Note 2 - Investment Securities

6 Months Ended

Jun. 30, 2013

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

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

Note 2. Investment Securities

The following tables present information regarding securities available for sale:

June 30, 2013	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury securities	$	9,386	$	-	$	38	$	9,348
Obligations of U.S. government corporations and government sponsored enterprises
Residential mortgage-backed securities
CMOs (Federal Home Loan Mortgage Corporation)		13,569		168		8		13,729
CMOs (Government National Mortgage Association)		1,477		10		1		1,486
Federal National Mortgage Association		1,589		67		-		1,656
Federal Home Loan Mortgage Corporation		19		-		1		18
Government National Mortgage Association		78		1		-		79
Total residential mortgage-backed securities		16,732		246		10		16,968
Agency notes
Federal National Mortgage Association		950		-		15		935
Federal Home Loan Bank		300		-		5		295
Federal Home Loan Mortgage Corporation		75		2		-		77
Federal Farm Credit Bank		200		-		12		188
Total obligations of U.S. government corporations and government sponsored enterprises		18,257		248		42		18,463
Obligations of state and political institutions-New York Bank Qualified		16,500		652		-		17,152
Single-issuer, trust preferred securities		65,283		627		542		65,368
Other preferred securities		5,011		-		11		5,000
Corporate debt securities		152,944		735		179		153,500
Equity and other securities		19,662		3,486		418		22,730
Total	$	287,043	$	5,748	$	1,230	$	291,561

			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
December 31, 2012	Cost		Gains		Losses		Value
U.S. Treasury securities	$	6,387	$	1	$	2	$	6,386
Obligations of U.S. government corporations and government sponsored enterprises
Residential mortgage-backed securities
CMOs (Federal Home Loan Mortgage Corporation)		19,615		47		30		19,632
CMOs (Government National Mortgage Association)		3,293		12		14		3,291
Federal National Mortgage Association		1,860		118		-		1,978
Federal Home Loan Mortgage Corporation		20		-		1		19
Government National Mortgage Association		85		1		-		86
Total residential mortgage-backed securities		24,873		178		45		25,006
Agency notes
Federal National Mortgage Association		650		1		-		651
Federal Home Loan Bank		500		1		-		501
Federal Home Loan Mortgage Corporation		75		4		-		79
Total obligations of U.S. government corporations an government sponsored enterprises		26,098		184		45		26,237
Obligations of state and political institutions-New York Bank Qualified		16,499		1,424		-		17,923
Single-issuer, trust preferred securities		37,875		1,090		80		38,885
Other preferred securities		12,012		3		62		11,953
Corporate debt securities		173,332		1,288		202		174,418
Equity and other securities		19,371		2,129		465		21,035
Total	$	291,574	$	6,119	$	856	$	296,837

The following tables present information regarding securities held to maturity:

June 30, 2013	Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Obligations of U.S. government corporations and government sponsored enterprises
Residential mortgage-backed securities
CMOs (Federal National Mortgage Association)	$	1,395	$	77	$	-	$	1,472
CMOs (Federal Home Loan Mortgage Corporation)		2,605		123		-		2,728
Federal National Mortgage Association		26,407		2,077		-		28,484
Federal Home Loan Mortgage Corporation		12,947		839		-		13,786
Government National Mortgage Association		3,030		444		-		3,474
Total residential mortgage-backed securities		46,384		3,560		-		49,944
Agency notes
Federal National Mortgage Association		113,956		-		3,657		110,299
Federal Home Loan Bank		89,379		-		2,351		87,028
Total obligations of U.S. government corporations and government sponsored enterprises		249,719		3,560		6,008		247,271
Obligations of state and political institutions-New York Bank Qualified		133,875		4,455		102		138,228
Total	$	383,594	$	8,015	$	6,110	$	385,499

December 31, 2012	Carrying Value		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Obligations of U.S. government corporations and government sponsored enterprises
Residential mortgage-backed securities
CMOs (Federal National Mortgage Association)	$	2,051	$	88	$	-	$	2,139
CMOs (Federal Home Loan Mortgage Corporation)		3,525		145		-		3,670
Federal National Mortgage Association		32,731		2,854		-		35,585
Federal Home Loan Mortgage Corporation		15,768		1,237		-		17,005
Government National Mortgage Association		3,385		559		-		3,944
Total residential mortgage-backed securities		57,460		4,883		-		62,343
Agency notes
Federal National Mortgage Association		95,977		95		74		95,998
Federal Home Loan Bank		81,989		38		12		82,015
Federal Home Loan Mortgage Corporation		15,000		21		-		15,021
Total obligations of U.S. government corporations and government sponsored enterprises		250,426		5,037		86		255,377
Obligations of state and political institutions-New York Bank Qualified		135,982		11,861		2		147,841
Total	$	386,408	$	16,898	$	88	$	403,218

The following tables present information regarding securities available for sale with temporary unrealized losses for the periods indicated:

	Less Than 12 Months				12 Months or Longer				Total
June 30, 2013	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. Treasury securities	$	9,348	$	38	$	-	$	-	$	9,348	$	38
Obligations of U.S. government corporations and government sponsored enterprises
Residential mortgage-backed securities
CMOs (Federal Home Loan Mortgage Corporation)		-		-		3,608		8		3,608		8
CMOs (Government National Mortgage Association)		-		-		34		1		34		1
Federal Home Loan Mortgage Corporation		-		-		18		1		18		1
Total residential mortgage-backed securities		-		-		3,660		10		3,660		10
Agency notes
Federal National Mortgage Association		935		15		-		-		935		15
Federal Home Loan Bank		295		5		-		-		295		5
Federal Farm Credit Bank		188		12		-		-		188		12
Total obligations of U.S. government corporations and government sponsored enterprises		1,418		32		3,659		10		5,077		42
Single-issuer, trust preferred securities		31,264		535		491		7		31,755		542
Other preferred securities		-		-		5,000		11		5,000		11
Corporate debt securities		59,396		130		4,979		49		64,375		179
Equity and other securities		7,428		287		928		131		8,356		418
Total	$	108,854	$	1,022	$	15,058	$	208	$	123,912	$	1,230
December 31, 2012
U.S. Treasury securities	$	388	$	2	$	-	$	-	$	388	$	2
Obligations of U.S. government corporations and government sponsored enterprises
Residential mortgage-backed securities
CMOs (Federal Home Loan Mortgage Corporation)		5,876		12		2,314		18		8,190		30
CMOs (Government National Mortgage Association)		-		-		1,518		14		1,518		14
Federal Home Loan Mortgage Corporation		-		-		19		1		19		1
Total obligations of U.S. government corporations and government sponsored enterprises		5,876		12		3,851		33		9,727		45
Single-issuer, trust preferred securities		9,698		71		1,079		9		10,777		80
Other preferred securities		11,849		62		-		-		11,849		62
Corporate debt securities		35,832		73		10,667		129		46,499		202
Equity and other securities		2,476		316		1,057		149		3,533		465
Total	$	66,119	$	536	$	16,654	$	320	$	82,773	$	856

The following tables present information regarding securities held to maturity with temporary unrealized losses for the periods indicated:

	Less Than 12 Months				12 Months or Longer				Total
June 30, 2013	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Obligations of U.S. government corporations and government sponsored enterprises
Agency notes
Federal National Mortgage Association	$	110,299	$	3,657	$	-	$	-	$	110,299	$	3,657
Federal Home Loan Bank		87,028		2,351		-		-		87,028		2,351
Total obligations of U.S. government corporations and government sponsored enterprises		197,327		6,008		-		-		197,327		6,008
Obligations of state and political institutions-New York Bank Qualified		7,905		98		201		4		8,106		102
Total	$	205,232	$	6,106	$	201	$	4	$	205,433	$	6,110
December 31, 2012
Obligations of U.S. government corporations and government sponsored enterprises
Agency notes
Federal National Mortgage Association	$	14,926	$	74	$	-	$	-	$	14,926	$	74
Federal Home Loan Bank		32,987		12		-		-		32,987		12
Total obligations of U.S. government corporations and government sponsored enterprises		47,913		86		-		-		47,913		86
Obligations of state and political institutions-New York Bank Qualified		203		2		-		-		203		2
Total	$	48,116	$	88	$	-	$	-	$	48,116	$	88

The following table presents information regarding single-issuer, trust preferred securities at June 30, 2013:

Issuer	TARP Recipient	Credit Rating	Amortized Cost		Fair Value		Unrealized Gain/(Loss)
Sterling Bancorp Trust I, 8.375%, due 3/31/2032	Yes *	NA	$	992	$	1,056	$	64
Allfirst Pfd Cap Trust, Floating Rate, due 7/15/2029, owned by M&T Bank Corporation	Yes *	BBB		385		433		48
Citigroup Capital IX, 6.00%, due 2/14/2033	Yes *	BB		9,831		9,939		108
Citigroup Capital X, 6.10%, due 9/30/2033	Yes *	BB		1,256		1,262		6
Citigroup Capital XI, 6.00%, due 9/27/2034	Yes *	BB		1,153		1,146		(7	)
Citigroup Capital XVI, 6.45%, due 12/31/66, called 7/15/13	Yes *	BB		9,845		9,845		-
Citigroup Capital XVII, 6.35%, due 3/15/2067	Yes *	BB		46		63		17
Countrywide Capital IV, 6.75% due 4/01/2033, owned by Bank of America	Yes *	BB+		9,660		9,675		15
Countrywide Capital V, 7.00% due 11/01/2036, owned by Bank of America	Yes *	BB+		2,507		2,516		9
First Chicago NDB Capital I, Floating Rate, due 2/01/2027, owned by JP Morgan Chase	Yes *	BBB		1,724		1,622		(102	)
First Tennessee Capital II, 6.30%, due 4/15/2034	Yes *	BB		5,771		5,890		119
Goldman Sachs Capital II, Floating Rate, due 6/01/2043	Yes *	BB+		852		795		(57	)
Goldman Sachs Capital I, 6.345%, due 2/15/2034	Yes *	BB+		8,913		8,648		(265	)
Keycorp Capital II, 6.875%, due 3/17/2029	Yes *	BBB-		93		96		3
Mellon Capital IV, Floating Rate, due 6/29/2049	Yes *	BBB		118		115		(3	)
JP Morgan Chase Capital XIII, Floating Rate, due 9/30/2034	Yes *	BBB		765		787		22
Morgan Stanley Capital Trust III, 6.25%, due 3/01/2033	Yes *	BB+		5,635		5,702		67
Morgan Stanley Capital Trust IV, 6.25%, due 4/01/2033	Yes *	BB+		2,880		2,884		4
Morgan Stanley Capital Trust V, 5.75%, due 7/15/2033	Yes *	BB+		2,005		1,956		(49	)
SunTrust Capital I, Floating Rate, due 5/15/2027	Yes *	BB+		741		830		89
USB Capital IX, Floating Rate, due 10/29/2049	Yes *	BBB+		90		87		(3	)
VNB Capital Trust I, 7.75%, due 12/15/2031	Yes *	BBB-		21		21		-
			$	65,283	$	65,368	$	85

* TARP obligation was repaid prior to June 30, 2013.

The Company invests principally in obligations of U.S. government corporations and government sponsored enterprises and other investment-grade securities. The fair value of these investments fluctuates based on several factors, including credit quality and general interest rate changes. The Company determined that it is not more likely than not that the Company would be required to sell any investments before anticipated recovery.

At June 30, 2013, approximately $145.6 million representing approximately 21.6% of the Company’s held to maturity and available for sale securities is comprised of securities issued by financial service companies/banks including single-issuer trust preferred securities (22 issuers), corporate debt (36 issuers), other preferred securities (one issuer) and equity and other securities (17 issuers). These investments may pose a higher risk of future impairment charges as a result of a lack of significant improvement of the U.S. economy and/or a further deterioration in stock prices of the companies in the financial services industry. The Company would be required to recognize impairment charges on these securities if they suffer a decline in value that is considered other-than-temporary. Numerous factors, including lack of liquidity for re-sales of certain investment securities, absence of reliable pricing information for investment securities, adverse changes in business climate, adverse actions by regulators or unanticipated changes in the competitive environment could have a negative effect on the Company’s investment portfolio and may result in other-than-temporary impairment on certain investment securities in future periods.

At June 30, 2013, the Company held one security position of single-issuer, trust preferred securities issued by a financial institution, in the available for sale portfolio, that was in an unrealized loss position for more than 12 months and is paying in accordance with its term and has no deferrals of interest or other deferrals. In addition, management analyzes the performance of the issuer on a periodic basis, including a review of the issuer’s most recent bank regulatory reports and other public regulatory disclosures, to assess credit risk and the probability of impairment of the contractual cash flows of the applicable security. Based upon management’s second quarter review, the issuer has maintained performance levels adequate to support the contractual cash flows of the security.

At June 30, 2013, the Company held seven security positions of corporate debt securities issued by financial institutions and other corporate issuers in the available for sale portfolio that were in an unrealized loss position for more than 12 months. Each of these positions are paying in accordance with their terms and have no deferrals of interest or other deferrals. In addition, management analyzes the performance of each issuer on a periodic basis, including a review of the issuer’s most recent public regulatory disclosures, to assess credit risk and the probability of impairment of the applicable securities. Based upon management’s second quarter review, management has concluded that the unrealized losses are deemed to be temporary.

At June 30, 2013, the Company held two security positions of other preferred securities issued by a non-financial institution, in the available for sale portfolio, that was in an unrealized loss position for more than 12 months and is paying in accordance with its term and has no deferrals of interest or other deferrals. In addition, management analyses the performance of the issuer on a periodic basis, including a review of the issuer’s most recent public regulatory disclosures, to assess credit risk and the probability of impairment of the contractual cash flows of the applicable security. Based upon management’s second quarter review, the issuer has maintained performance levels adequate to support the contractual cash flows of the security.

At June 30, 2013, the Company held four positions in residential mortgage-backed securities issued by the Federal Home Loan Mortgage Corporation (three) and Government National Mortgage Association (one) in the available for sale portfolio that were in unrealized loss positions for more than 12 months.

At June 30, 2013, the Company held seven issues of equity and other securities, in the available for sale portfolio, that were in an unrealized loss position for more than 12 months. Each of these issues is rated as “hold” or better by the analysts who cover them. In addition, management analyzes the performance of each issuer on a periodic basis, including a review of the issuer’s most recent public regulatory disclosures, to assess credit risk and the probability of impairment of the applicable securities. Based upon management’s second quarter review, management has concluded that the unrealized losses are deemed to be temporary.

The following tables present information regarding securities available for sale and securities held to maturity at June 30, 2013, based on contractual maturity. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

Available for sale	Amortized Cost		Fair Value
U.S. Treasury securities
Due within 1 year	$	8,997	$	8,997
Due after 5 years but within 10 years		389		351
Total U.S. Treasury securities		9,386		9,348
Obligations of U.S. government corporations and government sponsored enterprises
Residential mortgage-backed securities
CMOs (Federal Home Loan Mortgage Corporation)		13,569		13,729
CMOs (Government National Mortgage Association)		1,477		1,486
Federal National Mortgage Association		1,589		1,656
Federal Home Loan Mortgage Corporation		19		18
Government National Mortgage Association		78		79
Total residential mortgage-backed securities		16,732		16,968
Agency notes
Federal National Mortgage Association
Due after 1 year but within 5 years		950		935
Federal Home Loan Bank
Due after 1 year but within 5 years		300		295
Federal Home Loan Mortgage Corporation
Due within 1 year		75		77
Federal Farm Credit Bank
Due after 10 years		200		188
Total obligations of U.S. government corporations and government sponsored enterprises		18,257		18,463
Obligations of state and political institutions - New York Bank Qualified
Due after 5 years but within 10 years		3,791		3,968
Due after 10 years		12,709		13,184
Total obligations of state and political institutions-New York Bank Qualified		16,500		17,152
Single-issuer, trust preferred securities
Due within 1 year		9,845		9,845
Due after 10 years		55,438		55,523
Total single-issuer, trust preferred securities		65,283		65,368
Other preferred securities
Due within 1 year		5,011		5,000
Total other preferred securities		5,011		5,000
Corporate debt securities
Due within 6 months		93,023		93,053
Due after 6 months but within 1 year		25,353		25,533
Due after 1 year but within 2 years		18,916		19,251
Due after 2 years but within 5 years		13,311		13,368
Due after 5 years but within 10 years		2,107		2,064
Due after 10 years		234		231
Total corporate debt securities		152,944		153,500
Equity and other securities		19,662		22,730
Total	$	287,043	$	291,561

Held to maturity	Carrying Value		Fair Value
Obligations of U.S. government corporations and government sponsored enterprises
Residential mortgage-backed securities
CMOs (Federal National Mortgage Association)	$	1,395	$	1,472
CMOs (Federal Home Loan Mortgage Corporation)		2,605		2,728
Federal National Mortgage Association		26,407		28,484
Federal Home Loan Mortgage Corporation		12,947		13,786
Government National Mortgage Association		3,030		3,474
Total residential mortgage-backed securities		46,384		49,944
Agency notes
Federal National Mortgage Association
Due after 1 year but within 5 years		10,000		9,852
Due after 10 years		103,956		100,447
Federal Home Loan Bank
Due after 10 years		89,379		87,028
Total obligations of U.S. government corporations and government sponsored enterprises		249,719		247,271
Obligations of state and political institutions - New York Bank Qualified
Due after 1 year but within 5 years		154		164
Due after 5 years but within 10 years		26,481		27,867
Due after 10 years		107,240		110,197
Total obligations of state and political institutions-New York Bank Qualified		133,875		138,228
Total	$	383,594	$	385,499

Information regarding sales/calls of available for sale securities is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Sales
Proceeds	$	1,092	$	47,510	$	14,570	$	95,884
Gross gains		179		300		351		1,042
Gross losses		-		-		26		1
Calls
Proceeds		6,951		5,638		18,595		21,396
Gross gains		33		28		113		184
Gross losses		7		14		14		36

Information regarding sales/calls of held to maturity securities is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Sales
Proceeds	$	-	$	-	$	1,910	$	-
Gross gains		-		-		-		-
Gross losses		-		-		87		-
Calls
Proceeds	$	45,100	$	90,962		90,100		160,962
Gross gains		9		15		9		19
Gross losses		1		-		1		-

There were no transfers of held to maturity securities during the six-month periods ended June 30, 2013 or June 30, 2012.

The held to maturity securities sold during the six months ended June 30, 2013 were comprised of a single issue of bonds from a municipality that had experienced a deterioration in its credit standing due to a fall-off of property tax revenues and expenses incurred due to Hurricane Sandy.