Impairment of Investment Securities (Tables)

12 Months Ended

Dec. 31, 2012

Schedule of Unrealized Losses and Estimated Fair Values

The following table presents the gross unrealized losses and estimated fair values at December 31, 2012 by investment category and time frame for which the securities have been in a continuous unrealized loss position:


	Less Than 12 Months					12 Months or More					Total
	Estimated Fair Value		Gross Unrealized Losses			Estimated Fair Value		Gross Unrealized Losses			Estimated Fair Value		Gross Unrealized Losses
	(dollars in thousands)
Obligations of U.S. Government Agencies:
Mortgage-Backed Securities—Residential	$	0	$	0		$	13	$	0	(a)	$	13	$	0
Obligations of U.S. Government-Sponsored Enterprises:
Mortgage-Backed Securities—Residential		76,296		(392	)		21		0	(a)		76,317		(392	)
Mortgage-Backed Securities—Commercial		0		0			0		0			0		0
Other Government-Sponsored Enterprises		59,303		(72	)		0		0			59,303		(72	)
Obligations of States and Political Subdivisions		0		0			0		0			0		0
Corporate Securities		0		0			0		0			0		0
Pooled Trust Preferred Collateralized Debt Obligations		0		0			23,316		(28,496	)		23,316		(28,496	)

Total Securities Available for Sale	$	135,599	$	(464	)	$	23,350	$	(28,496	)	$	158,949	$	(28,960	)

(a)	Gross unrealized losses related to these types of securities are less than $1 thousand.

The following table presents the gross unrealized losses and estimated fair value at December 31, 2011 for available-for-sale and securities by investment category and time frame for which the securities had been in a continuous unrealized loss position:


	Less Than 12 Months					12 Months or More					Total
	Estimated Fair Value		Gross Unrealized Losses			Estimated Fair Value		Gross Unrealized Losses			Estimated Fair Value		Gross Unrealized Losses
	(dollars in thousands)
Obligations of U.S. Government Agencies:
Mortgage-Backed Securities—Residential	$	1,086	$	(6	)	$	16	$	0	(a)	$	1,102	$	(6	)
Obligations of U.S. Government-Sponsored Enterprises:
Mortgage-Backed Securities—Residential		25		0	(a)		0		0			25		0
Mortgage-Backed Securities—Commercial		151		(1	)		0		0			151		(1	)
Other Government-Sponsored Enterprises		55,969		(132	)		0		0			55,969		(132	)
Obligations of States and Political Subdivisions		0		0			0		0			0		0
Corporate Securities		4,536		(562	)		0		0			4,536		(562	)
Pooled Trust Preferred Collateralized Debt Obligations		0		0			22,927		(31,785	)		22,927		(31,785	)

Total Securities Available for Sale	$	61,767	$	(701	)	$	22,943	$	(31,785	)	$	84,710	$	(32,486	)

Pooled Trust Preferred Collateralized Debt Obligations

The following table provides additional information related to our pooled trust preferred collateralized debt obligations as of December 31, 2012:


Deal	Class	Book Value		Fair Value		Unrealized Gain (Loss)			Moody’s/ Fitch Ratings	Number of Banks		Deferrals and Defaults as a % of Current Collateral			Excess Subordination as a % of Current Performing Collateral
(dollars in thousands)
Pre TSL I	Senior	$	1,009	$	1,005	$	(4	)	Aa3/A		17		33.33	%		159.27	%
Pre TSL IV	Mezzanine		1,830		1,111		(719	)	Caa2/CCC		6		27.07			91.00
Pre TSL V	Mezzanine		54		57		3		C/-		3		100.00			0.00
Pre TSL VII	Mezzanine		3,654		3,326		(328	)	Ca/C		16		48.92			0.00
Pre TSL VIII	Mezzanine		1,833		1,007		(826	)	C/C		32		52.99			0.00
Pre TSL IX	Mezzanine		2,268		943		(1,325	)	Ca/C		46		25.50			13.32
Pre TSL X	Mezzanine		1,388		1,165		(223	)	Ca/C		50		35.24			0.00
Pre TSL XII	Mezzanine		5,508		2,531		(2,977	)	Ca/C		71		35.35			0.00
Pre TSL XIII	Mezzanine		12,571		4,456		(8,115	)	Ca/C		63		36.87			6.48
Pre TSL XIV	Mezzanine		13,188		4,783		(8,405	)	Ca/C		61		38.97			29.37
MMCap I	Senior		1,220		1,193		(27	)	A3/A		17		50.26			573.29
MMCap I	Mezzanine		867		466		(401	)	Ca/C		17		50.26			0.00
MM Comm IX	Mezzanine		6,476		1,330		(5,146	)	Ca/CC		29		42.41			0.00

Total		$	51,866	$	23,373	$	(28,493	)

Cumulative Roll Forward of Credit Losses Recognized in Earnings for Debt Securities Held and Not Intended to be Sold

The table below provides a cumulative roll forward of credit losses recognized in earnings for debt securities held and not intended to be sold for the years ended December 31:


	2012			2011			2010
	(dollars in thousands)
Balance, beginning (a)	$	44,736		$	44,850		$	36,161
Credit losses on debt securities for which other-than-temporary impairment was not previously recognized		0			0			0
Additional credit losses on debt securities for which other-than-temporary impairment was previously recognized		0			0			8,689
Increases in cash flows expected to be collected, recognized over the remaining life of the security (b)		(1,462	)		(114	)		0

Balance, ending	$	43,274		$	44,736		$	44,850

(a)	The beginning balance represents credit related losses included in other-than-temporary impairment charges recognized on debt securities in prior periods.

(b)	Represents the increase in cash flows recognized in interest income during the period.

- Definition

Tabular disclosure of the amount of other than temporary impairment (OTTI) related to credit losses recognized in earnings including: (a) the beginning balance of the amount related to credit losses on debt securities held by the investor at the beginning of the period for which a portion of an OTTI was recognized in other comprehensive income; (b) additions for the amount related to the credit loss for which an OTTI was not previously recognized; (c) reductions for securities sold during the period (realized); (d) reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the investor intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis; (e) additional increases to the amount related to the credit loss for which an OTTI was previously recognized when the investor does not intend to sell the security and it is not more likely than not that the investor will be required to sell the security before recovery of its amortized cost basis; (f) reductions for increases in cash flows expected to be collected that are recognized over the remaining life of the security; and (g) the ending balance of the amount related to credit losses on debt securities held by the entity at the end of the period for which a portion of an OTTI was recognized in other comprehensive income.

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