Note 15 - Employee Benefit Plans

12 Months Ended

Dec. 31, 2012

Pension and Other Postretirement Benefits Disclosure [Text Block]

15.    EMPLOYEE BENEFIT PLANS

Savings and Profit Sharing Plan

The Company has a defined contribution retirement savings plan (the “Profit Sharing Plan”), which gives qualified employees the option to make contributions up to 45% of their pre-tax base salary (15% for certain highly compensated employees) through salary deductions under Section 401(k) of the Internal Revenue Code. At the employees’ direction, employee contributions are invested among a variety of investment alternatives. For employees who make voluntary contributions to the Profit Sharing Plan, the Company contributes an amount equal to 2% of the employee’s compensation. The Profit Sharing Plan also permits the Company to distribute a discretionary profit-sharing component up to 15% of the employee’s compensation. The Company’s matching contribution vests immediately, while the discretionary component vests over a period of six years.

Savings and Profit Sharing Plan

(Dollar amounts in thousands)

	Years Ended December 31,
	2012		2011		2010
Profit sharing expense (1)	$	2,532	$	2,897	$	859
Company dividends received by the Profit Sharing Plan	$	71	$	72	$	72
Company shares held by the Profit Sharing Plan at the end of the year:
Number of shares		1,743,085		1,806,262		2,752,521
Fair value	$	21,823	$	18,297	$	31,709

(1) Included in retirement and other employee benefits in the Consolidated Statements of Income.

Pension Plan

The Company sponsors a noncontributory defined benefit retirement plan (the “Pension Plan”) that provides for retirement benefits based on years of service and compensation levels of the participants. The Pension Plan covers a majority of employees who met certain eligibility requirements and were hired before April 1, 2007, the date it was amended to eliminate new enrollment of employees. Actuarially determined pension costs are charged to current operations and included in other employee benefits in the Consolidated Statements of Income. The Company’s funding policy is to contribute amounts to its plan sufficient to meet the minimum funding requirements of the Employee Retirement Income Security Act of 1974 plus additional amounts as the Company deems appropriate.

Pension Plan Cost and Obligations

(Dollar amounts in thousands)

	December 31,
	2012			2011
Accumulated benefit obligation	$	62,326		$	55,782
Change in benefit obligation:
Projected benefit obligation at the beginning of the year	$	63,011		$	51,963
Service cost		2,862			2,725
Interest cost		2,720			3,032
Actuarial losses		9,331			8,067
Benefits paid		(5,069	)		(2,776	)
Projected benefit obligation at the end of the year	$	72,855		$	63,011
Change in plan assets:
Fair value of plan assets at the beginning of the year	$	62,990		$	54,713
Actual return on plan assets		5,580			1,053
Employer contributions		-			10,000
Benefits paid		(5,069	)		(2,776	)
Fair value of plan assets at the end of the year	$	63,501		$	62,990
Funded status recognized in the Consolidated Statements of Financial Condition:
Noncurrent liabilities	$	(9,354	)	$	(21	)
Amounts recognized in accumulated other comprehensive loss:
Prior service cost	$	1		$	4
Net loss		28,383			21,860
Net amount recognized	$	28,384		$	21,864
Actuarial losses included in accumulated other comprehensive loss as a percent of:
Accumulated benefit obligation		45.5	%		39.2	%
Fair value of plan assets		44.7	%		34.7	%
Amounts expected to be amortized from accumulated other comprehensive loss into net periodic benefit cost in the next fiscal year:
Prior service cost	$	1		$	3
Net loss		2,358			1,336
Net amount expected to be recognized	$	2,359		$	1,339
Weighted-average assumptions at the end of the year used to determine the actuarial present value of the projected benefit obligation:
Discount rate		3.40	%		4.40	%
Rate of compensation increase		2.50	%		2.50	%

Expected amortization of net actuarial losses–To the extent the cumulative actuarial losses included in accumulated other comprehensive loss exceed 10% of the greater of the accumulated benefit obligation or the market-related value of the Pension Plan assets, it is the Company’s policy to amortize the Pension Plan’s net actuarial losses into income over the future working life of the Pension Plan participants. Actuarial losses included in accumulated other comprehensive loss as of December 31, 2012 exceeded 10% of the accumulated benefit obligation and the fair value of plan assets. The amortization of net actuarial losses is a component of the net periodic benefit cost. Amortization of the net actuarial losses and prior service cost included in other comprehensive (loss) income is not expected to have a material impact on the Company’s future results of operations, financial position, or liquidity.

Net Periodic Benefit Pension Cost

(Dollar amounts in thousands)

	Years Ended December 31,
	2012			2011			2010
Components of net periodic benefit cost:
Service cost	$	2,862		$	2,725		$	2,352
Interest cost		2,720			3,032			2,665
Expected return on plan assets		(4,456	)		(4,110	)		(4,150	)
Recognized net actuarial loss		1,684			976			2
Amortization of prior service cost		3			3			3
Other (1)		-			1,285			-
Net periodic cost		2,813			3,911			872
Other changes in plan assets and benefit obligations recognized as a charge to other comprehensive (loss) income:
Net loss for the period		8,207			11,124			3,746
Amortization of prior service cost		(4	)		(4	)		(4	)
Amortization of net loss		(1,683	)		(2,260	)		(2	)
Total unrealized loss		6,520			8,860			3,740
Total recognized in net periodic pension cost and other comprehensive loss	$	9,333		$	12,771		$	4,612
Weighted-average assumptions used to determine the net periodic cost:
Discount rate		4.40	%		5.50	%		6.00	%
Expected return on plan assets		7.25	%		7.50	%		7.50	%
Rate of compensation increase		2.50	%		3.00	%		3.00	%

(1) The 2011 amount represents the correction of a 2010 actuarial pension expense calculation related to the valuation of future early retirement benefits.

Pension Plan Asset Allocation

(Dollar amounts in thousands)

	Target Allocation				Fair Value of		Percentage of Plan Assets
	2012				Plan Assets (1)		2012			2011
Asset Category:
Equity securities		50	-	60%	$	37,496		59	%		51	%
Fixed income		30	-	48%		22,458		35	%		30	%
Cash equivalents		2	-	10%		3,547		6	%		19	%
Total					$	63,501		100	%		100	%

(1) Additional information regarding the fair value of plan assets can be found in Note 22, “Fair Value.”

As of December 31, 2011, asset category allocations were outside the target range due to a December 2011 employer contribution included in cash equivalents. On January 31, 2012, subsequent to investing this contribution, allocations were 55% equity, 35% fixed income, and 10% cash equivalents.

Expected long-term rate of return– The expected long-term rate of return on Pension Plan assets represents the average rate of return expected to be earned over the period the benefits included in the benefit obligation are to be paid. In developing the expected rate of return, the Company considers long-term returns of historical market data and projections of future returns for each asset category, as well as historical actual returns on the Pension Plan assets with the assistance of its independent actuarial consultant. Using this reference data, the Company develops a forward-looking return expectation for each asset category and a weighted-average expected long-term rate of return based on the target asset allocation.

Investment policy and strategy – The investment objective of the Pension Plan is to maximize the return on Pension Plan assets over a long-term horizon to satisfy the Pension Plan obligations. In establishing its investment policies and asset allocation strategies, the Company considers expected returns and the volatility associated with different strategies. The policy established by the Company’s Retirement Plan Committee provides for growth of capital with a moderate level of volatility by investing assets according to the target allocations stated above and reallocating those assets as needed to stay within those allocations. Investments are weighted toward publicly traded securities. Alternative asset classes, such as private equity hedge funds and real estate, are avoided. Under the advisement of a certified investment advisor, the Committee reviews the investment policy on a quarterly basis to determine if any adjustments to the policy or investment strategy are necessary.

Based on the actuarial assumptions, the Company does not anticipate making a contribution to the Pension Plan in 2013. Estimated future pension benefit payments, which reflect expected future service, for fiscal years ending December 31, 2013 through 2022, are as follows.

Estimated Future Pension Benefit Payments

(Dollar amounts in thousands)

	Total
Year ending December 31,
2013	$	5,388
2014		5,463
2015		5,511
2016		5,562
2017		5,613
2018-2022		27,457