Fair Value Disclosure

9 Months Ended

Sep. 30, 2011

Fair Value Disclosure [Abstract]

Fair Value Disclosure

 (6) Fair Value Disclosure

In April 2009, the FASB issued accounting guidance that if an entity determines that either the volume and/or level of activity for an investment security has significantly decreased (from normal conditions for that investment security) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value. This guidance was effective for interim and annual periods ending after June 15, 2009, with early adoption permitted. This guidance was applied prospectively.  The adoption of this guidance did not have an impact on the Company's financial statements or condition.

In October 2008, the FASB issued accounting guidance to clarify the application of GAAP in determining fair value of financial instruments in a market that is not active.  The guidance was effective upon issuance, including prior periods for which financial statements had not been issued.  Our adoption of this guidance does not have a material effect on our financial position, results of operations, cash flows or disclosures.

In September 2006, FASB issued accounting guidance that defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for an asset or liability in an orderly transaction between market participants on the measurement date.  This guidance also establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.  The guidance also categorizes assets and liabilities at fair value into one of three different levels depending on the observation of the inputs employed in the measurement, as follows.

Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.  A quoted price for an identical asset or liability in an active market provides the most reliable fair value measurement because it is directly observable to the market.

Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs are observable for an asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement.

Securities available for sale:  The fair value of securities available for sale is determined by obtaining quoted prices on nationally recognized security exchanges. 

Assets measured at fair value on a recurring basis as of September 30, 2011, presented in accordance with this guidance, are as follows.

	As of September 30, 2011
	Level 1		Level 2		Level 3		Total
	(Dollars in Thousands)
Debt securities:
United States government obligations and authorities	$	-	$	35,050	$	-	$	35,050
Obligations of states and political subdivisions		-		3,336		-		3,336
Corporate		65,361		-		-		65,361
International		-		589		-		589
		65,361		38,975		-		104,336
Equity securities:
Common stocks		17,063		-		-		17,063
		17,063		-		-		17,063
Total debt and equity securities	$	82,424	$	38,975	$	-	$	121,399

Assets measured at fair value on a recurring basis as of December 31, 2010, presented in accordance with this guidance, are as follows.

	As of December 31, 2010
	Level 1		Level 2		Level 3		Total
	(Dollars in Thousands)
Debt securities:
United States government obligations and authorities	$	-	$	28,196	$	-	$	28,196
Obligations of states and political subdivisions		-		2,963		-		2,963
Corporate		65,809		-		-		65,809
International		-		1,382		-		1,382
		65,809		32,541		-		98,350
Equity securities:
Common stocks		17,937		-		-		17,937
		17,937		-		-		17,937
Total debt and equity securities	$	83,746	$	32,541	$	-	$	116,287