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Investment Securities

6 Months Ended

Jun. 30, 2012

Note 2: Investment Securities

The amortized cost, gross unrealized gains, gross unrealized losses and approximate fair values of available-for-sale securities at June 30, 2012 and December 31, 2011 are as follows:


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
June 30, 2012:

U. S. Government agency bonds	$	5,000,000	$	16,920	$	—		$	5,016,920
U. S. Government agency mortgage-backed securities		38,624,381		1,020,326		(1,942	)		39,642,765
Corporate bonds		12,202,773		8,553		(528,381	)		11,682,945

	$	55,827,154	$	1,045,799	$	(530,323	)	$	56,342,630

December 31, 2011:

U. S. Government agency bonds	$	5,000,000	$	37,085	$	—		$	5,037,085
U. S. Government agency mortgage-backed securities		49,004,232		1,051,097		(5,900	)		50,049,429
Corporate bonds		12,249,064		25,338		(890,944	)		11,383,458

	$	66,253,296	$	1,113,520	$	(896,844	)	$	66,469,972

The following table presents the gross unrealized loss and fair value of Bancorp’s available-for-sale securities, aggregated by the length of time the individual securities have been in a continuous loss position, at June 30, 2012 and December 31, 2011:


	Less Than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
June 30, 2012:

U. S. Government mortgage - backed securities	$	67,729	$	(160	)	$	285,040	$	(1,782	)	$	352,769	$	(1,942	)
Corporate bonds		5,814,060		(185,940	)		2,657,559		(342,441	)		8,471,619		(528,381	)

Totals	$	5,881,789	$	(186,100	)	$	2,942,599	$	(344,223	)	$	8,824,388	$	(530,323	)

December 31, 2011:

U. S. Government mortgage - backed securities	$	4,941,662	$	(5,492	)	$	68,309	$	(408	)	$	5,009,971	$	(5,900	)
Corporate bonds		8,358,120		(890,944	)		—		—			8,358,120		(890,944	)

Totals	$	13,299,782	$	(896,436	)	$	68,309	$	(408	)	$	13,368,091	$	(896,844	)

At June 30, 2012, eight securities had unrealized holding losses with aggregate depreciation of 5.7% from the amortized cost. At December 31, 2011, nine securities had unrealized losses with aggregate depreciation of 6.3% from the amortized cost.

Bancorp performs a quarterly analysis of those securities that are in an unrealized loss position to determine if those losses qualify as other-than-temporary impairments. This analysis considers the following criteria in its determination: the ability of the issuer to meet its obligations, an impairment due to a deterioration in credit, management’s plans and ability to maintain its investment in the security, the length of time and the amount by which the security has been in a loss position, the interest rate environment, the general economic environment and prospects or projections for improvement or deterioration.

Management believes that none of the unrealized losses on available-for-sale securities noted above are other than temporary due to the fact that they relate to market interest rate changes on corporate debt and mortgage-backed securities issued by U.S. Government agencies. Management considers the issuers of the securities to be financially sound, the corporate bonds are investment grade and the Company expects to receive all contractual principal and interest related to these investments. Because the Company does not intend to sell the investments, and it is not more-likely-than-not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at June 30, 2012.

The amortized cost and fair value of available-for-sale debt securities at June 30, 2012 by contractual maturity are presented below. Actual maturities of mortgage-backed securities may differ from contractual maturities because the mortgages underlying the securities may be prepaid without any penalties. Because mortgage-backed securities are not due at a single maturity date, they are not included in the maturity categories in the following maturity summary:


	Amortized Cost		Fair Value
Maturity:
Over 10 years	$	—	$	—
Corporate bonds < 5 years		3,202,773		3,211,326
Corporate bonds 5 to 10 years		9,000,000		8,471,619
U.S. Government bonds 5 to 10 years		5,000,000		5,016,920
Mortgage-backed securities		38,624,381		39,642,765

Total	$	55,827,154	$	56,342,630