, including those of our third-party vendors and other service providers , may prove inadequate , which could adversely affect customer confidence in peoples and or result in peoples incurring a financial loss ; ( 15 ) the overall adequacy of peoples ' risk management program ; and ( 16 ) other risk factors relating to the banking industry or peoples as detailed from time to time in peoples ' reports filed with the securities and exchange commission ( “ sec ” ) , including those risk factors included in the disclosure under `` item 1a . risk factors `` of this form 10-k. all forward-looking statements speak only as of the filing date of this form 10-k and are expressly qualified in their entirety by the cautionary statements . although management believes the expectations in these forward-looking statements are based on reasonable assumptions within the bounds of management 's knowledge of peoples ' business and operations , it is possible that actual results may differ materially from these projections . additionally , peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the filing date of this form 10-k or to reflect the occurrence of unanticipated events except as may be required by applicable legal requirements . copies of documents filed with the sec are available free of charge at the sec 's website at www.sec.gov and or from peoples bancorp inc. 's website – www.peoplesbancorp.com under the “ investor relations ” section . 26 the following discussion and analysis of peoples ' consolidated financial statements is presented to provide insight into management 's assessment of the financial results and condition for the periods presented . this discussion and analysis should be read in conjunction with the audited consolidated financial statements and notes thereto , as well as the ratios and statistics , contained elsewhere in this form 10-k. summary of significant transactions and events the following is a summary of transactions or events that have impacted or are expected by management to impact peoples ' results of operations or financial condition : ◦ during the second quarter of 2012 , peoples became more active with its merger and acquisition activities . these activities included the merger transactions with sistersville bancorp , inc. ( `` sistersville `` ) and its wholly-owned subsidiary , first federal savings bank , announced on june 5 , 2012 and subsequently completed on september 14 , 2012 , and the purchase of a small financial advisory book of business in wood county , west virginia . in the third quarter of 2012 , peoples purchased another small financial advisory book of business in gallipolis , ohio . these transactions are more fully described in note 18 of the notes to the consolidated financial statements . in addition , peoples ' management team continues to evaluate other acquisition opportunities involving banks , insurance agencies and wealth management providers located in ohio , west virginia and kentucky . on january 2 , 2013 , peoples insurance acquired a commercial insurance agency office and related customer accounts in the pikeville , kentucky area . ◦ in 2012 , peoples incurred $ 641,000 of acquisition-related expenses , primarily fees for legal costs , other professional services , deconversion costs and write-offs associated with assets acquired . approximately a quarter of these costs related to acquisition opportunities that management determined did not meet peoples ' criteria and thus negotiations were terminated prior to completion . ◦ on september 17 , 2012 , peoples introduced its new brand as part of a company-wide brand revitalization . the brand is peoples ' promise , which is a guarantee of satisfaction and quality . costs associated with rebranding efforts were approximately $ 421,000 during 2012. peoples will continue to incur costs throughout 2013 associated with the brand revitalization , including marketing due to advertisement , and depreciation for the revitalization of our branch network . ◦ during 2012 , peoples increased the quarterly dividend declared to common shareholders by 20 % . the dividend declared in first quarter of 2012 was $ 0.11 and the dividend declared in the fourth quarter of 2012 was $ 0.12 , compared to the quarterly dividend of $ 0.10 that was declared during 2011 . ◦ as described in note 12 of the notes to the consolidated financial statements , peoples incurred settlement charges of $ 835,000 during 2012 due to the aggregate amount of lump-sum distributions to participants in peoples ' defined benefit pension plan exceeding the threshold for recognizing such charges during the second quarter . settlement charges of $ 815,000 were recognized during the 2011 . ◦ as described in note 10 of the notes to the consolidated financial statements , peoples repaid the entire $ 23.0 million outstanding principal amount of its junior subordinated debentures and related trust preferred securities on december 19 , 2012 ( the `` trust preferred redemption `` ) . this transaction resulted in peoples incurring a pre-tax loss of $ 1.0 million for the redemption premium and unamortized issuance costs . peoples funded the repayment with a term note from an unaffiliated financial institution at a significantly lower interest rate . as a result , peoples will realize an annual interest expense savings of $ 1.1 million beginning in 2013 . ◦ in the first quarter of 2012 , peoples prepaid $ 35.0 million of wholesale borrowings using short-term funds , which resulted in prepayment charges of $ 3.1 million . these borrowings had an average cost of 3.09 % and consisted of both term repurchase agreements and advances from the federal home loan bank of cincinnati . the impact of the prepayment charges on first quarter earnings was offset by $ 3.2 million in gains from the sale of $ 60.5 million in investment securities . the securities sold were primarily mortgage-backed securities issued by u.s. government-sponsored agencies . story_separator_special_tag given the nature of peoples ' deferred tax assets , management determined no valuation allowances were needed at either december 31 , 2012 or 2011 . the calculation of tax liabilities is complex and requires the use of estimates and judgment since it involves the application of complex tax laws that are subject to different interpretations by peoples and the various tax authorities . these interpretations are subject to challenge by the tax authorities upon audit or to reinterpretation based on management 's ongoing assessment of facts and evolving case law . from time-to-time and in the ordinary course of business , peoples is involved in inquiries and reviews by tax authorities that normally require management to provide supplemental information to support certain tax positions taken by peoples in its tax returns . uncertain tax positions are initially recognized in the consolidated financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities . such tax positions are initially and subsequently measured as the largest amount of tax benefit that is greater than 50 % likely of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and all relevant facts . the amount of unrecognized tax benefits was immaterial at both december 31 , 2012 and 2011 . management believes it has taken appropriate positions on its tax returns , although the ultimate outcome of any tax review can not be predicted with certainty . consequently , no assurance can be given that the final outcome of these matters will not be different than what is reflected in the current and historical financial statements . fair value measurements as a financial services company , the carrying value of certain financial assets and liabilities is impacted by the application of fair value measurements , either directly or indirectly . in certain cases , an asset or liability is measured and reported at fair value on a recurring basis , such as available-for-sale investment securities . in other cases , management must rely on estimates or judgments to determine if an asset or liability not measured at fair value warrants an impairment write-down or whether a valuation reserve should be established . given the inherent volatility , the use of fair value measurements may have a significant impact on the carrying value of assets or liabilities , or result in material changes to the consolidated financial statements , from period to period . detailed information regarding fair value measurements can be found in note 2 of the notes to the consolidated financial statements . the following is a summary of those assets and liabilities that may be affected by fair value measurements , as well as a brief description of the current accounting practices and valuation methodologies employed by peoples : available-for-sale investment securities investment securities classified as available-for-sale are measured and reported at fair value on a recurring basis . for most securities , the fair value is based upon quoted market prices ( level 1 ) or determined by pricing models that consider observable market data ( level 2 ) . for structured investment securities , the fair value often must be based upon unobservable market data , such as non-binding broker quotes and discounted cash flow analysis or similar models , due to the absence of an active market for these securities ( level 3 ) . as a result , management 's determination of fair value for these securities is highly dependent on subjective or complex judgments , estimates and assumptions , which could change materially between periods . management occasionally uses information from independent third-party consultants in its determination of the fair value of more complex structured investment securities . at december 31 , 2012 , all of peoples ' available-for-sale investment securities were measured using observable market data . at december 31 , 2012 , the majority of the investment securities with level 2 fair values were determined using information provided by third-party pricing services . management reviews the fair values provided by these third parties on a monthly basis and challenges prices when it believes a discrepancy in pricing exists . management also reviews the valuation methodology and quality controls utilized by the pricing services in their overall assessment of the reasonableness of the fair values provided . to the extent available , management utilizes an independent third-party pricing source to assist in its assessment of the values provided by its primary pricing services . management challenges third-party valuations for any security where it believes a material difference in pricing exists . based on peoples ' past experience , these challenges more-often-than-not result in the third party adjusting its valuation of the security . impaired loans for loans considered impaired , the amount of impairment loss recognized is determined based on a discounted cash flow analysis or the fair value of the underlying collateral if repayment is expected solely from the sale of the collateral . management typically relies on the fair value of the underlying collateral due to the significant uncertainty surrounding the borrower 's ability to make future payments . the vast majority of the collateral securing impaired loans is real estate , 31 although the collateral may also include accounts receivable and equipment , inventory or similar personal property . the fair value of the collateral used by management represents the estimated proceeds to be received from the sale of the collateral , less costs incurred during the sale , based upon observable market data or market value data provided by independent , licensed or certified appraisers . goodwill the process of evaluating goodwill for impairment involves highly subjective or complex judgments , estimates and assumptions regarding the fair value of peoples ' reporting unit and , in some cases , goodwill itself . as a result , changes to these judgments , estimates and assumptions in future periods could result in materially different results . peoples

cash and cash equivalents peoples considers cash and cash equivalents to consist of federal funds sold , cash and balances due from banks , interest-bearing balances in other institutions and other short-term investments that are readily liquid . the amount of cash and cash equivalents fluctuates on a daily basis due to customer activity and peoples ' liquidity needs . beginning in 2010 , peoples has maintained excess cash reserves at the federal reserve bank of cleveland , which are included in `` interest-bearing deposits in other banks '' on the consolidated balance sheets , rather than federal funds sold due to more favorable interest rates . at december 31 , 2012 , excess cash reserves at the federal reserve bank were $ 11.6 million , compared to $ 4.4 million at december 31 , 2011 . the amount of excess cash reserves maintained is dependent upon peoples ' daily liquidity position , which is driven primarily by changes in deposit and loan balances . 41 in 2012 , peoples ' total cash and cash equivalents increased $ 23.6 million , as cash provided by peoples ' operating and financing activities of $ 41.3 million and $ 51.9 million , respectively , exceeded the $ 69.6 million of cash used by investing activities .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```cash and cash equivalents peoples considers cash and cash equivalents to consist of federal funds sold , cash and balances due from banks , interest-bearing balances in other institutions and other short-term investments that are readily liquid . the amount of cash and cash equivalents fluctuates on a daily basis due to customer activity and peoples ' liquidity needs . beginning in 2010 , peoples has maintained excess cash reserves at the federal reserve bank of cleveland , which are included in `` interest-bearing deposits in other banks '' on the consolidated balance sheets , rather than federal funds sold due to more favorable interest rates . at december 31 , 2012 , excess cash reserves at the federal reserve bank were $ 11.6 million , compared to $ 4.4 million at december 31 , 2011 . the amount of excess cash reserves maintained is dependent upon peoples ' daily liquidity position , which is driven primarily by changes in deposit and loan balances . 41 in 2012 , peoples ' total cash and cash equivalents increased $ 23.6 million , as cash provided by peoples ' operating and financing activities of $ 41.3 million and $ 51.9 million , respectively , exceeded the $ 69.6 million of cash used by investing activities .
```    
 Suspicious Activity Report : , including those of our third-party vendors and other service providers , may prove inadequate , which could adversely affect customer confidence in peoples and or result in peoples incurring a financial loss ; ( 15 ) the overall adequacy of peoples ' risk management program ; and ( 16 ) other risk factors relating to the banking industry or peoples as detailed from time to time in peoples ' reports filed with the securities and exchange commission ( “ sec ” ) , including those risk factors included in the disclosure under `` item 1a . risk factors `` of this form 10-k. all forward-looking statements speak only as of the filing date of this form 10-k and are expressly qualified in their entirety by the cautionary statements . although management believes the expectations in these forward-looking statements are based on reasonable assumptions within the bounds of management 's knowledge of peoples ' business and operations , it is possible that actual results may differ materially from these projections . additionally , peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the filing date of this form 10-k or to reflect the occurrence of unanticipated events except as may be required by applicable legal requirements . copies of documents filed with the sec are available free of charge at the sec 's website at www.sec.gov and or from peoples bancorp inc. 's website – www.peoplesbancorp.com under the “ investor relations ” section . 26 the following discussion and analysis of peoples ' consolidated financial statements is presented to provide insight into management 's assessment of the financial results and condition for the periods presented . this discussion and analysis should be read in conjunction with the audited consolidated financial statements and notes thereto , as well as the ratios and statistics , contained elsewhere in this form 10-k. summary of significant transactions and events the following is a summary of transactions or events that have impacted or are expected by management to impact peoples ' results of operations or financial condition : ◦ during the second quarter of 2012 , peoples became more active with its merger and acquisition activities . these activities included the merger transactions with sistersville bancorp , inc. ( `` sistersville `` ) and its wholly-owned subsidiary , first federal savings bank , announced on june 5 , 2012 and subsequently completed on september 14 , 2012 , and the purchase of a small financial advisory book of business in wood county , west virginia . in the third quarter of 2012 , peoples purchased another small financial advisory book of business in gallipolis , ohio . these transactions are more fully described in note 18 of the notes to the consolidated financial statements . in addition , peoples ' management team continues to evaluate other acquisition opportunities involving banks , insurance agencies and wealth management providers located in ohio , west virginia and kentucky . on january 2 , 2013 , peoples insurance acquired a commercial insurance agency office and related customer accounts in the pikeville , kentucky area . ◦ in 2012 , peoples incurred $ 641,000 of acquisition-related expenses , primarily fees for legal costs , other professional services , deconversion costs and write-offs associated with assets acquired . approximately a quarter of these costs related to acquisition opportunities that management determined did not meet peoples ' criteria and thus negotiations were terminated prior to completion . ◦ on september 17 , 2012 , peoples introduced its new brand as part of a company-wide brand revitalization . the brand is peoples ' promise , which is a guarantee of satisfaction and quality . costs associated with rebranding efforts were approximately $ 421,000 during 2012. peoples will continue to incur costs throughout 2013 associated with the brand revitalization , including marketing due to advertisement , and depreciation for the revitalization of our branch network . ◦ during 2012 , peoples increased the quarterly dividend declared to common shareholders by 20 % . the dividend declared in first quarter of 2012 was $ 0.11 and the dividend declared in the fourth quarter of 2012 was $ 0.12 , compared to the quarterly dividend of $ 0.10 that was declared during 2011 . ◦ as described in note 12 of the notes to the consolidated financial statements , peoples incurred settlement charges of $ 835,000 during 2012 due to the aggregate amount of lump-sum distributions to participants in peoples ' defined benefit pension plan exceeding the threshold for recognizing such charges during the second quarter . settlement charges of $ 815,000 were recognized during the 2011 . ◦ as described in note 10 of the notes to the consolidated financial statements , peoples repaid the entire $ 23.0 million outstanding principal amount of its junior subordinated debentures and related trust preferred securities on december 19 , 2012 ( the `` trust preferred redemption `` ) . this transaction resulted in peoples incurring a pre-tax loss of $ 1.0 million for the redemption premium and unamortized issuance costs . peoples funded the repayment with a term note from an unaffiliated financial institution at a significantly lower interest rate . as a result , peoples will realize an annual interest expense savings of $ 1.1 million beginning in 2013 . ◦ in the first quarter of 2012 , peoples prepaid $ 35.0 million of wholesale borrowings using short-term funds , which resulted in prepayment charges of $ 3.1 million . these borrowings had an average cost of 3.09 % and consisted of both term repurchase agreements and advances from the federal home loan bank of cincinnati . the impact of the prepayment charges on first quarter earnings was offset by $ 3.2 million in gains from the sale of $ 60.5 million in investment securities . the securities sold were primarily mortgage-backed securities issued by u.s. government-sponsored agencies . story_separator_special_tag given the nature of peoples ' deferred tax assets , management determined no valuation allowances were needed at either december 31 , 2012 or 2011 . the calculation of tax liabilities is complex and requires the use of estimates and judgment since it involves the application of complex tax laws that are subject to different interpretations by peoples and the various tax authorities . these interpretations are subject to challenge by the tax authorities upon audit or to reinterpretation based on management 's ongoing assessment of facts and evolving case law . from time-to-time and in the ordinary course of business , peoples is involved in inquiries and reviews by tax authorities that normally require management to provide supplemental information to support certain tax positions taken by peoples in its tax returns . uncertain tax positions are initially recognized in the consolidated financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities . such tax positions are initially and subsequently measured as the largest amount of tax benefit that is greater than 50 % likely of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and all relevant facts . the amount of unrecognized tax benefits was immaterial at both december 31 , 2012 and 2011 . management believes it has taken appropriate positions on its tax returns , although the ultimate outcome of any tax review can not be predicted with certainty . consequently , no assurance can be given that the final outcome of these matters will not be different than what is reflected in the current and historical financial statements . fair value measurements as a financial services company , the carrying value of certain financial assets and liabilities is impacted by the application of fair value measurements , either directly or indirectly . in certain cases , an asset or liability is measured and reported at fair value on a recurring basis , such as available-for-sale investment securities . in other cases , management must rely on estimates or judgments to determine if an asset or liability not measured at fair value warrants an impairment write-down or whether a valuation reserve should be established . given the inherent volatility , the use of fair value measurements may have a significant impact on the carrying value of assets or liabilities , or result in material changes to the consolidated financial statements , from period to period . detailed information regarding fair value measurements can be found in note 2 of the notes to the consolidated financial statements . the following is a summary of those assets and liabilities that may be affected by fair value measurements , as well as a brief description of the current accounting practices and valuation methodologies employed by peoples : available-for-sale investment securities investment securities classified as available-for-sale are measured and reported at fair value on a recurring basis . for most securities , the fair value is based upon quoted market prices ( level 1 ) or determined by pricing models that consider observable market data ( level 2 ) . for structured investment securities , the fair value often must be based upon unobservable market data , such as non-binding broker quotes and discounted cash flow analysis or similar models , due to the absence of an active market for these securities ( level 3 ) . as a result , management 's determination of fair value for these securities is highly dependent on subjective or complex judgments , estimates and assumptions , which could change materially between periods . management occasionally uses information from independent third-party consultants in its determination of the fair value of more complex structured investment securities . at december 31 , 2012 , all of peoples ' available-for-sale investment securities were measured using observable market data . at december 31 , 2012 , the majority of the investment securities with level 2 fair values were determined using information provided by third-party pricing services . management reviews the fair values provided by these third parties on a monthly basis and challenges prices when it believes a discrepancy in pricing exists . management also reviews the valuation methodology and quality controls utilized by the pricing services in their overall assessment of the reasonableness of the fair values provided . to the extent available , management utilizes an independent third-party pricing source to assist in its assessment of the values provided by its primary pricing services . management challenges third-party valuations for any security where it believes a material difference in pricing exists . based on peoples ' past experience , these challenges more-often-than-not result in the third party adjusting its valuation of the security . impaired loans for loans considered impaired , the amount of impairment loss recognized is determined based on a discounted cash flow analysis or the fair value of the underlying collateral if repayment is expected solely from the sale of the collateral . management typically relies on the fair value of the underlying collateral due to the significant uncertainty surrounding the borrower 's ability to make future payments . the vast majority of the collateral securing impaired loans is real estate , 31 although the collateral may also include accounts receivable and equipment , inventory or similar personal property . the fair value of the collateral used by management represents the estimated proceeds to be received from the sale of the collateral , less costs incurred during the sale , based upon observable market data or market value data provided by independent , licensed or certified appraisers . goodwill the process of evaluating goodwill for impairment involves highly subjective or complex judgments , estimates and assumptions regarding the fair value of peoples ' reporting unit and , in some cases , goodwill itself . as a result , changes to these judgments , estimates and assumptions in future periods could result in materially different results . peoples

