DERIVATIVE INSTRUMENTS

9 Months Ended

Sep. 30, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE INSTRUMENTS

DERIVATIVEINSTRUMENTS

The Company utilizes derivative instruments to assist in the management of interest rate sensitivity by modifying the repricing, maturity and option characteristics of certain assets and liabilities. The following table summarizes derivative instruments held by the Company, their notional amount, estimated fair values and their location in the consolidated balance sheets at September 30, 2014 and December 31, 2013:

(dollars in thousands)				Derivatives in Other Assets
	Notional Amount			Fair Value Gain (Loss)
	September 30, 2014		December 31, 2013	September 30, 2014		December 31, 2013
Derivative Instruments Not Designated as Hedging Instruments:
Interest rate lock commitments	$	17,800	14,237	378		217
Forward commitments to sell mortgage-backed securities	33,200		29,100	(150	)	296
Total	$	51,000	43,337	228		513

Interest Rate Lock Commitments / Forward Commitments to Sell Mortgage-Backed Securities. Derivative instruments issued by the Company consist of interest rate lock commitments to originate fixed-rate loans to be sold. Commitments to originate fixed-rate loans consist primarily of residential real estate loans. These interest rate lock commitments and loans held for sale are hedged with forward contracts to sell mortgage-backed securities, which expire in December 2014.

The following table summarizes amounts included in the consolidated statements of income for the three and nine months ended September 30, 2014 and 2013 related to non-hedging derivative instruments:

(dollars in thousands)	Location of Gain (Loss) Recognized in Operations on Derivatives	Amount of Gain (Loss) Recognized in Operations on Derivatives
		Three Months Ended					Nine Months Ended
		September 30,					September 30,
		2014			2013		2014		2013
Derivative Instruments Not Designated as Hedging Instruments:
Interest rate lock commitments	Gain on loans sold and held for sale	$	(157	)	675		161		(1,094	)
Forward commitments to sell mortgage-backed securities	Gain on loans sold and held for sale	291			(3,115	)	(446	)	(332	)