INVESTMENT SECURITIES AVAILABLE FOR SALE

3 Months Ended

Mar. 31, 2012

Investment Securities Available For Sale

INVESTMENT SECURITIES AVAILABLE FOR SALE

3.          INVESTMENT SECURITIES AVAILABLE FOR SALE

A summary of amortized cost and approximate fair value of securities available for sale included in the consolidated statements of condition as of March 31, 2012 and December 31, 2011 follows:

	March 31, 2012
				Gross		Gross
		Amortized		Unrealized		Unrealized			Fair
(In Thousands)		Cost		Gains		Losses			Value
U.S. Government-Sponsored Entities	$	38,447	$	57	$	(32	)	$	38,472
Mortgage-Backed Securities - Residential		204,093		4,674		(49	)		208,718
State and Political Subdivisions		27,731		1,107		(1	)		28,837
Other Securities		5,999		35		(895	)		5,139
Marketable Equity Securities		577		27		—			604
Total	$	276,847	$	5,900	$	(977	)	$	281,770

	December 31, 2011
				Gross		Gross
		Amortized		Unrealized		Unrealized			Fair
(In Thousands)		Cost		Gains		Losses			Value
U.S. Government-Sponsored Entities	$	46,729	$	149	$	—		$	46,878
Mortgage-Backed Securities - Residential		223,240		4,891		(147	)		236,984
State and Political Subdivisions		28,539		1,314		(2	)		29,851
Other Securities		5,999		40		(832	)		5,207
Marketable Equity Securities		593		7		—			600
Total	$	314,100	$	6,401	$	(981	)	$	319,520

The following tables present the Corporation’s available for sale securities with continuous unrealized losses and the approximate fair value of these investments as of March 31, 2012 and December 31, 2011.

	March 31, 2012
	Duration of Unrealized Loss
	Less Than 12 Months					12 Months or Longer					Total
		Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands)		Value		Losses			Value		Losses			Value		Losses
U.S. Government- Sponsored Entities	$	17,955	$	(32	)	$	—	$	—		$	17,955	$	(32	)
Mortgage-Backed Securities - Residential		12,548		(41	)		89		(8	)		12,637		(49	)
State and Political Subdivisions		761		(1	)		—		—			761		(1	)
Other Securities		—		—			2,104		(895	)		2,104		(895	)
Total	$	31,264	$	(74	)	$	2,193	$	(903	)	$	33,457	$	(977	)

	December 31, 2011
	Duration of Unrealized Loss
	Less Than 12 Months					12 Months or Longer					Total
		Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(In Thousands)		Value		Losses			Value		Losses			Value		Losses
Mortgage-Backed Securities - Residential	$	32,931	$	(120	)	$	317	$	(27	)	$	33,248	$	(147	)
State and Political Subdivisions		736		(2	)		—		—			736		(2	)
Other Securities		—		—			2,167		(832	)		2,167		(832	)
Total	$	33,667	$	(122	)	$	2,484	$	(859	)	$	36,151	$	(981	)

Management believes that the unrealized losses on investment securities available for sale are temporary and due to interest rate fluctuations and/or volatile market conditions rather than the creditworthiness of the issuers. The Corporation does not intend to sell these securities nor is it likely that it will be required to sell the securities before their anticipated recovery; however, Management also closely monitors market conditions and may sell the securities if it determines it would be beneficial to do so.

At March 31, 2012, the unrealized loss on other securities, $895 thousand, is primarily related to a debt security issued by a large bank holding company that has experienced declines in all its securities due to the turmoil in the financial markets and a merger. The security, a single-issuer trust preferred security, was downgraded to below investment grade by Moody’s and is currently rated Ba1. Management monitors the performance of the issuer on a quarterly basis to determine if there are any credit events that could result in deferral or default of the security. Management believes the depressed valuation is a result of the nature of the security, a trust preferred bond, and the bond’s very low yield. As Management does not intend to sell this security nor is it likely that it will be required to sell the security before its anticipated recovery, the security is not considered other-than-temporarily impaired at March 31, 2012.