Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2013

Schedule of assets and liabilities recorded at fair value on a recurring basis

	Fair Value Measurements
			Quoted Prices
			in Active
			Markets for		Other		Significant
			Identical		Observable		Unobservable
			Assets		Inputs		Inputs
(in thousands)	Fair Value		(Level 1)		(Level 2)		(Level 3)
September 30, 2013
Assets:
U.S. treasury	$	1,006	$	1,006	$	0	$	0
Government sponsored enterprises	63,838		0		63,838		0
Asset-backed securities	114,079		0		114,079		0
Obligations of states and political subdivisions	34,706		0		34,706		0
Mortgage servicing rights	3,079		0		0		3,079
Total	$	216,708	$	1,006	$	212,623	$	3,079

December 31, 2012
Assets:
U.S. treasury	$	2,030	$	2,030	$	0	$	0
Government sponsored enterprises	55,180		0		55,180		0
Asset-backed securities	107,872		0		107,872		0
Obligations of states and political subdivisions	35,164		0		35,164		0
Mortgage servicing rights	2,549		0		0		2,549
Total	$	202,795	$	2,030	$	198,216	$	2,549

Summary of changes in Level 3 assets and liabilities measured at fair value on a recurring basis

	Fair Value Measurements Using
	Significant Unobservable Inputs
	(Level 3)
	Mortgage Servicing Rights
	Three Months Ended					Nine Months Ended
	September 30,					September 30,
(in thousands)	2013		2012			2013		2012
Balance at beginning of period	$	2,873	$	2,666		$	2,549	$	0
Transfer into level 3	0		0			0		3,050
Total gains or losses (realized/unrealized):
Included in earnings	123		(273		)	86		(985		)
Included in other comprehensive income	0		0			0		0
Purchases	0		0			0		0
Sales	0		0			0		0
Issued	83		231			444		559
Settlements	0		0			0		0
Balance at end of period	$	3,079	$	2,624		$	3,079	$	2,624

Schedule of quantitative Information about Level 3 Fair Value Measurements

			Input Value
	Quantitative Information about Level 3 Fair Value Measurements		Nine Months Ended September 30,
	Valuation Technique	Unobservable Inputs	2013		2012
Mortgage servicing rights	Discounted cash flows	Weighted average constant prepayment rate	10.94	%	16.32	%
		Weighted average discount rate	8.56	%	8.01	%

Schedule of valuation methods for instruments measured at fair value on a nonrecurring basis

	Fair Value Measurements Using
			Quoted Prices
			in Active						Three			Nine
			Markets for		Other		Significant		Months Ended			Months Ended
			Identical		Observable		Unobservable		September 30,			September 30,
	Total		Assets		Inputs		Inputs		Total Gains			Total Gains
(in thousands)	Fair Value		(Level 1)		(Level 2)		(Level 3)		(Losses)*			(Losses)*
September 30, 2013
Assets:
Impaired loans:
Commercial, financial, & agricultural	$	1,315	$	0	$	0	$	1,315	$	(607	)	$	(692	)
Real estate construction - residential	1,902		0		0		1,902		0			(119		)
Real estate construction - commercial	3,990		0		0		3,990		0			0
Real estate mortgage - residential	2,079		0		0		2,079		(81		)	(327		)
Real estate mortgage - commercial	10,082		0		0		10,082		(376		)	(1,363		)
Consumer	38		0		0		38		0			0
Total	$	19,406	$	0	$	0	$	19,406	$	(1,064	)	$	(2,501	)
Other real estate owned and repossessed assets	$	15,868	$	0	$	0	$	15,868	$	(320	)	$	(5,006	)

September 30, 2012
Assets:
Impaired loans:
Commercial, financial, & agricultural	$	876	$	0	$	0	$	876	$	(742	)	$	(791	)
Real estate construction - residential	130		0		0		130		0			0
Real estate construction - commercial	5,458		0		0		5,458		0			0
Real estate mortgage - residential	2,311		0		0		2,311		(19		)	(564		)
Real estate mortgage - commercial	14,607		0		0		14,607		(524		)	(1,547		)
Consumer	0		0		0		0		0			0
Total	$	23,382	$	0	$	0	$	23,382	$	(1,285	)	$	(2,902	)
Other real estate owned and repossessed assets	$	25,195	$	0	$	0	$	25,195	$	(2,778	)	$	(3,186	)

* Total gains (losses) reported for other real estate owned and repossessed assets includes charge-offs, valuation write downs, and net losses taken during the periods reported.

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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