Note 3 - Securities

6 Months Ended

Jun. 30, 2014

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

NOTE 3: Securities

Debt and equity securities, all of which were classified as available for sale, are summarized as follows:

	June 30, 2014
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
U.S. government agencies and corporations	$	29,723	$	27	$	(848	)	$	28,902
Mortgage-backed securities		57,411		585		(244	)		57,752
Obligations of states and political subdivisions		124,660		6,296		(302	)		130,654
	$	211,794	$	6,908	$	(1,394	)	$	217,308

	December 31, 2013
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
U.S. Treasury securities	$	10,000	$	—	$	—		$	10,000
U.S. government agencies and corporations		32,503		4		(2,557	)		29,950
Mortgage-backed securities		51,318		100		(555	)		50,863
Obligations of states and political subdivisions		123,729		4,223		(813	)		127,139
Corporate and other debt securities		158		—		—			158
	$	217,708	$	4,327	$	(3,925	)	$	218,110

The amortized cost and estimated fair value of securities, all of which were classified as available for sale, at June 30, 2014, by the earlier of contractual maturity or expected maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to prepay obligations with or without call or prepayment penalties. 

	June 30, 2014
(Dollars in thousands)	Amortized Cost		Estimated Fair Value
Due in one year or less	$	28,062	$	27,899
Due after one year through five years		90,906		93,851
Due after five years through ten years		63,093		64,459
Due after ten years		29,733		31,099
	$	211,794	$	217,308

Proceeds from the maturities, calls and sales of securities available for sale for the six months ended June 30, 2014 were $21.55 million.

The Corporation pledges securities primarily as collateral for public deposits and repurchase agreements. Securities with an aggregate amortized cost of $105.19 million and an aggregate fair value of $108.01 million were pledged at June 30, 2014. Securities with an aggregate amortized cost of $149.22 million and an aggregate fair value of $149.83 million were pledged at December 31, 2013.

Securities in an unrealized loss position at June 30, 2014, by duration of the period of the unrealized loss, are shown below.

	Less Than 12 Months				12 Months or More				Total
(Dollars in thousands)	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. government agencies and corporations	$	7,370	$	87	$	21,147	$	761	$	28,517	$	848
Mortgage backed securities		8,330		177		1,442		67		9,772		244
Obligations of states and political subdivisions		5,765		83		10,448		219		16,213		302
Total temporarily impaired securities	$	21,465	$	347	$	33,037	$	1,047	$	54,502	$	1,394

There are 96 debt securities totaling $54.50 million considered temporarily impaired at June 30, 2014. The Corporation's unrealized loss position has improved since December 31, 2013 because interest rates fell during the first half of 2014, primarily in the intermediate and long-end of the United States Treasury yield curve, thereby increasing market values of the Corporation's portfolio of securities of U.S. government agencies and corporations and obligations of states and political subdivisions. The United States fixed income markets continued to rally throughout the second quarter due to uneven economic performance, low levels of inflation and the accommodative monetary policy maintained by the Federal Reserve. At June 30, 2014, approximately 97 percent of the Corporation's obligations of states and political subdivisions, as measured by market value, were rated “A” or better by Standard & Poor's or Moody's Investors Service.  Of those in a net unrealized loss position, approximately 96 percent were rated “A” or better, as measured by market value, at June 30, 2014.  For the approximate four percent not rated “A” or better, as measured by market value at June 30, 2014, the Corporation considers these to meet regulatory credit quality standards, such that the securities have low risk of default by the obligor, and the full and timely repayment of principal and interest is expected over the expected life of the investment.  Because the Corporation intends to hold these investments in debt securities to maturity and it is more likely than not that the Corporation will not be required to sell these investments before a recovery of unrealized losses, the Corporation does not consider these investments to be other-than-temporarily impaired at June 30, 2014 and no other-than-temporary impairment has been recognized.

Securities in an unrealized loss position at December 31, 2013, by duration of the period of the unrealized loss, are shown below.

	Less Than 12 Months				12 Months or More				Total
(Dollars in thousands)	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
U.S. government agencies and corporations	$	29,430	$	1,385	$	8,948	$	1,172	$	38,378	$	2,557
Mortgage-backed securities		40,090		555		—		—		40,090		555
Obligations of states and political subdivisions		21,260		656		3,078		157		24,338		813
Total temporarily impaired securities	$	90,780	$	2,596	$	12,026	$	1,329	$	102,806	$	3,925

The Corporation’s investment in restricted stocks includes membership stock in the Federal Home Loan Bank (FHLB) and the Community Bankers Bank at June 30, 2014, and additionally included stock in the Federal Reserve Bank at December 31, 2013. Restricted stocks totaled $3.69 million at June 30, 2014 and $4.34 million at December 31, 2013. These membership stocks are generally viewed as long-term investments and as a restricted investment securities, which are carried at cost, because there is no market for the stock, other than member institutions. Therefore, when evaluating these investments for impairment, their value is based on the ultimate recoverability of the par value rather than by recognizing temporary declines in value. The Corporation does not consider these investments to be other-than-temporarily impaired at June 30, 2014 and no impairment has been recognized. These stocks are shown as a separate line item on the balance sheet and are not a part of the available for sale securities portfolio.