Fair Value (Tables)

6 Months Ended

Jun. 30, 2012

Fair Value

Schedule of financial assets and liabilities measured on a recurring basis

			Fair Value Measurements Using
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(Dollars in thousands)
Assets at June 30, 2012:
Available-for-sale securities:
Agency mortgage-backed securities	$	325,926		—	$	325,926		—
Corporate bonds		23,221		—		23,221		—
Trust preferred securities		40,673		—		40,673		—
I/O strip receivables		2,140		—		2,140		—
Assets at December 31, 2011:
Available-for-sale securities:
Agency mortgage-backed securities	$	350,348	$	—	$	350,348		—
Trust preferred securities		30,107		—		30,107		—
I/O strip receivables		2,094		—		2,094		—

Schedule of assets and liabilities measured on a non-recurring basis

			Fair Value Measurements Using
	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(Dollars in thousands)
Assets at June 30, 2012:
Impaired loans held-for-sale—other:
Real estate:
Land and construction	$	177		—	$	177		—
Impaired loans—held-for-investment:
Commercial	$	4,873		—		—	$	4,873
Real estate:
Commercial and residential		906		—		—		906
Land and construction		1,697		—		—		1,697
Home equity		317						317
Consumer		142		—		—		142
	$	7,935		—		—	$	7,935
Foreclosed assets:
Commercial and residential	$	183		—		—	$	183
Land and construction		2,915		—		—		2,915
	$	3,098					$	3,098
Assets at December 31, 2011:
Impaired loans held-for-sale—other:
Real estate:
Land and construction	$	186		—	$	186		—
Impaired loans—held-for-investment:
Commercial	$	6,526		—		—	$	6,526
Real estate:
Commercial and residential		1,794		—		—		1,794
Land and construction		1,590		—		—		1,590
Home equity		32						32
Consumer		10		—		—		10
	$	9,952		—		—	$	9,952
Foreclosed assets:
Commercial and residential	$	156		—		—	$	156
Land and construction		2,156		—		—		2,156
	$	2,312					$	2,312

Schedule of impaired loans held-for-investment and impaired loans held-for-investment carried at fair value

	June 30, 2012			December 31, 2011
	(Dollars in thousands)
Impaired loans held-for-investment:
Book value of impaired loans held-for-investment carried at fair value	$	9,786		$	12,279
Book value of impaired loans held-for-investment carried at cost		4,796			5,635
Total impaired loans held-for-investment	$	14,582		$	17,914
Impaired loans held-for-investment carried at fair value:
Book value of impaired loans held-for-investment carried at fair value	$	9,786		$	12,279
Specific valuation allowance		(1,851	)		(2,327	)
Impaired loans held-for-investment carried at fair value, net	$	7,935		$	9,952

Schedule of quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis

	Fair Value		Valuation Techniques	Unobservable Inputs	Range (Weighted Average)
	(Dollars in thousands)
Impaired loans—held-for-investment:
Commercial	$	4,873	Market Approach	Discount adjustment for differences between comparable sales	2% to 34% (17%)
Real estate:
Commercial and residential		906	Market Approach	Discount adjustment for differences between comparable sales	2% to 7% (5%)
Land and construction		1,697	Market Approach	Discount adjustment for differences between comparable sales	1% to 36% (12%)
Foreclosed assets:
Land and construction		2,915	Market Approach	Discount adjustment for differences between comparable sales	0% to 23% (6%)

Schedule of carrying amounts and estimated fair values of financial instruments

The carrying amounts and estimated fair values of financial instruments at June 30, 2012 are as follows:

			Estimated Fair Value
	Carrying Amounts		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	46,361	$	46,361	$	—	$	—	$	46,361
Securities available-for-sale		389,820		—		389,820		—		389,820
Loans (including loans held-for-sale), net		780,974		—		2,891		777,736		780,627
FHLB and FRB stock		10,897		—		—		—		N/A
Accrued interest receivable		3,877		—		3,877		—		3,877
Loan servicing rights and I/O strips receivables		2,920		—		5,228		—		5,228
Liabilities:
Time deposits	$	295,172	$	—	$	296,090	$	—	$	296,090
Other deposits		807,581		—		807,581		—		807,581
Subordinated debt		23,702		—		—		19,310		19,310
Accrued interest payable		768		—		768		—		768

        The carrying amounts and estimated fair values of the Company's financial instruments at December 31, 2011:

	Carrying Amounts		Estimated Fair Value
	(Dollars in thousands)
Assets:
Cash and cash equivalents	$	72,872	$	72,872
Securities available-for-sale		380,455		380,455
Loans (including loans held-for-sale), net		745,057		745,421
FHLB and FRB stock		9,925		N/A
Accrued interest receivable		3,719		3,719
Loan servicing rights and I/O strips receivables		2,886		5,261
Liabilities:
Time deposits	$	288,528	$	289,512
Other deposits		760,900		760,900
Subordinated debt		23,702		15,950
Accrued interest payable		784		784