Investment Securities

3 Months Ended

Mar. 31, 2012

(2)	Investment Securities

Investment securities available for sale at March 31, 2012 and December 31, 2011 are as follows:

(Dollars in thousands)
	March 31, 2012
	Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Estimated Fair Value
Mortgage-backed securities	$	193,998	2,016	471	195,543
U.S. Government
sponsored enterprises		3,193	94	-	3,287
State and political subdivisions		92,842	3,709	75	96,476
Corporate bonds		1,542	18	-	1,560
Trust preferred securities		1,250	-	-	1,250
Equity securities		748	439	-	1,187
Total	$	293,573	6,276	546	299,303

(Dollars in thousands)
	December 31, 2011
	Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Estimated Fair Value
Mortgage-backed securities	$	213,378	1,371	1,056	213,693
U.S. Government
sponsored enterprises		7,429	265	-	7,694
State and political subdivisions		92,996	4,157	56	97,097
Corporate bonds		546	-	3	543
Trust preferred securities		1,250	-	-	1,250
Equity securities		748	363	-	1,111
Total	$	316,347	6,156	1,115	321,388

The current fair value and associated unrealized losses on investments in securities with unrealized losses at March 31, 2012 and December 31, 2011 are summarized in the tables below, with the length of time the individual securities have been in a continuous loss position.

(Dollars in thousands)
	March 31, 2011
	Less than 12 Months			12 Months or More		Total
	Fair Value		Unrealized Losses	Fair Value	Unrealized Losses	Fair Value	Unrealized Losses
Mortgage-backed securities	$	60,846	435	3,063	36	63,909	471
State and political subdivisions		5,767	75	-	-	5,767	75
Total	$	66,613	510	3,063	36	69,676	546

(Dollars in thousands)
	December 31, 2011
	Less than 12 Months			12 Months or More		Total
	Fair Value		Unrealized Losses	Fair Value	Unrealized Losses	Fair Value	Unrealized Losses
Mortgage-backed securities	$	95,122	991	4,125	65	99,247	1,056
State and political subdivisions		4,444	56	-	-	4,444	56
Corporate bonds		542	3	-	-	542	3
Total	$	100,108	1,050	4,125	65	104,233	1,115

At March 31, 2012, unrealized losses in the investment securities portfolio relating to debt securities totaled $546,000. The unrealized losses on these debt securities arose due to changing interest rates and are considered to be temporary. From the March 31, 2012 tables above, seven out of 138 securities issued by state and political subdivisions contained unrealized losses and 27 out of 98 securities issued by U.S. Government sponsored enterprises, including mortgage-backed securities, contained unrealized losses. These unrealized losses are considered temporary because of acceptable investment grades on each security and the repayment sources of principal and interest are government backed.

The amortized cost and estimated fair value of investment securities available for sale at March 31, 2012, by contractual maturity, are shown below. Expected maturities of mortgage-backed securities will differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

(Dollars in thousands)
	Amortized Cost		Estimated Fair Value
Due within one year	$	5,303	5,367
Due from one to five years		14,000	14,298
Due from five to ten years		67,926	70,602
Due after ten years		11,598	12,306
Mortgage-backed securities		193,998	195,543
Equity securities		748	1,187
Total	$	293,573	299,303

Proceeds from sales of securities available for sale during three months ended March 31, 2012 were $20.4 million and resulted in gross gains of $527,000. Proceeds from sales of securities available for sale during the three months ended March 31, 2011 were $30.4 million and resulted in gross gains of $1.1 million.

Securities with a fair value of approximately $82.7 million and $83.6 million at March 31, 2012 and December 31, 2011, respectively, were pledged to secure public deposits and for other purposes as required by law.

- Definition

Tabular disclosure of marketable securities. This may consist of investments in certain debt and equity securities, short-term investments and other assets.

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