Investment Securities (Tables)

9 Months Ended

Sep. 30, 2013

Schedule of Available-for-sale and Held to Maturity Securities [Table Text Block]

The following is a summary of available-for-sale and held-to-maturity securities:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
At September 30, 2013
Available-for-Sale Securities:

Obligations of U.S. government corporations and agencies	$	5,000	$	-	$	(69)	$	4,931
Mortgage-backed securities – residential		36,800		877		(738)		36,939
Collateralized mortgage obligations		52,306		848		(610)		52,544
Trust preferred securities and preferred stock		3,601		441		(1,676)		2,366
Corporate bonds		8,839		138		(9)		8,968
Obligations of state and political subdivisions		76,251		2,956		(836)		78,371
Totals	$	182,797	$	5,260	$	(3,938)	$	184,119

Held-to-Maturity Securities*:
FHLMC certificates	$	33	$	-	$	-	$	33
FNMA certificates		136		4		-		140
GNMA certificates		52		2		-		54
Obligations of state and political subdivisions		186		-		-		186
Totals	$	407	$	6	$	-	$	413

At December 31, 2012
Available-for-Sale Securities:

Obligations of U.S. government corporations and agencies	$	11,000	$	69	$	-	$	11,069
U.S. treasury bonds		1,000		2		-		1,002
Mortgage-backed securities – residential		30,020		1,441		-		31,461
Collateralized mortgage obligations		55,962		1,504		-		57,466
Trust preferred securities and preferred stock		3,600		99		(2,091)		1,608
Corporate bonds		8,717		167		-		8,884
Obligations of state and political subdivisions		76,339		6,277		(5)		82,611
Totals	$	186,638	$	9,559	$	(2,096)	$	194,101

Held-to-Maturity Securities*:
FHLMC certificates	$	69	$	-	$	(1)	$	68
FNMA certificates		162		6		-		168
GNMA certificates		60		3		-		63
Obligations of state and political subdivisions		217		-		-		217
Totals	$	508	$	9	$	(1)	$	516

* FHLMC, FNMA, and GNMA certificates are residential mortgage-backed securities.

Investments Classified by Contractual Maturity Date [Table Text Block]

These securities may mature earlier than their weighted-average contractual maturities because of principal prepayments.

	Available-for-Sale				Held-to-Maturity
	Amortized		Fair		Amortized		Fair
	Cost		Value		Cost		Value
	(In Thousands)
Due in one year or less	$	2,255	$	2,262	$	-	$	-
Due after one year through five years		6,126		6,315		186		186
Due after five years through ten years		37,483		38,818		-		-
Due after ten years		47,827		47,241		-		-
MBS/CMO		89,106		89,483		221		227
	$	182,797	$	184,119	$	407	$	413

Unrealized Gain (Loss) on Investments [Table Text Block]

The following tables summarize First Defiance’s securities that were in an unrealized loss position at September 30, 2013 and December 31, 2012:

	Duration of Unrealized Loss Position
	Less than 12 Months				12 Month or Longer				Total
			Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Losses
	(In Thousands)
At September 30, 2013
Available-for-sale securities:
Obligations of U.S. government corporations and agencies	$	2,931	$	(69)	$	-	$	-	$	2,931	$	(69)
Mortgage-backed - residential		19,456		(738)		-		-		19,456		(738)
Collateralized mortgage obligations		19,948		(610)		-		-		19,948		(610)
Trust preferred stock and preferred stock		-		-		1,890		(1,676)		1,890		(1,676)
Corporate bonds		2,991		(9)		-		-		2,991		(9)
Obligations of state and political subdivisions		16,682		(836)		-		-		16,682		(836)
Total temporarily impaired securities	$	62,008	$	(2,262)	$	1,890	$	(1,676)	$	63,898	$	(3,938)

	Duration of Unrealized Loss Position
	Less than 12 Months				12 Months or Longer				Total
			Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	Value		Loss		Value		Loss		Value		Loses
		(In Thousands)
At December 31, 2012
Available-for-sale securities:
Mortgage-backed securities - residential	$	1	$	-	$	-	$	-	$	1	$	-
Obligations of state and political subdivisions		949		(5)		-		-		949		(5)
Trust preferred stock and preferred stock		-		-		1,474		(2,091)		1,474		(2,091)
Total temporarily impaired securities	$	950	$	(5)	$	1,474	$	(2,091)	$	2,424	$	(2,096)

Schedule of Other than Temporary Impairment, Credit Losses Recognized in Earnings [Table Text Block]

The following table details the six securities with other-than-temporary impairment, their lowest credit rating at September 30, 2013 and the related credit losses recognized in earnings for the three month period ending March 31, 2013, June 30, 2013 and September 30, 2013 (In Thousands):

		TPREF Funding II		Alesco VIII		Preferred Term Security XXVII		Trapeza CDO I		Alesco Preferred Funding VIII		Alesco Preferred Funding IX
		Rated Caa3		Rated Ca		Rated C		Rated Ca		Not Rated		Not Rated		Total
Cumulative OTTI related to credit loss at January 1, 2013	$	323	$	1,000	$	78	$	857	$	453	$	465	$	3,176
Addition – Qtr 1		-		-		-		-		-		-		-
Cumulative OTTI related to credit loss at March 31, 2013	$	323	$	1,000	$	78	$	857	$	453	$	465	$	3,176
Addition – Qtr 2		-		-		-		-		-		-		-
Cumulative OTTI related to credit loss at June 30, 2013	$	323	$	1,000	$	78	$	857	$	453	$	465	$	3,176
Addition – Qtr 3		-		-		-		-		-		-		-
Cumulative OTTI related to credit loss at September 30, 2013	$	323	$	1,000	$	78	$	857	$	453	$	465	$	3,176

Investment [Table Text Block]

The following table provides additional information related to the four CDO investments for which a balance remains as of September 30, 2013 (dollars in thousands):

CDO	Class	Amortized Cost		Fair Value		Unrealized Loss		OTTI Losses 2013		Lowest Rating	Current Number of Banks and Insurance Companies	Actual Deferrals and Defaults as a % of Current Collateral		Expected Deferrals and Defaults as a % of Remaining Performing Collateral		Excess Sub- ordination as a % of Current Performing Collateral

TPREF Funding II	B		673		271		(402)		-	Caa3	15	43.47	%	15.90	%	-	%

I-Preferred Term Sec I	B-1		1,000		686		(314)		-	CCC-	14	17.24	%	12.04	%	23.78	%

Dekania II CDO	C-1		990		612		(378)		-	CCC	31	-	%	13.29	%	26.51	%

Preferred Term Sec XXVII	C-1		903		321		(582)		-	C	32	26.15	%	18.83	%	5.99	%
Total		$	3,566	$	1,890	$	(1,676)	$	-

Marketable Securities [Table Text Block]

The proceeds from the sales and calls of securities and the associated gains are listed below:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2013		2012		2013		2012
	(In thousands)				(In thousands)
Proceeds	$	-	$	2,122	$	4,027	$	8,538
Gross realized gains		-		103		97		528
Gross realized losses		-		-		-		-

- Definition

Summarization of information required and determined to be disclosed as a tabular roll forward of the amount of other than temporary impairment (OTTI) related to credit losses recognized in earnings including: (a) the beginning balance of the amount related to credit losses on debt securities held by the investor at the beginning of the period for which a portion of an OTTI was recognized in other comprehensive income; (b) additions for the amount related to the credit loss for which an OTTI was not previously recognized; (c) reductions for securities sold during the period (realized); (d) reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the investor intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis; (e) additional increases to the amount related to the credit loss for which an OTTI was previously recognized when the investor does not intend to sell the security and it is not more likely than not that the investor will be required to sell the security before recovery of its amortized cost basis; (f) reductions for increases in cash flows expected to be collected that are recognized over the remaining life of the security; and (g) the ending balance of the amount related to credit losses on debt securities held by the entity at the end of the period for which a portion of an OTTI was recognized in other comprehensive income.

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- Definition

Tabular disclosure of marketable securities. This may consist of investments in certain debt and equity securities, short-term investments and other assets.

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