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Securities | 6 Months Ended
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Jun. 30, 2012
Securities [Abstract] |
SECURITIES | 4. SECURITIES Securities available for sale at June 30, 2012 and December 31, 2011 are as follows:
|  | June 30, 2012 |  |  | December 31, 2011 |
|  | Amortized Cost |  |  | Unrealized |  |  | Fair Value |  |  | Amortized Cost |  |  | Unrealized |  |  | Fair Value |
|  |  | Gains |  |  | Losses |  |  |  |  | Gains |  |  | Losses |  |
U.S. Treasury |  | $ | 6,036 |  |  | $ | 33 |  |  | $ | 0 |  |  | $ | 6,069 |  |  | $ | 8,064 |  |  | $ | 66 |  |  | $ | 0 |  |  | $ | 8,130 |
U.S. Gov’t sponsored entities |  |  | 107,398 |  |  |  | 5,641 |  |  |  | (9 | ) |  |  | 113,030 |  |  |  | 102,258 |  |  |  | 5,249 |  |  |  | (15 | ) |  |  | 107,492 |
State & political subdivisions |  |  | 151,321 |  |  |  | 10,316 |  |  |  | (54 | ) |  |  | 161,583 |  |  |  | 149,685 |  |  |  | 8,844 |  |  |  | (92 | ) |  |  | 158,437 |
Residential mortgage & asset backed |  |  | 363,792 |  |  |  | 8,923 |  |  |  | (279 | ) |  |  | 372,436 |  |  |  | 292,297 |  |  |  | 8,043 |  |  |  | (214 | ) |  |  | 300,126 |
Commercial mortgage & asset backed |  |  | 2,071 |  |  |  | 61 |  |  |  | 0 |  |  |  | 2,132 |  |  |  | 2,077 |  |  |  | 45 |  |  |  | 0 |  |  |  | 2,122 |
Corporate notes & bonds |  |  | 16,364 |  |  |  | 62 |  |  |  | (3,010 | ) |  |  | 13,416 |  |  |  | 17,358 |  |  |  | 50 |  |  |  | (3,548 | ) |  |  | 13,860 |
Pooled trust preferred |  |  | 800 |  |  |  | 0 |  |  |  | (440 | ) |  |  | 360 |  |  |  | 800 |  |  |  | 0 |  |  |  | (460 | ) |  |  | 340 |
Pooled SBA |  |  | 43,062 |  |  |  | 1,830 |  |  |  | (9 | ) |  |  | 44,883 |  |  |  | 44,851 |  |  |  | 1,282 |  |  |  | (77 | ) |  |  | 46,056 |
Other securities |  |  | 1,521 |  |  |  | 22 |  |  |  | 0 |  |  |  | 1,543 |  |  |  | 1,521 |  |  |  | 23 |  |  |  | 0 |  |  |  | 1,544 |
Total |  | $ | 692,365 |  |  | $ | 26,888 |  |  | $ | (3,801 | ) |  | $ | 715,452 |  |  | $ | 618,911 |  |  | $ | 23,602 |  |  | $ | (4,406 | ) |  | $ | 638,107 |
At June 30, 2012, there were no holdings of securities of any one issuer, other than the U.S. Government and its agencies, in an amount greater than 10% of shareholders’ equity. Trading securities accounted for under the fair value option at June 30, 2012 and December 31, 2011 are as follows:
|  | June 30, 2012 |  |  | December 31, 2011 |
Corporate equity securities |  | $ | 2,297 |  |  | $ | 1,959 |
Certificates of deposit |  |  | 382 |  |  |  | 255 |
International mutual funds |  |  | 252 |  |  |  | 257 |
Large cap growth mutual funds |  |  | 147 |  |  |  | 145 |
Money market mutual funds |  |  | 108 |  |  |  | 241 |
Large cap value mutual funds |  |  | 103 |  |  |  | 105 |
Corporate notes and bonds |  |  | 101 |  |  |  | 100 |
Real estate investment trust mutual funds |  |  | 64 |  |  |  | 68 |
U.S. Government sponsored entities |  |  | 56 |  |  |  | 55 |
Small cap mutual funds |  |  | 25 |  |  |  | 25 |
Mid cap mutual funds |  |  | 25 |  |  |  | 23 |
Total |  | $ | 3,560 |  |  | $ | 3,233 |
Securities with unrealized losses at June 30, 2012 and December 31, 2011, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, are as follows (in thousands):
June 30, 2012 |  | Less than 12 Months |  |  | 12 Months or More |  |  | Total |
Description of Securities |  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |
U.S. Treasury |  | $ | 0 |  |  | $ | 0 |  |  | $ | 0 |  |  | $ | 0 |  |  | $ | 0 |  |  | $ | 0 |
U.S. Gov’t sponsored entities |  |  | 5,989 |  |  |  | (9 | ) |  |  | 0 |  |  |  | 0 |  |  |  | 5,989 |  |  |  | (9 | )
State & political subdivisions |  |  | 5,046 |  |  |  | (53 | ) |  |  | 1,591 |  |  |  | (1 | ) |  |  | 6,637 |  |  |  | (54 | )
Residential mortgage & asset backed |  |  | 42,816 |  |  |  | (276 | ) |  |  | 743 |  |  |  | (3 | ) |  |  | 43,559 |  |  |  | (279 | )
Commercial mortgage & asset backed |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |
Corporate notes & bonds |  |  | 1,949 |  |  |  | (51 | ) |  |  | 9,492 |  |  |  | (2,959 | ) |  |  | 11,441 |  |  |  | (3,010 | )
Pooled trust preferred |  |  | 0 |  |  |  | 0 |  |  |  | 360 |  |  |  | (440 | ) |  |  | 360 |  |  |  | (440 | )
Pooled SBA |  |  | 2,022 |  |  |  | (9 | ) |  |  | 0 |  |  |  | 0 |  |  |  | 2,022 |  |  |  | (9 | )
Other securities |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |
|  | $ | 57,822 |  |  | $ | (398 | ) |  | $ | 12,186 |  |  | $ | (3,403 | ) |  | $ | 70,008 |  |  | $ | (3,801 | )
|  | Less than 12 Months |  |  | 12 Months or More |  |  | Total |
|  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |  |  | Fair Value |  |  | Unrealized Loss |
December 31, 2011 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. Treasury |  | $ | 0 |  |  | $ | 0 |  |  | $ | 0 |  |  | $ | 0 |  |  | $ | 0 |  |  | $ | 0 |
U.S. Gov’t sponsored entities |  |  | 7,671 |  |  |  | (15 | ) |  |  | 0 |  |  |  | 0 |  |  |  | 7,671 |  |  |  | (15 | )
State & political subdivisions |  |  | 5,314 |  |  |  | (92 | ) |  |  | 0 |  |  |  | 0 |  |  |  | 5,314 |  |  |  | (92 | )
Residential mortgage & asset backed |  |  | 36,626 |  |  |  | (162 | ) |  |  | 9,485 |  |  |  | (52 | ) |  |  | 46,111 |  |  |  | (214 | )
Commercial mortgage & asset backed |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |
Corporate notes & bonds |  |  | 2,860 |  |  |  | (139 | ) |  |  | 8,841 |  |  |  | (3,409 | ) |  |  | 11,701 |  |  |  | (3,548 | )
Pooled trust preferred |  |  | 0 |  |  |  | 0 |  |  |  | 340 |  |  |  | (460 | ) |  |  | 340 |  |  |  | (460 | )
Pooled SBA |  |  | 8,139 |  |  |  | (77 | ) |  |  | 0 |  |  |  | 0 |  |  |  | 8,139 |  |  |  | (77 | )
Other securities |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |  |  |  | 0 |
|  | $ | 60,610 |  |  | $ | (485 | ) |  | $ | 18,666 |  |  | $ | (3,921 | ) |  | $ | 79,276 |  |  | $ | (4,406 | )
The Corporation evaluates securities for other-than-temporary impairment on a quarterly basis, or more frequently when economic or market conditions warrant such an evaluation. At June 30, 2012, the Corporation held one structured pooled trust preferred security with an adjusted amortized cost of $800 and a fair value of $360. The Corporation evaluated this security for other-than-temporary impairment by estimating the cash flows expected to be received, taking into account future estimated levels of deferrals and defaults by the underlying issuers, and discounting those cash flows at the appropriate accounting yield. For the three and six months ended June 30, 2012, no other-than-temporary impairment was required to be realized in earnings. For the three and six months ended June 30, 2011, other-than-temporary impairment of $0 and $398, respectively, was realized in earnings. At June 30, 2012 and December 31, 2011, the Corporation held four structured pooled trust preferred securities with an adjusted amortized cost of zero. A roll-forward of the other-than-temporary impairment amount related to credit losses for the three and six months ended June 30, 2012 is as follows:
Balance of credit losses on debt securities for which a portion of other-than-temporary impairment was recognized in other comprehensive income, beginning of period |  | $ | 4,054 |
Additional credit loss for which other-than-temporary impairment was not previously recognized |  |  | 0 |
Additional credit loss for which other-than-temporary impairment was previously recognized |  |  | 0 |
Balance of credit losses on debt securities for which a portion of other-than-temporary impairment was recognized in other comprehensive income, end of period |  | $ | 4,054 |
A roll-forward of the other-than-temporary impairment amount related to credit losses for the three months ended June 30, 2011 is as follows:
Balance of credit losses on debt securities for which a portion of other-than-temporary impairment was recognized in other comprehensive income, beginning of period |  | $ | 4,054 |
Additional credit loss for which other-than-temporary impairment was not previously recognized |  |  | 0 |
Additional credit loss for which other-than-temporary impairment was previously recognized |  |  | 0 |
Balance of credit losses on debt securities for which a portion of other-than-temporary impairment was recognized in other comprehensive income, end of period |  | $ | 4,054 |
A roll-forward of the other-than-temporary impairment amount related to credit losses for the six months ended June 30, 2011 is as follows:
Balance of credit losses on debt securities for which a portion of other-than-temporary impairment was recognized in other comprehensive income, beginning of period |  | $ | 3,656 |
Additional credit loss for which other-than-temporary impairment was not previously recognized |  |  | 0 |
Additional credit loss for which other-than-temporary impairment was previously recognized |  |  | 398 |
Balance of credit losses on debt securities for which a portion of other-than-temporary impairment was recognized in other comprehensive income, end of period |  | $ | 4,054 |
Due to the insignificance of the adjusted amortized cost and other-than-temporary impairment charges to the consolidated financial statements, no further disclosures are required with respect to the Corporation’s structured pooled trust preferred securities. For the securities that comprise corporate notes and bonds and the securities that are issued by state and political subdivisions, management monitors publicly available financial information, such as filings with the Securities and Exchange Commission, in order to evaluate the securities for other-than-temporary impairment. For financial institution issuers, management also monitors information from quarterly “call” report filings that are used to generate Uniform Bank Performance Reports. When reviewing this information, management considers the financial condition and near-term prospects of the issuer and whether downgrades by bond rating agencies have occurred. Management also considers the length of time and extent to which fair value has been less than cost and the intent and ability of the Corporation to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value. As of June 30, 2012 and December 31, 2011, management concluded that the securities described in the previous paragraph were not other-than-temporarily impaired for the following reasons:
| • |  | There is no indication of any significant deterioration of the creditworthiness of the institutions that issued the securities.
| • |  | The unrealized losses are predominantly attributable to liquidity disruptions within the credit markets and the generally stressed condition of the financial services industry.
| • |  | All contractual interest payments on the securities have been received as scheduled, and no information has come to management’s attention through the processes previously described which would lead to a conclusion that future contractual payments will not be timely received.
The Corporation does not intend to sell and it is not more likely than not that it will be required to sell the securities in an unrealized loss position before recovery of its amortized cost basis. Information pertaining to security sales is as follows:
|  | Proceeds |  |  | Gross Gains |  |  | Gross Losses |
Three months ended June 30, 2012 |  | $ | 46,468 |  |  | $ | 810 |  |  | $ | (79 | )
Six months ended June 30, 2012 |  |  | 88,617 |  |  |  | 1,446 |  |  |  | (149 | )
Three months ended June 30, 2011 |  |  | 0 |  |  |  | 0 |  |  |  | 0 |
Six months ended June 30, 2011 |  |  | 23,610 |  |  |  | 146 |  |  |  | (72 | )
The following is a schedule of the contractual maturity of securities available for sale, excluding equity securities, at June 30, 2012:
|  | Amortized Cost |  |  | Fair Value |
1 year or less |  | $ | 22,131 |  |  | $ | 22,295 |
1 year – 5 years |  |  | 80,606 |  |  |  | 83,067 |
5 years – 10 years |  |  | 128,463 |  |  |  | 138,447 |
After 10 years |  |  | 93,781 |  |  |  | 95,532 |
|  |  | 324,981 |  |  |  | 339,341 |
Residential mortgage & asset backed securities |  |  | 363,792 |  |  |  | 372,436 |
Commercial mortgage & asset backed securities |  |  | 2,071 |  |  |  | 2,132 |
Total debt securities |  | $ | 690,844 |  |  | $ | 713,909 |
Mortgage and asset backed securities are not due at a single date; periodic payments are received based on the payment patterns of the underlying collateral. On June 30, 2012 and December 31, 2011, securities carried at $250,338 and $264,166, respectively, were pledged to secure public deposits and for other purposes as provided by law.

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- Definition Tabular disclosure of marketable securities. This may consist of investments in certain debt and equity securities, short-term investments and other assets. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 5 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=6872113&loc=d3e27232-111563 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.2,12) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 45 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6871852&loc=d3e26626-111562 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6872113&loc=d3e27161-111563 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 45 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6871852&loc=d3e26610-111562 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 210 -Section S99 -Paragraph 1 -Subparagraph (SX 210.9-03.4) -URI http://asc.fasb.org/extlink&oid=6876686&loc=d3e534808-122878 + Details
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