Note 3 - Investment Securities Available for Sale

3 Months Ended

Mar. 31, 2014

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

Note 3. Investment Securities Available-for-Sale

Amortized cost and estimated fair value of securities available-for-sale are summarized as follows:

March 31, 2014	Amortized		Gross Unrealized		Gross Unrealized		Estimated Fair
(dollars in thousands)	Cost		Gains		Losses		Value
U. S. Government agency securities	$	48,797	$	687	$	127	$	49,357
Residential mortgage backed securities		232,001		1,292		4,682		228,611
Municipal bonds		107,434		3,136		1,165		109,405
Other equity investments		396		21		-		417
	$	388,628	$	5,136	$	5,974	$	387,790

December 31, 2013	Amortized		Gross Unrealized		Gross Unrealized		Estimated Fair
(dollars in thousands)	Cost		Gains		Losses		Value
U. S. Government agency securities	$	46,640	$	843	$	148	$	47,335
Residential mortgage backed securities		234,206		1,143		6,675		228,674
Municipal bonds		102,423		2,017		2,700		101,740
Other equity investments		396		-		12		384
	$	383,665	$	4,003	$	9,535	$	378,133

Gross unrealized losses and fair value by length of time that the individual available-for-sale securities have been in a continuous unrealized loss position are as follows:

	Less than				12 Months
	12 Months				or Greater				Total
	Estimated				Estimated				Estimated
March 31, 2014	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(dollars in thousands)	Value		Losses		Value		Losses		Value		Losses
U. S. Government agency securities	$	8,624	$	127	$	-	$	-	$	8,624	$	127
Residential mortgage backed securities		129,067		3,548		31,128		1,134		160,195		4,682
Municipal bonds		26,547		794		8,076		371		34,623		1,165
	$	164,238	$	4,469	$	39,204	$	1,505	$	203,442	$	5,974

	Less than				12 Months
	12 Months				or Greater				Total
	Estimated				Estimated				Estimated
December 31, 2013	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(dollars in thousands)	Value		Losses		Value		Losses		Value		Losses
U. S. Government agency securities	$	4,782	$	148	$	-	$	-	$	4,782	$	148
Residential mortgage backed securities		155,475		5,992		15,658		683		171,133		6,675
Municipal bonds		50,450		2,512		3,196		188		53,646		2,700
Other equity investments		-		-		165		12		165		12
	$	210,707	$	8,652	$	19,019	$	883	$	229,726	$	9,535

The unrealized losses that exist are generally the result of changes in market interest rates and interest spread relationships since original purchases. The weighted average duration of debt securities, which comprise 99.9% of total investment securities, is relatively short at 4.1 years. If quoted prices are not available, fair value is measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss assumptions. The Company does not believe that the investment securities that were in an unrealized loss position as of March 31, 2014 represent an other-than-temporary impairment for the reasons noted. The Company does not intend to sell the investments and it is more likely than not that the Company will not have to sell the securities before recovery of its amortized cost basis, which may be maturity. In addition, at March 31, 2014, the Company held $10.6 million in equity securities in a combination of Federal Reserve Bank (“FRB”) and Federal Home Loan Bank (“FHLB”) stocks, which are required to be held for regulatory purposes and are not marketable.

The amortized cost and estimated fair value of investments available-for-sale by contractual maturity are shown in the table below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	March 31, 2014				December 31, 2013
	Amortized		Estimated		Amortized		Estimated
(dollars in thousands)	Cost		Fair Value		Cost		Fair Value
U. S. Government agency securities maturing:
One year or less	$	19,012	$	19,063	$	19,025	$	19,133
After one year through five years		27,321		27,781		27,615		28,202
Five years through ten years		2,464		2,513		-		-
Residential mortgage backed securities		232,001		228,611		234,206		228,674
Municipal bonds maturing:
After one year through five years		31,725		32,598		25,718		26,008
Five years through ten years		75,709		76,807		76,705		75,732
Other equity investments		396		417		396		384
	$	388,628	$	387,790	$	383,665	$	378,133

The carrying value of securities pledged as collateral for certain government deposits, securities sold under agreements to repurchase, and certain lines of credit with correspondent banks at March 31, 2014 was $276.2 million. As of March 31, 2014 and December 31, 2013, there were no holdings of securities of any one issuer, other than the U.S. Government and U.S. Government agency securities that exceeded ten percent of shareholders’ equity.