Note 6 - Investment Securities

6 Months Ended

Jun. 30, 2014

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

6. Investment Securities

The following tables summarize the amortized costs and estimated fair value of the securities portfolio at June 30, 2014 and December 31, 2013. The summary is divided into available for sale and held to maturity investment securities.

June 30, 2014 (In thousands)	Amortized Cost		Gross UnrealizedGains		Gross UnrealizedLosses		Estimated Fair Value
Available For Sale
Obligations of U.S. government-sponsored entities	$	98,241	$	292	$	1,303	$	97,230
Obligations of states and political subdivisions		130,947		2,920		586		133,281
Mortgage-backed securities – residential		370,687		8,777		1,945		377,519
Mortgage-backed securities – commercial		741		-		26		715
Corporate debt securities		6,925		45		478		6,492
Mutual funds and equity securities		992		28		1		1,019
Total securities – available for sale	$	608,533	$	12,062	$	4,339	$	616,256
Held To Maturity
Obligations of states and political subdivisions	$	3,814	$	149	$	-	$	3,963

December 31, 2013 (In thousands)	Amortized Cost		Gross UnrealizedGains		Gross UnrealizedLosses		Estimated Fair Value
Available For Sale
Obligations of U.S. government-sponsored entities	$	96,750	$	155	$	3,155	$	93,750
Obligations of states and political subdivisions		132,311		2,056		2,397		131,970
Mortgage-backed securities – residential		379,238		5,071		6,232		378,077
Mortgage-backed securities – commercial		748		-		59		689
Corporate debt securities		7,266		40		1,049		6,257
Mutual funds and equity securities		2,082		15		20		2,077
Total securities – available for sale	$	618,395	$	7,337	$	12,912	$	612,820
Held To Maturity
Obligations of states and political subdivisions	$	765	$	62	$	-	$	827

The amortized cost and estimated fair value of the debt securities portfolio at June 30, 2014, by contractual maturity, are detailed below. The summary is divided into available for sale and held to maturity securities. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Mutual funds and equity securities in the available for sale portfolio consist of investments attributed to the Company’s captive insurance subsidiary. These securities have no stated maturity and are not included in the maturity schedule that follows.

Mortgage-backed securities are stated separately due to the nature of payment and prepayment characteristics of these securities, as principal is not due at a single date.

	Available For Sale				Held To Maturity
	Amortized		Estimated		Amortized		Estimated
June 30, 2014 (In thousands)	Cost		Fair Value		Cost		Fair Value
Due in one year or less	$	8,368	$	8,391	$	-	$	-
Due after one year through five years		123,957		124,798		-		-
Due after five years through ten years		86,163		86,514		765		846
Due after ten years		17,625		17,300		3,049		3,117
Mortgage-backed securities		371,428		378,234		-		-
Total	$	607,541	$	615,237	$	3,814	$	3,963

Gross realized gains and losses on the sale of available for sale investment securities were as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
(In thousands)	2014			2013			2014			2013
Gross realized gains	$	19		$	3		$	178		$	3
Gross realized losses		103			63			253			63
Net realized loss	$	(84	)	$	(60	)	$	(75	)	$	(60	)

Investment securities with unrealized losses at June 30, 2014 and December 31, 2013 not recognized in income are presented in the tables below. The tables segregate investment securities that have been in a continuous unrealized loss position for less than twelve months from those that have been in a continuous unrealized loss position for twelve months or more. The tables also include the fair value of the related securities.

	Less than 12 Months				12 Months or More				Total
June 30, 2014 (In thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Obligations of U.S. government-sponsored entities	$	3,391	$	12	$	66,769	$	1,291	$	70,160	$	1,303
Obligations of states and political subdivisions		9,739		17		31,756		569		41,495		586
Mortgage-backed securities – residential		10,303		37		101,240		1,908		111,543		1,945
Mortgage-backed securities – commercial		-		-		715		26		715		26
Corporate debt securities		-		-		5,395		478		5,395		478
Mutual funds and equity securities		-		-		154		1		154		1
Total	$	23,433	$	66	$	206,029	$	4,273	$	229,462	$	4,339

	Less than 12 Months				12 Months or More				Total
December 31, 2013 (In thousands)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Obligations of U.S. government-sponsored entities	$	65,094	$	2,434	$	11,830	$	721	$	76,924	$	3,155
Obligations of states and political subdivisions		48,715		1,594		15,095		803		63,810		2,397
Mortgage-backed securities – residential		219,032		5,199		16,306		1,033		235,338		6,232
Mortgage-backed securities – commercial		689		59		-		-		689		59
Corporate debt securities		80		-		4,816		1,049		4,896		1,049
Mutual funds and equity securities		716		17		22		3		738		20
Total	$	334,326	$	9,303	$	48,069	$	3,609	$	382,395	$	12,912

Unrealized losses included in the tables above have not been recognized in income since they have been identified as temporary. The Company evaluates investment securities for other-than-temporary impairment (“OTTI”) at least quarterly, and more frequently when economic or market conditions warrant. Many factors are considered, including: (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, (3) whether the market decline was effected by macroeconomic conditions, and (4) whether the Company has the intent to sell the security or more likely than not will be required to sell the security before its anticipated recovery. The assessment of whether an OTTI charge exists involves a high degree of subjectivity and judgment and is based on the information available to the Company at a point in time.

At June 30, 2014, the Company’s investment securities portfolio had gross unrealized losses of $4.3 million, a decrease of $8.6 million or 66.4% compared with $12.9 million at year-end 2013. Gross unrealized losses include $4.3 million which have been in a continuous loss position of 12 months or more.

Corporate debt securities in the Company’s investment securities portfolio at June 30, 2014 include single-issuer trust preferred capital securities with an unrealized loss of $478 thousand and a carrying value of $5.4 million. These securities were issued by a national and global financial services firm and purchased by the Company during 2007. The securities are currently performing and continue to be rated as investment grade by major rating agencies. The issuer of the securities announced in the first quarter of 2014 an increase in per share common dividend payments and authorization of a common equity repurchase plan. The Company does not intend to sell these securities nor does the Company believe it is likely that it will be required to sell these securities prior to their anticipated recovery. The Company believes these securities are not impaired due to reasons of credit quality or other factors, but rather the unrealized loss is primarily attributed to continuing uncertainties in both international and domestic economies and market volatility. The Company believes that it will collect all amounts due according to the contractual terms of these securities and that the fair values of these securities will continue to recover as they approach their maturity dates.

The Company attributes the unrealized losses in other sectors of its investment securities portfolio to changes in market interest rates and volatility. Investment securities with unrealized losses at June 30, 2014 are performing according to their contractual terms, and the Company does not expect to incur a loss on these securities unless they are sold prior to maturity. The Company does not have the intent to sell these securities nor does it believe it is likely that it will be required to sell these securities prior to their anticipated recovery. The Company does not consider any of the securities to be impaired due to reasons of credit quality or other factors.