		-		687
		Restructured non-accruing		308		-		76		1,236		-		1,620
	Balance		$	1,468	$	1,330	$	2,364	$	6,249	$	-	$	11,411
	Allowance		$	788	$	741	$	541	$	824	$	-	$	2,894
Impaired loans without a specific allowance
		Non-accruing	$	1,115	$	-	$	5,792	$	1,769	$	-	$	8,676
		Restructured accruing		23		-		2,123		-		2,664		4,810
		Restructured non-accruing		1,288		1,134		-		923		1,177		4,522
	Balance		$	2,426	$	1,134	$	7,915	$	2,692	$	3,841	$	18,008
Total impaired loans
		Non-accruing	$	1,588	$	1,330	$	8,080	$	6,782	$	-	$	17,780
		Restructured accruing		710		-		2,123		-		2,664		5,497
		Restructured non-accruing		1,596		1,134		76		2,159		1,177		6,142
	Balance		$	3,894	$	2,464	$	10,279	$	8,941	$	3,841	$	29,419
Unpaid principal balance in total impaired loans			$	5,360	$	7,044	$	14,926	$	10,729	$	4,126	$	42,185

	December 31, 2014
			Commercial Real Estate								Total Recorded
							Commercial		All		Investment in
			Commercial		Commercial		Owner		Other		Impaired
(In thousands)	Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Loans
Average impaired loans for the period	$	5,308	$	3,651	$	9,327	$	8,963	$	7,082	$	34,331
Contractual interest income due on impaired loans during the period	$	311	$	352	$	730	$	859	$	87
Interest income on impaired loans recognized on a cash basis	$	252	$	39	$	78	$	344	$	60
Interest income on impaired loans recognized on an accrual basis	$	63	$	-	$	111	$	-	$	106

Credit Quality of Loan Portfolio by Segment

The following tables provide information on the credit quality of the loan portfolio by segment at the dates indicated:

		June 30, 2015
				Commercial Real Estate										Residential Real Estate
								Commercial
				Commercial		Commercial		Owner						Residential		Residential
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Non-performing loans and assets:
	Non-accrual loans and leases	$	3,285	$	194	$	10,023	$	8,423	$	-	$	1,214	$	7,780	$	780	$	31,699
	Loans and leases 90 days past due		-		-		-		-		2		7		-		-		9
	Restructured loans and leases		896		-		2,103		-		-		-		2,621		-		5,620
Total non-performing loans and leases			4,181		194		12,126		8,423		2		1,221		10,401		780		37,328
	Other real estate owned		39		789		-		-		-		690		1,613		1,383		4,514
Total non-performing assets		$	4,220	$	983	$	12,126	$	8,423	$	2	$	1,911	$	12,014	$	2,163	$	41,842

		December 31, 2014
				Commercial Real Estate										Residential Real Estate
								Commercial
				Commercial		Commercial		Owner						Residential		Residential
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Non-performing loans and assets:
	Non-accrual loans and leases	$	3,184	$	2,464	$	8,156	$	8,941	$	-	$	1,668	$	3,012	$	1,105	$	28,530
	Loans and leases 90 days past due		-		-		-		-		-		-		-		-		-
	Restructured loans and leases		710		-		2,123		-		-		-		2,664		-		5,497
Total non-performing loans and leases			3,894		2,464		10,279		8,941		-		1,668		5,676		1,105		34,027
	Other real estate owned		39		365		-		-		-		-		1,408		1,383		3,195
Total non-performing assets		$	3,933	$	2,829	$	10,279	$	8,941	$	-	$	1,668	$	7,084	$	2,488	$	37,222

			June 30, 2015
					Commercial Real Estate										Residential Real Estate
									Commercial
					Commercial		Commercial		Owner						Residential		Residential
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Past due loans and leases
	31-60 days		$	61	$	-	$	85	$	609	$	-	$	1,307	$	3,772	$	-	$	5,834
	61-90 days			-		-		1,440		458		-		643		1,244		-		3,785
	> 90 days			-		-		-		-		2		7		-		-		9
		Total past due		61		-		1,525		1,067		2		1,957		5,016		-		9,628
	Non-accrual loans and leases			3,285		194		10,023		8,423		-		1,214		7,780		780		31,699
	Loans acquired with deteriorated credit quality			1,198		-		-		1,053		-		-		-		-		2,251
	Current loans			405,251		222,909		682,631		633,430		19		433,294		731,399		136,354		3,245,287
		Total loans and leases	$	409,795	$	223,103	$	694,179	$	643,973	$	21	$	436,465	$	744,195	$	137,134	$	3,288,865

			December 31, 2014
					Commercial Real Estate										Residential Real Estate
									Commercial
					Commercial		Commercial		Owner						Residential		Residential
(In thousands)			Commercial		AD&C		Investor R/E		Occupied R/E		Leasing		Consumer		Mortgage		Construction		Total
Past due loans and leases
	31-60 days		$	759	$	-	$	2,374	$	2,658	$	11	$	797	$	3,064	$	-	$	9,663
	61-90 days			995		320		1,493		156		-		179		836		-		3,979
	> 90 days			-		-		-		-		-		-		-		-		-
		Total past due		1,754		320		3,867		2,814		11		976		3,900		-		13,642
	Non-accrual loans and leases			3,184		2,464		8,156		8,941		-		1,668		3,012		1,105		28,530
	Loans acquired with deteriorated credit quality			1,238		-		-		1,773		-		-		-		-		3,011
	Current loans			384,605		202,340		628,170		597,533		43		422,908		710,974		135,636		3,082,209
		Total loans and leases	$	390,781	$	205,124	$	640,193	$	611,061	$	54	$	425,552	$	717,886	$	136,741	$	3,127,392

Restructured Loans for Specific Segments of Loan Portfolio

The following table provides the amounts of the restructured loans at the date of restructuring for specific segments of the loan portfolio during the period indicated:

		For the Six Months Ended June 30, 2015
				Commercial Real Estate
								Commercial		All
				Commercial		Commercial		Owner		Other
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Total
Troubled debt restructurings
	Restructured accruing	$	275	$	-	$	-	$	-	$	-	$	275
	Restructured non-accruing		-		-		-		639		-		639
Balance		$	275	$	-	$	-	$	639	$	-	$	914
Specific allowance		$	275	$	-	$	-	$	149	$	-	$	424
Restructured and subsequently defaulted		$	-	$	-	$	-	$	-	$	-	$	-

		For the Year Ended December 31, 2014
				Commercial Real Estate
								Commercial		All
				Commercial		Commercial		Owner		Other
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Loans		Total
Troubled debt restructurings
	Restructured accruing	$	75	$	-	$	1,284	$	-	$	-	$	1,359
	Restructured non-accruing		92		192		-		-		-		284
Balance		$	167	$	192	$	1,284	$	-	$	-	$	1,643
Specific allowance		$	99	$	-	$	-	$	-	$	-	$	99
Restructured and subsequently defaulted		$	-	$	-	$	-	$	-	$	-	$	-

Commercial

Accounts, Notes, Loans and Financing Receivable [Line Items]

Credit Risk Rating Indicators

The following tables provide information by credit risk rating indicators for each segment of the commercial loan portfolio at the dates indicated:

		June 30, 2015
				Commercial Real Estate
								Commercial
				Commercial		Commercial		Owner
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Total
	Pass	$	384,562	$	220,747	$	679,253	$	616,435	$	1,900,997
	Special Mention		8,212		698		1,857		6,431		17,198
	Substandard		17,021		1,658		13,069		21,107		52,855
	Doubtful		-		-		-		-		-
Total		$	409,795	$	223,103	$	694,179	$	643,973	$	1,971,050

		Decemeber 31, 2014
				Commercial Real Estate
								Commercial
				Commercial		Commercial		Owner
(In thousands)		Commercial		AD&C		Investor R/E		Occupied R/E		Total
	Pass	$	366,367	$	201,642	$	621,511	$	581,575	$	1,771,095
	Special Mention		8,835		698		3,931		7,669		21,133
	Substandard		15,579		2,784		14,751		21,817		54,931
	Doubtful		-		-		-		-		-
Total		$	390,781	$	205,124	$	640,193	$	611,061	$	1,847,159

Non Commercial Loan

Accounts, Notes, Loans and Financing Receivable [Line Items]

Credit Risk Rating Indicators

Homogeneous loan pools do not have individual loans subjected to internal risk ratings therefore, the credit indicator applied to these pools is based on their delinquency status. The following tables provide information by credit risk rating indicators for those remaining segments of the loan portfolio at the dates indicated:

			June 30, 2015
							Residential Real Estate
							Residential		Residential
(In thousands)			Leasing		Consumer		Mortgage		Construction		Total
	Performing		$	19	$	435,244	$	733,794	$	136,354	$	1,305,411
	Non-performing:
		90 days past due		2		7		-		-		9
		Non-accruing		-		1,214		7,780		780		9,774
		Restructured loans and leases		-		-		2,621		-		2,621
Total			$	21	$	436,465	$	744,195	$	137,134	$	1,317,815

			December 31, 2014
							Residential Real Estate
							Residential		Residential
(In thousands)			Leasing		Consumer		Mortgage		Construction		Total
	Performing		$	54	$	423,884	$	712,210	$	135,636	$	1,271,784
	Non-performing:
		90 days past due		-		-		-		-		-
		Non-accruing		-		1,668		3,012		1,105		5,785
		Restructured loans and leases		-		-		2,664		-		2,664
Total			$	54	$	425,552	$	717,886	$	136,741	$	1,280,233

XML

Fair Value (Unrealized Losses Included in Assets Measured in Consolidated Statements of Condition at Fair Value on Recurring Basis) (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Principal Redemption	$ (45,249)	$ (42,228)
Fair Value, Inputs, Level 3
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items]
Balance at January 1, 2015	1,236
Principal Redemption	(218)
Balance at March 31, 2015	$ 1,018

XML

Investments (Activity of OTTI on Investment Securities Due to Credit Losses Recognized in Earnings) (Detail) $ in Thousands	6 Months Ended
	Jun. 30, 2015 USD ($)
Investments [Abstract]
Cumulative credit losses on investment securities, through	$ 531
Additions for credit losses not previously recognized	0
Cumulative credit losses on investment securities, through	$ 531

XML

FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND DERIVATIVES

6 Months Ended

Jun. 30, 2015

Financial Instruments With Off- Balance Sheet Risk and Derivatives [Abstract]

FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK AND DERIVATIVES

Note 12 – Financial Instruments with Off-balance Sheet Risk and Derivatives

The Company has entered into interest rate swaps (“swaps”) to facilitate customer transactions and meet their financing needs. These swaps qualify as derivatives, but are not designated as hedging instruments. Interest rate swap contracts involve the risk of dealing with counterparties and their ability to meet contractual terms. When the fair value of a derivative instrument contract is positive, this generally indicates that the counterparty or customer owes the Company, and results in credit risk to the Company. When the fair value of a derivative instrument contract is negative, the Company owes the customer or counterparty and therefore, has no credit risk. The notional value of commercial loan swaps outstanding was $20.4 million with a fair value of $1.4 million as of June 30, 2015 compared to $20.9 million with a fair value of $1.5 million as of December 31, 2014. The offsetting nature of the swaps results in a neutral effect on the Company’s operations.Fair values of the swaps are carried as both gross assets and gross liabilities in the condensed consolidated statements of condition. The associated net gains and losses on the swaps are recorded in other non-interest income.