This table provides the major components of securities available for sale (“AFS”) and held to maturity (“HTM”) at amortized cost and estimated fair value at June 30, 2012 and December 31, 2011:


	June 30, 2012								December 31, 2011
(In thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value		Amortized cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value
Securities available for sale:
U.S. Government sponsored entities	$	2,193	$	96	$	-	$	2,289	$	5,274	$	102	$	-	$	5,376
State and political subdivisions		13,867		526		(8)		14,385		17,031		856		(9)		17,878
Residential mortgage-backed securities		52,454		1,476		(198)		53,732		56,546		1,655		(277)		57,924
Commercial mortgage-backed securities		7,034		8		(45)		6,997		208		2		-		210
Corporate and other securities		20,872		192		(502)		20,562		7,799		5		(427)		7,377
Total securities available for sale	$	96,420	$	2,298	$	(753)	$	97,965	$	86,858	$	2,620	$	(713)	$	88,765
Securities held to maturity:
State and political subdivisions	$	2,989	$	311	$	-	$	3,300	$	2,992	$	192	$	-	$	3,184
Residential mortgage-backed securities		11,208		379		(13)		11,574		13,083		329		(31)		13,381
Commercial mortgage-backed securities		2,684		743		-		3,427		2,696		618		-		3,314
Total securities held to maturity	$	16,881	$	1,433	$	(13)	$	18,301	$	18,771	$	1,139	$	(31)	$	19,879

This table provides the remaining contractual maturities and yields of securities within the investment portfolios. The carrying value of securities at June 30, 2012 is primarily distributed by contractual maturity. Mortgage-backed securities and other securities, which may have principal prepayment provisions, are distributed based on contractual maturity. Expected maturities will differ materially from contractual maturities as a result of early prepayments and calls. The total weighted average yield excludes equity securities.


	Within one year					After one through five years					After five through ten years					After ten years					Total carrying value
(In thousands)	Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield
Available for sale at fair value:
U.S. Government sponsored entities	$	-		-	%	$	1,353		1.73	%	$	8		0.97	%	$	928		3.66	%	$	2,289		2.51	%
State and political subdivisions		-		-			148		6.50			9,100		2.97			5,136		2.44			14,385		3.18
Residential mortgage-backed securities		48		3.85			159		3.49			1,248		4.48			52,277		2.98			53,732		3.01
Commercial mortgage-backed securities		-		-			-		-			-		-			6,997		1.95			6,997		1.95
Corporate and other securities		-		-			3,300		2.58			3,968		3.81			13,294		2.24			20,562		2.60
Total securities available for sale	$	48		3.85	%	$	4,960		2.49	%	$	14,324		3.33	%	$	78,632		2.77	%	$	97,965		2.86	%
Held to maturity at cost:
State and political subdivisions	$	-		-	%	$	-		-	%	$	-		-	%	$	2,989		4.59	%	$	2,989		4.59	%
Residential mortgage-backed securities		-		-			821		4.64			1,160		4.95			9,227		2.95			11,208		3.28
Commercial mortgage-backed securities		-		-			-		-			-		-			2,684		5.40			2,684		5.40
Total securities held to maturity	$	-		-	%	$	821		4.64	%	$	1,160		4.95	%	$	14,900		3.72	%	$	16,881		3.85	%

The fair value of securities with unrealized losses by length of time that the individual securities have been in a continuous unrealized loss position at June 30, 2012 and December 31, 2011 are as follows:


	June 30, 2012
			Less than 12 months				12 months and greater				Total
(In thousands)	Total number in a loss position		Estimated fair value		Unrealized loss		Estimated fair value		Unrealized loss		Estimated fair value		Unrealized loss
Securities available for sale:
State and political subdivisions		3	$	1,057	$	(8)	$	-	$	-	$	1,057	$	(8)
Residential mortgage-backed securities		8		5,747		(59)		1,220		(139)		6,967		(198)
Commercial mortgage-backed securities		7		4,312		(45)		-		-		4,312		(45)
Corporate and other securities		9		9,578		(182)		1,219		(320)		10,797		(502)
Total temporarily impaired investments		27	$	20,694	$	(294)	$	2,439	$	(459)	$	23,133	$	(753)
Securities held to maturity:
Residential mortgage-backed securities		1	$	-	$	-	$	345	$	(13)	$	345	$	(13)
Total temporarily impaired investments		1	$	-	$	-	$	345	$	(13)	$	345	$	(13)


	December 31, 2011
			Less than 12 months				12 months and greater				Total
(In thousands)	Total number in a loss position		Estimated fair value		Unrealized loss		Estimated fair value		Unrealized loss		Estimated fair value		Unrealized loss
Securities available for sale:
State and political subdivisions		2	$	424	$	(9)	$	-	$	-	$	424	$	(9)
Residential mortgage-backed securities		6		4,512		(80)		871		(197)		5,383		(277)
Corporate and other securities		8		5,038		(173)		1,334		(254)		6,372		(427)
Total temporarily impaired investments		16	$	9,974	$	(262)	$	2,205	$	(451)	$	12,179	$	(713)
Securities held to maturity:
Residential mortgage-backed securities		3	$	2,545	$	(4)	$	542	$	(27)	$	3,087	$	(31)
Total temporarily impaired investments		3	$	2,545	$	(4)	$	542	$	(27)	$	3,087	$	(31)

Unrealized Losses

The unrealized losses in each of the categories presented in the tables above are discussed in the paragraphs that follow:

State and political subdivision securities: The unrealized losses on investments in this type of security were caused by the increase in interest rate spreads. The contractual terms of these investments do not permit the issuer to settle the securities at a price less than the par value of the investments. Because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be at maturity, the Company did not consider these investments to be other-than temporarily impaired as of June 30, 2012 or December 31, 2011.

Residential and commercial mortgage-backed securities: The unrealized losses on investments in mortgage-backed securities were caused by increases in interest rate spreads or faster prepayment speeds. The majority of contractual cash flows of these securities are guaranteed by Fannie Mae, Ginnie Mae and the Federal Home Loan Mortgage Corporation. It is expected that the securities would not be settled at a price significantly less than the par value of the investment. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be at maturity, the Company did not consider these investments to be other-than-temporarily impaired as of June 30, 2012 or December 31, 2011.

Corporate and other securities: Included in this category are corporate debt securities, stock of other financial institutions, Community Reinvestment Act (“CRA”) investments, asset-backed securities, and trust preferred securities. The unrealized losses on corporate debt securities were due to widening credit spreads and the unrealized losses on stock of other financial institutions and CRA investments were caused by decreases in the market prices of the shares. The Company evaluated the prospects of the issuers and forecasted a recovery period; therefore it did not consider these investments to be other-than-temporarily impaired as of June 30, 2012 or December 31, 2011. The unrealized losses on asset-backed securities were caused by increases in interest rate spreads. The majority of contractual cash flows of these securities are guaranteed by Sallie Mae as part of the Federal Family Education Loan ("FFEL") Program. It is expected that the securities would not be settled at a price significantly less than the par value of the investment. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be at maturity, the Company did not consider these investments to be other-than-temporarily impaired as of June 30, 2012 or December 31, 2011. The unrealized losses on trust preferred securities were caused by an inactive trading market and changes in market credit spreads. At June 30, 2012 and December 31, 2011, this category consisted of one single-issuer trust preferred security. The contractual terms do not allow the security to be settled at a price less than the par value. Because the Company does not intend to sell the security and it is not more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis, which may be at maturity, the Company did not consider this security to be other-than-temporarily impaired as of June 30, 2012 or December 31, 2011.

Realized Gains and Losses

Gross realized gains (losses) on securities for the three and six months ended June 30, 2012 and 2011 are detailed in the table below:


	For the three months ended June 30,				For the six months ended June 30,
(In thousands)	2012		2011		2012		2011
Securities available for sale:
Realized gains	$	283	$	41	$	511	$	168
Realized losses		-		(12)		(4)		(13)
Total securities available for sale		283		29		507		155
Securities held to maturity:
Realized gains		-		-		-		-
Realized losses		-		(68)		-		(68)
Total securities held to maturity		-		(68)		-		(68)
Net gains (losses) on sales of securities	$	283	$	(39)	$	507	$	87

The net realized gains (losses) are included in noninterest income in the Consolidated Statements of Income as net security gains (losses). For the three and six months ended June 30, 2012, there were gross realized gains of $283 thousand and $511 thousand, respectively. There were no realized losses during the second quarter of 2012 and gross realized losses of $4 thousand in the first quarter. The net realized gains during 2012 were a result of the following:

· The Company sold approximately $6.1 million in book value of available for sale mortgage-backed and municipal securities, resulting in pre-tax gains of approximately $511 thousand, partially offset by

· Losses of $4 thousand on the partial call of $64 thousand in book value of one available for sale municipal security.

For the three and six months ended June 30, 2011, there were gross realized gains of $41 thousand and $168 thousand, respectively, and gross realized losses of $80 thousand and $81 thousand, respectively. The net gains during the six months ended June 30, 2011 were primarily attributed to:

· The Company selling approximately $9.1 million in book value of mortgage-backed securities, resulting in pretax gains of approximately $168 thousand, partially offset by

· Losses of $13 thousand on the sale of approximately $1.0 million in book value of five available for sale mortgage-backed securities and losses of $68 thousand on the sale of approximately $2.1 million in book value of three held to maturity private label mortgage backed securities. Although designated as held to maturity, these securities were sold due to the deterioration in the underlying credit, as evidenced by downgrades in their credit ratings.

Pledged Securities

Securities with a carrying value of $63.2 million and $81.1 million at June 30, 2012 and December 31, 2011, respectively, were pledged to secure Government deposits, secure other borrowings and for other purposes required or permitted by law. Included in these figures was $12.4 million and $27.7 million pledged against Government deposits at June 30, 2012 and December 31, 2011, respectively.