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Note 3 - Investment Securities Available-for-Sale
 3 Months Ended
Mar. 31, 2015
Investments, Debt and Equity Securities [Abstract]  
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

Note 3. Investment Securities Available-for-Sale


Amortized cost and estimated fair value of securities available-for-sale are summarized as follows:


           

Gross

     

Gross

   

Estimated

 

March 31, 2015

 

Amortized

   

Unrealized

     

Unrealized

   

Fair

 

(dollars in thousands)

 

Cost

   

Gains

     

Losses

   

Value

 

U. S. Government agency securities

  $ 29,433     $ 686  

 

  $ -     $ 30,119  

Residential mortgage backed securities

    233,127       2,183         1,159       234,151  

Municipal bonds

    65,109       3,737         49       68,797  

Other equity investments

    396       68         -       464  
    $ 328,065     $ 6,674       $ 1,208     $ 333,531  

           

Gross

     

Gross

   

Estimated

 

December 31, 2014

 

Amortized

   

Unrealized

     

Unrealized

   

Fair

 

(dollars in thousands)

 

Cost

   

Gains

     

Losses

   

Value

 

U. S. Government agency securities

  $ 29,434     $ 500  

 

  $ 40     $ 29,894  

Residential mortgage backed securities

    241,120       1,716         2,516       240,320  

Municipal bonds

    106,983       4,850         121       111,712  

Other equity investments

    396       21         -       417  
    $ 377,933     $ 7,087       $ 2,677     $ 382,343  

Gross unrealized losses and fair value by length of time that the individual available-for-sale securities have been in a continuous unrealized loss position are as follows:


   

Less than

   

12 Months

                 
   

12 Months

   

or Greater

   

Total

 
   

Estimated

             

Estimated

           

Estimated

         

March 31, 2015

 

Fair

     

Unrealized

   

Fair

   

Unrealized

   

Fair

   

Unrealized

 

(dollars in thousands)

 

Value

     

Losses

   

Value

   

Losses

   

Value

   

Losses

 

Residential mortgage backed securities

  $  13,798  

 

  $  35     $  76,319     $  1,124     $  90,117     $  1,159  

Municipal bonds

    5,620         49       -       -       5,620       49  
    $ 19,418       $ 84     $ 76,319     $ 1,124     $ 95,737     $ 1,208  

   

Less than

   

12 Months

                 
   

12 Months

   

or Greater

   

Total

 
   

Estimated

             

Estimated

           

Estimated

         

December 31, 2014

 

Fair

     

Unrealized

   

Fair

   

Unrealized

   

Fair

   

Unrealized

 

(dollars in thousands)

 

Value

     

Losses

   

Value

   

Losses

   

Value

   

Losses

 

U. S. Government agency securities

  $ 2,001       $ 7     $ 1,750     $ 33     $ 3,751     $ 40  

Residential mortgage backed securities

    49,644  

 

    221       86,028       2,295       135,672       2,516  

Municipal bonds

    4,974         14       10,915       107       15,889       121  
    $ 56,619       $ 242     $ 98,693     $ 2,435     $ 155,312     $ 2,677  

The unrealized losses that exist are generally the result of changes in market interest rates and interest spread relationships since original purchases. The weighted average duration of debt securities, which comprise 99.9% of total investment securities, is relatively short at 3.8 years. If quoted prices are not available, fair value is measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss assumptions. The Company does not believe that the investment securities that were in an unrealized loss position as of March 31, 2015 represent an other-than-temporary impairment for the reasons noted. The Company does not intend to sell the investments and it is more likely than not that the Company will not have to sell the securities before recovery of its amortized cost basis, which may be maturity. In addition, at March 31, 2015, the Company held $16.8 million in equity securities in a combination of Federal Reserve Bank (“FRB”) and Federal Home Loan Bank (“FHLB”) stocks, which are required to be held for regulatory purposes, and are not marketable.


The amortized cost and estimated fair value of investments available-for-sale by contractual maturity are shown in the table below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.


   

March 31, 2015

   

December 31, 2014

 
   

Amortized

   

Estimated

   

Amortized

   

Estimated

 

(dollars in thousands)

 

Cost

   

Fair Value

   

Cost

   

Fair Value

 

U. S. Government agency securities maturing:

                               

One year or less

  $ 2,999     $ 3,040     $ 2,998     $ 3,051  

After one year through five years

    19,940       20,381       19,947       20,276  

Five years through ten years

    6,494       6,698       6,489       6,567  

Residential mortgage backed securities

    233,127       234,151       241,120       240,320  

Municipal bonds maturing:

                               

One year or less

    1,530       1,535       2,410       2,438  

After one year through five years

    33,513       36,084       47,038       49,607  

Five years through ten years

    27,505       28,373       54,983       56,927  

After ten years

    2,561       2,805       2,552       2,740  

Other equity investments

    396       464       396       417  
    $ 328,065     $ 333,531     $ 377,933     $ 382,343  

The carrying value of securities pledged as collateral for certain government deposits, securities sold under agreements to repurchase, and certain lines of credit with correspondent banks at March 31, 2015 was $256.6 million, which is well in excess of required amounts in order to operationally provide significant reserve amounts for new business. As of March 31, 2015 and December 31, 2014, there were no holdings of securities of any one issuer, other than the U.S. Government and U.S. Government agency securities, which exceeded ten percent of shareholders’ equity.