Securities

6 Months Ended

Jun. 30, 2012

Investments debt and equity securities [Abstract]

Investments In Debt And Marketable Equity Securities And Certain Trading Assets Disclosure Text Block

NOTE 4: SECURITIES

At June 30, 2012 and December 31,2011, respectively, all securities within the scope of ASC 320, Investments – Debt and Equity Securities were classified as available-for-sale. The fair value and amortized cost for securities available-for-sale by contractual maturityat June 30, 2012 and December 31,2011, respectively, are presented below.

		June 30, 2012
			1 year	1 to 5	5 to 10	After 10	Fair	Gross Unrealized		Amortized
(Dollars in thousands)			or less	years	years	years	Value	Gains	Losses	Cost
Available-for-sale:
Agency obligations (a)		$	—	—	10,101	30,135	40,236	280	3	$	39,959
Agency RMBS (a)			—	—	5,238	147,430	152,668	3,057	81		149,692
State and political subdivisions			113	2,187	19,186	62,226	83,712	4,916	31		78,827
Trust preferred securities:
	Individual issuers		—	—	—	630	630	81	144		693
	Total available-for-sale	$	113	2,187	34,525	240,421	277,246	8,334	259	$	269,171
(a) Includes securities issued by U.S. government agencies or government sponsored entities.

		December 31, 2011
			1 year	1 to 5	5 to 10	After 10	Fair	Gross Unrealized		Amortized
(Dollars in thousands)			or less	years	years	years	Value	Gains	Losses	Cost
Available-for-sale:
Agency obligations (a)		$	—	—	5,013	46,072	51,085	182	1	$	50,904
Agency RMBS (a)			—	—	14,935	149,863	164,798	2,534	129		162,393
State and political subdivisions			—	414	17,761	63,538	81,713	4,339	48		77,422
Trust preferred securities:
	Pooled		—	—	—	100	100	—	130		230
	Individual issuers		—	—	—	1,886	1,886	186	243		1,943
	Total available-for-sale	$	—	414	37,709	261,459	299,582	7,241	551	$	292,892
(a) Includes securities issued by U.S. government agencies or government sponsored entities.

Securities with aggregate fair values of $144.5million and $161.5 million at June 30,2012 and December 31, 2011, respectively, were pledged to secure public deposits, securities sold under agreements to repurchase, Federal Home Loan Bank (“FHLB”) advances, and for other purposes required or permitted by law.

Included in other assets are cost-method investments. The carrying amounts of cost-method investments were$3.4million and $5.0 million at June 30,2012 and December 31, 2011, respectively. Cost-method investments primarily include non-marketable equity investments, such as FHLB of Atlanta stock and Federal Reserve Bank (“FRB”) stock.

Gross Unrealized Losses and Fair Value

The fair values and gross unrealized losses on securities at June 30,2012 and December 31, 2011, respectively, segregated by those securities that have been in an unrealized loss position for less than 12 months and 12 months or longer, are presented below.

				Less than 12 Months		12 Months or Longer			Total
				Fair	Unrealized	Fair	Unrealized		Fair	Unrealized
(Dollars in thousands)				Value	Losses	Value	Losses		Value	Losses
June 30, 2012:
Agency obligations			$	9,997	3	—	—	$	9,997	3
Agency RMBS				18,877	81	—	—		18,877	81
State and political subdivisions				2,607	31	—	—		2,607	31
Trust preferred securities:
	Individual issuer			—	—	356	144		356	144
		Total	$	31,481	115	356	144	$	31,837	259

December 31, 2011:
Agency obligations			$	5,000	1	—	—	$	5,000	1
Agency RMBS				17,020	129	—	—		17,020	129
State and political subdivisions				1,686	11	718	37		2,404	48
Trust preferred securities:
	Pooled			—	—	100	130		100	130
	Individual issuer			—	—	757	243		757	243
		Total	$	23,706	141	1,575	410	$	25,281	551

The applicable date for determining when securities are in an unrealized loss position is June 30, 2012. As such, it is possible that a security in an unrealized loss position at June 30, 2012had a market value that exceeded its amortized cost on other days during the past twelve-month period.

For the securities in the previous table, the Company does not have the intent to sell and has determined it is not more likely than not that the Company will be required to sell the security before recovery of the amortized cost basis, which may be maturity. The Company assesses each security for credit impairment. For debt securities, the Company evaluates, where necessary, whether credit impairment exists by comparing the present value of the expected cash flows to the securities' amortized cost basis. For cost-method investments, the Company evaluates whether an event or change in circumstances has occurred during the reporting period that may have a significant adverse effect on the fair value of the investment.

In determining whether a loss is temporary, the Company considers all relevant information including:

• the length of time and the extent to which the fair value has been less than the amortized cost basis;
• adverse conditions specifically related to the security, an industry, or a geographic area (for example, changes in the financial condition of the issuer of the security, or in the case of an asset-backed debt security, in the financial condition of the underlying loan obligors, including changes in technology or the discontinuance of a segment of the business that may affect the future earnings potential of the issuer or underlying loan obligors of the security or changes in the quality of the credit enhancement);
• the historical and implied volatility of the fair value of the security;
• the payment structure of the debt security and the likelihood of the issuer being able to make payments that increase in the future;
• failure of the issuer of the security to make scheduled interest or principal payments;
• any changes to the rating of the security by a rating agency; and
• recoveries or additional declines in fair value subsequent to the balance sheet date.

Agency obligations

The unrealized losses associated with agency obligations were primarily driven by changes in interest rates and not due to the credit quality of the securities. These securities were issued by U.S. government agencies or government-sponsored entities and did not have any credit losses given the explicit government guarantee or other government support.

Agency residential mortgage-backed securities (“RMBS”)

The unrealized losses associated with agency RMBS were primarily driven by changes in interest rates and not due to the credit quality of the securities. These securities were issued by U.S. government agencies or government-sponsored entities and did not have any credit losses given the explicit government guarantee or other government support.

Securities of U.S. states and political subdivisions

The unrealized losses associated with securities of U.S. states and political subdivisions were primarily driven by changes in interest rates and were not due to the credit quality of the securities. These securities will continue to be monitored as part of the Company's quarterly impairment analysis, but are expected to perform even if the rating agencies reduce the credit rating of the bond insurers. As a result, the Company expects to recover the entire amortized cost basis of these securities.

Individual issuer's trust preferred securities

The unrealized losses associated with individual issuer trust preferred securities were related to securities issued on behalf of individual community bank holding companies. For individual issuers, management evaluates the financial performance of the individual community bank holding companies on a quarterly basis to determine if it is probable that such issuer can make all contractual principal and interest payments. Based upon its evaluation, the Company expects to recover the remaining amortized cost basis of these securities.

Cost-method investments

At June 30, 2012, cost-method investments with an aggregate cost of $3.4 million were not evaluated for impairment because the Company did not identify any events or changes in circumstances that may have a significant adverse effect on the fair value of these cost-method investments.

The carrying values of the Company's investment securities could decline in the future if the financial condition of individual issuers of trust preferred securities, or the credit quality of other securities deteriorate and the Company determines it is probable that it will not recover the entire amortized cost basis for the security. As a result, there is a risk that significant other-than-temporary impairment charges may occur in the future.

The following tables show the applicable credit ratings, fair values, gross unrealized losses, and life-to-date impairment charges for trust preferred securities at June 30, 2012 and December 31, 2011, respectively, segregated by those securities that have been in an unrealized loss position for less than 12 months and 12 months or longer.

Trust Preferred Securities as of	June 30, 2012
							Unrealized Losses			Life-to-date
		Credit Rating			Fair	Less than		12 months		Impairment
(Dollars in thousands)		Moody's	Fitch		Value	12 months		or Longer	Total	Charges
Individual issuers (a):
Carolina Financial Capital Trust I		n/a	n/a	$	274		—	—	—	257
TCB Trust		n/a	n/a		356		—	144	144	—
Total trust preferred securities				$	630		—	144	144	257
n/a - not applicable, securities not rated.
(a) 144A Floating Rate Capital Securities. Issuers are individual community bank holding companies.

Trust Preferred Securities as of		December 31, 2011
								Unrealized Losses			Life-to-date
			Credit Rating			Fair	Less than		12 months		Impairment
(Dollars in thousands)			Moody's	Fitch		Value	12 months		or Longer	Total	Charges
Pooled:
ALESCO Preferred Funding XVII Ltd (a)			C	CC	$	100		—	130	130	1,770
Individual issuers (b):
Carolina Financial Capital Trust I			n/a	n/a		193		—	—	—	257
Main Street Bank Statutory Trust I (c)			n/a	n/a		389		—	111	111	—
MNB Capital Trust I			n/a	n/a		55		—	—	—	445
PrimeSouth Capital Trust I			n/a	n/a		75		—	—	—	425
TCB Trust			n/a	n/a		368		—	132	132	—
United Community Capital Trust			n/a	n/a		806		—	—	—	379
	Total individual issuer					1,886		—	243	243	1,506
Total trust preferred securities					$	1,986		—	373	373	3,276
n/a - not applicable securities not rated.
(a) Class B Deferrable Third Priority Secured Floating Rate Notes. The underlying collateral is primarily composed of
	trust preferred securities issued by community banks and thrifts.
(b) 144A Floating Rate Capital Securities. Issuers are individual community bank holding companies.
(c) Now an obligation of BB&T Corporation.

Other-Than-Temporarily Impaired Securities

The following table presents a roll-forward of the credit loss component of the amortized cost of debt securities that the Company has written down for other-than-temporary impairment and the credit component of the loss is recognized in earnings (referred to as “credit-impaired” debt securities). Other-than-temporary impairmentsrecognized in earnings for the quartersand six months ended June 30,2012and 2011, for credit-impaired debt securities are presented as additions in two components based upon whether the current period is the first time the debt security was credit-impaired (initial credit impairment) or is not the first time the debt security was credit-impaired (subsequent credit impairments). The credit loss component is reduced if the Company sells, intends to sell, or believesit will be required to sell previously credit-impaired debt securities. Additionally, the credit loss component is reduced if the Company receives cash flows in excess of what it expected to receive over the remaining life of the credit-impaired debt security, the security matures orthe security is fully written-down and deemed worthless. Changes in the credit loss component of credit-impaired debt securities were:

				Quarter ended June 30,				Six months ended June 30,
(Dollars in thousands)				2012		2011		2012		2011
Balance, beginning of period			$	1,257	$	2,989	$	3,276	$	2,938
	Additions:
		Subsequent credit impairments		—		51		130		102
	Reductions:
		Securities sold		—		—		2,149		—
		Due to change in intent or requirement to sell		—		—		—		—
		Securities fully written down and deemed worthless		—		—		—		—
		Increases in expected cash flows		—		—		—		—
Balance, end of period			$	1,257	$	3,040	$	1,257	$	3,040

Other-Than-TemporaryImpairment

The following table presents details of the other-than-temporary impairment related to securities, including equity securities carried at cost, for the quarters andsix months endedJune 30,2012 and 2011.

					Quarter ended June 30,				Six months ended June 30,
(Dollars in thousands)					2012		2011		2012		2011
Other-than-temporary impairment charges
	(included in earnings):
	Debt securities:
		Individual issuer trust preferred securities		$	—	$	51	$	130	$	102
			Total debt securities		—		51		130		102
Total other-than-temporary impairment charges				$	—	$	51	$	130	$	102
Other-than-temporary impairment on debt securities:
	Recorded as part of gross realized losses:
		Credit-related		$	—		51	$	130	$	102
		Securities with intent to sell			—		—		—		—
	Recorded directly to other
		comprehensive income for non-credit related
		impairment			—		—		—		210
Total other-than-temporary impairment on debt securities				$	—	$	51	$	130	$	312

Realized Gains and Losses
	The following table presents the gross realized gains and losses on sales and other-than-temporary impairment charges
related to securities, including cost-method investments.
			Quarter ended June 30,				Six months ended June 30,
(Dollars in thousands)			2012		2011		2012		2011
Gross realized gains		$	251	$	877	$	724	$	905
Gross realized losses			—		(432)		(164)		(455)
Other-than-temporary impairment charges			—		(51)		(130)		(102)
	Realized gains, net	$	251	$	394	$	430	$	348