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2. Investment Securities

3 Months Ended

Mar. 31, 2015

Investments, Debt and Equity Securities [Abstract]

Investment Securities

Investment securities available for sale at March 31, 2015 and December 31, 2014 are as follows:

(Dollars in thousands)
	March 31, 2015
	Amortized Cost			Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Mortgage-backed securities	$	86,230		2,331		8		88,553
U.S. Government
sponsored enterprises		36,977		526		141		37,362
State and political subdivisions		145,568		7,044		138		152,474
Corporate bonds		1,957		11		5		1,963
Trust preferred securities		750		-		-		750
Equity securities		748		725		-		1,473
Total	$	272,230		10,637		292		282,575

(Dollars in thousands)
	December 31, 2014
	Amortized Cost			Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Mortgage-backed securities	$	88,496		1,766		52		90,210
U.S. Government
sponsored enterprises		33,766		418		136		34,048
State and political subdivisions		145,938		6,534		226		152,246
Corporate bonds		2,469		16		18		2,467
Trust preferred securities		750		-		-		750
Equity securities		748		630		-		1,378
Total	$	272,167		9,364		432		281,099

The current fair value and associated unrealized losses on investments in securities with unrealized losses at March 31, 2015 and December 31, 2014 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, 2015
	Less than 12 Months					12 Months or More				Total
	Fair Value			Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Mortgage-backed securities	$	127		-		2,954		8		3,081		8
U.S. Government
sponsored enterprises		2,549		21		9,639		120		12,188		141
State and political subdivisions		6,328		30		6,784		108		13,112		138
Corporate bonds		-		-		533		5		533		5
Total	$	9,004		51		19,910		241		28,914		292

(Dollars in thousands)
	December 31, 2014
	Less than 12 Months					12 Months or More				Total
	Fair Value			Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Mortgage-backed securities	$	436		1		2,963		51		3,399		52
U.S. Government
sponsored enterprises		2,996		4		9,850		132		12,846		136
State and political subdivisions		567		1		14,998		225		15,565		226
Corporate bonds		-		-		525		18		525		18
Total	$	3,999		6		28,336		426		32,335		432

At March 31, 2015, unrealized losses in the investment securities portfolio relating to debt securities totaled $292,000. The unrealized losses on these debt securities arose due to changing interest rates and are considered to be temporary. From the March 31, 2015 tables above, 14 out of 173 securities issued by state and political subdivisions contained unrealized losses, seven out of 82 securities issued by U.S. Government sponsored enterprises, including mortgage-backed securities, contained unrealized losses, and one out of three securities issued by corporations contained unrealized losses. These unrealized losses are considered temporary because of acceptable financial condition and results of operations of entities that issued each security and the repayment sources of principal and interest on U.S. Government sponsored enterprises, including mortgage-backed securities, are government backed.

The amortized cost and estimated fair value of investment securities available for sale at March 31, 2015, 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.

March 31, 2015
(Dollars in thousands)
	Amortized Cost			Estimated Fair Value
Due within one year	$	4,399		4,412
Due from one to five years		50,121		52,794
Due from five to ten years		111,462		115,413
Due after ten years		19,270		19,930
Mortgage-backed securities		86,230		88,553
Equity securities		748		1,473
Total	$	272,230		282,575

No securities available for sale were sold during the three months ended March 31, 2015. Proceeds from sales of securities available for sale during the three months ended March 31, 2014 were $677,000 and resulted in gross gains of $26,000.

Securities with a fair value of approximately $85.9 million and $89.9 million at March 31, 2015 and December 31, 2014, 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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