Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2012

Fair Value of Financial Instruments [Abstract]

Financial instruments

	June 30, 2012
	Carrying Amount				Fair Value Measurements Using
(Dollars in thousands)			Fair Value		Level 1		Level 2		Level 3
Assets
Cash and cash equivalents	$	24,621	$	24,621	$	24,621	$	—	$	—
Investment securities		350,779		350,779		161,317		187,624		1,838
FHLB stock		3,899		3,899		—		3,899		—
Accrued interest receivable		5,030		5,030		—		5,030		—
Net loans		495,477		492,950		—		—		492,950
Loans held for sale		3,059		3,059		—		3,059		—
Liabilities
Demand, noninterest bearing deposits	$	146,326	$	146,326	$	—	$	146,326	$	—
Demand, interest-bearing deposits		305,298		305,298		—		305,298		—
Savings deposits		58,562		58,562		—		58,562		—
Time deposits		285,302		291,019		—		291,019		—
Accrued interest payable		469		469		—		469		—
Short-term borrowing		42,101		42,101		—		42,101		—
Long-term borrowing		18,000		18,710		—		18,710		—

	December 31, 2011
	Carrying Amount		Fair Value		Fair Value Measurements Using
(Dollars in thousands)					Level 1		Level 2		Level 3
Assets
Cash and cash equivalents	$	24,731	$	24,731	$	24,731	$	—	$	—
Investment securities		339,450		339,450		151,714		186,094		1,642
FHLB stock		3,456		3,456		—		3,456		—
Accrued interest receivable		5,308		5,308		—		5,308		—
Net loans		484,450		482,851		—		—		482,851
Loans held for sale		2,866		2,866		—		2,866		—
Liabilities
Demand, noninterest bearing deposits	$	135,732	$	135,732	$	—	$	135,732	$	—
Demand, interest-bearing deposits		270,119		270,119		—		270,119		—
Savings deposits		55,517		55,517		—		55,517		—
Time deposits		336,277		343,374		—		343,374		—
Accrued interest payable		519		519		—		519		—
Short-term borrowing		11,679		11,679		—		11,679		—
Long-term borrowing		25,500		26,296		—		26,296		—

Assets recorded at fair value on a recurring and nonrecurring basis

Assets recorded at fair value on a recurring basis

June 30, 2012	Total		Level 1		Level 2		Level 3
	(Dollars in thousands)
Investment Securities Available-for-Sale
Obligations of states and political subdivisions	$	37,779	$	3,903	$	33,876	$	—
Mortgage-backed securities		132,799		19,463		113,336		—
SBA-backed securities		139,602		137,951		1,651		—
Corporate bonds		40,599		—		38,761		1,838
Total Securities		350,779		161,317		187,624		1,838
Interest rate lock commitments		131		—		—		131
Total assets at fair value	$	350,910	$	161,317	$	187,624	$	1,969

December 31, 2011	Total		Level 1		Level 2		Level 3
	(Dollars in thousands)
Investment Securities Available-for-Sale
Government-sponsored enterprises and FFCB bonds	$	1,032	$	—	$	1,032	$	—
Obligations of states and political subdivisions		28,718		6,752		21,966		—
Mortgage-backed securities		132,292		—		132,292		—
SBA-backed securities		146,637		144,962		1,675		—
Corporate bonds		30,771		—		29,129		1,642
Total Securities		339,450		151,714		186,094		1,642
Interest rate lock commitments		76		—		—		76
Total assets at fair value	$	339,526	$	151,714	$	186,094	$	1,718

Assets recorded at fair value on a nonrecurring basis

June 30, 2012	Total		Level 1		Level 2		Level 3
	(Dollars in thousands)
Impaired Loans
Real estate—construction and land development	$	6,128	$	—	$	—	$	6,128
Real estate—secured by residential properties		5,240		—		—		5,240
Real estate—secured by nonfarm nonresidential properties		7,324		—		—		7,324
Commercial and industrial		179		—		—		179
Total impaired loans		18,871		—		—		18,871
Real estate and repossessions acquired in settlement of loans
Total real estate and repossessions acquired in settlement of loans		7,661		—		—		7,661
Total assets at fair value	$	26,532	$	—	$	—	$	26,532

December 31, 2011	Total		Level 1		Level 2		Level 3
	(Dollars in thousands)
Impaired Loans
Real estate—construction and land development	$	9,169	$	—	$	—	$	9,169
Real estate—secured by residential properties		3,893		—		—		3,893
Real estate—secured by nonfarm nonresidential properties		8,805		—		—		8,805
Commercial and industrial		196		—		—		196
Total impaired loans		22,063		—		—		22,063
Real estate and repossessions acquired in settlement of loans
Real estate and repossessions acquired in settlement of loans		6,573		—		—		6,573
Total assets at fair value	$	28,636	$	—	$	—	$	28,636

Reconciliation for all assets and liabilities measured at fair value on a recurring basis

	Corporate Bonds		Interest Rate Lock Commitments		Total
	(Dollars in thousands)
Balance, December 31, 2011	$	1,642	$	76	$	1,718
Total gains or losses (realized/unrealized):
Included in earnings		—		35		35
Included in other comprehensive income		147		—		147
Purchases, issuances, and settlements		—		—		—
Transfers in to/out of Level 3		—		—		—
Balance, Mach 31, 2012	$	1,789	$	111	$	1,900
Total gains or losses (realized/unrealized):
Included in earnings		—		20		20
Included in other comprehensive income		49		—		49
Purchases, issuances, and settlements		—		—		—
Transfers in to/out of Level 3		—		—		—
Balance, June 30, 2012	$	1,838	$	131	$	1,969

	Corporate Bonds			Interest Rate Lock Commitments			Total
	(Dollars in thousands)
Balance, December 31, 2010	$	1,716		$	101		$	1,817
Total gains or losses (realized/unrealized):
Included in earnings		—			(6	)		(6	)
Included in other comprehensive income		(392	)		—			(392	)
Purchases, issuances, and settlements		—			—			—
Transfers in to/out of Level 3		—			—			—
Balance, Mach 31, 2011	$	1,324		$	95		$	1,419
Total gains or losses (realized/unrealized):
Included in earnings		—			(25	)		(25	)
Included in other comprehensive income		167			—			167
Purchases, issuances, and settlements		—			—			—
Transfers in to/out of Level 3		—			—			—
Balance, June 30, 2011	$	1,491		$	70		$	1,561

Level 3 assets and liabilities measured at fair value on a recurring or non-recurring basis

Level 3 Assets with Significant Unobservable Inputs	Fair Value At 6/30/2012		Valuation Technique	Significant Unobservable Inputs	Significant Unobservable Input Value
Corporate Bonds	$	965	Fundamental Analysis	Spread	+550 BBB
			Pricing Model		Bank Paper
				Yield	9.89%
Corporate Bonds		873	Fundamental Analysis	Spread	+650 LIBOR
			Pricing Model		Index
				Yield	6.96%
Interest Rate Lock Commitments		131	Pricing Model	Weighted average Closing Ratio	90%
Impaired Loans		18,871	Discounted appraisals (1)	Appraisal adjustments (2)	5% to 85%
OREO		7,661	Discounted appraisals (1)	Appraisal adjustments (2)	5% to 70%

(1) Fair value is generally based on appraisals of the underlying collateral but is also based on discounted cash flows for some loans.

(2) Appraisals may be adjusted by management for customized discounting criteria, estimated sales costs, and proprietary qualitative adjustments.