10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q/A

(Amendment No. 1)

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2012.

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ____.

Commission File Number: 000-50400

NEW CENTURY BANCORP, INC.

(Exact name of registrant as specified in its charter)

North Carolina	20-0218264
(State or other jurisdiction of	(IRS Employer
incorporation or organization)	Identification No.)

700 W. Cumberland Street, Dunn, North Carolina 28334

(Address of principal executive offices)

(Zip Code)

(910) 892-7080

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one)

Large Accelerated Filer ¨	Accelerated Filer ¨
Non-Accelerated Filer ¨	Smaller Reporting Company x
(Do not check if a Smaller Reporting Company)

Indicate by check mark whether registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act).

Yes ¨ No x

1

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

There were 6,913,636 shares of the Issuer’s common stock, $1.00 par value per share, outstanding as of August 1, 2012.

EXPLANATORY NOTE

The sole purpose of this Amendment No. 1 to the Quarterly Report on Form 10-Q of New Century Bancorp, Inc., (the “Company”) for the quarterly period ended June 30, 2012, as filed with the Securities and Exchange Commission on August 13, 2012, is to furnish Exhibit 101 to the Form 10-Q, which contains the XBRL (eXtensible Business Reporting Language) interactive data file for the Company’s financial statements and notes included in Part I, Item 1 of the Form 10-Q. Under Rule 405(a)(2)(ii) of Regulation S-T, Exhibit 101 is permitted to be furnished by amendment within thirty days of the original filing date of the Form 10-Q.

No changes have been made to the Form 10-Q other than the furnishing of Exhibit 101 described above. This Amendment No. 1 does not reflect subsequent events occurring after the original filing date of the Form 10-Q or modify or update in any way the disclosures made in the Form 10-Q.

Pursuant to Rule 406T of Regulation S-T, the interactive data files contained in Exhibit 101 are deemed not filed or part of a registration statement or prospectus for purposes of section 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

PART II. OTHER INFORMATION

Item 6. Exhibits: The following exhibits are filed herewith:

Number Title

31.1 Rule 13a-14(a) Certification of Chief Executive Officer

31.2 Rule 13a-14(a) Certification of Chief Financial Officer

32.1 Section 1350 Certification

101 Interactive data files providing financial information from the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2012, in XBRL (eXtensible Business Reporting Language)*

________________

* Pursuant to Regulation 406T of Regulation S-T, these interactive data files are furnished and not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, or Section 18 of the Securities Exchange Act of 1934, as amended, and are otherwise not subject to liability.

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this amendment to be signed on its behalf by the undersigned thereunto duly authorized.

	New Century Bancorp, Inc.
Date: September 12, 2012	By:	/s/ Lisa F. Campbell
	Lisa F. Campbell
	Executive Vice President, Chief Financial Officer
	and Chief Operating Officer

3

EXHIBIT INDEX

Number Title

31.1 Rule 13a-14(a) Certification of Chief Executive Officer

31.2 Rule 13a-14(a) Certification of Chief Financial Officer

32.1 Section 1350 Certification

32.2 Section 1350 Certification

101 Interactive data files providing financial information from the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2012, in XBRL (eXtensible Business Reporting Language)*

________________

* Pursuant to Regulation 406T of Regulation S-T, these interactive data files are furnished and not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, or Section 18 of the Securities Exchange Act of 1934, as amended, and are otherwise not subject to liability.

4

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, William L. Hedgepeth II, certify that:

(1) I have reviewed this quarterly report for the quarter ended June 30, 2012 on Form 10-Q/A of New Century Bancorp, Inc. (the "Registrant");

(2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

(3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

(4) The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

(5) The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.

Date: September 12, 2012	By:	/s/ William L. Hedgepeth II
		William L. Hedgepeth II
		President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Lisa F. Campbell, certify that:

(1) I have reviewed this quarterly report for the quarter ended June 30, 2012 on Form 10-Q/A of New Century Bancorp, Inc. (the "Registrant");

(2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

(3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

(4) The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

(5) The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.

Date: September 12, 2012	By:	/s/ Lisa F. Campbell
		Lisa F. Campbell
		Executive Vice President and Chief Financial Officer and
		Chief Operating Officer

EX-32.1

Exhibit 32.1

Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

The undersigned hereby certifies that (i) the Form 10-Q/A filed by New Century Bancorp, Inc. (the "Issuer") for the quarter ended June 30, 2012, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and (ii) the information contained in that report fairly presents, in all material respects, the financial condition and results of operations of the Issuer on the dates and for the periods presented therein.

Date: September 12, 2012	By:	/s/ William L. Hedgepeth II
		William L. Hedgepeth II
		President and Chief Executive Officer

EX-32.2

Exhibit 32.2

Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

The undersigned hereby certifies that (i) the Form 10-Q/A filed by New Century Bancorp, Inc. (the "Issuer") for the quarter ended June 30, 2012, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and (ii) the information contained in that report fairly presents, in all material respects, the financial condition and results of operations of the Issuer on the dates and for the periods presented therein.

Date: September 12, 2012	By:	/s/ Lisa F. Campbell
		Lisa F. Campbell
		Executive Vice President and Chief Financial Officer and
		Chief Operating Officer

XML

BRANCH SALE (Details Textual) (USD $)	3 Months Ended	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2012	Apr. 06, 2012
Purchase Price Of Deposits and Selected Assets			$ 1,800,000
Purchase Price Of Real Property and Equipment			1,100,000
Purchase Price Of Deposit Premium			688,000
Write Off Of Core Deposit Intangible On Deposit Premium		131,000
Net Gain, Offset Of Deposit Premium		557,000
Deposits Assumed	1,100,000	14,600,000
Deposit Liabilities Reclassified as Loans Receivable	0	0	338,000
Deposit Liabilities, Accrued Interest	$ 5,000	$ 5,000	$ 2,000
Description On Separate Loan Payment Conditions		Separate payment for the loans purchased that was not included in the $1.8 million purchase price

XML

LOANS (Details 3) (USD $) In Thousands, unless otherwise specified	3 Months Ended	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2012
Number of loans	11	11
Pre-Modification Outstanding Recorded Investment	$ 5,646	$ 5,646
Post-Modification Outstanding Recorded Investment	5,478	5,478
Number of loans	6	13
Recorded Investment	1,014	2,562
Commercial and Inustrial Below Market Interest Rate [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Construction Below Market Interest Rate [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Commercial Real Estate Below Market Interest Rate [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Loans To Individuals and Overdrafts Below Market Interest Rate [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Residential 1 To 4 Family Below Market Interest Rate [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Home Equity Below Market Interest Rate [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Below Market Interest Rate [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Commercial and Inustrial Extended Payment Term [Member]
Number of loans	2	2
Pre-Modification Outstanding Recorded Investment	327	327
Post-Modification Outstanding Recorded Investment	325	325
Number of loans	0	1
Recorded Investment	0	114
Construction Extended Payment Term [Member]
Number of loans	2	2
Pre-Modification Outstanding Recorded Investment	2,057	2,057
Post-Modification Outstanding Recorded Investment	2,036	2,036
Number of loans	0	2
Recorded Investment	0	290
Commercial Real Estate Extended Payment Term [Member]
Number of loans	5	5
Pre-Modification Outstanding Recorded Investment	3,111	3,111
Post-Modification Outstanding Recorded Investment	2,974	2,974
Number of loans	0	4
Recorded Investment	0	1,144
Loans To Individuals and Overdrafts Extended Payment Term [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Residential 1 To 4 Family Extended Payment Term [Member]
Number of loans	2	2
Pre-Modification Outstanding Recorded Investment	151	151
Post-Modification Outstanding Recorded Investment	143	143
Number of loans	0	0
Recorded Investment	0	0
Home Equity Extended Payment Term [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Extended Payment Term [Member]
Number of loans	11	11
Pre-Modification Outstanding Recorded Investment	5,646	5,646
Post-Modification Outstanding Recorded Investment	5,478	5,478
Number of loans	0	7
Recorded Investment	0	1,548
Commercial and Inustrial Forgiveness Of Principal [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Construction Forgiveness Of Principal [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Commercial Real Estate Forgiveness Of Principal [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Loans To Individuals and Overdrafts Forgiveness Of Principal [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Residential 1 To 4 Family Forgiveness Of Principal [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Home Equity Forgiveness Of Principal [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Forgiveness Of Principal [Member]
Number of loans	0	0
Pre-Modification Outstanding Recorded Investment	0	0
Post-Modification Outstanding Recorded Investment	0	0
Number of loans	0	0
Recorded Investment	0	0
Other Commercial and Industrial [Member]
Number of loans	0	0
Recorded Investment	0	0
Other Construction [Member]
Number of loans	0	0
Recorded Investment	0	0
Other Commercial Real Estate [Member]
Number of loans	2	2
Recorded Investment	849	849
Other Loans To Individuals and Overdrafts [Member]
Number of loans	0	0
Recorded Investment	0	0
Other 1-To-4 Family Residential [Member]
Number of loans	4	4
Recorded Investment	165	165
Other Home Equity [Member]
Number of loans	0	0
Recorded Investment	0	0
Others [Member]
Number of loans	6	6
Recorded Investment	$ 1,014	$ 1,014

XML

FAIR VALUE MEASUREMENTS (Details Textual) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Recorded Investment Total	$ 24,255	$ 24,835
Recorded Investment with Related Allowance	3,100	9,564
Related Allowance	520	1,515
Recorded Investment with No Related Allowance	21,155	15,271
Fair Value [Member]
Recorded Investment Total	11,400	13,400
Recorded Investment with Related Allowance	3,100	9,600
Recorded Investment with No Related Allowance	$ 8,800	$ 5,300

XML

LOANS (Details 7) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Balance, beginning of period	$ 9,568	$ 10,118	$ 10,034	$ 10,015
Provision (recovery) for loan losses	(649)	2,542	(2,785)	3,706
Other		(53)		(53)
Loans charged-off	(940)	(6,019)	(2,019)	(7,291)
Recoveries	532	3,790	3,281	4,001
Balance, end of period	8,510	10,378	8,510	10,378
Ending balance: individually evaluated for impairment	520	2,073	520	2,073
Ending balance: collectively evaluated for impairment	7,990	8,305	7,990	8,305
Loans:
Ending balance	390,810	458,882	390,810	458,882	417,971
Ending balance: individually evaluated for impairment	24,255	20,577	24,255	20,577	24,835
Ending balance: collectively evaluated for impairment	366,555	438,305	366,555	438,305	393,136
Commercial and Industrial [Member]
Balance, beginning of period	555	1,081	719	1,052
Provision (recovery) for loan losses	(409)	203	(2,956)	160
Other		0		0
Loans charged-off	(4)	(3,880)	(51)	(3,880)
Recoveries	244	3,648	2,674	3,720
Balance, end of period	386	1,052	386	1,052
Ending balance: individually evaluated for impairment	2	191	2	191
Ending balance: collectively evaluated for impairment	384	861	384	861
Loans:
Ending balance	31,044	40,646	31,044	40,646	33,146
Ending balance: individually evaluated for impairment	519	538	519	538	478
Ending balance: collectively evaluated for impairment	30,525	40,108	30,525	40,108	32,668
Construction Loans Real Estate [Member]
Balance, beginning of period	1,311	1,271	1,540	349
Provision (recovery) for loan losses	(967)	570	(911)	1,714
Other		0		0
Loans charged-off	0	(669)	(458)	(891)
Recoveries	138	0	311	0
Balance, end of period	482	1,172	482	1,172
Ending balance: individually evaluated for impairment	167	106	167	106
Ending balance: collectively evaluated for impairment	315	1,066	315	1,066
Loans:
Ending balance	54,716	77,211	54,716	77,211	70,846
Ending balance: individually evaluated for impairment	3,504	2,329	3,504	2,329	4,376
Ending balance: collectively evaluated for impairment	51,212	74,882	51,212	74,882	66,470
Commercial Real Estate [Member]
Balance, beginning of period	4,804	3,609	4,771	3,111
Provision (recovery) for loan losses	1,024	1,864	1,357	3,133
Other		(53)		(53)
Loans charged-off	(670)	(926)	(981)	(1,699)
Recoveries	70	8	81	10
Balance, end of period	5,228	4,502	5,228	4,502
Ending balance: individually evaluated for impairment	75	761	75	761
Ending balance: collectively evaluated for impairment	5,153	3,741	5,153	3,741
Loans:
Ending balance	193,221	204,412	193,221	204,412	192,047
Ending balance: individually evaluated for impairment	14,535	13,647	14,535	13,647	14,234
Ending balance: collectively evaluated for impairment	178,686	190,765	178,686	190,765	177,813
Family Residential Real Estate 1 To 4 [Member]
Balance, beginning of period	1,585	2,451	1,661	1,985
Provision (recovery) for loan losses	(275)	(230)	(369)	296
Other		0		0
Loans charged-off	(54)	(410)	(99)	(600)
Recoveries	58	81	121	211
Balance, end of period	1,314	1,892	1,314	1,892
Ending balance: individually evaluated for impairment	162	701	162	701
Ending balance: collectively evaluated for impairment	1,152	1,191	1,152	1,191
Loans:
Ending balance	48,487	59,504	48,487	59,504	52,182
Ending balance: individually evaluated for impairment	2,493	3,408	2,493	3,408	2,836
Ending balance: collectively evaluated for impairment	45,994	56,096	45,994	56,096	49,346
Home Equity Line Of Credit [Member]
Balance, beginning of period	1,101	1,140	1,122	1,348
Provision (recovery) for loan losses	(41)	376	134	231
Other		0		0
Loans charged-off	(168)	(69)	(376)	(134)
Recoveries	5	3	17	5
Balance, end of period	897	1,450	897	1,450
Ending balance: individually evaluated for impairment	97	268	97	268
Ending balance: collectively evaluated for impairment	800	1,182	800	1,182
Loans:
Ending balance	36,771	40,532	36,771	40,532	38,702
Ending balance: individually evaluated for impairment	1,517	442	1,517	442	1,138
Ending balance: collectively evaluated for impairment	35,254	40,090	35,254	40,090	37,564
Loans To Individuals and Overdrafts [Member]
Balance, beginning of period	105	383	94	1,530
Provision (recovery) for loan losses	3	(232)	(37)	(1,362)
Other		0		0
Loans charged-off	(45)	(65)	(54)	(87)
Recoveries	17	50	77	55
Balance, end of period	80	136	80	136
Ending balance: individually evaluated for impairment	7	46	7	46
Ending balance: collectively evaluated for impairment	73	90	73	90
Loans:
Ending balance	7,070	8,409	7,070	8,409	7,671
Ending balance: individually evaluated for impairment	136	213	136	213	233
Ending balance: collectively evaluated for impairment	6,934	8,196	6,934	8,196	7,438
Multi Family Residential Real Estate [Member]
Balance, beginning of period	107	183	127	640
Provision (recovery) for loan losses	16	(9)	(4)	(466)
Other		0		0
Loans charged-off	0	0	0	0
Recoveries	0	0	0	0
Balance, end of period	123	174	123	174
Ending balance: individually evaluated for impairment	10	0	10	0
Ending balance: collectively evaluated for impairment	113	174	113	174
Loans:
Ending balance	19,501	28,168	19,501	28,168	23,377
Ending balance: individually evaluated for impairment	1,551	0	1,551	0	1,540
Ending balance: collectively evaluated for impairment	$ 17,950	$ 28,168	$ 17,950	$ 28,168	$ 21,837

XML

PER SHARE RESULTS

6 Months Ended

Jun. 30, 2012

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

NOTE B - PER SHARE RESULTS

Basic net income per share is computed based upon the weighted average number of shares of common stock outstanding during the period. Diluted net income per share includes the dilutive effect of stock options outstanding during the period. At June 30, 2012 and 2011 there were 371,883 and 431,274 anti-dilutive options for each three month period and 372,883 and 428,878 anti-dilutive options for each six month period, respectively.

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2012		2011		2012		2011
Weighted average shares used for basic net income per share		6,913,636		6,913,636		6,886,417		6,913,636
Effect of dilutive stock options		-		-		-		-
Weighted average shares used for diluted net income per share		6,913,636		6,913,636		6,886,417		6,913,636

XML

INVESTMENT SECURITIES (Details Textual) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Available-for-sale Securities, Gross Unrealized Gain (Loss)	$ 2,000,000		$ 2,000,000		$ 2,100,000
Deferred Income Taxes and Other Liabilities, Noncurrent	780,000		780,000		800,000
Available-For-Sale Securities, Continuous Unrealized Loss Position, Less Than 12 Months, Aggregate Losses	21,000		21,000		18,000
Available-for-sale Securities, Gross Realized Gains	3,000	5,000	6,000	12,000
Available-for-sale Securities, Gross Realized Losses	49,000	20,000	129,000	38,000
Proceeds from Sale of Available-for-sale Securities	$ 3,500,000	$ 2,600,000	$ 6,900,000	$ 5,800,000

XML

INVESTMENT SECURITIES (Details 1) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Unrealized Loss Less than 12 Months	$ 21	$ 18
Municipal Bonds [Member]
Fair Value Less than Twelve Months	669
Unrealized Loss Less than 12 Months	12
Fair Value 12 Months or More	0
Unrealized Loss 12 Months or More	0
Fair Value Total	669
Unrealized Loss Total	12
Us Government Agencies Debt Securities [Member]
Fair Value Less than Twelve Months	8,357
Unrealized Loss Less than 12 Months	9
Fair Value 12 Months or More	0
Unrealized Loss 12 Months or More	0
Fair Value Total	8,357
Unrealized Loss Total	9
Mortgage-Backed Securities, Issued By Us Government Sponsored Enterprises [Member]
Fair Value Less than Twelve Months		7,207
Unrealized Loss Less than 12 Months		18
Fair Value 12 Months or More		0
Unrealized Loss 12 Months or More		0
Fair Value Total		7,207
Unrealized Loss Total		18
Temporarily Impaired Securities [Member]
Fair Value Less than Twelve Months	9,026	7,207
Unrealized Loss Less than 12 Months	21	18
Fair Value 12 Months or More	0	0
Unrealized Loss 12 Months or More	0	0
Fair Value Total	9,026	7,207
Unrealized Loss Total	$ 21	$ 18

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LOANS (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Mar. 31, 2012	Dec. 31, 2011		Mar. 31, 2011	Dec. 31, 2010
Gross loans	$ 390,810	$ 458,882		$ 417,971
Amortization of deferred loan fees and costs	(96)	(104)
Total loans	390,403			417,624	[1]
Allowance for loan losses	(8,510)	(10,378)	(9,568)	(10,034)		(10,118)	(10,015)
Total loans, net	381,893			407,590	[1]
Percentage Of Deferred Origination Fees	0.10%			(0.08%)
Percent Of Loans	100.00%			100.00%
Family Residential Real Estate 1 To 4 [Member]
Gross loans	48,487	59,504		52,182
Total loans	48,487			52,182
Allowance for loan losses	(1,314)	(1,892)	(1,585)	(1,661)		(2,451)	(1,985)
Percent Of Loans	12.42%			12.49%
Commercial Real Estate [Member]
Gross loans	193,221	204,412		192,047
Total loans	193,221			192,047
Allowance for loan losses	(5,228)	(4,502)	(4,804)	(4,771)		(3,609)	(3,111)
Percent Of Loans	49.48%			45.98%
Multi Family Residential Real Estate [Member]
Gross loans	19,501	28,168		23,377
Total loans	19,501			23,377
Allowance for loan losses	(123)	(174)	(107)	(127)		(183)	(640)
Percent Of Loans	5.00%			5.60%
Construction Loans Real Estate [Member]
Gross loans	54,716	77,211		70,846
Total loans	54,716			70,846
Allowance for loan losses	(482)	(1,172)	(1,311)	(1,540)		(1,271)	(349)
Percent Of Loans	14.02%			16.96%
Home Equity Line Of Credit [Member]
Gross loans	36,771	40,532		38,702
Total loans	36,771			38,702
Allowance for loan losses	(897)	(1,450)	(1,101)	(1,122)		(1,140)	(1,348)
Percent Of Loans	9.42%			9.27%
Real Estate [Member]
Gross loans	352,696			377,154
Percent Of Loans	90.34%			90.30%
Commercial and Industrial Other [Member]
Gross loans	31,044	40,646		33,146
Total loans	31,044			33,146
Allowance for loan losses	(386)	(1,052)	(555)	(719)		(1,081)	(1,052)
Percent Of Loans	7.95%			7.94%
Loans To Individuals and Overdrafts [Member]
Gross loans	7,070	8,409		7,671
Total loans	7,070			7,671
Allowance for loan losses	(80)	(136)	(105)	(94)		(383)	(1,530)
Percent Of Loans	1.81%			1.84%
Other Loans [Member]
Gross loans	$ 38,114			$ 40,817
Percent Of Loans	9.76%			9.78%

[1] Derived from audited consolidated financial statements.

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LOANS (Details 1) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
30+ Days Past Due	$ 2,998		$ 4,247
Non-accrual loans	14,676		17,623
Total Past Due	17,674		21,870
Current	373,136		396,101
Total loans	390,403		417,624	[1]
Amortization of deferred loan fees and costs	(96)	(104)
Commercial and Industrial [Member]
30+ Days Past Due	1,923		48
Non-accrual loans	259		171
Total Past Due	2,182		219
Current	28,862		32,927
Total loans	31,044		33,146
Construction Loans Real Estate [Member]
30+ Days Past Due	366		568
Non-accrual loans	2,649		4,072
Total Past Due	3,015		4,640
Current	51,701		66,206
Total loans	54,716		70,846
Multi Family Residential Real Estate [Member]
30+ Days Past Due	43		1,540
Non-accrual loans	1,508		0
Total Past Due	1,551		1,540
Current	17,950		21,837
Total loans	19,501		23,377
Commercial Real Estate [Member]
30+ Days Past Due	63		1,013
Non-accrual loans	7,685		10,425
Total Past Due	7,748		11,438
Current	185,473		180,609
Total loans	193,221		192,047
Loans To Individuals and Overdrafts [Member]
30+ Days Past Due	18		10
Non-accrual loans	124		176
Total Past Due	142		186
Current	6,928		7,485
Total loans	7,070		7,671
1 - 4 Family Residential Real Estate [Member]
30+ Days Past Due	472		735
Non-accrual loans	1,627		1,875
Total Past Due	2,099		2,610
Current	46,388		49,572
Total loans	48,487		52,182
Home Equity Line Of Credit [Member]
30+ Days Past Due	113		333
Non-accrual loans	824		904
Total Past Due	937		1,237
Current	35,834		37,465
Total loans	$ 36,771		$ 38,702

[1] Derived from audited consolidated financial statements.

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BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2012

Organization, Consolidation and Presentation Of Financial Statements [Abstract]

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

NOTE A - BASIS OF PRESENTATION

New Century Bancorp, Inc. (the “Company”) is a bank holding company whose principal business activity consists of ownership of New Century Bank (the “Bank”). The Bank is engaged in general commercial and retail banking and operates under the banking laws of North Carolina and the rules and regulations of the Federal Deposit Insurance Corporation and the North Carolina Commissioner of Banks. The Bank undergoes periodic examinations by those regulatory authorities.

All significant inter-company transactions and balances have been eliminated in consolidation. In management’s opinion, the financial information, which is unaudited, reflects all adjustments (consisting solely of normal recurring adjustments) necessary for a fair presentation of the financial information as of and for the three and six month periods ended June 30, 2012 and 2011, in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

The preparation of consolidated financial statements requires management to make estimates and assumptions that affect reported amounts of assets and liabilities at the date of the financial statements, as well as the amounts of income and expense during the reporting period. Actual results could differ from those estimates. Operating results for the three and six month periods ended June 30, 2012 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2012.

The organization and business of the Company, accounting policies followed by the Company and other relevant information are contained in the notes to the financial statements filed as part of the Company’s 2011 Annual Report on Form 10-K, filed with the Securities and Exchange Commission (“SEC”) on
March 28, 2012. This quarterly report should be read in conjunction with the Annual Report.

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LOANS (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended	12 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Dec. 31, 2011
Recorded Investment with No Related Allowance	$ 21,155		$ 21,155	$ 15,271
Unpaid Principal Balance With No Related Allowance	24,013		24,013	17,586
Average Recorded Investment With No Related Allowance	20,066		18,468	13,086
Interest Income Recognized On Impaired Loans With No Related Allowance	225		332	345
Recorded Investment with Related Allowance	3,100		3,100	9,564
Unpaid Principal Balance with Related Allowance,	3,686		3,686	11,239
Related Allowance	520		520	1,515
Average Recorded Investment With Related Allowance	4,357		6,093	8,006
Interest Income Recognized on impaired loans with Related Allowance,	44		55	121
Recorded Investment Total	24,255		24,255	24,835
Unpaid Principal Balance Total	27,699		27,699	28,825
Average Recorded Investment Total	24,423		24,561	21,092
Interest Income Recognized on impaired Loans Total	269		387	466
Residential Real Estate [Member]
Related Allowance	259		259	328
Recorded Investment Total	4,010		4,010	3,974
Unpaid Principal Balance Total	4,802		4,802	4,962
Average Recorded Investment Total	4,019		4,005	4,472
Interest Income Recognized on impaired Loans Total	35		57	78
Commercial and Industrial [Member]
Recorded Investment with No Related Allowance	512		512	478
Unpaid Principal Balance With No Related Allowance	777		777	808
Average Recorded Investment With No Related Allowance	480	290	480	290
Interest Income Recognized On Impaired Loans With No Related Allowance	6		13	25
Recorded Investment with Related Allowance	7		7	0
Unpaid Principal Balance with Related Allowance,	7		7	0
Related Allowance	2		2	0
Average Recorded Investment With Related Allowance	64		43	272
Interest Income Recognized on impaired loans with Related Allowance,	0		12	0
Construction Loans Real Estate [Member]
Recorded Investment with No Related Allowance	2,312		2,312	1,011
Unpaid Principal Balance With No Related Allowance	2,915		2,915	1,166
Average Recorded Investment With No Related Allowance	2,134		1,760	1,539
Interest Income Recognized On Impaired Loans With No Related Allowance	6		6	23
Recorded Investment with Related Allowance	1,192		1,192	3,365
Unpaid Principal Balance with Related Allowance,	1,192		1,192	4,085
Related Allowance	167		167	674
Average Recorded Investment With Related Allowance	1,443		2,083	1,269
Interest Income Recognized on impaired loans with Related Allowance,	11		12	4
Commercial Real Estate [Member]
Recorded Investment with No Related Allowance	13,683		13,683	9,195
Unpaid Principal Balance With No Related Allowance	15,187		15,187	10,085
Average Recorded Investment With No Related Allowance	12,810		11,605	7,889
Interest Income Recognized On Impaired Loans With No Related Allowance	196		284	158
Recorded Investment with Related Allowance	852		852	5,039
Unpaid Principal Balance with Related Allowance,	1,114		1,114	5,929
Related Allowance	75		75	498
Average Recorded Investment With Related Allowance	1,744		2,842	4,043
Interest Income Recognized on impaired loans with Related Allowance,	13		13	71
Loans To Individuals and Overdrafts [Member]
Recorded Investment with No Related Allowance	121		121	217
Unpaid Principal Balance With No Related Allowance	138		138	234
Average Recorded Investment With No Related Allowance	149		171	175
Interest Income Recognized On Impaired Loans With No Related Allowance	1		1	4
Recorded Investment with Related Allowance	15		15	16
Unpaid Principal Balance with Related Allowance,	16		16	16
Related Allowance	7		7	15
Average Recorded Investment With Related Allowance	35		29	102
Interest Income Recognized on impaired loans with Related Allowance,	0		0	1
Multi Family Residential Real Estate [Member]
Recorded Investment with No Related Allowance	1,508		1,508	1,540
Unpaid Principal Balance With No Related Allowance	1,508		1,508	1,540
Average Recorded Investment With No Related Allowance	1,524		1,529	1,041
Interest Income Recognized On Impaired Loans With No Related Allowance	0		0	102
Recorded Investment with Related Allowance	43		43	0
Unpaid Principal Balance with Related Allowance,	43		43	0
Related Allowance	10		10	0
Average Recorded Investment With Related Allowance	21		14	0
Interest Income Recognized on impaired loans with Related Allowance,	1		1	0
1 - 4 Family Residential Real Estate [Member]
Recorded Investment with No Related Allowance	1,683		1,683	2,100
Unpaid Principal Balance With No Related Allowance	1,932		1,932	2,930
Average Recorded Investment With No Related Allowance	1,776		1,884	1,746
Interest Income Recognized On Impaired Loans With No Related Allowance	9		13	33
Recorded Investment with Related Allowance	810		810	736
Unpaid Principal Balance with Related Allowance,	1,133		1,133	774
Related Allowance	162		162	170
Average Recorded Investment With Related Allowance	792		774	1,999
Interest Income Recognized on impaired loans with Related Allowance,	14		24	35
Home Equity Line Of Credit [Member]
Recorded Investment with No Related Allowance	1,336		1,336	730
Unpaid Principal Balance With No Related Allowance	1,556		1,556	823
Average Recorded Investment With No Related Allowance	1,193		1,039	406
Interest Income Recognized On Impaired Loans With No Related Allowance	7		15	0
Recorded Investment with Related Allowance	181		181	408
Unpaid Principal Balance with Related Allowance,	181		181	435
Related Allowance	97		97	158
Average Recorded Investment With Related Allowance	258		308	321
Interest Income Recognized on impaired loans with Related Allowance,	5		5	10
Commercial Loan [Member]
Related Allowance	254		254	1,172
Recorded Investment Total	20,109		20,109	20,628
Unpaid Principal Balance Total	22,743		22,743	23,613
Average Recorded Investment Total	20,220		20,356	16,343
Interest Income Recognized on impaired Loans Total	233		329	383
Consumer Loan [Member]
Related Allowance	7		7	15
Recorded Investment Total	136		136	233
Unpaid Principal Balance Total	154		154	250
Average Recorded Investment Total	184		200	277
Interest Income Recognized on impaired Loans Total	$ 1		$ 1	$ 5

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CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
ASSETS
Cash and due from banks	$ 15,731	$ 18,478	[1]
Interest-earning deposits in other banks	56,558	55,590	[1]
Federal funds sold	3,028	3,028	[1]
Investment securities available for sale, at fair value	71,808	67,854	[1]
Loans	390,403	417,624	[1]
Allowance for loan losses	(8,510)	(10,034)
NET LOANS	381,893	407,590	[1]
Accrued interest receivable	1,628	2,003	[1]
Stock in Federal Home Loan Bank of Atlanta ("FHLB"), at cost	1,034	1,248	[1]
Other non-marketable securities	1,075	1,080	[1]
Foreclosed real estate	3,859	3,031	[1]
Premises and equipment held for sale	0	1,113	[1]
Premises and equipment, net	11,096	11,243	[1]
Bank-Owned Life Insurance ("BOLI")	8,106	7,981	[1]
Core deposit intangible	356	545	[1]
Other assets	7,510	8,867	[1]
TOTAL ASSETS	563,682	589,651	[1]
LIABILITIES AND SHAREHOLDERS' EQUITY
Demand	72,683	74,569	[1]
Savings	23,985	24,461	[1]
Money market and NOW	95,374	92,600	[1]
Time	279,142	309,747	[1]
TOTAL DEPOSITS	471,184	501,377	[1]
Short-term debt	22,953	21,877	[1]
Long-term debt	12,372	14,372	[1]
Accrued interest payable	281	330	[1]
Accrued expenses and other liabilities	3,938	2,149	[1]
TOTAL LIABILITIES	510,728	540,105	[1]
Shareholders' Equity
Common stock, $1 par value, 25,000,000 shares authorized; 6,913,636 and 6,860,367 shares issued and outstanding at June 30, 2012 and December 31, 2011, respectively	6,914	6,860	[1]
Additional paid-in capital	41,985	41,851	[1]
Retained earnings (accumulated deficit)	2,820	(450)	[1]
Accumulated other comprehensive income	1,235	1,285	[1]
TOTAL SHAREHOLDERS' EQUITY	52,954	49,546	[1]
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 563,682	$ 589,651	[1]

[1] Derived from audited consolidated financial statements.

XML

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (USD $) In Thousands, except Share data	Common Stock [Member]	Common Stock Reveivable [Member]	Additional Paid-In Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Total
Balance at Dec. 31, 2010	$ 6,914	$ 0	$ 41,887	$ (286)	$ 1,178	$ 49,693
Balance, (in shares) at Dec. 31, 2010	6,913,636
Net income (loss)	0	0	0	(740)	0	(740)
Common stock receivable	0	(242)	0	0	0	(242)
Other comprehensive income, net	0	0	0	0	69	69
Stock based compensation	0	0	185	0	0	185
Balance at Jun. 30, 2011	6,914	(242)	42,072	(1,026)	1,247	48,965
Balance, (in shares) at Jun. 30, 2011	6,913,636
Balance at Dec. 31, 2011	6,860	0	41,851	(450)	1,285	49,546	[1]
Balance, (in shares) at Dec. 31, 2011	6,860,367
Net income (loss)	0	0	0	3,270	0	3,270
Sale of common stock	54	0	111	0	0	165
Sale of common stock (in shares)	53,269
Common stock receivable	0	0	0	0	0	0
Other comprehensive income, net	0	0	0	0	(50)	(50)
Stock based compensation	0	0	23	0	0	23
Balance at Jun. 30, 2012	$ 6,914	$ 0	$ 41,985	$ 2,820	$ 1,235	$ 52,954
Balance, (in shares) at Jun. 30, 2012	6,913,636

[1] Derived from audited consolidated financial statements.

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LOANS (Details 5) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Loans	$ 390,403	$ 417,624	[1]
Commercial and Industrial [Member]
Loans	31,044	33,146
Commercial and Industrial [Member] | Superior [Member]
Loans	764	722
Commercial and Industrial [Member] | Very Good [Member]
Loans	32	154
Commercial and Industrial [Member] | Good [Member]
Loans	3,067	5,184
Commercial and Industrial [Member] | Acceptable [Member]
Loans	9,870	8,224
Commercial and Industrial [Member] | Acceptable With Care [Member]
Loans	15,441	15,048
Commercial and Industrial [Member] | Special Mention [Member]
Loans	1,339	3,062
Commercial and Industrial [Member] | Substandard [Member]
Loans	531	752
Commercial and Industrial [Member] | Doubtful [Member]
Loans	0	0
Commercial and Industrial [Member] | Loss [Member]
Loans	0	0
Construction Loans [Member]
Loans	54,716	70,846
Construction Loans [Member] | Superior [Member]
Loans	55	59
Construction Loans [Member] | Very Good [Member]
Loans	4	6
Construction Loans [Member] | Good [Member]
Loans	655	2,369
Construction Loans [Member] | Acceptable [Member]
Loans	5,049	6,685
Construction Loans [Member] | Acceptable With Care [Member]
Loans	40,670	54,087
Construction Loans [Member] | Special Mention [Member]
Loans	4,629	2,671
Construction Loans [Member] | Substandard [Member]
Loans	3,654	4,969
Construction Loans [Member] | Doubtful [Member]
Loans	0	0
Construction Loans [Member] | Loss [Member]
Loans	0	0
Commercial Real Estate [Member]
Loans	193,221	192,047
Commercial Real Estate [Member] | Superior [Member]
Loans	0	0
Commercial Real Estate [Member] | Very Good [Member]
Loans	307	429
Commercial Real Estate [Member] | Good [Member]
Loans	14,303	16,510
Commercial Real Estate [Member] | Acceptable [Member]
Loans	63,276	67,922
Commercial Real Estate [Member] | Acceptable With Care [Member]
Loans	74,336	60,604
Commercial Real Estate [Member] | Special Mention [Member]
Loans	23,338	27,177
Commercial Real Estate [Member] | Substandard [Member]
Loans	17,661	19,405
Commercial Real Estate [Member] | Doubtful [Member]
Loans	0	0
Commercial Real Estate [Member] | Loss [Member]
Loans	0	0
Multi Family Residential Real Estate [Member]
Loans	19,501	23,377
Multi Family Residential Real Estate [Member] | Superior [Member]
Loans	0	0
Multi Family Residential Real Estate [Member] | Very Good [Member]
Loans	0	0
Multi Family Residential Real Estate [Member] | Good [Member]
Loans	1,687	1,064
Multi Family Residential Real Estate [Member] | Acceptable [Member]
Loans	5,793	12,828
Multi Family Residential Real Estate [Member] | Acceptable With Care [Member]
Loans	10,470	7,820
Multi Family Residential Real Estate [Member] | Special Mention [Member]
Loans	0	125
Multi Family Residential Real Estate [Member] | Substandard [Member]
Loans	1,551	1,540
Multi Family Residential Real Estate [Member] | Doubtful [Member]
Loans	0	0
Multi Family Residential Real Estate [Member] | Loss [Member]
Loans	0	0
Family Residential Real Estate 1 To 4 [Member]
Loans	48,487	52,182
Family Residential Real Estate 1 To 4 [Member] | Pass [Member]
Loans	41,324	43,647
Family Residential Real Estate 1 To 4 [Member] | Special Mention [Member]
Loans	3,528	2,925
Family Residential Real Estate 1 To 4 [Member] | Substandard [Member]
Loans	3,635	5,610
Home Equity Line Of Credit [Member]
Loans	36,771	38,702
Home Equity Line Of Credit [Member] | Pass [Member]
Loans	33,746	35,127
Home Equity Line Of Credit [Member] | Special Mention [Member]
Loans	1,200	1,391
Home Equity Line Of Credit [Member] | Substandard [Member]
Loans	1,825	2,184
Loans To Individuals and Overdrafts [Member]
Loans	7,070	7,671
Loans To Individuals and Overdrafts [Member] | Pass [Member]
Loans	6,888	7,447
Loans To Individuals and Overdrafts [Member] | Non Pass [Member]
Loans	$ 182	$ 224

[1] Derived from audited consolidated financial statements.

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PER SHARE RESULTS (Details Textual)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	371,883	431,274	372,883	428,878

XML

LOANS (Details 6) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Non-accrual loans	$ 14,676	$ 17,623
Accruing TDRs	1,903	2,013
Total non-performing loans	16,579	19,636
Foreclosed real estate	3,859	3,031	[1]
Total non-performing assets	$ 20,438	$ 22,667

[1] Derived from audited consolidated financial statements.

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FAIR VALUE MEASUREMENTS (Details 1) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Assets carried at fair value on a nonrecurring basis	$ 15,253	$ 17,497
Impaired Loans [Member]
Assets carried at fair value on a nonrecurring basis	11,394	13,353
Foreclosed Real Estate [Member]
Assets carried at fair value on a nonrecurring basis	3,859	3,031
Premises and Equipment Held For Sale [Member]
Assets carried at fair value on a nonrecurring basis		1,113
Fair Value, Inputs, Level 1 [Member]
Assets carried at fair value on a nonrecurring basis	0	0
Fair Value, Inputs, Level 1 [Member] | Impaired Loans [Member]
Assets carried at fair value on a nonrecurring basis	0	0
Fair Value, Inputs, Level 1 [Member] | Foreclosed Real Estate [Member]
Assets carried at fair value on a nonrecurring basis	0	0
Fair Value, Inputs, Level 1 [Member] | Premises and Equipment Held For Sale [Member]
Assets carried at fair value on a nonrecurring basis		0
Fair Value, Inputs, Level 2 [Member]
Assets carried at fair value on a nonrecurring basis	0	0
Fair Value, Inputs, Level 2 [Member] | Impaired Loans [Member]
Assets carried at fair value on a nonrecurring basis	0	0
Fair Value, Inputs, Level 2 [Member] | Foreclosed Real Estate [Member]
Assets carried at fair value on a nonrecurring basis	0	0
Fair Value, Inputs, Level 2 [Member] | Premises and Equipment Held For Sale [Member]
Assets carried at fair value on a nonrecurring basis		0
Fair Value, Inputs, Level 3 [Member]
Assets carried at fair value on a nonrecurring basis	15,253	17,497
Fair Value, Inputs, Level 3 [Member] | Impaired Loans [Member]
Assets carried at fair value on a nonrecurring basis	11,394	13,353
Fair Value, Inputs, Level 3 [Member] | Foreclosed Real Estate [Member]
Assets carried at fair value on a nonrecurring basis	3,859	3,031
Fair Value, Inputs, Level 3 [Member] | Premises and Equipment Held For Sale [Member]
Assets carried at fair value on a nonrecurring basis		$ 1,113

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$ 3,270	$ (740)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Provision (recovery) for loan losses	(2,785)	3,706
Depreciation and amortization of premises and equipment	286	336
Amortization and accretion of investment securities	281	410
Amortization of deferred loan fees and costs	(96)	(104)
Amortization of core deposit intangible	57	77
Stock-based compensation	23	185
Gain on branch sale	557	0
Increase in cash surrender value of bank owned life insurance	(125)	(127)
Net loss on sale and write-downs of foreclosed real estate	545	903
Net (gains) loss on sale of investments	123	(26)
Change in assets and liabilities:
Net change in accrued interest receivable	373	136
Net change in other assets	1,916	222
Net change in accrued expenses and other liabilities	1,745	673
NET CASH PROVIDED BY OPERATING ACTIVITIES	5,056	5,651
CASH FLOWS FROM INVESTING ACTIVITIES
Redemption of FHLB stock	214	83
Purchase of investment securities available for sale	(19,372)	(7,256)
Maturities of investment securities available for sale	8,021	14,237
Mortgage-backed securities pay-downs	6,417	5,274
Sale of investment securities available for sale	500	500
Net cash payment on branch sale	(13,001)	0
Net change in loans outstanding	24,602	6,970
Proceeds from sale of foreclosed real estate	2,265	1,177
Purchases of premises and equipment	(109)	(32)
NET CASH PROVIDED BY INVESTING ACTIVITIES	9,537	20,953
CASH FLOWS FROM FINANCING ACTIVITIES
Net change in deposits	(15,613)	4,213
Proceeds from short-term debt	3,424	80
Repayments on short-term debt	(2,348)	0
Repayments on long-term debt	(2,000)	(2,000)
Proceeds from sale of common stock	165	0
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES	(16,372)	2,293
NET CHANGE IN CASH AND CASH EQUIVALENTS	(1,779)	28,897
CASH AND CASH EQUIVALENTS, BEGINNING	77,096	35,902
CASH AND CASH EQUIVALENTS, ENDING	75,317	64,799
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest paid	3,506	4,450
Non-cash transactions:
Unrealized gains (losses) on investment securities available for sale, net of tax	(50)	69
Transfers from loans to foreclosed real estate	3,638	1,805
Common stock receivable	$ 0	$ (242)

XML

CONSOLIDATED BALANCE SHEETS [Parenthetical] (USD $)	Jun. 30, 2012	Dec. 31, 2011
Preferred stock, par value (in dollars per share)	$ 1	$ 1
Preferred stock, shares authorized	25,000,000	25,000,000
Preferred stock, shares issued	6,913,636	6,860,367
Preferred stock, shares outstanding	6,913,636	6,860,367

XML

FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2012

Fair Value Disclosures [Abstract]

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

The following tables summarize quantitative disclosures about the fair value measurement for each category of assets carried at fair value on a recurring basis as of June 30, 2012 and December 31, 2011 (dollars in thousands):

			Quoted Prices in		Significant
Investment securities			Active Markets		Other		Significant
available for sale			for Identical		Observable		Unobservable
June 30, 2012	Fair value		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
U.S. government agencies	$	32,631	$	-	$	32,631	$	-
Mortgage-backed securities - Government Sponsored- Enterprises (“GSE’s”)		32,594		-		32,594		-
Municipal bonds		6,583		-		6,583		-
Total	$	71,808	$	-	$	71,808	$	-

			Quoted Prices in		Significant
Investment securities			Active Markets		Other		Significant
available for sale			for Identical		Observable		Unobservable
December 31, 2011	Fair value		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
U.S. government agencies	$	26,412	$	-	$	26,412	$	-
Mortgage-backed securities - GSE’s		35,169		-		35,169		-
Municipal bonds		6,273		-		6,273		-
Total	$	67,854	$	-	$	67,854	$	-

Fair Value Measurements, Nonrecurring [Table Text Block]

The following tables summarize quantitative disclosures about the fair value measurement for each category of assets carried at fair value on a non-recurring basis as of June 30, 2012 and December 31, 2011 (dollars in thousands):

			Quoted Prices in		Significant
			Active Markets		Other		Significant
Asset Category			for Identical		Observable		Unobservable
June 30, 2012	Fair value		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
Impaired loans	$	11,394	$	-	$	-	$	11,394
Foreclosed real estate		3,859		-		-		3,859
Total	$	15,253	$	-	$	-	$	15,253

Of the $11.4 million in impaired loans at June 30, 2012 there were $3.1 million in loans with specific reserves of $520,000 along with $8.8 million in loans without specific reserves which had been partially charged-off.

			Quoted Prices in		Significant
			Active Markets		Other		Significant
Asset Category			for Identical		Observable		Unobservable
December 31, 2011	Fair value		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
Impaired loans	$	13,353	$	-	$	-	$	13,353
Foreclosed real estate		3,031		-		-		3,031
Premises and equipment held for sale		1,113		-		-		1,113
Total	$	17,497	$	-	$	-	$	17,497

XML

DOCUMENT AND ENTITY INFORMATION	6 Months Ended
	Jun. 30, 2012	Aug. 31, 2012
Entity Registrant Name	NEW CENTURY BANCORP INC
Entity Central Index Key	0001263762
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Trading Symbol	ncbc
Entity Common Stock, Shares Outstanding		6,913,636
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2012
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2012

XML

FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2012

Investments, All Other Investments [Abstract]

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

The following table presents the carrying values and estimated fair values of the Company's financial instruments at June 30, 2012 and December 31, 2011:

	June 30, 2012
	Carrying		Estimated
	Amount		Fair Value		Level 1		Level 2		Level 3
	(In thousands)
Financial assets:
Cash and due from banks	$	15,731	$	15,731	$	15,731	$	-	$	-
Interest-earning deposits in other banks		56,558		56,558		56,558		-		-
Federal funds sold		3,028		3,028		3,028		-		-
Investment securities available for sale		71,808		71,808		-		71,808		-
Loans, net		381,220		398,540		-		-		398,540
Accrued interest receivable		1,628		1,628		-		-		1,628
Stock in the FHLB		1,034		1,034		-		-		1,034
Other non-marketable securities		1,075		1,075		-		-		1,075
Financial liabilities:
Deposits	$	471,184	$	479,845	$	-	$	479,845	$	-
Short-term debt		22,953		22,953		-		22,953		-
Long-term debt		12,372		7,661		-		7,661		-
Accrued interest payable		281		281		-		-		281

	December 31, 2011
	Carrying		Estimated
	Amount		Fair Value		Level 1		Level 2		Level 3
	(In thousands)
Financial assets:
Cash and due from banks	$	18,478	$	18,478	$	18,478	$	-	$	-
Interest-earning deposits in other banks		55,590		55,590		55,590		-		-
Federal funds sold		3,028		3,028		3,028		-		-
Investment securities available for sale		67,854		67,854		-		67,854		-
Loans, net		407,590		424,851		-		-		424,851
Premises and equipment held for sale		1,113		1,113		-		-		1,113
Accrued interest receivable		2,003		2,003		-		-		2,003
Stock in the FHLB		1,248		1,248		-		-		1,248
Other non-marketable securities		1,080		1,080		-		-		1,080
Financial liabilities:
Deposits	$	501,377	$	509,454	$	-	$	509,454	$	-
Short-term debt		21,877		21,877		-		21,877		-
Long-term debt		14,372		9,661		-		9,661		-
Accrued interest payable		330		330		-		-		330

XML

CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
INTEREST INCOME
Loans	$ 5,887	$ 7,251	$ 12,042	$ 14,555
Federal funds sold and interest-earning deposits in other banks	36	22	72	39
Investments	402	525	830	1,119
TOTAL INTEREST INCOME	6,325	7,798	12,944	15,713
INTEREST EXPENSE
Money market, NOW and savings deposits	127	180	228	397
Time deposits	1,451	1,873	3,007	3,753
Short-term debt	26	66	60	135
Long-term debt	80	74	162	148
TOTAL INTEREST EXPENSE	1,684	2,193	3,457	4,433
NET INTEREST INCOME	4,641	5,605	9,487	11,280
PROVISION (RECOVERY) FOR LOAN LOSSES	(649)	2,542	(2,785)	3,706
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	5,290	3,063	12,273	7,574
NON-INTEREST INCOME
Fees from pre-sold mortgages	75	61	113	87
Service charges on deposit accounts	291	376	609	758
Gain on branch sale	557	0	557	0
Other fees and income	276	455	547	688
TOTAL NON-INTEREST INCOME	1,199	892	1,826	1,533
NON-INTEREST EXPENSE
Personnel	2,047	2,284	4,008	4,675
Occupancy and equipment	311	358	670	720
Deposit insurance	187	235	381	497
Professional fees	470	503	940	1,133
Information systems	368	441	735	827
Foreclosure-related expenses	521	700	545	903
Other	744	818	1,586	1,662
TOTAL NON-INTEREST EXPENSE	4,648	5,339	8,865	10,417
INCOME BEFORE INCOME TAX (BENEFIT)	1,841	(1,384)	5,234	(1,310)
INCOME TAX (BENEFIT)	683	(523)	1,964	(570)
NET INCOME (LOSS)	$ 1,158	$ (861)	$ 3,270	$ (740)
NET INCOME (LOSS) PER COMMON SHARE
Basic	$ 0.17	$ (0.13)	$ 0.47	$ (0.11)
Diluted	$ 0.17	$ (0.13)	$ 0.47	$ (0.11)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic	6,913,636	6,913,636	6,886,417	6,913,636
Diluted	6,913,636	6,913,636	6,886,417	6,913,636

XML

FAIR VALUE OF FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2012

Investments, All Other Investments [Abstract]

Financial Instruments Disclosure [Text Block]

NOTE E – FAIR VALUE OF FINANCIAL INSTRUMENTS

The following table presents the carrying values and estimated fair values of the Company's financial instruments at June 30, 2012 and December 31, 2011:

	June 30, 2012
	Carrying		Estimated
	Amount		Fair Value		Level 1		Level 2		Level 3
	(In thousands)
Financial assets:
Cash and due from banks	$	15,731	$	15,731	$	15,731	$	-	$	-
Interest-earning deposits in other banks		56,558		56,558		56,558		-		-
Federal funds sold		3,028		3,028		3,028		-		-
Investment securities available for sale		71,808		71,808		-		71,808		-
Loans, net		381,220		398,540		-		-		398,540
Accrued interest receivable		1,628		1,628		-		-		1,628
Stock in the FHLB		1,034		1,034		-		-		1,034
Other non-marketable securities		1,075		1,075		-		-		1,075
Financial liabilities:
Deposits	$	471,184	$	479,845	$	-	$	479,845	$	-
Short-term debt		22,953		22,953		-		22,953		-
Long-term debt		12,372		7,661		-		7,661		-
Accrued interest payable		281		281		-		-		281

	December 31, 2011
	Carrying		Estimated
	Amount		Fair Value		Level 1		Level 2		Level 3
	(In thousands)
Financial assets:
Cash and due from banks	$	18,478	$	18,478	$	18,478	$	-	$	-
Interest-earning deposits in other banks		55,590		55,590		55,590		-		-
Federal funds sold		3,028		3,028		3,028		-		-
Investment securities available for sale		67,854		67,854		-		67,854		-
Loans, net		407,590		424,851		-		-		424,851
Premises and equipment held for sale		1,113		1,113		-		-		1,113
Accrued interest receivable		2,003		2,003		-		-		2,003
Stock in the FHLB		1,248		1,248		-		-		1,248
Other non-marketable securities		1,080		1,080		-		-		1,080
Financial liabilities:
Deposits	$	501,377	$	509,454	$	-	$	509,454	$	-
Short-term debt		21,877		21,877		-		21,877		-
Long-term debt		14,372		9,661		-		9,661		-
Accrued interest payable		330		330		-		-		330

Cash and Due from Banks, Interest-Earning Deposits in Other Banks and Federal Funds Sold

The carrying amounts for cash and due from banks, interest-earning deposits in other banks and federal funds sold approximate fair value because of the short maturities of those instruments.

Investment Securities Available for Sale

Fair value for investment securities available for sale equals quoted market price if such information is available. If a quoted market price is not available, fair value is estimated using prices quoted for similar investments or quoted market prices obtained from independent pricing services.

Loans Held for Sale

Loans held for sale are carried at fair value which is determined by offers to purchase or expected value of future cash flows. Unrealized losses on loans held for sale are included in losses on sales of loans and leases in the consolidated statement of operations.

Loans

The fair value of loans is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. However, the values likely do not represent exit prices due to distressed market conditions.

Stock in Federal Home Loan Bank of Atlanta and Other Non-marketable Securities

The fair value for FHLB stock approximates carrying value, based on the redemption provisions of the Federal Home Loan Bank. The fair value of stock in other non-marketable securities is assumed to approximate carrying value.

Premises and Equipment Held for Sale

Premises and equipment held for sale are stated at book value which approximates fair market value.

Deposits

The fair value of demand deposits is the amount payable on demand at the reporting date. The fair values of time deposits are estimated using the rates currently offered for instruments of similar remaining maturities.

Short-term Debt

The fair values of short-term debt (sweep accounts that re-price daily and short-term FHLB advances) are based on discounting expected cash flows at the interest rate for debt with the same or similar remaining maturities and collateral requirements.

Long-term Debt

The fair values of long-term debt are based on discounting expected cash flows at the interest rate for debt with the same or similar remaining maturities and collateral requirements.

Accrued Interest Receivable and Accrued Interest Payable

The carrying amounts of accrued interest receivable and payable approximate fair value, because of the short maturities of these instruments.

Financial Instruments with Off-Balance Sheet Risk

With regard to financial instruments with off-balance sheet risk, it is not practicable to estimate the fair value of future financing commitments.

XML

FAIR VALUE MEASUREMENTS

6 Months Ended

Jun. 30, 2012

Fair Value Disclosures [Abstract]

Fair Value Disclosures [Text Block]

NOTE D – FAIR VALUE MEASUREMENTS

Accounting Standards Codification (“ASC”) 820 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 does not require any new fair value measurements, but clarifies and standardizes some divergent practices that have emerged since prior guidance was issued. ASC 820 creates a three-level hierarchy under which individual fair value estimates are to be ranked based on the relative reliability of the inputs used in the valuation.

Financial instruments include cash and due from banks, interest-earning deposits with banks, investments, loans, BOLI, deposit accounts and borrowings. Fair value estimates are made at a specific moment in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument.

Because no active market readily exists for a portion of the Company’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value:

Fair Value Hierarchy

The Company groups assets and liabilities at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. These levels are:

· Level 1 – Valuation is based upon quoted prices for identical instruments traded in active markets.

· Level 2 – Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market.  

· Level 3 – Valuation is generated from model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flows models and similar techniques.

The following is a description of valuation methodologies used for assets and liabilities recorded at fair value on a recurring basis.

Investment Securities Available-for-Sale (“AFS”)

Investment securities available-for-sale are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted prices, if available. If quoted prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss assumptions. Level 1 securities include those traded on an active exchange, such as the New York Stock Exchange, U.S. Treasury securities that are traded by dealers or brokers in active over-the-counter markets and money market funds. Level 2 securities include U.S. government agencies, mortgage-backed securities issued by government sponsored entities, and municipal bonds. There have been no changes in valuation techniques for the quarter ended June 30, 2012. Valuation techniques are consistent with techniques used in prior periods.

The following tables summarize quantitative disclosures about the fair value measurement for each category of assets carried at fair value on a recurring basis as of June 30, 2012 and December 31, 2011 (dollars in thousands):

			Quoted Prices in		Significant
Investment securities			Active Markets		Other		Significant
available for sale			for Identical		Observable		Unobservable
June 30, 2012	Fair value		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
U.S. government agencies	$	32,631	$	-	$	32,631	$	-
Mortgage-backed securities - Government Sponsored- Enterprises (“GSE’s”)		32,594		-		32,594		-
Municipal bonds		6,583		-		6,583		-
Total	$	71,808	$	-	$	71,808	$	-

			Quoted Prices in		Significant
Investment securities			Active Markets		Other		Significant
available for sale			for Identical		Observable		Unobservable
December 31, 2011	Fair value		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
U.S. government agencies	$	26,412	$	-	$	26,412	$	-
Mortgage-backed securities - GSE’s		35,169		-		35,169		-
Municipal bonds		6,273		-		6,273		-
Total	$	67,854	$	-	$	67,854	$	-

The following is a description of valuation methodologies used for assets recorded at fair value on a non-recurring basis.

Loans

The Company does not record loans at fair value on a recurring basis. However, from time to time, a loan is considered impaired and an allowance for loan losses is established. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered impaired. Once a loan is identified as individually impaired, management measures impairment in accordance with ASC 310, “Receivables”. The fair value of impaired loans is estimated using one of several methods, including collateral value, market value of similar debt, enterprise value, or liquidation value and discounted cash flows. Those impaired loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceed the recorded investments in such loans. At June 30, 2012 and December 31, 2011, substantially all of the total impaired loans were evaluated based on the fair value of the collateral. Impaired loans where an allowance is established based on the fair value of collateral require classification in the fair value hierarchy. When the fair value of the collateral is based on an observable market price or a current appraised value, the Company records the impaired loan as non-recurring Level 2. When an appraised value is not available or management determines the fair value of the collateral is further impaired below the appraised value and there is no observable market price, the Company records the impaired loan as non-recurring Level 3. There were no transfers between levels from the prior reporting periods. There have been no changes in valuation techniques for the quarter ended June 30, 2012. Valuation techniques are consistent with techniques used in prior periods.

Foreclosed Real Estate

Foreclosed real estate are properties recorded at the balance of the loan or an estimated fair value less estimated selling costs, whichever is less. Inputs include appraised values on the properties or recent sales activity for similar assets in the property’s market. Therefore, foreclosed real estate is classified within Level 3 of the hierarchy. There have been no changes in valuation techniques for the quarter ended June 30, 2012. Valuation techniques are consistent with techniques used in prior quarters.

Premises and Equipment Held for Sale

Premises and equipment held for sale are stated at book value which approximates fair market value.

The following tables summarize quantitative disclosures about the fair value measurement for each category of assets carried at fair value on a non-recurring basis as of June 30, 2012 and
December 31, 2011 (dollars in thousands):

			Quoted Prices in		Significant
			Active Markets		Other		Significant
Asset Category			for Identical		Observable		Unobservable
June 30, 2012	Fair value		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
Impaired loans	$	11,394	$	-	$	-	$	11,394
Foreclosed real estate		3,859		-		-		3,859
Total	$	15,253	$	-	$	-	$	15,253

Of the $11.4 million in impaired loans at June 30, 2012 there were $3.1 million in loans with specific reserves of $520,000 along with $8.8 million in loans without specific reserves which had been partially charged-off.

			Quoted Prices in		Significant
			Active Markets		Other		Significant
Asset Category			for Identical		Observable		Unobservable
December 31, 2011	Fair value		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
Impaired loans	$	13,353	$	-	$	-	$	13,353
Foreclosed real estate		3,031		-		-		3,031
Premises and equipment held for sale		1,113		-		-		1,113
Total	$	17,497	$	-	$	-	$	17,497

Of the $13.4 million in impaired loans at December 31, 2011 there were $9.6 million in loans with specific reserves of $1.5 million along with $5.3 million in loans without specific reserves which had been partially charged-off.

XML

FAIR VALUE MEASUREMENTS (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Assets carried at fair value on a recurring basis	$ 71,808	$ 67,854
Municipal Bonds [Member]
Assets carried at fair value on a recurring basis	6,583	6,273
Us Government Agencies Debt Securities [Member]
Assets carried at fair value on a recurring basis	32,631	26,412
Mortgage-Backed Securities, Issued By Us Government Sponsored Enterprises [Member]
Assets carried at fair value on a recurring basis	32,594	35,169
Fair Value, Inputs, Level 1 [Member]
Assets carried at fair value on a recurring basis	0	0
Fair Value, Inputs, Level 1 [Member] | Municipal Bonds [Member]
Assets carried at fair value on a recurring basis	0	0
Fair Value, Inputs, Level 1 [Member] | Us Government Agencies Debt Securities [Member]
Assets carried at fair value on a recurring basis	0	0
Fair Value, Inputs, Level 1 [Member] | Mortgage-Backed Securities, Issued By Us Government Sponsored Enterprises [Member]
Assets carried at fair value on a recurring basis	0	0
Fair Value, Inputs, Level 2 [Member]
Assets carried at fair value on a recurring basis	71,808	67,854
Fair Value, Inputs, Level 2 [Member] | Municipal Bonds [Member]
Assets carried at fair value on a recurring basis	6,583	6,273
Fair Value, Inputs, Level 2 [Member] | Us Government Agencies Debt Securities [Member]
Assets carried at fair value on a recurring basis	32,631	26,412
Fair Value, Inputs, Level 2 [Member] | Mortgage-Backed Securities, Issued By Us Government Sponsored Enterprises [Member]
Assets carried at fair value on a recurring basis	32,594	35,169
Fair Value, Inputs, Level 3 [Member]
Assets carried at fair value on a recurring basis	0	0
Fair Value, Inputs, Level 3 [Member] | Municipal Bonds [Member]
Assets carried at fair value on a recurring basis	0	0
Fair Value, Inputs, Level 3 [Member] | Us Government Agencies Debt Securities [Member]
Assets carried at fair value on a recurring basis	0	0
Fair Value, Inputs, Level 3 [Member] | Mortgage-Backed Securities, Issued By Us Government Sponsored Enterprises [Member]
Assets carried at fair value on a recurring basis	$ 0	$ 0

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INVESTMENT SECURITIES (Tables)

6 Months Ended

Jun. 30, 2012

Investments, Debt and Equity Securities [Abstract]

Available-for-sale Securities [Table Text Block]

The amortized cost and fair value of securities available for sale, with gross unrealized gains and losses, follow:

	June 30, 2012
			Gross		Gross
	Amortized		unrealized		unrealized			Fair
	cost		gains		losses			value
	(In thousands)
Securities available for sale:
U.S. government agencies
Within 1 year	$	12,021	$	59	$	-		$	12,080
After 1 year but within 5 years		20,391		169		(9	)		20,551
Mortgage-backed securities-GSE’s
Within 1 year		1,196		46		-			1,242
After 1 year but within 5 years		24,747		1,183		-			25,930
After 5 years but within 10 years		5,281		141		-			5,422
Municipal bonds
Within 1 year		352		4		-			356
After 1 year but within 5 years		2,358		209		-			2,567
After 5 years but within 10 years		1,846		127		(12	)		1,961
After 10 years		1,601		98		-			1,699
	$	69,793	$	2,036	$	(21	)	$	71,808

	December 31, 2011
			Gross		Gross
	Amortized		unrealized		unrealized			Fair
	cost		gains		losses			value
	(In thousands)
Securities available for sale:
U.S. government agencies
Within 1 year	$	13,508	$	106	$	-		$	13,614
After 1 year but within 5 years		12,577		221		-			12,798
Mortgage-backed securities-GSE’s
Within 1 year		1,858		56		-			1,914
After 1 year but within 5 years		29,584		1,243		(11	)		30,816
After 5 years but within 10 years		2,429		17		(7	)		2,439
Municipal bonds
Within 1 year		-		-		-			-
After 1 year but within 5 years		1,369		70		-			1,439
After 5 years but within 10 years		2,691		287		-			2,978
After 10 years		1,747		109		-			1,856
	$	65,763	$	2,109	$	(18	)	$	67,854

Schedule of Unrealized Loss on Investments [Table Text Block]

The following tables show investments’ gross unrealized losses and fair value, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, at June 30, 2012 and December 31, 2011.

	June 30, 2012
	Less Than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
	(In thousands)
Securities available for sale:
U.S. government agencies	$	8,357	$	9	$	-	$	-	$	8,357	$	9
Municipal bonds		669		12		-		-		669		12
Total temporarily impaired securities	$	9,026	$	21	$	-	$	-	$	9,026	$	21

At June 30, 2012, the Company had no AFS securities with an unrealized loss for twelve or more consecutive months. Seven U.S. government agencies and one municipal bond had unrealized losses for less than twelve months totaling $21,000 at June 30, 2012. All unrealized losses are attributable to the general trend of interest rates.

	December 31, 2011
	Less Than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
	(In thousands)
Securities available for sale:
Mortgage-backed securities- GSE’s	$	7,207	$	18	$	-	$	-	$	7,207	$	18
Total temporarily impaired securities	$	7,207	$	18	$	-	$	-	$	7,207	$	18

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BRANCH SALE

6 Months Ended

Jun. 30, 2012

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

NOTE H –BRANCH SALE

On April 6, 2012, the Bank sold all deposits and selected assets associated with two branch offices located in Pembroke and Raeford, North Carolina. The transaction was consummated pursuant to a definitive purchase and assumption agreement with Lumbee Guaranty Bank, Pembroke, North Carolina, which was entered into on December 20, 2011. The purchase price under the terms of the purchase and assumption agreement was $1.8 million which included $1.1 million for all real property and equipment and $688,000 for a deposit premium. The deposit premium was offset by the write-off of a core deposit intangible of $131,000 on these deposits resulting in a net gain of $557,000 for the Company from this transaction. Lumbee Guarantee Bank assumed $14.6 million in deposits plus accrued interest of $5,000 from the Bank and took assignment of all real property and equipment associated with the two branch offices, which totaled $1.1 million at April 6, 2012. The Bank retained all loans associated with the two branches except for approximately $338,000 plus accrued interest of $2,000 in loans associated with deposit accounts which included overdraft protection loans and time deposit loans. There was a separate payment for the loans purchased that was not included in the $1.8 million purchase price.

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INVESTMENT 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 F - INVESTMENT SECURITIES

The amortized cost and fair value of securities available for sale, with gross unrealized gains and losses, follow:

	June 30, 2012
			Gross		Gross
	Amortized		unrealized		unrealized			Fair
	cost		gains		losses			value
	(In thousands)
Securities available for sale:
U.S. government agencies
Within 1 year	$	12,021	$	59	$	-		$	12,080
After 1 year but within 5 years		20,391		169		(9	)		20,551
Mortgage-backed securities-GSE’s
Within 1 year		1,196		46		-			1,242
After 1 year but within 5 years		24,747		1,183		-			25,930
After 5 years but within 10 years		5,281		141		-			5,422
Municipal bonds
Within 1 year		352		4		-			356
After 1 year but within 5 years		2,358		209		-			2,567
After 5 years but within 10 years		1,846		127		(12	)		1,961
After 10 years		1,601		98		-			1,699
	$	69,793	$	2,036	$	(21	)	$	71,808

As of June 30, 2012, accumulated other comprehensive income included unrealized net gains of $2.0 million, net of deferred income taxes of $780,000.

For the second quarter 2012 and 2011, sales of securities available for sale resulted in gross realized gains of $3,000 and $5,000, respectively, and realized losses of $49,000 and $20,000, respectively for each period. These investment sales generated $3.5 million and $2.6 million in proceeds during these respective periods. For the six months ended June 30, 2012 and 2011, sales of securities available for sale resulted in gross realized gains of $6,000 and $12,000, respectively, and realized losses of $129,000 and $38,000, respectively, for each period. These investment sales generated $6.9 million and $5.8 million in proceeds during these respective periods.

	December 31, 2011
			Gross		Gross
	Amortized		unrealized		unrealized			Fair
	cost		gains		losses			value
	(In thousands)
Securities available for sale:
U.S. government agencies
Within 1 year	$	13,508	$	106	$	-		$	13,614
After 1 year but within 5 years		12,577		221		-			12,798
Mortgage-backed securities-GSE’s
Within 1 year		1,858		56		-			1,914
After 1 year but within 5 years		29,584		1,243		(11	)		30,816
After 5 years but within 10 years		2,429		17		(7	)		2,439
Municipal bonds
Within 1 year		-		-		-			-
After 1 year but within 5 years		1,369		70		-			1,439
After 5 years but within 10 years		2,691		287		-			2,978
After 10 years		1,747		109		-			1,856
	$	65,763	$	2,109	$	(18	)	$	67,854

As of December 31, 2011, accumulated other comprehensive income included unrealized net gains of $2.1 million, net of deferred income taxes of $800,000.

The following tables show investments’ gross unrealized losses and fair value, aggregated by investment category and length of time that the individual securities have been in a continuous unrealized loss position, at June 30, 2012 and December 31, 2011.

	June 30, 2012
	Less Than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
	(In thousands)
Securities available for sale:
U.S. government agencies	$	8,357	$	9	$	-	$	-	$	8,357	$	9
Municipal bonds		669		12		-		-		669		12
Total temporarily impaired securities	$	9,026	$	21	$	-	$	-	$	9,026	$	21

At June 30, 2012, the Company had no AFS securities with an unrealized loss for twelve or more consecutive months. Seven U.S. government agencies and one municipal bond had unrealized losses for less than twelve months totaling $21,000 at June 30, 2012. All unrealized losses are attributable to the general trend of interest rates.

	December 31, 2011
	Less Than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
	value		losses		value		losses		value		losses
	(In thousands)
Securities available for sale:
Mortgage-backed securities- GSE’s	$	7,207	$	18	$	-	$	-	$	7,207	$	18
Total temporarily impaired securities	$	7,207	$	18	$	-	$	-	$	7,207	$	18

At December 31, 2011, the Company had no AFS securities with an unrealized loss for twelve or more consecutive months. Seven GSE’s had unrealized losses for less than twelve months totaling $18,000 at December 31, 2011. All unrealized losses are attributable to the general trend of interest rates.

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LOANS

6 Months Ended

Jun. 30, 2012

Receivables [Abstract]

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

NOTE G - LOANS

Following is a summary of loans at June 30, 2012 and December 31, 2011:

	2012						2011
				Percent						Percent
	Amount			of total			Amount			of total
	(In thousands)
Real estate loans:
1-to-4 family residential	$	48,487			12.42	%	$	52,182			12.49	%
Commercial real estate		193,221			49.48	%		192,047			45.98	%
Multi-family residential		19,501			5.00	%		23,377			5.60	%
Construction		54,716			14.02	%		70,846			16.96	%
Home equity lines of credit (“HELOC”)		36,771			9.42	%		38,702			9.27	%
Total real estate loans		352,696			90.34	%		377,154			90.30	%
Other loans:
Commercial and industrial		31,044			7.95	%		33,146			7.94	%
Loans to individuals & overdrafts		7,070			1.81	%		7,671			1.84	%
Total other loans		38,114			9.76	%		40,817			9.78	%
Gross loans		390,810						417,971
Less deferred loan origination fees, net		(407	)		(.10	)%		(347	)		(.08	)%
Total loans		390,403			100.00	%		417,624			100.00	%
Allowance for loan losses		(8,510	)					(10,034	)
Total loans, net	$	381,893					$	407,590

Loans are primarily made in southeastern North Carolina. Real estate loans can be affected by the condition of the local real estate market and by the local economic conditions.

At June 30, 2012, the Company had pre-approved but unused lines of credit for customers totaling $60.0 million. In management’s opinion, these commitments, and undisbursed proceeds on loans reflected above, represent no more than normal lending risk to the Company and will be funded from normal sources of liquidity.

A description of the various loan products provided by the Bank is presented below.

1-to-4 Family Residential Loans

Residential 1-to-4 family loans are mortgage loans that typically convert from construction loans into permanent financing and are secured by properties within the Bank’s market areas.

Commercial Real Estate Loans

Commercial real estate loans are underwritten based on the borrower’s ability to generate adequate cash flow to repay the subject debt within reasonable terms. Commercial real estate loans typically include both owner and non-owner occupied properties with higher principal loan amounts and the repayment of these loans is generally dependent on the successful management of the property. Commercial real estate loans are sensitive to market and general economic conditions. Repayment analysis must be performed and consists of an identified primary/cash flow source of repayment and a secondary/liquidation source of repayment. The primary source of repayment is cash flow from income generated from rental or lease of the property. However, the cash flow can be supplemented with the borrower's and guarantor's global cash flow position. Other credit issues such as the business fundamentals and financial strength of the borrower/guarantor can be considered in determining adequacy of repayment ability. The secondary source of repayment is liquidation of the collateral, supplemented by a liquidation cushion provided by the financial assets of the borrower/guarantor. Management monitors and evaluates commercial real estate loans based on collateral, market area, and risk grade.

Multi-family Residential Loans

Multi-family residential loans are typically non-farm properties with 5 or more dwelling units in structures which include apartment buildings used primarily to accommodate households on a more or less permanent basis. Successful performance of these types of loans is primarily dependant on occupancy rates, rental rates, and property management.

Construction Loans

Construction loans are non-revolving extensions of credit secured by real property of which the proceeds are used to acquire and develop land and to construct commercial or residential buildings. The primary source of repayment for these types of loans is the sale of the improved property or permanent financing in which case the property is expected to generate the cash flow necessary for repayment on a permanent loan basis. Property cash flow may be supplemented with financial support from the borrowers/guarantors. Proper underwriting of a construction loan consists of the initial process of obtaining, analyzing, and approving various aspects of information pertaining to: the analysis of the permanent financing source, creditworthiness of the borrower and guarantors, ability of contractor to perform under the terms of the contract, and the feasibility, marketability, and valuation of the project.

Also much consideration needs to be given to the cost of the project and sources of funds needed to complete construction as well as identifying any sources of equity funding. Construction loans are traditionally considered to be higher risk loans involving technical and legal requirements inherently different from other types of loans; however with thorough credit underwriting, proper loan structure, and diligent loan servicing, these risks can often be mitigated. Some examples of risks inherent in this type of lending include: underestimated costs, inflation of material and labor costs, site difficulties (i.e. rock, soil), project not built to plans, weather delays and natural disasters, borrower/contractor/subcontractor disputes which prompt liens, interest rates increasing beyond budget.

Home Equity Lines of Credit

Home equity lines of credit are consumer-purpose revolving extensions of credit which are secured by first or second liens on owner-occupied residential real estate. Appropriate risk management and compliance practices are exercised to ensure that loan-to-value, lien perfection, and compliance risks are addressed and managed within the Bank’s established guidelines. The degree of utilization of revolving commitments within this loan segment is reviewed periodically to identify changes in the behavior of this borrowing group.

Commercial and Industrial Loans

Commercial and industrial loans are underwritten after evaluating and understanding the borrower’s ability to generate positive cash flow, operate profitably and prudently expand its business. Underwriting standards are designed to promote relationships to include a full range of loan, deposit, and cash management services. Commercial and industrial loans are primarily made based on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the borrower and the guarantors. The cash flows of the borrower, however, may not be as expected and the collateral securing these loans may fluctuate in value. In the case of loans secured by accounts receivable, the availability of funds for repayment can be impacted by the borrower’s ability to collect amounts due from its customers.

Loans to Individuals & Overdrafts

Consumer loans are approved using Bank policies and procedures established to evaluate each credit request. All lending decisions and credit risks are clearly documented. Several factors are considered in making these decisions such as credit score, adjusted net worth, liquidity, debt ratio, disposable income, credit history, and loan-to-value of the collateral. This process combined with the relatively smaller loan amounts spreads the risk among many individual borrowers. Overdrafts on customer accounts are classified as loans for reporting purposes.

The following tables present an age analysis of past due loans, segregated by class of loans as of June 30, 2012 and December 31, 2011, respectively:

	June 30, 2012
	30+		Non-		Total
	Days		Accrual		Past				Total
	Past Due		Loans		Due		Current		Loans
	(In thousands)
Commercial and industrial	$	1,923	$	259	$	2,182	$	28,862	$	31,044
Construction		366		2,649		3,015		51,701		54,716
Multi-family residential		43		1,508		1,551		17,950		19,501
Commercial real estate		63		7,685		7,748		185,473		193,221
Loans to individuals & overdrafts		18		124		142		6,928		7,070
1-to-4 family residential		472		1,627		2,099		46,388		48,487
HELOC		113		824		937		35,834		36,771
Deferred loan (fees) cost, net										(407	)
	$	2,998	$	14,676	$	17,674	$	373,136	$	390,403

At June 30, 2012 there were no loans that were more than 90 days past due and still accruing interest.

	December 31, 2011
	30+		Non-		Total
	Days		Accrual		Past				Total
	Past Due		Loans		Due		Current		Loans
	(In thousands)
Commercial and industrial	$	48	$	171	$	219	$	32,927	$	33,146
Construction		568		4,072		4,640		66,206		70,846
Multi-family residential		1,540		-		1,540		21,837		23,377
Commercial real estate		1,013		10,425		11,438		180,609		192,047
Loans to individuals & overdrafts		10		176		186		7,485		7,671
1-to-4 family residential		735		1,875		2,610		49,572		52,182
HELOC		333		904		1,237		37,465		38,702
Deferred loan (fees) cost, net										(347	)
	$	4,247	$	17,623	$	21,870	$	396,101	$	417,624

At December 31, 2011 there were three loans totaling $108,000 that were 90 days or more past due and still accruing interest.

Impaired Loans

The following tables present information on loans that were considered to be impaired as of June 30, 2012 and December 31, 2011:

							Three months ended				Six months ended
							June 30, 2012				June 30, 2012
			Contractual						Interest Income				Interest Income
			Unpaid				Average		Recognized on		Average		Recognized on
	Recorded		Principal		Related		Recorded		Impaired		Recorded		Impaired
	Investment		Balance		Allowance		Investment		Loans		Investment		Loans
	(In thousands)
With no related allowance recorded:
Commercial and  industrial	$	512	$	777	$	-	$	480	$	6	$	480	$	13
Construction		2,312		2,915		-		2,134		6		1,760		6
Commercial real  estate		13,683		15,187		-		12,810		196		11,605		284
Loans to individuals & overdrafts		121		138		-		149		1		171		1
Multi-family residential		1,508		1,508		-		1,524		-		1,529		-
1 to 4 family residential		1,683		1,932		-		1,776		9		1,884		13
HELOC		1,336		1,556		-		1,193		7		1,039		15
Subtotal:		21,155		24,013		-		20,066		225		18,468		332
With an allowance recorded:
Commercial and  industrial		7		7		2		64		-		43		-
Construction		1,192		1,192		167		1,443		11		2,083		12
Commercial real  estate		852		1,114		75		1,744		13		2,842		13
Loans to individuals  & overdrafts		15		16		7		35		-		29		-
Multi-family residential		43		43		10		21		1		14		1
1 to 4 family residential		810		1,133		162		792		14		774		24
HELOC		181		181		97		258		5		308		5
Subtotal:		3,100		3,686		520		4,357		44		6,093		55
Totals:
Commercial		20,109		22,743		254		20,220		233		20,356		329
Consumer		136		154		7		184		1		200		1
Residential		4,010		4,802		259		4,019		35		4,005		57
Grand Total:	$	24,255	$	27,699	$	520	$	24,423	$	269	$	24,561	$	387

							December 31, 2011
			Contractual				Year to Date
			Unpaid				Average		Interest Income
	Recorded		Principal		Related		Recorded		Recognized on
	Investment		Balance		Allowance		Investment		Impaired Loans
	(In thousands)
With no related allowance recorded:
Commercial and industrial	$	478	$	808	$	-	$	290	$	25
Construction		1,011		1,166		-		1,539		23
Commercial real estate		9,195		10,085		-		7,889		158
Loans to individuals & overdrafts		217		234		-		175		4
Multi-family residential		1,540		1,540		-		1,041		102
1-to-4 family residential		2,100		2,930		-		1,746		33
HELOC		730		823		-		406		-
Subtotal:		15,271		17,586		-		13,086		345
With an allowance recorded:
Commercial and industrial		-		-		-		272		-
Construction		3,365		4,085		674		1,269		4
Commercial real estate		5,039		5.929		498		4,043		71
Loans to individuals & overdrafts		16		16		15		102		1
Multi-family residential		-		-		-		-		-
1-to-4 family residential		736		774		170		1,999		35
HELOC		408		435		158		321		10
Subtotal:		9,564		11,239		1,515		8,006		121
Totals:
Commercial		20,628		23,613		1,172		16,343		383
Consumer		233		250		15		277		5
Residential		3,974		4,962		328		4,472		78
Grand Total:	$	24,835	$	28,825	$	1,515	$	21,092	$	466

Loans are placed on non-accrual status when it has been determined that all contractual principal and interest will not be received. Any payments received on these loans are applied to principal first and then to interest only after all principal has been collected. In the case of an impaired loan that is still on accrual basis, payments are applied to both principal and interest.

Troubled Debt Restructurings

The following table presents loans that were modified as troubled debt restructurings (“TDRs”) for which there was a payment default together with a breakdown of the types of concessions made by loan class during the previous twelve months:

	Twelve months ended June 30, 2012
			Pre-		Post-
			Modification		Modification
			Outstanding		Outstanding
	Number		Recorded		Recorded
	of loans		Investment		Investment
	(Dollars in thousands)
Below market interest rate:
Commercial and industrial		-	$	-	$	-
Construction		-		-		-
Commercial real estate		-		-		-
Loans to individuals & overdrafts		-		-		-
1-to-4 family residential		-		-		-
HELOC		-		-		-
Total		-		-		-
Extended payment terms:
Commercial and industrial		2		327		325
Construction		2		2,057		2,036
Commercial real estate		5		3,111		2,974
Loans to individuals & overdrafts		-		-		-
1-to-4 family residential		2		151		143
HELOC		-		-		-
Total		11		5,646		5,478
Forgiveness of principal:
Commercial and industrial		-		-		-
Construction		-		-		-
Commercial real estate		-		-		-
Loans to individuals & overdrafts		-		-		-
1- to-4 family residential		-		-		-
HELOC		-		-		-
Total		-		-		-
Total		11	$	5,646	$	5,478

The following table presents loans that were modified as TDRs with a breakdown of the types of concessions made by loan class during the three months and six months ended June 30, 2012:

	Three months ended				Six months ended
	June 30, 2012				June 30, 2012
	Number		Recorded		Number		Recorded
	of loans		investment		of loans		investment
	(Dollars in thousands)
Below market interest rate:
Commercial and industrial		-	$	-		-	$	-
Construction		-		-		-		-
Commercial real estate		-		-		-		-
Loans to individuals & overdrafts		-		-		-		-
1-to-4 family residential		-		-		-		-
HELOC		-		-		-		-
Total		-		-		-		-
Extended payment terms:
Commercial and industrial		-		-		1		114
Construction		-		-		2		290
Commercial real estate		-		-		4		1,144
Loans to individuals & overdrafts		-		-		-		-
1-to-4 family residential		-		-		-		-
HELOC		-		-		-		-
Total		-		-		7		1,548
Forgiveness of principal:
Commercial and industrial		-		-		-		-
Construction		-		-		-		-
Commercial real estate		-		-		-		-
Loans to individuals and overdrafts		-		-		-		-
1-to-4 family residential		-		-		-		-
HELOC		-		-		-		-
Total		-		-		-		-
Other:
Commercial and industrial		-		-		-		-
Construction		-		-		-		-
Commercial real estate		2		849		2		849
Loans to individuals and overdrafts		-		-		-		-
1-to-4 family residential		4		165		4		165
HELOC		-		-		-		-
Total		6		1,014		6		1,014
Total		6	$	1,014		13	$	2,562

All loans extended to borrowers that are considered TDRs and have characteristics that are not within the normal lending guidelines and practices when extending credit are included in the Other category.

The following table presents the successes and failures of the types of modifications within the previous six months as of June 30, 2012:

	Paid in full				Paying as restructured				Converted to non-accrual				Foreclosure/Default
	Number		Recorded		Number		Recorded		Number		Recorded		Number		Recorded
	of loans		Investment		of loans		Investment		of loans		Investment		of loans		Investment
	(In thousands)
Below market interest rate		-	$	-		-	$	-		-	$	-		-	$	-
Extended payment terms		-		-		2		290		4		975		1		283
Forgiveness of principal		-		-		-		-		-		-		-		-
Other		-		-		6		1,014		-		-		-		-
Total		-	$	-		8	$	1,304		4	$	975		1	$	283

At June 30, 2012, the Company had 31 loans with a balance of $9.0 million that were considered to be troubled debt restructurings. Of those TDRs, 14 loans with a balance totaling $1.9 million were still accruing as of June 30, 2012. The remaining 17 TDRs with a balance totaling $7.1 million as of June 30, 2012 were in non-accrual status.

Credit Quality Indicators

As part of the on-going monitoring of the credit quality of the loan portfolio, management utilizes a risk grading matrix to assign a risk grade to each of the Company’s loans. All non-consumer loans are graded on a scale of 1 to 9. A description of the general characteristics of these nine different risk grades is as follows:

· Risk Grade 1 (Superior) - Credits in this category are virtually risk-free and are well-collateralized by cash-equivalent instruments. The repayment program is well-defined and achievable. Repayment sources are numerous. No material documentation deficiencies or exceptions exist.

· Risk Grade 2 (Very Good) - This grade is reserved for loans secured by readily marketable collateral, or loans within guidelines to borrowers with liquid financial statements. A liquid financial statement is a financial statement with substantial liquid assets relative to debts. These loans have excellent sources of repayment, with no significant identifiable risk of collection, and conform in all respects to Bank policy, guidelines, underwriting standards, and Federal and State regulations (no exceptions of any kind).

· Risk Grade 3 (Good) - These loans have excellent sources of repayment, with no significant identifiable risk of collection. Generally, loans assigned this risk grade will demonstrate the following characteristics:

o Conformity in all respects with Bank policy, guidelines, underwriting standards, and Federal and State regulations (no exceptions of any kind).

o Documented historical cash flow that meets or exceeds required minimum Bank guidelines, or that can be supplemented with verifiable cash flow from other sources.

o Adequate secondary sources to liquidate the debt, including combinations of liquidity, liquidation of collateral, or liquidation value to the net worth of the borrower or guarantor.

· Risk Grade 4 (Acceptable) - This grade is given to acceptable loans. These loans have adequate sources of repayment, with little identifiable risk of collection. Loans assigned this risk grade will demonstrate the following characteristics:

o General conformity to the Bank's policy requirements, product guidelines and underwriting standards, with limited exceptions. Any exceptions that are identified during the underwriting and approval process have been adequately mitigated by other factors.

o Documented historical cash flow that meets or exceeds required minimum Bank guidelines, or that can be supplemented with verifiable cash flow from other sources.  

o Adequate secondary sources to liquidate the debt, including combinations of liquidity, liquidation of collateral, or liquidation value to the net worth of the borrower or guarantor

· Risk Grade 5 (Acceptable With Care) - This grade is given to acceptable loans that show signs of weakness in either adequate sources of repayment or collateral, but have demonstrated mitigating factors that minimize the risk of delinquency or loss.  Loans assigned this grade may demonstrate some or all of the following characteristics:

o Additional exceptions to the Bank's policy requirements, product guidelines or underwriting standards that present a higher degree of risk to the Bank.  Although the combination and/or severity of identified exceptions is greater, all exceptions have been properly mitigated by other factors.

o Unproven, insufficient or marginal primary sources of repayment that appear sufficient to service the debt at this time.  Repayment weaknesses may be due to minor operational issues, financial trends, or reliance on projected (not historic) performance.

o Marginal or unproven secondary sources to liquidate the debt, including combinations of liquidation of collateral and liquidation value to the net worth of the borrower or guarantor.

· Risk Grade 6 (Watch List or Special Mention) – Loans in this category can have the following characteristics:

o Loans with underwriting guideline tolerances and/or exceptions and with no mitigating factors.

o Extending loans that are currently performing satisfactorily but with potential weaknesses that may, if not corrected, weaken the asset or inadequately protect the Bank's position at some future date. Potential weaknesses are the result of deviations from prudent lending practices.

o Loans where adverse economic conditions that develop subsequent to the loan origination that don't jeopardize liquidation of the debt but do substantially increase the level of risk may also warrant this rating.

· Risk Grade 7 (Substandard) - A Substandard loan is inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as Substandard must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt; they are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Loans consistently not meeting the repayment schedule should be downgraded to substandard. Loans in this category are characterized by deterioration in quality exhibited by any number of well-defined weaknesses requiring corrective action.

· Risk Grade 8 (Doubtful) - Loans classified Doubtful have all the weaknesses inherent in loans classified Substandard, plus the added characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions, and values highly questionable and improbable. However, these loans are not yet rated as loss because certain events may occur which would salvage the debt.

· Risk Grade 9 (Loss) - Loans classified as Loss are considered uncollectable and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off the loan even though partial recovery may be affected in the future.

Consumer loans are graded on a scale of 1 to 9. A description of the general characteristics of the nine risk grades is as follows:

· Risk Grades 1 – 5 (Pass) – The loans in this category range from loans secured by cash with no risk of principal deterioration (Risk Grade 1) to loans that show signs of weakness in either adequate sources of repayment or collateral but have demonstrated mitigating factors that minimize the risk of delinquency or loss (Risk Grade 5).

· Risk Grade 6 (Watch List or Special Mention) - Watch List or Special Mention loans include the following characteristics:

o Loans within guideline tolerances or with exceptions of any kind that have not been mitigated by other economic or credit factors.

o Extending loans that are currently performing satisfactorily but with potential weaknesses that may, if not corrected, weaken the asset or inadequately protect the Bank's position at some future date. Potential weaknesses are the result of deviations from prudent lending practices.

o Loans where adverse economic conditions that develop subsequent to the loan origination that don't jeopardize liquidation of the debt but do substantially increase the level of risk may also warrant this rating.

· Risk Grade 7 (Substandard) - A Substandard loan is inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as Substandard must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt; they are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

· Risk Grade 8 (Doubtful) - Loans classified Doubtful have all the weaknesses inherent in loans classified Substandard, plus the added characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions, and values highly questionable and improbable. However, these loans are not yet rated as loss because certain events may occur which would salvage the debt.

· Risk Grade 9 (Loss) - Loans classified Loss are considered uncollectable and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this worthless loan even though partial recovery may be affected in the future.

The following tables present information on risk ratings of the commercial and consumer loan portfolios, segregated by loan class as of June 30, 2012 and December 31, 2011, respectively:

June 30, 2012
Commercial
Credit
Exposure By	Commercial				Commercial
Internally	and				real		Multi-family
Assigned Grade	industrial		Construction		estate		residential
(In thousands)
Superior	$	764	$	55	$	-	$	-
Very good		32		4		307		-
Good		3,067		655		14,303		1,687
Acceptable		9,870		5,049		63,276		5,793
Acceptable with care		15,441		40,670		74,336		10,470
Special mention		1,339		4,629		23,338		-
Substandard		531		3,654		17,661		1,551
Doubtful		-		-		-		-
Loss		-		-		-		-
	$	31,044	$	54,716	$	193,221	$	19,501

Consumer Credit
Exposure By
Internally	1-to-4 family
Assigned Grade	residential		HELOC
Pass	$	41,324	$	33,746
Special mention		3,528		1,200
Substandard		3,635		1,825
	$	48,487	$	36,771

Consumer Credit
Exposure Based	Loans to
On Payment	individuals &
Activity	overdrafts
Pass	$	6,888
Non –pass		182
	$	7,070

December 31, 2011
Commercial
Credit
Exposure By	Commercial				Commercial
Internally	and				real		Multi-family
Assigned Grade	industrial		Construction		estate		residential
(In thousands)
Superior	$	722	$	59	$	-	$	-
Very good		154		6		429		-
Good		5,184		2,369		16,510		1,064
Acceptable		8,224		6,685		67,922		12,828
Acceptable with care		15,048		54,087		60,604		7,820
Special mention		3,062		2,671		27,177		125
Substandard		752		4,969		19,405		1,540
Doubtful		-		-		-		-
Loss		-		-		-		-
	$	33,146	$	70,846	$	192,047	$	23,377

Consumer Credit
Exposure By
Internally	1-to-4 family
Assigned Grade	residential		HELOC
Pass	$	43,647	$	35,127
Special mention		2,925		1,391
Substandard		5,610		2,184
	$	52,182	$	38,702

Consumer Credit
Exposure Based	Loans to
On Payment	individuals &
Activity	overdrafts
Pass	$	7,447
Non-pass		224
	$	7,671

Non-performing assets at June 30, 2012 and December 31, 2011 consist of the following:

	June 30, 2012		December 31, 2011
	(In thousands)
Non-accrual loans	$	14,676	$	17,623
Accruing TDRs		1,903		2,013
Total non-performing loans		16,579		19,636
Foreclosed real estate		3,859		3,031
Total non-performing assets	$	20,438	$	22,667

Allowance for Loan Losses

The allowance for loan losses is a reserve established through provisions for loan losses charged to income and represents management’s best estimate of probable loans losses that have been incurred within the existing portfolio of loans. The allowance, in the judgment of management, is necessary to reserve for estimated losses and risk inherent in the loan portfolio. The Company’s allowance for loan loss methodology is based on historical loss experience by type of credit and internal risk grade, specific homogeneous risk pools and specific loss allocations, with adjustments for current events and conditions. The Company’s process for determining the appropriate level of reserves is designed to account for changes in credit quality as they occur. The provision for loan losses reflect loan quality trends, including the levels of and trends related to past due loans and economic conditions at the local and national levels. It also considers the quality and risk characteristics of the Company’s loan origination and servicing policies and practices.

Individual reserves are calculated according to ASC Section 310-10-35 against loans evaluated individually and deemed to most likely be impaired.  All loans in non-accrual status and all substandard loans that are deemed to be collateral dependent are assessed for impairment.

Loans are deemed uncollectible at the discretion of the Chief Credit Officer, based on a variety of credit, collateral, documentation and other issues. In the case of uncollectible receivables, the collateral is considered unsecured and therefore fully charged off.

The following tables present a roll forward of the Company’s allowance for loan losses by loan class for the three month and six month periods ended June 30, 2012 and June 30, 2011, respectively:

	Three months ended
	June 30, 2012
	Commercial									1-to-4						Loans to			Multi-
	and						Commercial			family						individuals &			family
Allowance for loan losses	industrial			Construction			real estate			residential			HELOC			overdrafts			residential		Total
	(In thousands)
Balance, beginning of period 3/31/2012	$	555		$	1,311		$	4,804		$	1,585		$	1,101		$	105		$	107	$	9,568
Provision (recovery) for loan losses		(409	)		(967	)		1,024			(275	)		(41	)		3			16		(649	)
Loans charged-off		(4	)		-			(670	)		(54	)		(168	)		(45	)		-		(940	)
Recoveries		244			138			70			58			5			17			-		532
Balance, end of period 6/30/2012	$	386		$	482		$	5,228		$	1,314		$	897		$	80		$	123	$	8,510
Ending balance: individually evaluated for impairment	$	2		$	167		$	75		$	162		$	97		$	7		$	10	$	520
Ending balance: collectively evaluated for impairment	$	384		$	315		$	5,153		$	1,152		$	800		$	73		$	113	$	7,990
Loans:
Ending balance	$	31,044		$	54,716		$	193,221		$	48,487		$	36,771		$	7,070		$	19,501	$	390,810
Ending balance: individually evaluated for impairment	$	519		$	3,504		$	14,535		$	2,493		$	1,517		$	136		$	1,551	$	24,255
Ending balance: collectively evaluated for impairment	$	30,525		$	51,212		$	178,686		$	45,994		$	35,254		$	6,934		$	17,950	$	366,555

	Six months ended
	June 30, 2012
	Commercial									1-to-4						Loans to			Multi-
	and						Commercial			family						individuals &			family
Allowance for loan losses	industrial			Construction			real estate			residential			HELOC			overdrafts			residential			Total
	(In thousands)
Balance, beginning of period 1/1/2012	$	719		$	1,540		$	4,771		$	1,661		$	1,122		$	94		$	127		$	10,034
Provision (recovery) for loan losses		(2,956	)		(911	)		1,357			(369	)		134			(37	)		(4	)		(2,786	)
Loans charged-off		(51	)		(458	)		(981	)		(99	)		(376	)		(54	)		-			(2,019	)
Recoveries		2,674			311			81			121			17			77			-			3,281
Balance, end of period 6/30/2012	$	386		$	482		$	5,228		$	1,314		$	897		$	80		$	123		$	8,510
Ending balance: individually evaluated for impairment	$	2		$	167		$	75		$	162		$	97		$	7		$	10		$	520
Ending balance: collectively evaluated for impairment	$	384		$	315		$	5,153		$	1,152		$	800		$	73		$	113		$	7,990
Loans:
Ending balance	$	31,044		$	54,716		$	193,221		$	48,487		$	36,771		$	7,070		$	19,501		$	390,810
Ending balance: individually evaluated for impairment	$	519		$	3,504		$	14,535		$	2,493		$	1,517		$	136		$	1,551		$	24,255
Ending balance: collectively evaluated for impairment	$	30,525		$	51,212		$	178,686		$	45,994		$	35,254		$	6,934		$	17,950		$	366,555

During the six months ended June 30, 2012 the Company recorded recoveries on loans previously charged-off in the amount of $3.3 million. These recoveries were primarily a result of a $2.4 million recovery on commercial and industrial loans. These recoveries combined with the decrease in total loans outstanding at June 30, 2012 resulted in a $2.8 million recovery in the provision for loan losses.

	December 31, 2011
	Commercial						1-to-4				Loans to		Multi-
	and				Commercial		family				individuals &		family
Allowance for loan losses	industrial		Construction		real estate		residential		HELOC		overdrafts		residential		Total
	(In thousands)
Loans:
Ending Balance	$	33,146	$	70,846	$	192,047	$	52,182	$	38,702	$	7,671	$	23,377	$	417,971
Ending Balance: individually evaluated for impairment	$	478	$	4,376	$	14,234	$	2,836	$	1,138	$	233	$	1,540	$	24,835
Ending Balance: collectively evaluated for impairment	$	32,668	$	66,470	$	177,813	$	49,346	$	37,564	$	7,438	$	21,837	$	393,136

	Three months ended
	June 30, 2011
	Commercial									1-to-4						Loans to			Multi-
	and						Commercial			family						individuals &			family
Allowance for loan losses	industrial			Construction			real estate			residential			HELOC			overdrafts			residential			Total
	(In thousands)
Balance, beginning of period 3/31/2011	$	1,081		$	1,271		$	3,609		$	2,451		$	1,140		$	383		$	183		$	10,118
Provision (recovery) for loan losses		203			570			1,864			(230	)		376			(232	)		(9	)		2,542
Other		-			-			(53	)		-			-			-			-			(53	)
Loans charged-off		(3,880	)		(669	)		(926	)		(410	)		(69	)		(65	)		-			(6,019	)
Recoveries		3,648			-			8			81			3			50			-			3,790
Balance, end of period 6/30/2011	$	1,052		$	1,172		$	4,502		$	1,892		$	1,450		$	136		$	174		$	10,378
Ending balance: individually evaluated for impairment	$	191		$	106		$	761		$	701		$	268		$	46		$	-		$	2,073
Ending balance: collectively evaluated for impairment	$	861		$	1,066		$	3,741		$	1,191		$	1,182		$	90		$	174		$	8,305
Loans:
Ending balance	$	40,646		$	77,211		$	204,412		$	59,504		$	40,532		$	8,409		$	28,168		$	458,882
Ending balance: individually evaluated for impairment	$	538		$	2,329		$	13,647		$	3,408		$	442		$	213		$	-		$	20,577
Ending balance: collectively evaluated for impairment	$	40,108		$	74,882		$	190,765		$	56,096		$	40,090		$	8,196		$	28,168		$	438,305

	Six months ended
	June 30, 2011
	Commercial									1-to-4						Loans to			Multi-
	and						Commercial			family						individuals &			family
Allowance for loan losses	industrial			Construction			real estate			residential			HELOC			overdrafts			residential			Total
	(In thousands)
Balance, beginning of period 1/1/2011	$	1,052		$	349		$	3,111		$	1,985		$	1,348		$	1,530		$	640		$	10,015
Provision (recovery) for loan losses		160			1,714			3,133			296			231			(1,362	)		(466	)		3,706
Other		-			-			(53	)		-			-			-			-			(53	)
Loans charged-off		(3,880	)		(891	)		(1,699	)		(600	)		(134	)		(87	)		-			(7,291	)
Recoveries		3,720			-			10			211			5			55			-			4,001
Balance, end of period 6/30/2011	$	1,052		$	1,172		$	4,502		$	1,892		$	1,450		$	136		$	174		$	10,378
Ending balance: individually evaluated for impairment	$	191		$	106		$	761		$	701		$	268		$	46		$	-		$	2,073
Ending balance: collectively evaluated for impairment	$	861		$	1,066		$	3,741		$	1,191		$	1,182		$	90		$	174		$	8,305
Loans:
Ending balance	$	40,646		$	77,211		$	204,412		$	59,504		$	40,532		$	8,409		$	28,168		$	458,882
Ending balance: individually evaluated for impairment	$	538		$	2,329		$	13,647		$	3,408		$	442		$	213		$	-		$	20,577
Ending balance: collectively evaluated for impairment	$	40,108		$	74,882		$	190,765		$	56,096		$	40,090		$	8,196		$	28,168		$	438,305

XML

PER SHARE RESULTS (Tables)

6 Months Ended

Jun. 30, 2012

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2012		2011		2012		2011
Weighted average shares used for basic net income per share		6,913,636		6,913,636		6,886,417		6,913,636
Effect of dilutive stock options		-		-		-		-
Weighted average shares used for diluted net income per share		6,913,636		6,913,636		6,886,417		6,913,636

XML

LOANS (Details 4) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012
Number of loans	11
Recorded Investment	$ 0
Foreclosure/Default, Number of loans	1
Foreclosure/Default, Recorded Investment	283
Paid In Full [Member]
Number of loans	0
Recorded Investment	0
Paying As Restructured [Member]
Number of loans	8
Recorded Investment	1,304
Converted To Nonaccrual [Member]
Number of loans	4
Recorded Investment	975
Below Market Interest Rate [Member]
Number of loans	0
Foreclosure/Default, Number of loans	0
Foreclosure/Default, Recorded Investment	0
Below Market Interest Rate [Member] | Paid In Full [Member]
Number of loans	0
Recorded Investment	0
Below Market Interest Rate [Member] | Paying As Restructured [Member]
Number of loans	0
Recorded Investment	0
Below Market Interest Rate [Member] | Converted To Nonaccrual [Member]
Number of loans	0
Recorded Investment	0
Extended Payment Term [Member]
Number of loans	11
Foreclosure/Default, Number of loans	1
Foreclosure/Default, Recorded Investment	283
Extended Payment Term [Member] | Paid In Full [Member]
Number of loans	0
Recorded Investment	0
Extended Payment Term [Member] | Paying As Restructured [Member]
Number of loans	2
Recorded Investment	290
Extended Payment Term [Member] | Converted To Nonaccrual [Member]
Number of loans	4
Recorded Investment	975
Forgiveness Of Principal [Member]
Number of loans	0
Foreclosure/Default, Number of loans	0
Foreclosure/Default, Recorded Investment	0
Forgiveness Of Principal [Member] | Paid In Full [Member]
Number of loans	0
Recorded Investment	0
Forgiveness Of Principal [Member] | Paying As Restructured [Member]
Number of loans	0
Recorded Investment	0
Forgiveness Of Principal [Member] | Converted To Nonaccrual [Member]
Number of loans	0
Recorded Investment	0
Others [Member]
Foreclosure/Default, Number of loans	0
Foreclosure/Default, Recorded Investment	0
Others [Member] | Paid In Full [Member]
Number of loans	0
Recorded Investment	0
Others [Member] | Paying As Restructured [Member]
Number of loans	6
Recorded Investment	1,014
Others [Member] | Converted To Nonaccrual [Member]
Number of loans	0
Recorded Investment	$ 0

XML

PER SHARE RESULTS (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Weighted average shares used for basic net income per share (in shares)	6,913,636	6,913,636	6,886,417	6,913,636
Effect of dilutive stock options (in shares)	0	0	0	0
Weighted average shares used for diluted net income per share (in shares)	6,913,636	6,913,636	6,886,417	6,913,636

XML

FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
ASSETS
Cash and due from banks	$ 15,731	$ 18,478	[1]
Interest-earning deposits in other banks	56,558	55,590	[1]
Federal funds sold	3,028	3,028	[1]
Investment securities available for sale, at fair value	71,808	67,854	[1]
NET LOANS	381,893	407,590	[1]
Premises and equipment held for sale	0	1,113	[1]
Accrued interest receivable	1,628	2,003	[1]
Stock in Federal Home Loan Bank of Atlanta ("FHLB"), at cost	1,034	1,248	[1]
Other non-marketable securities	1,075	1,080	[1]
Liabilities
TOTAL DEPOSITS	471,184	501,377	[1]
Short-term debt	22,953	21,877	[1]
Long-term debt	12,372	14,372	[1]
Accrued interest payable	281	330	[1]
Financial assets:
Cash and due from banks, Fair value	15,731	18,478
Interest-earning deposits in other banks, Fair value	56,558	55,590
Federal funds sold, Fair value	3,028	3,028
Investment securities available for sale, Fair value	71,808	67,854
Loans, net, Fair value	398,540	424,851
Premises and equipment available for sale, Fair value		1,113
Accrued interest receivable, Fair value	1,628	2,003
Stock in the FHLB, Fair value	1,034	1,248
Other non marketable securities, Fair value	1,075	1,080
Financial liabilities:
Deposits, Fair value	479,845	509,454
Short-term debt, Fair value	22,953	21,877
Long-term debt, Fair value	7,661	9,661
Accrued interest payable, Fair value	281	330
Fair Value, Inputs, Level 1 [Member]
Financial assets:
Cash and due from banks, Fair value	15,731	18,478
Interest-earning deposits in other banks, Fair value	56,558	55,590
Federal funds sold, Fair value	3,028	3,028
Investment securities available for sale, Fair value	0	0
Loans, net, Fair value	0	0
Premises and equipment available for sale, Fair value		0
Accrued interest receivable, Fair value	0	0
Stock in the FHLB, Fair value	0	0
Other non marketable securities, Fair value	0	0
Financial liabilities:
Deposits, Fair value	0	0
Short-term debt, Fair value	0	0
Long-term debt, Fair value	0	0
Accrued interest payable, Fair value	0	0
Fair Value, Inputs, Level 2 [Member]
Financial assets:
Cash and due from banks, Fair value	0	0
Interest-earning deposits in other banks, Fair value	0	0
Federal funds sold, Fair value	0	0
Investment securities available for sale, Fair value	71,808	67,854
Loans, net, Fair value	0	0
Premises and equipment available for sale, Fair value		0
Accrued interest receivable, Fair value	0	0
Stock in the FHLB, Fair value	0	0
Other non marketable securities, Fair value	0	0
Financial liabilities:
Deposits, Fair value	479,845	509,454
Short-term debt, Fair value	22,953	21,877
Long-term debt, Fair value	7,661	9,661
Accrued interest payable, Fair value	0	0
Fair Value, Inputs, Level 3 [Member]
Financial assets:
Cash and due from banks, Fair value	0	0
Interest-earning deposits in other banks, Fair value	0	0
Federal funds sold, Fair value	0	0
Investment securities available for sale, Fair value	0	0
Loans, net, Fair value	398,540	424,851
Premises and equipment available for sale, Fair value		1,113
Accrued interest receivable, Fair value	1,628	2,003
Stock in the FHLB, Fair value	1,034	1,248
Other non marketable securities, Fair value	1,075	1,080
Financial liabilities:
Deposits, Fair value	0	0
Short-term debt, Fair value	0	0
Long-term debt, Fair value	0	0
Accrued interest payable, Fair value	$ 281	$ 330

[1] Derived from audited consolidated financial statements.

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Net income (loss)	$ 1,158	$ (861)	$ 3,270	$ (740)
Other comprehensive income (loss):
Unrealized gain (loss) on investment securities available for sale	(50)	268	(198)	130
Tax effect	19	(92)	72	(50)
Other Comprehensive Income (Loss), Available-for-sale Securities, Tax	(31)	176	(126)	80
Reclassification adjustment for gain (loss) included in net income	65	(2)	123	(26)
Tax effect	(25)	1	(47)	15
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax	40	(1)	76	(11)
Total	9	175	(50)	69
Total comprehensive income (loss)	$ 1,167	$ (686)	$ 3,220	$ (671)

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RECENT ACCOUNTING PRONOUNCEMENTS

6 Months Ended

Jun. 30, 2012

New Accounting Pronouncements and Changes In Accounting Principles [Abstract]

Description of New Accounting Pronouncements Not yet Adopted [Text Block]

NOTE C - RECENT ACCOUNTING PRONOUNCEMENTS

The following summarizes recent accounting pronouncements and their expected impact on the Company:

Accounting Standards Update (“ASU”) No. 2011-03, Transfers and Servicing (Topic 860) - Reconsideration of Effective Control for Repurchase Agreements. ASU 2011-03 is intended to improve financial reporting of repurchase agreements and other agreements that both entitle and obligate a transferor to repurchase or redeem financial assets before their maturity. ASU 2011-03 removes from the assessment of effective control (i) the criterion requiring the transferor to have the ability to repurchase or redeem the financial assets on substantially the agreed terms, even in the event of default by the transferee, and (ii) the collateral maintenance guidance related to that criterion. ASU 2011-03 became effective for the Company on January 1, 2012 and did not have a significant impact on the Company’s financial statements.

ASU 2011-04, Fair Value Measurement (Topic 820) - Amendments to Achieve Common Fair Value Measurements and Disclosure Requirements in U.S. GAAP and IFRS. ASU 2011-04 amends Topic 820, Fair Value Measurements and Disclosures, to add both additional clarifications to existing fair value measurement and disclosure requirements and changes to existing principles and disclosure guidance. Clarifications were made to the relevancy of the highest and best use valuation concept, measurement of an instrument classified in an entity’s shareholders’ equity and disclosure of quantitative information about the unobservable inputs for level 3 fair value measurements. Changes to existing principles and disclosures included measurement of financial instruments managed within a portfolio, the application of premiums and discounts included measurement of financial instruments managed within a portfolio, the application of premiums and discounts in fair value measurement, and additional disclosures related to fair value measurements. ASU 2011-04 became effective for annual periods beginning after December 15, 2011, and did not have a significant impact on the Company’s financial statements.

ASU 2011-05, Comprehensive Income (Topic 220) - Presentation of Comprehensive Income. ASU 2011-05 amends Topic 220, Comprehensive Income, to require that all non-owner changes in shareholders’ equity be presented in either a single continuous statement of comprehensive income or in two separate but consecutive statements. Additionally, ASU 2011-05 requires entities to present, on the face of the financial statements, reclassification adjustments for items that are reclassified from other comprehensive income to net income in the statement or statements where the components of net income and the components of other comprehensive income are presented. The option to present components of other comprehensive income as part of the statement of changes in shareholders’ equity was eliminated. ASU 2011-05 became effective for annual periods beginning after December 15, 2011. The Company has adopted the standard and the adoption of ASU 2011-05 did not have an impact on the Company’s financial condition, results of operations, or cash flows.

ASU 2011-12, Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income. ASU 2011-12 amends Topic 220 to allow the Financial Accounting Standards Board (“FASB”) time to redeliberate whether to present on the face of the financial statements the effects of reclassifications out of accumulated other comprehensive income on the components of net income and other comprehensive income for all periods presented. All other requirements in ASU No. 2011-05 are not affected by ASU No. 2011-12, including the requirement to report comprehensive income either in a single continuous financial statement or in two separate but consecutive financial statements. Public entities are required to apply these requirements for fiscal years, and interim periods within those years beginning after December 15, 2011. The Company has adopted the standard and the adoption of ASU 2011-12 did not have an impact on the Company’s financial condition, results of operations, or cash flows.

Other accounting standards that have been issued or proposed by FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations and cash flows.

From time to time, the FASB issues exposure drafts for proposed statements of financial accounting standards. Such exposure drafts are subject to comment from the public, to revisions by the FASB and to final issuance by the FASB as statements of financial accounting standards. Management considers the effect of the proposed statements on the consolidated financial statements of the Company and monitors the status of changes to and proposed effective dates of exposure drafts.

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INVESTMENT SECURITIES (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2012	Dec. 31, 2011
Securities available for sale:
Amortized Cost	$ 69,793	$ 65,763
Gross Unrealized Gains	2,036	2,109
Gross Unrealized Losses	(21)	(18)
Fair Value	71,808	67,854	[1]
Municipal Bonds [Member]
Securities available for sale:
Amortized cost Within 1 year	352	0
Amortized Cost After 1 year but within 5 years	2,358	1,369
Amortized Cost After 5 years but within 10 years	1,846	2,691
Amortized Cost After 10 years	1,601	1,747
Gross Unealized Gains Within 1 year	4	0
Gross Unealized Gains After 1 year but within 5 years	209	70
Gross Unealized Gains After 5 years but within 10 years	127	287
Gross Unealized Gains After 10 years	98	109
Gross Unealized Losses Within 1 year	0	0
Gross Unealized Losses After 1 year but within 5 years	0	0
Gross Unealized Losses After 5 years but within 10 years	(12)	0
Gross Unealized Losses After 10 years	0	0
Fair Value Within 1 year	356	0
Fair Value After 1 year but within 5 years	2,567	1,439
Fair Value After 5 years but within 10 years	1,961	2,978
Fair Value After 10 years	1,699	1,856
Us Government Agencies Debt Securities [Member]
Securities available for sale:
Amortized cost Within 1 year	12,021	13,508
Amortized Cost After 1 year but within 5 years	20,391	12,577
Gross Unealized Gains Within 1 year	59	106
Gross Unealized Gains After 1 year but within 5 years	169	221
Gross Unealized Losses Within 1 year	0	0
Gross Unealized Losses After 1 year but within 5 years	(9)	0
Fair Value Within 1 year	12,080	13,614
Fair Value After 1 year but within 5 years	20,551	12,798
Mortgage-Backed Securities, Issued By Us Government Sponsored Enterprises [Member]
Securities available for sale:
Amortized cost Within 1 year	1,196	1,858
Amortized Cost After 1 year but within 5 years	24,747	29,584
Amortized Cost After 5 years but within 10 years	5,281	2,429
Gross Unealized Gains Within 1 year	46	56
Gross Unealized Gains After 1 year but within 5 years	1,183	1,243
Gross Unealized Gains After 5 years but within 10 years	141	17
Gross Unealized Losses Within 1 year	0	0
Gross Unealized Losses After 1 year but within 5 years	0	(11)
Gross Unealized Losses After 5 years but within 10 years	0	(7)
Fair Value Within 1 year	1,242	1,914
Fair Value After 1 year but within 5 years	25,930	30,816
Fair Value After 5 years but within 10 years	$ 5,422	$ 2,439

[1] Derived from audited consolidated financial statements.

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LOANS (Details Textual) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing	$ 1,903,000		$ 1,903,000		$ 2,013,000
Number of loans	11		11
Recorded Investment	0		0
Recoveries	532,000	3,790,000	3,281,000	4,001,000
Increase (Decrease) in Finance Receivables			2,800,000
Residential 1 To 4 Family [Member]
Financing Receivable, Recorded Investment, 90 Days Past Due and Still Accruing	0		0		108,000
Troubled Debt Restructuring Accrual Status [Member]
Number of loans	14		14
Recorded Investment	1,900,000		1,900,000
Troubled Debt Restructuring Nonaccrual Status [Member]
Number of loans	17		17
Recorded Investment	7,100,000		7,100,000
Troubled Debt Restructurings [Member]
Number of loans	31		31
Recorded Investment	9,000,000		9,000,000
Unused Lines Of Credit [Member]
Proceeds from Lines of Credit			60,000,000
Commercial and Industrial Loan [Member]
Recoveries			$ 2,400,000

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LOANS (Tables)

6 Months Ended

Jun. 30, 2012

Receivables [Abstract]

Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]

Following is a summary of loans at June 30, 2012 and December 31, 2011:

	2012						2011
				Percent						Percent
	Amount			of total			Amount			of total
	(In thousands)
Real estate loans:
1-to-4 family residential	$	48,487			12.42	%	$	52,182			12.49	%
Commercial real estate		193,221			49.48	%		192,047			45.98	%
Multi-family residential		19,501			5.00	%		23,377			5.60	%
Construction		54,716			14.02	%		70,846			16.96	%
Home equity lines of credit (“HELOC”)		36,771			9.42	%		38,702			9.27	%
Total real estate loans		352,696			90.34	%		377,154			90.30	%
Other loans:
Commercial and industrial		31,044			7.95	%		33,146			7.94	%
Loans to individuals & overdrafts		7,070			1.81	%		7,671			1.84	%
Total other loans		38,114			9.76	%		40,817			9.78	%
Gross loans		390,810						417,971
Less deferred loan origination fees, net		(407	)		(.10	)%		(347	)		(.08	)%
Total loans		390,403			100.00	%		417,624			100.00	%
Allowance for loan losses		(8,510	)					(10,034	)
Total loans, net	$	381,893					$	407,590

Past Due Financing Receivables [Table Text Block]

The following tables present an age analysis of past due loans, segregated by class of loans as of June 30, 2012 and December 31, 2011, respectively:

	June 30, 2012
	30+		Non-		Total
	Days		Accrual		Past				Total
	Past Due		Loans		Due		Current		Loans
	(In thousands)
Commercial and industrial	$	1,923	$	259	$	2,182	$	28,862	$	31,044
Construction		366		2,649		3,015		51,701		54,716
Multi-family residential		43		1,508		1,551		17,950		19,501
Commercial real estate		63		7,685		7,748		185,473		193,221
Loans to individuals & overdrafts		18		124		142		6,928		7,070
1-to-4 family residential		472		1,627		2,099		46,388		48,487
HELOC		113		824		937		35,834		36,771
Deferred loan (fees) cost, net										(407	)
	$	2,998	$	14,676	$	17,674	$	373,136	$	390,403

At June 30, 2012 there were no loans that were more than 90 days past due and still accruing interest.

	December 31, 2011
	30+		Non-		Total
	Days		Accrual		Past				Total
	Past Due		Loans		Due		Current		Loans
	(In thousands)
Commercial and industrial	$	48	$	171	$	219	$	32,927	$	33,146
Construction		568		4,072		4,640		66,206		70,846
Multi-family residential		1,540		-		1,540		21,837		23,377
Commercial real estate		1,013		10,425		11,438		180,609		192,047
Loans to individuals & overdrafts		10		176		186		7,485		7,671
1-to-4 family residential		735		1,875		2,610		49,572		52,182
HELOC		333		904		1,237		37,465		38,702
Deferred loan (fees) cost, net										(347	)
	$	4,247	$	17,623	$	21,870	$	396,101	$	417,624

Impaired Financing Receivables [Table Text Block]

The following tables present information on loans that were considered to be impaired as of June 30, 2012 and December 31, 2011:

							Three months ended				Six months ended
							June 30, 2012				June 30, 2012
			Contractual						Interest Income				Interest Income
			Unpaid				Average		Recognized on		Average		Recognized on
	Recorded		Principal		Related		Recorded		Impaired		Recorded		Impaired
	Investment		Balance		Allowance		Investment		Loans		Investment		Loans
	(In thousands)
With no related allowance recorded:
Commercial and  industrial	$	512	$	777	$	-	$	480	$	6	$	480	$	13
Construction		2,312		2,915		-		2,134		6		1,760		6
Commercial real  estate		13,683		15,187		-		12,810		196		11,605		284
Loans to individuals & overdrafts		121		138		-		149		1		171		1
Multi-family residential		1,508		1,508		-		1,524		-		1,529		-
1 to 4 family residential		1,683		1,932		-		1,776		9		1,884		13
HELOC		1,336		1,556		-		1,193		7		1,039		15
Subtotal:		21,155		24,013		-		20,066		225		18,468		332
With an allowance recorded:
Commercial and  industrial		7		7		2		64		-		43		-
Construction		1,192		1,192		167		1,443		11		2,083		12
Commercial real  estate		852		1,114		75		1,744		13		2,842		13
Loans to individuals  & overdrafts		15		16		7		35		-		29		-
Multi-family residential		43		43		10		21		1		14		1
1 to 4 family residential		810		1,133		162		792		14		774		24
HELOC		181		181		97		258		5		308		5
Subtotal:		3,100		3,686		520		4,357		44		6,093		55
Totals:
Commercial		20,109		22,743		254		20,220		233		20,356		329
Consumer		136		154		7		184		1		200		1
Residential		4,010		4,802		259		4,019		35		4,005		57
Grand Total:	$	24,255	$	27,699	$	520	$	24,423	$	269	$	24,561	$	387

							December 31, 2011
			Contractual				Year to Date
			Unpaid				Average		Interest Income
	Recorded		Principal		Related		Recorded		Recognized on
	Investment		Balance		Allowance		Investment		Impaired Loans
	(In thousands)
With no related allowance recorded:
Commercial and industrial	$	478	$	808	$	-	$	290	$	25
Construction		1,011		1,166		-		1,539		23
Commercial real estate		9,195		10,085		-		7,889		158
Loans to individuals & overdrafts		217		234		-		175		4
Multi-family residential		1,540		1,540		-		1,041		102
1-to-4 family residential		2,100		2,930		-		1,746		33
HELOC		730		823		-		406		-
Subtotal:		15,271		17,586		-		13,086		345
With an allowance recorded:
Commercial and industrial		-		-		-		272		-
Construction		3,365		4,085		674		1,269		4
Commercial real estate		5,039		5.929		498		4,043		71
Loans to individuals & overdrafts		16		16		15		102		1
Multi-family residential		-		-		-		-		-
1-to-4 family residential		736		774		170		1,999		35
HELOC		408		435		158		321		10
Subtotal:		9,564		11,239		1,515		8,006		121
Totals:
Commercial		20,628		23,613		1,172		16,343		383
Consumer		233		250		15		277		5
Residential		3,974		4,962		328		4,472		78
Grand Total:	$	24,835	$	28,825	$	1,515	$	21,092	$	466

Troubled Debt Restructurings on Financing Receivables [Table Text Block]

The following table presents loans that were modified as troubled debt restructurings (“TDRs”) for which there was a payment default together with a breakdown of the types of concessions made by loan class during the previous twelve months:

	Twelve months ended June 30, 2012
			Pre-		Post-
			Modification		Modification
			Outstanding		Outstanding
	Number		Recorded		Recorded
	of loans		Investment		Investment
	(Dollars in thousands)
Below market interest rate:
Commercial and industrial		-	$	-	$	-
Construction		-		-		-
Commercial real estate		-		-		-
Loans to individuals & overdrafts		-		-		-
1-to-4 family residential		-		-		-
HELOC		-		-		-
Total		-		-		-
Extended payment terms:
Commercial and industrial		2		327		325
Construction		2		2,057		2,036
Commercial real estate		5		3,111		2,974
Loans to individuals & overdrafts		-		-		-
1-to-4 family residential		2		151		143
HELOC		-		-		-
Total		11		5,646		5,478
Forgiveness of principal:
Commercial and industrial		-		-		-
Construction		-		-		-
Commercial real estate		-		-		-
Loans to individuals & overdrafts		-		-		-
1- to-4 family residential		-		-		-
HELOC		-		-		-
Total		-		-		-
Total		11	$	5,646	$	5,478

The following table presents loans that were modified as TDRs with a breakdown of the types of concessions made by loan class during the three months and six months ended June 30, 2012:

	Three months ended				Six months ended
	June 30, 2012				June 30, 2012
	Number		Recorded		Number		Recorded
	of loans		investment		of loans		investment
	(Dollars in thousands)
Below market interest rate:
Commercial and industrial		-	$	-		-	$	-
Construction		-		-		-		-
Commercial real estate		-		-		-		-
Loans to individuals & overdrafts		-		-		-		-
1-to-4 family residential		-		-		-		-
HELOC		-		-		-		-
Total		-		-		-		-
Extended payment terms:
Commercial and industrial		-		-		1		114
Construction		-		-		2		290
Commercial real estate		-		-		4		1,144
Loans to individuals & overdrafts		-		-		-		-
1-to-4 family residential		-		-		-		-
HELOC		-		-		-		-
Total		-		-		7		1,548
Forgiveness of principal:
Commercial and industrial		-		-		-		-
Construction		-		-		-		-
Commercial real estate		-		-		-		-
Loans to individuals and overdrafts		-		-		-		-
1-to-4 family residential		-		-		-		-
HELOC		-		-		-		-
Total		-		-		-		-
Other:
Commercial and industrial		-		-		-		-
Construction		-		-		-		-
Commercial real estate		2		849		2		849
Loans to individuals and overdrafts		-		-		-		-
1-to-4 family residential		4		165		4		165
HELOC		-		-		-		-
Total		6		1,014		6		1,014
Total		6	$	1,014		13	$	2,562

Schedule Of Types Of Modifications [Table Text Block]

The following table presents the successes and failures of the types of modifications within the previous six months as of June 30, 2012:

	Paid in full				Paying as restructured				Converted to non-accrual				Foreclosure/Default
	Number		Recorded		Number		Recorded		Number		Recorded		Number		Recorded
	of loans		Investment		of loans		Investment		of loans		Investment		of loans		Investment
	(In thousands)
Below market interest rate		-	$	-		-	$	-		-	$	-		-	$	-
Extended payment terms		-		-		2		290		4		975		1		283
Forgiveness of principal		-		-		-		-		-		-		-		-
Other		-		-		6		1,014		-		-		-		-
Total		-	$	-		8	$	1,304		4	$	975		1	$	283

Financing Receivable Credit Quality Indicators [Table Text Block]

The following tables present information on risk ratings of the commercial and consumer loan portfolios, segregated by loan class as of June 30, 2012 and December 31, 2011, respectively:

June 30, 2012
Commercial
Credit
Exposure By	Commercial				Commercial
Internally	and				real		Multi-family
Assigned Grade	industrial		Construction		estate		residential
(In thousands)
Superior	$	764	$	55	$	-	$	-
Very good		32		4		307		-
Good		3,067		655		14,303		1,687
Acceptable		9,870		5,049		63,276		5,793
Acceptable with care		15,441		40,670		74,336		10,470
Special mention		1,339		4,629		23,338		-
Substandard		531		3,654		17,661		1,551
Doubtful		-		-		-		-
Loss		-		-		-		-
	$	31,044	$	54,716	$	193,221	$	19,501

Consumer Credit
Exposure By
Internally	1-to-4 family
Assigned Grade	residential		HELOC
Pass	$	41,324	$	33,746
Special mention		3,528		1,200
Substandard		3,635		1,825
	$	48,487	$	36,771

Consumer Credit
Exposure Based	Loans to
On Payment	individuals &
Activity	overdrafts
Pass	$	6,888
Non –pass		182
	$	7,070

December 31, 2011
Commercial
Credit
Exposure By	Commercial				Commercial
Internally	and				real		Multi-family
Assigned Grade	industrial		Construction		estate		residential
(In thousands)
Superior	$	722	$	59	$	-	$	-
Very good		154		6		429		-
Good		5,184		2,369		16,510		1,064
Acceptable		8,224		6,685		67,922		12,828
Acceptable with care		15,048		54,087		60,604		7,820
Special mention		3,062		2,671		27,177		125
Substandard		752		4,969		19,405		1,540
Doubtful		-		-		-		-
Loss		-		-		-		-
	$	33,146	$	70,846	$	192,047	$	23,377

Consumer Credit
Exposure By
Internally	1-to-4 family
Assigned Grade	residential		HELOC
Pass	$	43,647	$	35,127
Special mention		2,925		1,391
Substandard		5,610		2,184
	$	52,182	$	38,702

Consumer Credit
Exposure Based	Loans to
On Payment	individuals &
Activity	overdrafts
Pass	$	7,447
Non-pass		224
	$	7,671

Schedule Of Non Performing Asset [Table Text Block]

Non-performing assets at June 30, 2012 and December 31, 2011 consist of the following:

	June 30, 2012		December 31, 2011
	(In thousands)
Non-accrual loans	$	14,676	$	17,623
Accruing TDRs		1,903		2,013
Total non-performing loans		16,579		19,636
Foreclosed real estate		3,859		3,031
Total non-performing assets	$	20,438	$	22,667

Allowance for Credit Losses on Financing Receivables [Table Text Block]

The following tables present a roll forward of the Company’s allowance for loan losses by loan class for the three month and six month periods ended June 30, 2012 and June 30, 2011, respectively:

	Three months ended
	June 30, 2012
	Commercial									1-to-4						Loans to			Multi-
	and						Commercial			family						individuals &			family
Allowance for loan losses	industrial			Construction			real estate			residential			HELOC			overdrafts			residential		Total
	(In thousands)
Balance, beginning of period 3/31/2012	$	555		$	1,311		$	4,804		$	1,585		$	1,101		$	105		$	107	$	9,568
Provision (recovery) for loan losses		(409	)		(967	)		1,024			(275	)		(41	)		3			16		(649	)
Loans charged-off		(4	)		-			(670	)		(54	)		(168	)		(45	)		-		(940	)
Recoveries		244			138			70			58			5			17			-		532
Balance, end of period 6/30/2012	$	386		$	482		$	5,228		$	1,314		$	897		$	80		$	123	$	8,510
Ending balance: individually evaluated for impairment	$	2		$	167		$	75		$	162		$	97		$	7		$	10	$	520
Ending balance: collectively evaluated for impairment	$	384		$	315		$	5,153		$	1,152		$	800		$	73		$	113	$	7,990
Loans:
Ending balance	$	31,044		$	54,716		$	193,221		$	48,487		$	36,771		$	7,070		$	19,501	$	390,810
Ending balance: individually evaluated for impairment	$	519		$	3,504		$	14,535		$	2,493		$	1,517		$	136		$	1,551	$	24,255
Ending balance: collectively evaluated for impairment	$	30,525		$	51,212		$	178,686		$	45,994		$	35,254		$	6,934		$	17,950	$	366,555

	Six months ended
	June 30, 2012
	Commercial									1-to-4						Loans to			Multi-
	and						Commercial			family						individuals &			family
Allowance for loan losses	industrial			Construction			real estate			residential			HELOC			overdrafts			residential			Total
	(In thousands)
Balance, beginning of period 1/1/2012	$	719		$	1,540		$	4,771		$	1,661		$	1,122		$	94		$	127		$	10,034
Provision (recovery) for loan losses		(2,956	)		(911	)		1,357			(369	)		134			(37	)		(4	)		(2,786	)
Loans charged-off		(51	)		(458	)		(981	)		(99	)		(376	)		(54	)		-			(2,019	)
Recoveries		2,674			311			81			121			17			77			-			3,281
Balance, end of period 6/30/2012	$	386		$	482		$	5,228		$	1,314		$	897		$	80		$	123		$	8,510
Ending balance: individually evaluated for impairment	$	2		$	167		$	75		$	162		$	97		$	7		$	10		$	520
Ending balance: collectively evaluated for impairment	$	384		$	315		$	5,153		$	1,152		$	800		$	73		$	113		$	7,990
Loans:
Ending balance	$	31,044		$	54,716		$	193,221		$	48,487		$	36,771		$	7,070		$	19,501		$	390,810
Ending balance: individually evaluated for impairment	$	519		$	3,504		$	14,535		$	2,493		$	1,517		$	136		$	1,551		$	24,255
Ending balance: collectively evaluated for impairment	$	30,525		$	51,212		$	178,686		$	45,994		$	35,254		$	6,934		$	17,950		$	366,555

During the six months ended June 30, 2012 the Company recorded recoveries on loans previously charged-off in the amount of $3.3 million. These recoveries were primarily a result of a $2.4 million recovery on commercial and industrial loans. These recoveries combined with the decrease in total loans outstanding at June 30, 2012 resulted in a $2.8 million recovery in the provision for loan losses.

	December 31, 2011
	Commercial						1-to-4				Loans to		Multi-
	and				Commercial		family				individuals &		family
Allowance for loan losses	industrial		Construction		real estate		residential		HELOC		overdrafts		residential		Total
	(In thousands)
Loans:
Ending Balance	$	33,146	$	70,846	$	192,047	$	52,182	$	38,702	$	7,671	$	23,377	$	417,971
Ending Balance: individually evaluated for impairment	$	478	$	4,376	$	14,234	$	2,836	$	1,138	$	233	$	1,540	$	24,835
Ending Balance: collectively evaluated for impairment	$	32,668	$	66,470	$	177,813	$	49,346	$	37,564	$	7,438	$	21,837	$	393,136

	Three months ended
	June 30, 2011
	Commercial									1-to-4						Loans to			Multi-
	and						Commercial			family						individuals &			family
Allowance for loan losses	industrial			Construction			real estate			residential			HELOC			overdrafts			residential			Total
	(In thousands)
Balance, beginning of period 3/31/2011	$	1,081		$	1,271		$	3,609		$	2,451		$	1,140		$	383		$	183		$	10,118
Provision (recovery) for loan losses		203			570			1,864			(230	)		376			(232	)		(9	)		2,542
Other		-			-			(53	)		-			-			-			-			(53	)
Loans charged-off		(3,880	)		(669	)		(926	)		(410	)		(69	)		(65	)		-			(6,019	)
Recoveries		3,648			-			8			81			3			50			-			3,790
Balance, end of period 6/30/2011	$	1,052		$	1,172		$	4,502		$	1,892		$	1,450		$	136		$	174		$	10,378
Ending balance: individually evaluated for impairment	$	191		$	106		$	761		$	701		$	268		$	46		$	-		$	2,073
Ending balance: collectively evaluated for impairment	$	861		$	1,066		$	3,741		$	1,191		$	1,182		$	90		$	174		$	8,305
Loans:
Ending balance	$	40,646		$	77,211		$	204,412		$	59,504		$	40,532		$	8,409		$	28,168		$	458,882
Ending balance: individually evaluated for impairment	$	538		$	2,329		$	13,647		$	3,408		$	442		$	213		$	-		$	20,577
Ending balance: collectively evaluated for impairment	$	40,108		$	74,882		$	190,765		$	56,096		$	40,090		$	8,196		$	28,168		$	438,305

	Six months ended
	June 30, 2011
	Commercial									1-to-4						Loans to			Multi-
	and						Commercial			family						individuals &			family
Allowance for loan losses	industrial			Construction			real estate			residential			HELOC			overdrafts			residential			Total
	(In thousands)
Balance, beginning of period 1/1/2011	$	1,052		$	349		$	3,111		$	1,985		$	1,348		$	1,530		$	640		$	10,015
Provision (recovery) for loan losses		160			1,714			3,133			296			231			(1,362	)		(466	)		3,706
Other		-			-			(53	)		-			-			-			-			(53	)
Loans charged-off		(3,880	)		(891	)		(1,699	)		(600	)		(134	)		(87	)		-			(7,291	)
Recoveries		3,720			-			10			211			5			55			-			4,001
Balance, end of period 6/30/2011	$	1,052		$	1,172		$	4,502		$	1,892		$	1,450		$	136		$	174		$	10,378
Ending balance: individually evaluated for impairment	$	191		$	106		$	761		$	701		$	268		$	46		$	-		$	2,073
Ending balance: collectively evaluated for impairment	$	861		$	1,066		$	3,741		$	1,191		$	1,182		$	90		$	174		$	8,305
Loans:
Ending balance	$	40,646		$	77,211		$	204,412		$	59,504		$	40,532		$	8,409		$	28,168		$	458,882
Ending balance: individually evaluated for impairment	$	538		$	2,329		$	13,647		$	3,408		$	442		$	213		$	-		$	20,577
Ending balance: collectively evaluated for impairment	$	40,108		$	74,882		$	190,765		$	56,096		$	40,090		$	8,196		$	28,168		$	438,305