FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2015

Schedule of changes in asset subject to fair value measurement by Level

	(Dollars in Thousands)
										Fair
	Level 1			Level 2			Level 3			Value
December 31, 2014
Recurring:
Investment securities available for sale (AFS)	$	790		$	86,815		$	388		$	87,993

Non-recurring:
Maryland Financial Bank stock		-			-			30			30
Impaired loans		-			-			5,176			5,176
OREO		-			45			-			45
		790			86,860			5,594			93,244

Activity:
Investment securities AFS
Purchases of investment securities		-			18,211			-			18,211
Sales, calls and maturities of investment securities		-			(9,248	)		-			(9,248	)
Amortization/accretion of premium/discount		-			(115	)		-			(115	)
Increase (decrease) in market value		191			340			(56	)		475
Transfer to Level 2		(573	)		797			(224	)		-

Loans
New impaired loans		-			-			389			389
Payments and other loan reductions		-			-			(132	)		(132	)
Change in total provision		-			-			(44	)		(44	)

OREO
Sales of OREO		-			-			-			-
Loss on disposal of OREO		-			-			-			-
Write-down of OREO		-			-			-			-

March 31, 2015
Recurring:
Investment securities AFS		408			96,800			108			97,316

Non-recurring:
Maryland Financial Bank stock		-			-			30			30
Impaired loans		-			-			5,389			5,389
OREO		-			45			-			45
	$	408		$	96,845		$	5,527		$	102,780

Schedule of estimated fair values of financial instruments


	March 31, 2015				December 31, 2014
(In Thousands)	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Financial assets:
Cash and due from banks	$	6,247	$	6,247	$	7,101	$	7,101
Interest-bearing deposits		6,136		6,136		2,155		2,155
Federal funds sold		5,058		5,058		4,024		4,024
Investment securities		97,316		97,316		87,993		87,993
Investments in restricted stock		1,203		1,203		1,328		1,328
Ground rents		169		169		169		169
Loans, net		268,233		263,097		273,986		268,536
Accrued interest receivable		1,099		1,099		1,274		1,274

Financial liabilities:
Deposits		346,571		319,332		338,877		310,239
Long-term borrowings		20,000		21,035		20,000		20,951
Dividends payable		276		276		276		276
Accrued interest payable		42		42		40		40

Off-balance sheet commitments		25,786		25,786		21,430		21,430

Schedule of gross unrealized losses and fair value, aggregated by investment category and length of time in continuous unrealized loss position


Securities available for sale:	Less than 12 months				12 months or more				Total
(Dollars in Thousands)
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loss

Obligations of U.S. Govt Agencies	$	5	$	4	$	-	$	-	$	5	$	4
State and Municipal		5,411		87		803		23		6,214		110
Corporate Trust Preferred		-		-		108		80		108		80
Mortgage Backed		27,537		117		16,509		457		44,046		574
	$	32,953	$	208	$	17,420	$	560	$	50,373	$	768

Schedule of rollforward of the cumulative other-than-temporary credit losses recognized in earnings for debt securities

	At		At
	March 31,		December 31,
	2015		2014
	(Dollars in Thousands)

Estimated credit losses, beginning of year	$	3,262	$	3,262
Credit losses - no previous OTTI recognized		-		-
Credit losses - previous OTTI recognized		-		-

Estimated credit losses, end of period	$	3,262	$	3,262

- Definition

Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

+ References+ Details

- Definition

Tabular disclosure of the amount of other than temporary impairment (OTTI) related to credit losses recognized in earnings including: (a) the beginning balance of the amount related to credit losses on debt securities held by the investor at the beginning of the period for which a portion of an OTTI was recognized in other comprehensive income; (b) additions for the amount related to the credit loss for which an OTTI was not previously recognized; (c) reductions for securities sold during the period (realized); (d) reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the investor intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis; (e) additional increases to the amount related to the credit loss for which an OTTI was previously recognized when the investor does not intend to sell the security and it is not more likely than not that the investor will be required to sell the security before recovery of its amortized cost basis; (f) reductions for increases in cash flows expected to be collected that are recognized over the remaining life of the security; and (g) the ending balance of the amount related to credit losses on debt securities held by the entity at the end of the period for which a portion of an OTTI was recognized in other comprehensive income.

+ References+ Details