FAIR VALUE (Tables)

6 Months Ended

Jun. 30, 2012

Fair Value, Assets Measured on Recurring Basis [Table Text Block]

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets measured at fair value on a recurring basis are summarized below: There were no transfers between Level 1 and Level 2 during the periods presented.

			Quoted Prices in
			Active Markets for		Significant Other		Significant
	June 30,		Identical Assets		Observable Inputs		Unobservable Inputs
(Dollars in thousands)	2012		(Level 1)		(Level 2)		(Level 3)
Assets:
U.S. Treasury and agencies	$	13,026	$	-	$	13,026	$	-
Government-sponsored mortgage-backed residential		281,848		-		281,848		-
State and municipal		13,966		-		13,966		-
Corporate bonds		8,182		-		8,182		-
Trust preferred securities		266		-		-		266
Total	$	317,288	$	-	$	317,022	$	266

			Quoted Prices in
			Active Markets for		Significant Other		Significant
	December 31,		Identical Assets		Observable Inputs		Unobservable Inputs
(Dollars in thousands)	2011		(Level 1)		(Level 2)		(Level 3)
Assets:
U.S. Treasury and agencies	$	25,028	$	-	$	25,028	$	-
Government-sponsored mortgage-backed residential		264,691		-		264,691		-
State and municipal		23,794		-		23,794		-
Trust preferred securities		264		-		-		264
Total	$	313,777	$	-	$	313,513	$	264

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]

The table below presents reconciliation for all assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the periods ended June 30, 2012 and 2011:

	Fair Value Measurements						Fair Value Measurements
	Using Significant						Using Significant
	Unobservable Inputs						Unobservable Inputs
	(Level 3)						(Level 3)
	Three Months Ended						Six Months Ended
	June 30,						June 30,
(Dollars in thousands)	2012			2011			2012		2011
Beginning balance	$	268		$	763		$	264	$	346
Total gains or losses:
Impairment charges on securities		-			-			-		(25	)
Included in other comprehensive income		(2	)		(95	)		2		347
Transfers in and/or out of Level 3		-			-			-		-
Ending balance	$	266		$	668		$	266	$	668

Fair Value, Assets and Liabilities Measured on Recurring Basis, Gain (Loss) Included in Earnings [Table Text Block]

The table below summarizes changes in unrealized gains and losses recorded in earnings for the quarter and six months ended June 30 for Level 3 assets and liabilities that are still held at June 30.

	Changes in Unrealized Gains/Losses				Changes in Unrealized Gains/Losses
	Relating to Assets Still Held at Reporting				Relating to Assets Still Held at Reporting
	Date for the Three Months Ended				Date for the Six Months Ended
	June 30,				June 30,
(Dollars in thousands)	2012		2011		2012		2011
Interest income on securities	$	-	$	-	$	-	$	-
Other changes in fair value		-		-		-		25
Total	$	-	$	-	$	-	$	25

Fair Value, Assets and Liabilities Measured on Nonrecurring Basis [Table Text Block]

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Assets measured at fair value on a nonrecurring basis are summarized below:

			Quoted Prices in
			Active Markets for		Significant Other		Significant
	June 30,		Identical Assets		Observable Inputs		Unobservable Inputs
(Dollars in thousands)	2012		(Level 1)		(Level 2)		(Level 3)
Assets:
Impaired loans:
Commercial	$	1,037	$	-	$	-	$	1,037
Commercial Real Estate:
Land Development		2,789		-		-		2,789
Building Lots		417		-		-		417
Other		19,314		-		-		19,314
Real Estate Construction		-		-		-		-
Residential Mortgage		4,272		-		-		4,272
Consumer and Home Equity		727		-		-		727
Indirect Consumer		109		-		-		109
Real estate acquired through foreclosure:
Commercial		559		-		-		559
Commercial Real Estate:
Land Development		4,285		-		-		4,285
Building Lots		5,882		-		-		5,882
Other		9,418		-		-		9,418
Residential Mortgage		153		-		-		153
Trust preferred security held-to-maturity		16		-		-		16
Loans held for sale related to probable branch divestiture		100,372		-		100,372		-

			Quoted Prices in
			Active Markets for		Significant Other		Significant
	December 31,		Identical Assets		Observable Inputs		Unobservable Inputs
(Dollars in thousands)	2011		(Level 1)		(Level 2)		(Level 3)
Assets:
Impaired loans:
Commercial	$	2,643	$	-	$	-	$	2,643
Commercial Real Estate:
Land Development		7,929		-		-		7,929
Building Lots		1,517		-		-		1,517
Other		27,668		-		-		27,668
Real Estate Construction		-		-		-		-
Residential Mortgage		4,384		-		-		4,384
Consumer and Home Equity		937		-		-		937
Indirect Consumer		194		-		-		194
Real estate acquired through foreclosure:
Commercial		728		-		-		728
Commercial Real Estate:
Land Development		4,285		-		-		4,285
Building Lots		5,369		-		-		5,369
Other		6,300		-		-		6,300
Residential Mortgage		172		-		-		172
Trust preferred security held-to-maturity		24		-		-		24
Loans held for sale		45,829		-		45,829		-

Fair Value, by Balance Sheet Grouping [Table Text Block]

The estimated fair value of financial instruments, not previously presented, is as follows:

			June 30, 2012
(Dollars in thousands)	Carrying		Fair Value Measurements
	Value		Total		Level 1		Level 2		Level 3
Financial assets:
Cash and due from banks	$	154,114		154,114		7,116		146,998		-
Mortgage loans held for sale		3,220		3,282		-		3,282		-
Loans, net		492,201		532,823		-		-		532,823
FHLB stock		4,805		N/A		N/A		N/A		N/A
Financial liabilities:
Deposits		1,089,302		1,107,732		-		1,107,732		-
Advances from Federal Home Loan Bank		27,666		30,601		-		30,601		-
Subordinated debentures		18,000		12,719		-		-		12,719

(Dollars in thousands)	December 31, 2011
	Carrying		Fair
	Value		Value
Financial assets:
Cash and due from banks	$	92,236	$	92,236
Mortgage loans held for sale		10,187		10,326
Loans, net		628,800		643,797
FHLB stock		4,805		N/A
Financial liabilities:
Deposits		1,122,794		1,134,843
Advances from Federal Home Loan Bank		27,736		30,888
Subordinated debentures		18,000		12,448

Fair Value, Measurements, Recurring [Member]

Fair Value Inputs, Assets, Quantitative Information [Table Text Block]

The following table presents quantitative information about recurring Level 3 fair value measurements at June 30, 2012.

					Range
	Fair		Valuation	Unobservable	(Weighted
(Dollars in thousands)	Value		Technique	Inputs	Average)
Trust preferred securities	$	266	Discounted cash flow	Discount rate	0.00% - 34.73%
					(21.31%)

Fair Value, Measurements, Nonrecurring [Member]

Fair Value Inputs, Assets, Quantitative Information [Table Text Block]

The following table presents quantitative information about level 3 fair value measurements for financial instruments measured at fair value on a non-recurring basis at June 30, 2012.

(Dollars in thousands)	Fair Value		Valuation Technique(s)	Unobservable Input(s)	Range (Weighted Average)(1)
Impaired loans:
Commercial	$	1,037	Sales comparison approach	Adjustment for differences  between comparable sales	6.43%
Commercial Real Estate:
Land Development		2,789	Income approach	Capitalization rate	20.00% – 24.50% (23.03%)
			Sales comparison approach	Adjustment for differences  between comparable sales	0.00%
Building Lots		417	Sales comparison approach	Adjustment for differences between comparable sales	2.49%
Other		19,314	Income approach	Capitalization rate	7.70% – 16.00% (11.30%)
			Sales comparison approach	Adjustment for differences between comparable sales	0.00% – 21.87% (12.25%)
Residential Mortgage		4,272	Sales comparison approach	Adjustment for differences between comparable sales	0.00% – 19.00% (14.90%)
Consumer and Home Equity		727	Sales comparison approach	Adjustment for differences between comparable sales	0.00% – 8.29% (2.10%)
Indirect Consumer		109	NADA value
Real estate acquired through foreclosure:
Commercial		559	Sales comparison approach	Adjustment for differences between comparable sales	9.62% – 9.67% (9.62%)
Commercial Real Estate:
Land Development		4,285	Income approach	Capitalization rate	8.50%
			Sales comparison approach	Adjustment for differences  between comparable sales	3.44% – 25.00% (11.78%)
Building Lots		5,882	Income approach	Capitalization rate	24.00% – 28.00% (26.23%)
Other		9,418	Income approach	Capitalization rate	8.50% – 10.50% (9.75%)
			Sales comparison approach	Adjustment for differences between comparable sales	2.75% – 5.19% (3.20%)
Residential Mortgage		153	Sales comparison approach	Adjustment for differences  between comparable sales	1.11% – 3.00% (2.63%)
Trust preferred security held-to-maturity		16	Discounted cash flow	Discount rate	15.47%

(1) Unobservable inputs with a single discount listed include only one property.