Annual report pursuant to Section 13 and 15(d)

Fair Value Measurements (Tables)

v2.4.0.6
Fair Value Measurements (Tables)
 12 Months Ended
Dec. 31, 2012
Assets and Liabilities Measured at Fair Value on Recurring Basis

As of December 31, 2012 and 2011, assets and liabilities measured at fair value on a recurring basis are as follows:

 

     Level 1      Level 2      Level 3         
     Quoted Prices
in Active
Markets For
Identical Assets		      Significant
Observable
Inputs With No
Active Market
With Identical
Characteristics 		     Significant
Unobservable
Inputs		      Balance  
     (In Thousands)  

December 31, 2012:

            

ASSETS:

            

Debt Securities Available for Sale:

            

Mortgage-Backed Securities

    $ —       $ 160,326       $ —       $ 160,326   

Collateralized Mortgage Obligations

      —         100,487         —         100,487   

U.S. Government Agency Securities

      93,118         —         —         93,118   

Municipal Bonds-Tax Exempt

      —         12,033         779         12,812   

Municipal Bonds-Taxable

      —         46,142         —         46,142   

Corporate Bonds

      —         20,400         —         20,400   

SBA Loan Pools Securities

      —         14,026         —         14,026   

Other Securities

      —         3,357         —         3,357   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total Debt Securities Available for Sale

      93,118         356,771         779         450,668   
  

 

 

     

 

 

     

 

 

     

 

 

  

Equity Securities Available for Sale:

            

Financial Services Industry

      392         —         —         392   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total Equity Securities Available for Sale

      392         —         —         392   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total Securities Available for Sale

    $ 93,510       $ 356,771       $ 779       $ 451,060   
  

 

 

     

 

 

     

 

 

     

 

 

  

LIABILITIES:

            

Stock Warrants

    $ —       $ —       $ 906       $ 906   
  

 

 

     

 

 

     

 

 

     

 

 

  

December 31, 2011:

            

ASSETS:

            

Debt Securities Available for Sale:

            

Mortgage-Backed Securities

    $ —       $ 113,005       $ —       $ 113,005   

Collateralized Mortgage Obligations

      —         162,837         —         162,837   

U.S. Government Agency Securities

      72,548         —         —         72,548   

Municipal Bonds-Tax Exempt

      —         3,482         —         3,482   

Municipal Bonds-Taxable

      —         6,138         —         6,138   

Corporate Bonds

      —         19,836         —         19,836   

Other Securities

      —         3,335         —         3,335   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total Debt Securities Available for Sale

      72,548         308,633         —         381,181   
  

 

 

     

 

 

     

 

 

     

 

 

  

Equity Securities Available for Sale:

            

Financial Services Industry

      681         —         —         681   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total Equity Securities Available for Sale

      681         —         —         681   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total Securities Available for Sale

    $ 73,229       $ 308,633       $ —       $ 381,862   
  

 

 

     

 

 

     

 

 

     

 

 

  

LIABILITIES:

            

Stock Warrants

    $ —       $ —       $ 883       $ 883   
  

 

 

     

 

 

     

 

 

     

 

 

  
Reconciliation and Income Statement Classification of Gains and Losses for All Assets and Liabilities

The table below presents a reconciliation and income statement classification of gains and losses for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the year ended December 31, 2012:

 

     Beginning
Balance as of
January 1,
2012		      Purchase,
Issuances,
Sales and
Settlement		      Realized
Gains or Losses
In Earnings		      Unrealized
Gains or Losses
In Other
Comprehensive
Income		      Ending
Balance as of
December 31,
2012		  
     (In Thousands)  

ASSETS:

               

Municipal Bonds-Tax Exempt (1)

    $ —       $ 698       $ —       $ 81       $ 779   

LIABILITIES:

               

Stock Warrants (2)

    $ 883       $ —       $ 23       $ —       $ 906   

 

     Beginning
Balance as of
January 1,
2011		      Purchase,
Issuances,
Sales and
Settlement		      Realized
Gains or Losses
In Earnings		     Unrealized
Gains or Losses
In Other
Comprehensive
Income		      Ending
Balance as of
December 31,
2011		  

LIABILITIES:

              

Stock Warrants (2)

    $ 1,600       $ —       $ (717 )    $ —       $ 883   

 

(1) 

Reflects a zero coupon tax credit municipal bond that was previously classified as a held-to-maturity security, which was reclassified as an available-for-sale security during the year ended December 31, 2012. As the Company was not able to obtain a price from independent external pricing service providers, the discounted cash flow method was used to determine its fair value. The bond carried a par value of $700,000 and an amortized value of $698,000 with a remaining life of 2.2 years at December 31, 2012.

 

(2) 

Reflects warrants for our common stock issued in connection with services it provided to us as a placement agent in connection with our best efforts public offering and as our financial adviser in connection with our completed rights offering. The warrants were immediately exercisable when issued at an exercise price of $9.60 per share of our common stock and expire on October 14, 2015. See “Note 13 – Stockholders’ Equity” for more details.
Assets and Liabilities Measured at Fair Value on Non-Recurring Basis

As of December 31, 2012, assets and liabilities measured at fair value on a non-recurring basis are as follows:

 

     Level 1      Level 2      Level 3         
     Quoted Prices in
Active Markets
For Identical
Assets		      Significant
Observable
Inputs With
No Active
Market With
Identical
Characteristics		      Significant
Unobservable
Inputs		      Loss During
The Year
Ended
December 31,
2012 and 2011 		 
     (In Thousands)  

December 31, 2012:

            

ASSETS:

            

Non-Performing Loans Held for Sale (1)

    $ —       $ 484       $ —       $ 3,747   

Impaired Loans (2)

    $ —       $ 27,844       $ 8,888       $ 580   

Other Real Estate Owned (3)

    $ —       $ 774       $ —       $ 301   

December 31, 2011:

            

ASSETS:

            

Non-Performing Loans Held for Sale (4)

    $ —       $ 17,525       $ —       $ 2,903   

Impaired Loans (5)

    $ —       $ 54,784       $ 35,835       $ 7,364   

Other Real Estate Owned (6)

    $ —       $ 180       $ —       $ 488   

 

(1) 

Includes a SBA loan of $484,000

 

(2) 

Includes real estate loans of $8.7 million, commercial and industrial loans of $27.0 million, and consumer loans of $1.0 million

 

(3) 

Includes properties from the foreclosure of real estate loans of $774,000

 

(4) 

Includes commercial property loans of $11.1 million, commercial term loan of $5.6 million, and SBA loans of $870,500

 

(5) 

Includes real estate loans of $35.1 million, commercial and industrial loans of $54.8 million, and consumer loans of $721,000

 

(6) 

Includes properties from the foreclosure of real estate loans of $180,000
Estimated Fair Values of Financial Instruments

The estimated fair values of financial instruments were as follows:

 

     December 31, 2012      December 31, 2011  
     Carrying
or
Contract
Amount 		     Estimated
Fair
Value 		     Carrying
or
Contract
Amount 		     Estimated
Fair
Value 		 
     (In Thousands)  

Financial Assets:

            

Cash and Cash Equivalents

    $ 268,047       $ 268,047       $ 201,683       $ 201,683   

Restricted Cash

      5,350         5,350         1,818         1,818   

Term Federal Funds

      —         —         115,000         115,173   

Investment Securities Available for Sale

      451,060         451,060         381,862         381,862   

Investment Securities Held to Maturity

      —         —         59,742         59,363   

Loans Receivable, Net of Allowance for Loan Losses

      1,986,051         1,981,669         1,849,020         1,802,511   

Loans Held for Sale

      8,306         8,306         22,587         22,587   

Accrued Interest Receivable

      7,581         7,581         7,829         7,829   

Investment in Federal Home Loan Bank Stock

      17,800         17,800         22,854         22,854   

Investment in Federal Reserve Bank

      12,222         12,222         8,558         8,558   

Financial Liabilities:

            

Noninterest-Bearing Deposits

      720,931         720,931         634,466         634,466   

Interest-Bearing Deposits

      1,675,032         1,680,211         1,710,444         1,710,878   

Borrowings

      85,341         85,414         85,709         83,853   

Accrued Interest Payable

      11,775         11,775         16,032         16,032   

Off-Balance Sheet Items:

            

Commitments to Extend Credit

      182,746         146         158,748         194   

Standby Letters of Credit

      10,588         24         12,742         26