Securities:

3 Months Ended

Mar. 31, 2012

Securities: [Abstract]

Securities:

Securities:

The following table summarizes the amortized cost and fair value of the available-for-sale investment securities portfolio at March 31, 2012 and December 31, 2011 and the corresponding amounts of unrealized gains and losses recognized in accumulated other comprehensive income:

(In Thousands of Dollars) March 31, 2012	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury and U.S. government sponsored entities	$	54,094	$	2,048	$	0		$	56,142
State and political subdivisions		77,717		3,986		(28	)		81,675
Corporate bonds		1,239		13		0			1,252
Mortgage-backed securities — residential		231,567		5,226		(296	)		236,497
Collateralized mortgage obligations		35,417		391		0			35,808
Small business administration		305		1		(4	)		302
Equity securities		139		199		(5	)		333
Totals	$	400,478	$	11,864	$	(333	)	$	412,009

(In Thousands of Dollars) December 31, 2011	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury and U.S. government sponsored entities	$	53,689	$	2,300	$	(1	)	$	55,988
State and political subdivisions		78,288		4,446		(44	)		82,690
Corporate bonds		758		11		0			769
Mortgage-backed securities — residential		217,644		5,384		(310	)		222,718
Collateralized mortgage obligations		36,806		416		0			37,222
Small business administration		318		1		(4	)		315
Equity securities		139		194		(6	)		327
Totals	$	387,642	$	12,752	$	(365	)	$	400,029

There were no security sales during the three months ended March 31, 2012 and 2011.

The amortized cost and fair value of the debt securities portfolio are shown by expected maturity. Expected maturities may differ from contractual maturities if issuers have the right to call or prepay obligations with or without call or prepayment penalties. Mortgage-backed and CMO securities are not due at a single maturity date and are shown separately.

	March 31, 2012
(In Thousands of Dollars)	Amortized		Fair
Maturity	Cost		Value
Within one year	$	19,844	$	20,196
One to five years		62,342		65,477
Five to ten years		36,638		38,400
Beyond ten years		14,226		14,996
Mortgage-backed, CMO and SBA securities		267,289		272,607
Total	$	400,339	$	411,676

The following table summarizes the investment securities with unrealized losses at March 31, 2012 and December 31, 2011, aggregated by major security type and length of time in a continuous unrealized loss position:

	Less Than 12 Months					12 Months or Longer					Total
(In Thousands of Dollars) March 31, 2012	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Available-for-sale
State and political subdivisions	$	0	$	0		$	301	$	(28	)	$	301	$	(28	)
Corporate bonds		233		0			0		0			233		0
Mortgage-backed securities — residential		58,325		(231	)		9,344		(65	)		67,669		(296	)
Small business administration		0		0			190		(4	)		190		(4	)
Equity securities		1		0			7		(5	)		8		(5	)
Total	$	58,559	$	(231	)	$	9,842	$	(102	)	$	68,401	$	(333	)

	Less Than 12 Months					12 Months or Longer					Total
(In Thousands of Dollars)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
December 31, 2011
Available-for-sale
U.S. Treasury and U.S. government sponsored entities	$	249	$	(1	)	$	0	$	0		$	249	$	(1	)
State and political subdivisions		0		0			2,420		(44	)		2,420		(44	)
Corporate bonds		507		0			0		0			507		0
Mortgage-backed securities — residential		43,426		(203	)		9,652		(107	)		53,078		(310	)
Small business administration		0		0			233		(4	)		233		(4	)
Equity securities		0		0			7		(6	)		7		(6	)
Total	$	44,182	$	(204	)	$	12,312	$	(161	)	$	56,494	$	(365	)

Other-Than-Temporary-Impairment

Management evaluates securities for other-than-temporary impairment (“OTTI”) at least on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. Investment securities are generally evaluated for OTTI under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 320, Investments – Debt and Equity Securities. Consideration is given to the length of time and the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, whether the market decline was affected by macroeconomic conditions and whether the Company has the intent to sell the debt security or more likely than not will be required to sell the debt security before its anticipated recovery. In analyzing an issuer's financial condition, the Company may consider whether the securities are issued by the federal government or its agencies, or U.S. government sponsored enterprises, whether downgrades by bond rating agencies have occurred, and the results of reviews of the issuer's financial condition. The assessment of whether an other-than-temporary decline exists involves a high degree of subjectivity and judgment and is based on the information available to management at a point in time.

When OTTI occurs, the amount of the OTTI recognized in earnings depends on whether an entity intends to sell the security or it is more likely than not it will be required to sell the security before recovery of its amortized cost basis. If an entity intends to sell or it is more likely than not it will be required to sell the security before recovery of its amortized cost basis, the OTTI shall be recognized in earnings equal to the entire difference between the investment’s amortized cost basis and its fair value at the balance sheet date. The previous amortized cost basis less the OTTI recognized in earnings becomes the new amortized cost basis of the investment. For debt securities that do not meet the aforementioned criteria, the amount of impairment is split into two components as follows: 1) OTTI related to credit loss, which must be recognized in the income statement and 2) OTTI related to other factors, which is recognized in other comprehensive income or loss. The credit loss is defined as the difference between the present value of the cash flows expected to be collected and the amortized cost basis. For equity securities, the entire amount of impairment is recognized through earnings.

As of March 31, 2012, the Company’s security portfolio consisted of 419 securities, 31 of which were in an unrealized loss position. The majority of the unrealized losses on the Company’s securities are related to its holdings of mortgage-backed securities and small business administration securities as discussed below.

Unrealized losses on debt securities issued by state and political subdivisions have not been recognized into income. Generally these securities have maintained their investment grade ratings and management does not have the intent to sell these securities before their anticipated recovery. The fair value is expected to recover as the securities approach their maturity date.

All of the Company's holdings of mortgage-backed securities-residential were issued by U.S. government-sponsored entities. Unrealized losses on mortgage-backed securities-residential have not been recognized into income. Because the decline in fair value is attributable to changes in interest rates and illiquidity, and not credit quality, and because the Company does not have the intent to sell these mortgage-backed securities-residential and it is likely that it will not be required to sell the securities before their anticipated recovery, the Company does not consider these securities to be OTTI.

Unrealized losses on small business administration securities issued by U.S. government-sponsored entities have not been recognized into income because the securities are of high credit quality, management does not have the intent to sell these securities before their anticipated recovery and the decline in fair value is largely due to fluctuations in market interest rates and not credit quality. Consequently, the fair value of such debt securities is expected to recover as the securities approach their maturity date.

The Company’s equity securities are made up of local and regional bank holdings. The unrealized losses associated with these holdings have not been recognized into income. Generally these securities have suffered as most banking securities have suffered during the recent economic cycle. The fair value is expected to recover as the banking sector recovers. Management does not have the intent to sell these securities before their anticipated recovery.