Note 3 – Securities

The amortized cost, unrealized gross gains and losses recognized in accumulated other comprehensive income (loss), and fair value of Securities Available-for-Sale at September 30, 2013 and December 31, 2012, were as follows:

			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
Securities Available-for-Sale:

September 30, 2013
U.S. Treasury and Agency Securities	$	20,754	$	2	$	(969)	$	19,787
Obligations of State and Political Subdivisions		95,033		2,793		(555)		97,271
Mortgage-backed Securities - Residential		496,129		4,765		(10,325)		490,569
Equity Securities		684		342		—		1,026
Total	$	612,600	$	7,902	$	(11,849)	$	608,653

December 31, 2012
U.S. Treasury and Agency Securities	$	23,570	$	40	$	(138)	$	23,472
Obligations of State and Political Subdivisions		71,352		5,145		(12)		76,485
Mortgage-backed Securities - Residential		475,452		11,505		(45)		486,912
Equity Securities		684		49		—		733
Total	$	571,058	$	16,739	$	(195)	$	587,602

Equity securities that do not have readily determinable fair values are included in the above totals, are carried at historical cost and are evaluated for impairment on a periodic basis. All mortgage-backed securities in the above table are residential mortgage-backed securities and guaranteed by government sponsored entities.

The carrying amount, unrecognized gains and losses and fair value of Securities Held-to-Maturity at September 30, 2013 and December 31, 2012, were as follows:

			Gross		Gross
	Carrying		Unrecognized		Unrecognized		Fair
	Amount		Gains		Losses		Value
Securities Held-to-Maturity:

September 30, 2013
Obligations of State and Political Subdivisions	$	268	$	3	$	—	$	271

December 31, 2012
Obligations of State and Political Subdivisions	$	346	$	5	$	—	$	351

The amortized cost and fair value of Securities at September 30, 2013 by contractual maturity are shown below. Expected maturities may differ from contractual maturities because some issuers have the right to call or prepay certain obligations with or without call or prepayment penalties. Mortgage-backed and Equity Securities are not due at a single maturity date and are shown separately.

	Amortized		Fair
	Cost		Value
Securities Available-for-Sale:
Due in one year or less	$	2,855	$	2,878
Due after one year through five years		11,966		12,237
Due after five years through ten years		60,770		61,075
Due after ten years		40,196		40,868
Mortgage-backed Securities - Residential		496,129		490,569
Equity Securities		684		1,026
Totals	$	612,600	$	608,653

	Carrying		Fair
	Amount		Value
Securities Held-to-Maturity:
Due in one year or less	$	—	$	—
Due after one year through five years		268		271
Due after five years through ten years		—		—
Due after ten years		—		—
Totals	$	268	$	271

Proceeds from the sales of Available-for-Sale Securities are summarized below:

	Three Months Ended		Three Months Ended
	September 30, 2013		September 30, 2012

Proceeds from Sales and Calls	$	19,231	$	40,949
Gross Gains on Sales and Calls		428		598
Income Taxes on Gross Gains		150		209

	Nine Months Ended		Nine Months Ended
	September 30, 2013		September 30, 2012

Proceeds from Sales and Calls	$	119,952	$	92,344
Gross Gains on Sales and Calls		1,508		692
Income Taxes on Gross Gains		528		242

Below is a summary of securities with unrealized losses as of September 30, 2013 and December 31, 2012, presented by length of time the securities have been in a continuous unrealized loss position:

	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loss
September 30, 2013
U.S. Treasury and Agency Securities	$	19,031	$	(969)	$	—	$	—	$	19,031	$	(969)
Obligations of State and Political Subdivisions		18,166		(555)		—		—		18,166		(555)
Mortgage-backed Securities - Residential		319,113		(10,325)		—		—		319,113		(10,325)
Equity Securities		—		—		—		—		—		—
Total	$	356,310	$	(11,849)	$	—	$	—	$	356,310	$	(11,849)

	Less than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loss
December 31, 2012
U.S. Treasury and Agency Securities	$	19,862	$	(138)	$	—	$	—	$	19,862	$	(138)
Obligations of State and Political Subdivisions		1,042		(12)		—		—		1,042		(12)
Mortgage-backed Securities - Residential		18,323		(45)		—		—		18,323		(45)
Equity Securities		—		—		—		—		—		—
Total	$	39,227	$	(195)	$	—	$	—	$	39,227	$	(195)

Securities are written down to fair value when a decline in fair value is not considered temporary. In estimating other-than-temporary losses, management considers many factors, 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 affected by macroeconomic conditions, and (4) 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. The Company doesn’t intend to sell or expect to be required to sell these securities, and the decline in fair value is largely due to changes in market interest rates, therefore, the Company does not consider these securities to be other-than-temporarily impaired. All mortgage-backed securities in the Company’s portfolio are guaranteed by government sponsored entities, are investment grade, and are performing as expected.