Impaired collateral-dependent loans are carried at fair value when the current collateral value is lower than the carrying value of the loan. Those impaired collateral-dependent loans which are measured at fair value or a nonrecurring basis are as follows (in thousands):

	At December 31, 2012										Losses Recorded in Operations For the Year Ended December 31,
	Fair Value		Level 1		Level 2		Level 3		Total Losses		2012
Residential real estate	$	1,247	$	0	$	0	$	1,247	$	451	$	0
Commercial real estate		6,232		0		0		6,232		2,780		366
Land and construction		887		0		0		887		449		0

	$	8,366	$	0	$	0	$	8,366	$	3,680	$	366

	At December 31, 2011										Losses Recorded in Operations For the Year Ended December 31,
	Fair Value		Level 1		Level 2		Level 3		Total Losses		2011
Residential real estate	$	1,591	$	0	$	0	$	1,591	$	545	$	308
Commercial real estate		6,831		0		0		6,831		2,660		158
Land and construction		6,793		0		0		6,793		1,511		834

	$	15,215	$	0	$	0	$	15,215	$	4,716	$	1,300

Foreclosed real estate is recorded at fair value less estimated costs to sell. Foreclosed real estate which is measured at fair value on a nonrecurring basis is as follows (in thousands):

	At Year End										Losses Recorded During the
	Fair Value		Level 1		Level 2		Level 3		Total Losses		Year
At December 31, 2012	$	10,938	$	0	$	0	$	10,938	$	102	$	102

At December 31, 2011	$	7,646	$	0	$	0	$	7,646	$	772	$	772

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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+ Details