10-K

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark One)
ý	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2012
OR
o	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: 000-54025

FOX CHASE BANCORP, INC.
(Exact name of registrant as specified in its charter)

Maryland (State or other jurisdiction of incorporation or organization)	35-2379633 (I.R.S. Employer Identification No.)
4390 Davisville Road, Hatboro, Pennsylvania (Address of principal executive offices)	19040 (Zip Code)

         Registrant's telephone number, including area code: (215) 682-7400

         Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock, par value $0.01 per share	Nasdaq Stock Market

         Securities registered pursuant to Section 12(g) of the Act: None

         Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o    No ý

         Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o    No ý

         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 ý    No o

         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 ý    No o

         Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ý

         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 definition of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer o Accelerated Filer ý Non-Accelerated Filer o
(Do not check if a
smaller reporting company) Smaller Reporting Company o

         Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes o    No ý

         The aggregate market value of the voting and non-voting common equity held by nonaffiliates as of June 30, 2012 was approximately $168.7 million. Solely for purposes of this calculation, the shares held by directors and officers of the registrant are deemed to be held by affiliates.

         The number of shares outstanding of the registrant's common stock as of March 1, 2013 was 12,305,564.

DOCUMENTS INCORPORATED BY REFERENCE

         Portions of the registrant's proxy statement for its 2013 annual meeting of stockholders are incorporated into Part III of this Annual Report on Form 10-K by reference.

INDEX

		Page
Part I
Item 1.	Business		1
Item 1A.	Risk Factors		21
Item 1B.	Unresolved Staff Comments		27
Item 2.	Properties		27
Item 3.	Legal Proceedings		27
Item 4.	Mine Safety Disclosures		27
Part II
Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		28
Item 6.	Selected Financial Data		31
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operation		32
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		63
Item 8.	Financial Statements and Supplementary Data		63
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure		63
Item 9A.	Controls and Procedures		64
Item 9B.	Other Information		67
Part III
Item 10.	Directors, Executive Officers and Corporate Governance		67
Item 11.	Executive Compensation		67
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		68
Item 13.	Certain Relationships and Related Transactions and Director Independence		68
Item 14.	Principal Accountant Fees and Services		69
Part IV
Item 15.	Exhibits and Financial Statement Schedules		69
SIGNATURES

This annual report contains forward-looking statements that are based on assumptions and may describe future plans, strategies and expectations of Fox Chase Bancorp, Inc. These forward-looking statements are generally identified by use of the words "believe," "expect," "intend," "anticipate," "estimate," "project" or similar expressions. Fox Chase Bancorp, Inc.'s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations of Fox Chase Bancorp, Inc. and its subsidiary include, but are not limited to, changes in interest rates, national and regional economic conditions, legislative and regulatory changes, monetary and fiscal policies of the U.S. government, including policies of the U.S. Treasury and the Federal Reserve Board, the credit quality and composition of the loan and investment portfolios, valuation of assets acquired through foreclosure, deposit flows, competition, demand for loan products and for financial services in Fox Chase Bancorp, Inc.'s market area, changes in real estate market values in Fox Chase Bancorp, Inc.'s market area, changes in relevant accounting principles and guidelines and inability of third party service providers to perform as required. Additional factors that may affect our results are discussed in Item 1A to this annual report titled "Risk Factors."

These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Except as required by applicable law or regulation, Fox Chase Bancorp, Inc. does not undertake, and specifically disclaims any obligation, to release publicly the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of the statements or to reflect the occurrence of anticipated or unanticipated events.

Unless the context indicates otherwise, all references in this annual report to "Company," "we," "us" and "our" refer to Fox Chase Bancorp, Inc. and its subsidiary.

ITEM 1.    BUSINESS

General

        Fox Chase Bancorp, Inc. (the "Bancorp" or the "Company") is a Maryland corporation that was incorporated in March 2010 to be the successor corporation to old Fox Chase Bancorp, Inc. ("Old Fox Chase Bancorp"), the former stock holding company for Fox Chase Bank (the "Bank"), upon completion of the mutual-to-stock conversion of Fox Chase MHC, the former mutual holding company for Fox Chase Bank.

        The mutual-to-stock conversion was completed on June 29, 2010. In connection with the conversion, Bancorp sold 8,712,500 shares of common stock at $10.00 per share in a public offering. Concurrent with the completion of the offering, shares of Old Fox Chase Bancorp's common stock owned by public stockholders were exchanged for 1.0692 shares of Bancorp common stock. Additionally, as part of the mutual-to-stock conversion, the Bank's Employee Stock Ownership Plan ("ESOP") acquired 348,500 shares, or 4.0% of Bancorp's issued shares, at $10.00 per share. Net proceeds from the conversion and offering, after the loan made to the ESOP, were approximately $77.8 million.

        Financial information presented in this annual report is derived in part from the consolidated financial statements of Fox Chase Bancorp, Inc. and subsidiaries on and after June 29, 2010 and from the consolidated financial statements of Old Fox Chase Bancorp and subsidiaries prior to June 29, 2010.

        Bancorp's business activities consist of the ownership of the Bank's capital stock, making loans to the ESOP and the management of the offering proceeds it retained. Bancorp does not own or lease any property. Instead, it uses the premises, equipment and other property of the Bank. Accordingly, the information set forth in this annual report, including the consolidated financial statements and related financial data, relates primarily to the Bank. As a savings and loan holding company, Bancorp is subject

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to the regulation of the Board of Governors of the Federal Reserve System (the "Federal Reserve Board").

        The Bank operates as a community-oriented financial institution offering traditional financial services to consumers and businesses in its market areas. The Bank attracts deposits from the general public and uses those funds to originate one- to four-family real estate, multi-family and commercial real estate, construction, commercial and consumer loans, which the Bank generally holds for investment. Fox Chase Bank also maintains an investment portfolio. The Bank is regulated by the Office of the Comptroller of the Currency and its deposits are insured up to applicable legal limits under the Deposit Insurance Fund administered by the Federal Deposit Insurance Corporation. The Bank is also a member of the Federal Home Loan Bank of Pittsburgh.

        The Bank's website address is www.foxchasebank.com. Information on our website should not be considered a part of this annual report.

Market Area

        We are headquartered in Hatboro, Pennsylvania, which is approximately fifteen miles north of Center City, Philadelphia. We maintain two offices in Montgomery County, Pennsylvania, one office in each of Philadelphia, Chester and Delaware Counties, Pennsylvania and three offices in Bucks County, Pennsylvania. All eight of these branch offices are in the Philadelphia-Camden-Wilmington metropolitan statistical area. We maintain three offices in southern New Jersey; one in Atlantic County and two in Cape May County.

        Philadelphia Market Area.    The economy of our Philadelphia market area is primarily dominated by the service sector. According to published statistics, the population of the five-county area served by our branches totaled approximately 4.0 million in 2011. The Philadelphia market area is comprised of a highly-educated workforce and benefits from a diverse local economy as traditional employers in the manufacturing and financial services industry have been bolstered by growth in the life sciences and health care industries as well as the information technology and communication sectors. The median household and per capita income in Bucks, Chester, Delaware and Montgomery Counties significantly exceeds the comparable figures for Pennsylvania as a whole, while the median household and per capita income in Philadelphia County trails the comparable figures for Pennsylvania.

        New Jersey Market Area.    The economy of Atlantic County is dependent upon the gaming industry in nearby Atlantic City, New Jersey. According to published statistics, Atlantic County's population in 2011 was approximately 275,000. The economy in Atlantic County has deteriorated as gaming revenues have declined significantly in recent years due to deteriorating economic conditions and increased gaming competition from other states. The economy in Cape May County relies on the tourism and hospitality industries. According to published statistics, Cape May County's population in 2011 was approximately 97,000. Additionally, median household and per capita income in Atlantic and Cape May Counties are lower than the comparable figures for New Jersey as a whole.

Competition

        We face significant competition for the attraction of deposits and origination of loans. Our most direct competition for deposits has historically come from the numerous financial institutions and credit unions operating in our market areas and, to a lesser extent, from other financial service companies such as brokerage firms and insurance companies. Credit unions generally do not pay federal income tax and, accordingly, are frequently able to offer customers higher rates on deposits and lower rates on loans and achieve similar levels of profitability as financial institutions that are required to pay federal income tax. We also face competition for investors' funds from money market funds, mutual funds and other corporate and government securities. At June 30, 2012, which is the most recent date for which data is available from the Federal Deposit Insurance Corporation, we held less than 1% of total

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deposits in counties where our offices are located. In addition, larger banks such as Bank of America, Wells Fargo, Sovereign Bank, Citizens Bank of PA and TD Bank also operate in our market areas. These institutions are significantly larger than us and, therefore, have greater resources.

        Our competition for loans comes primarily from financial institutions in our market areas, and, to a lesser extent, from other financial service providers such as mortgage companies, mortgage brokers and credit unions. Competition for loans also comes from non-depository financial service companies entering the mortgage and commercial lending markets such as insurance companies, securities companies and specialty finance companies.

        We expect competition to increase in the future as a result of legislative, regulatory and technological changes and the continuing trend of consolidation in the financial services industry. Technological advances, for example, have lowered the barriers to market entry, allowed banks and other lenders to expand their geographic reach by providing services over the internet and made it possible for non-depository institutions to offer products and services that traditionally have been provided by banks. Changes in federal law permit affiliation among banks, securities firms and insurance companies, which promotes a competitive environment in the financial services industry. Competition for deposits and the origination of loans could limit our future growth.

Lending Activities

        General.    We generally originate loans for investment. Our loan portfolio consists of multi-family and commercial real estate loans, one- to four-family residential real estate loans, commercial and industrial loans, and to a lesser extent, construction loans and consumer loans. We have added personnel to assist us in increasing our commercial loan portfolio, including hiring experienced commercial lenders and commercial credit and risk management professionals over the last several years. These additions and our continued emphasis on increasing the commercial segment of our portfolio has resulted in additional originations and servicing of multi-family and commercial real estate and commercial and industrial loans to individuals and businesses in our primary market areas.

        Multi-Family and Commercial Real Estate Loans.    The largest segment of our portfolio is multi-family and commercial real estate loans. We offer fixed-rate and adjustable-rate mortgage loans secured by multi-family and commercial real estate to individuals and small businesses in our primary market areas. Our multi-family and commercial real estate loans are generally secured by condominiums, apartment buildings and mixed-use properties with residential units, as well as office and retail space. While we have focused on increasing this segment of our loan portfolio over the last several years, we continue to be more selective in the types of properties and projects securing such loans due to economic conditions.

        We originate multi-family and commercial real estate loans with terms of up to 25 years but generally have a rate reset after five years. These loans are typically repaid or the term is extended before maturity, in which case a new rate is negotiated to meet market conditions and an extension of the loan is executed for a new term with a new amortization schedule. Interest rates and payments on our adjustable-rate loans generally are based on LIBOR, the Prime Interest Rate, Constant Maturity Treasury Index, or the Bank's cost of funds. Loans are secured by first mortgages that generally do not exceed 80% of the property's appraised value. We require all properties securing multi-family and commercial real estate loans to be appraised by a Bank-approved independent licensed appraiser and appraisals greater than $3.0 million receive an independent third party review. Many multi-family and commercial real estate loans also are supported by personal guarantees.

        At December 31, 2012, our largest multi-family or commercial real estate loan was a commercial mortgage to Philadelphia Mortgage Advisors, a mortgage banker located in Plymouth Meeting, Pennsylvania, to which Fox Chase Bank has committed $18.0 million, of which $15.2 million is

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outstanding. Fox Chase Bank owns approximately 45% of Philadelphia Mortgage Advisors. The loan was performing in accordance with its contractual terms at December 31, 2012.

        At December 31, 2012, our second largest multi-family or commercial real estate lending relationship is a commitment of $15.9 million to a real estate investment firm located in Philadelphia, Pennsylvania, of which $15.7 million is outstanding. This loan was performing in accordance with its contractual terms at December 31, 2012.

        One- to Four-Family Residential Real Estate Loans.    The second largest segment of our loan portfolio is residential mortgage loans, which enable borrowers to purchase or refinance existing homes, most of which are owner occupied. We offer fixed-rate and adjustable-rate loans with terms up to 30 years. Borrower demand for fixed rate loans versus adjustable-rate loans is a function of current and expected future levels of interest rates and the difference between the interest rates and loan fees offered for fixed-rate mortgage loans and the initial period interest rates and loan fees for adjustable-rate loans. Loan fees, interest rates and other provisions of mortgage loans are determined by us on the basis of our own pricing criteria and competitive market conditions. The majority of our new mortgage loans are purchased from Philadelphia Mortgage Advisors. The ability to originate loans through this investment allows Fox Chase Bank to continue to offer one- to four-family mortgage loans to a growing and diverse set of customers through additional distribution channels in a cost-effective manner. We have not originated subprime loans for our portfolio.

        While one- to four-family residential real estate loans are normally originated with terms of up to 30 years, such loans typically remain outstanding for substantially shorter periods because borrowers often prepay their loans in full upon the sale of the property pledged as security or upon refinancing the original loan. Therefore, average loan maturity is a function of, among other factors, the level of purchase and sale activity in the real estate market, prevailing interest rates and the interest rates payable on outstanding loans. In general, as interest rates decline, prepayments accelerate and the average life of the loans decrease.

        Interest rates and payments on our adjustable-rate mortgage loans generally adjust annually after an initial fixed period of one, three or five years. Interest rates and payments on these adjustable-rate loans generally are based on the one-year constant maturity Treasury index. The maximum amount by which the interest rate may be increased is generally two percentage points per adjustment period with a lifetime interest rate cap of six percentage points over the initial interest rate of the loan.

        Because of our branch locations in southern New Jersey, a portion of the properties securing our residential mortgages are second homes or rental properties. At December 31, 2012, 19.5% of our one- to four-family mortgage loans were secured by second homes and 9.2% were secured by rental properties. If the property is a second home, our underwriting emphasizes the borrower's ability to repay the loan out of current income. If the property is a rental property, we focus on the anticipated income from the property. Interest rates on loans secured by rental properties are typically higher than comparable loans secured by primary or secondary residences. Generally, mortgage loans secured by rental properties or second homes have a higher risk of default than mortgage loans secured by the borrower's primary residence.

        Historically, we generally did not make conventional loans with loan-to-value ratios exceeding 95% at the time the loan was originated. During 2008, Fox Chase Bank began lowering its loan-to-value limits on certain loans due to deteriorating economic conditions and declining real estate values. At December 31, 2012 we did not have any residential loans with a loan-to-value ratio exceeding 90%. Private mortgage insurance is generally required for all first mortgage loans with loan-to-value ratios in excess of 80%. We require properties securing mortgage loans to be appraised by a Bank-approved independent licensed appraiser. We generally require title insurance on all first mortgage loans. Borrowers must obtain hazard insurance, and flood insurance for loans on properties located in a flood zone, before closing the loan.

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        At December 31, 2012, our largest outstanding one- to four-family residential real estate loan had an outstanding balance of $1.1 million and was secured by a single family home in Wilmington, Delaware. The loan was performing in accordance with its contractual terms at December 31, 2012.

        Commercial and Industrial Loans.    We also offer commercial and industrial loans to professionals, sole proprietorships and small and mid-size businesses in our market area. Fox Chase Bank also purchases loan participations from other institutions to utilize excess capital and liquidity when we believe that such investments will provide an appropriate return. We offer secured and unsecured commercial term loans, which have a maturity of greater than one year and the payment of which is dependent on future earnings and cash flows. The term for repayment of the loan will normally be limited to the lesser of the expected useful life of the asset being financed or a fixed amount of time, generally five to ten years. The unsecured term loan will generally have a term no longer than two years. We also offer revolving lines of credit, letters of credit and demand loans secured by business assets other than real estate, such as business equipment, inventory and accounts receivable. We originate these loans on both a fixed-rate and adjustable-rate basis. Adjustable-rate loans are based on the prime rate, although our policies permit interest rates to be based on the Constant Maturity Treasury Index, LIBOR or the federal funds rate and adjust either monthly, quarterly or annually. Where the borrower is a corporation, partnership or other entity, we generally require significant equity holders to be co-borrowers and in cases where they are not co-borrowers, we may require personal guarantees from significant equity holders.

        When making commercial and industrial loans, we consider the financial statements and/or tax returns of the borrower, the borrower's payment history of both corporate and personal debt, the debt service capabilities of the borrower, the projected cash flows of the business, the viability of the industry in which the customer operates, the value of the collateral and our assessment of management's ability. Commercial and industrial loans are generally secured by a variety of collateral, primarily accounts receivable, inventory and equipment, and may be supported by personal guarantees. Depending on the collateral used to secure the loans, commercial loans are made in amounts up to 80% of the value of the collateral securing the loan. As of December 31, 2012, we had line of credit commitments totaling $130.4 million, of which $62.4 million were funded and $68.0 million were unfunded.

        At December 31, 2012, our largest commercial and industrial loan relationship was a $15.0 million commitment to a firm that invests in multi-asset classes, including commercial real estate and commercial and industrial businesses, of which $12.5 million is outstanding. This loan was performing in accordance with its contractual terms at December 31, 2012.

        Construction Loans.    We originate adjustable-rate and fixed-rate loans to individuals, builders and developers to finance the construction of residential dwellings. We also make construction loans for commercial development projects, including apartment buildings, restaurants, shopping centers, schools and other owner-occupied properties used for businesses. Our construction loans generally provide for the payment or reserving of interest only during the construction phase, which is usually six to twelve months for residential properties and eighteen months or more for commercial properties. At the end of the construction phase, the loan is typically repaid with the proceeds from sales of individual units or is converted to a permanent mortgage loan. Loans generally can be made with a maximum loan-to-value ratio of 80% at the time the loan is originated. Before making a commitment to fund a construction loan, we require an appraisal of the property by a Bank-approved independent licensed appraiser. We also generally require an inspection of the property before disbursement of funds during the construction phase of the loan.

        At December 31, 2012, we had loans secured by undeveloped and developed land that totaled $5.3 million. The terms and rates of our land loans are the same as our multi-family and commercial real estate loans. Loans secured by undeveloped land or improved lots generally involve greater risks

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than residential mortgage lending because land loans are more difficult to evaluate. If the estimate of value proves to be inaccurate, in the event of default and foreclosure, we may be confronted with a property value which is insufficient to assure full repayment. Loan amounts generally do not exceed 75% of the lesser of the appraised value or the purchase price. We did not make any loans secured by undeveloped or developed land in 2012.

        At December 31, 2012, our largest residential construction loan was a residential townhome development located in Chester County, Pennsylvania to which Fox Chase Bank has committed $4.3 million, of which $3.8 million was outstanding. This loan was classified as impaired and nonperforming at December 31, 2012.

        At December 31, 2012, our largest outstanding commercial construction loan was for $6.8 million. This loan is secured by a charter school in Philadelphia, Pennsylvania. This property was completed in 2012 and became a commercial real estate loan in early 2013. The loan was performing in accordance with its contractual terms at December 31, 2012.

        Consumer Loans.    We offer a variety of consumer loans, including home equity loans and lines of credit, loans secured by certificate of deposits (share loans) and unsecured overdraft lines of credit.

        The procedures for underwriting consumer loans include an assessment of the applicant's payment history on other debts and ability to meet existing obligations and payments on the proposed loan. Although the applicant's creditworthiness is a primary consideration, the underwriting process also includes a comparison of the value of the collateral, if any, to the proposed loan amount.

        We offer fixed-rate and adjustable-rate home equity loans. Home equity loans have terms that range from 1 to 15 years. We hold a first or second mortgage position on most of the homes that secure our home equity loans and home equity lines of credit. We generally offer fixed-rate home equity loans with a maximum combined loan-to-value ratio of 90% and adjustable-rate lines of credit with a maximum combined loan-to-value ratio of 80%. Home equity lines of credit have adjustable-rates of interest that are based on the prime interest rate. Home equity lines of credit generally require interest and principal to be paid on a monthly basis and have terms up to 20 years. Interest rates on these lines typically adjust monthly.

Loan Underwriting Risks

        Adjustable-Rate Loans.    While we anticipate that adjustable-rate loans will better offset the adverse effects of an increase in interest rates as compared to fixed-rate mortgages, the increased mortgage payments required of adjustable-rate loan borrowers in a rising interest rate environment could cause an increase in delinquencies and defaults. The marketability and collateral value of the underlying property also may be adversely affected in a higher interest rate environment. In addition, although adjustable-rate mortgage loans help make our loan portfolio more responsive to changes in interest rates, the extent of this interest sensitivity is limited by the annual and lifetime interest rate adjustment limits.

        Multi-Family and Commercial Real Estate Loans.    Loans secured by multi-family and commercial real estate generally have larger balances and involve a greater degree of risk than one- to four-family residential mortgage loans. The primary concern in multi-family and commercial real estate lending is the borrower's creditworthiness and the feasibility and cash flow of the project. Payments on loans secured by income properties often depend on successful operation and management of the properties. As a result, repayment of such loans may be subject to a greater extent than residential real estate loans to adverse conditions in the real estate market or the economy. To monitor cash flows on income properties, we generally require borrowers and loan guarantors to provide annual financial statements and/or tax returns. In reaching a decision on whether to make a multi-family or commercial real estate loan, we consider the net operating income of the property, the borrower's expertise, credit history and

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profitability and the value of the underlying property. We have generally required that the properties securing these real estate loans have debt service coverage ratios (the ratio of earnings before debt service to debt service) of at least 1.20x. Environmental screens, surveys and inspections are obtained when circumstances suggest the possibility of the presence of hazardous materials. Further, in connection with our ongoing monitoring of the loan, we typically review the loan, cash flows of the underlying property and guarantors annually.

        Construction Loans.    Construction financing is generally considered to involve a higher degree of risk of loss than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property's value at completion of construction, the estimated cost (including interest) of construction and the ability of the project to be sold or refinanced upon completion. During the construction phase, a number of factors could result in delays and cost overruns. If the estimate of construction costs proves to be inaccurate, we may be required to advance funds beyond the amount originally committed to permit completion of the building. If the estimate of value proves to be inaccurate, we may be confronted, at or before the maturity of the loan, with a project having a value that is insufficient to assure full repayment. If we are forced to foreclose on a project before or at completion due to a borrower default, we may not be able to recover all of the unpaid balance of, and accrued interest on, the loan as well as related foreclosure and holding costs. In general, due to the increased risk associated with construction loans, the risk of loss is higher if a borrower defaults than other types of commercial loans.

        Commercial and Industrial Loans.    Unlike commercial real estate loans, which generally are made on the basis of the cash flows of the underlying real estate, and which are secured by real property the value of which tends to be more easily ascertainable, commercial and industrial loans are typically made on the basis of the borrower's ability to make repayment from the cash flows of the borrower's underlying business. As a result, the availability of funds for the repayment of commercial and industrial loans may depend substantially on the success of the business itself. Further, any collateral securing such loans may depreciate over time, may be difficult to appraise and may fluctuate in value.

        One- to Four-Family Residential Real Estate Loans.    One- to four-family residential real estate loans are secured by first mortgages on residential real estate properties. Repayment of these loans is generally dependent on the earnings and cash flows of the borrowers, however, ultimate repayment is secured by the underlying collateral. In circumstances where real estate values decline, the risk of loss on one- to four-family residential real estate loans increases as the repossessed collateral may not provide an adequate source of repayment.

        Consumer Loans.    Consumer loans are comprised primarily of home equity loans and lines of credit, which may entail greater risk than residential mortgage loans, as they are generally secured by second or third mortgages on real estate. In circumstances where real estate values decline, the risk of loss on a home equity loan or line of credit increases, as the repossessed collateral may not provide an adequate source of repayment. Additionally, the Company has small segments of consumer loans that are unsecured or secured by assets that depreciate rapidly. In such cases, repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment for the outstanding loan and the remaining deficiency often does not warrant further substantial collection efforts against the borrower. In addition, consumer loan collections depend on the borrower's continuing financial stability, and therefore are more likely to be adversely affected by job loss, divorce, illness or personal bankruptcy. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount that can be recovered on such loans.

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        Loan Originations, Sales and Participations.    Loan originations come from a number of sources. The primary source of loan originations is existing customers, walk-in traffic, advertising, referrals from customers and loans originated by our commercial relationship managers. We advertise in newspapers that are widely circulated throughout our market areas. Fox Chase Bank also purchases loans from Philadelphia Mortgage Advisors.

        At December 31, 2012, we were a participating lender in ten loan relationships totaling $32.1 million, which are secured by commercial and residential real estate, lease payments and the assets of the businesses, including our purchase of shared national credits described below. These loans are being serviced by the lead lender. We expect to continue to purchase participation interests, primarily in commercial loans and commercial real estate loans, when such opportunities meet our investment returns and risk parameters. On these participation interests, we generally perform our own underwriting analysis before purchasing such loans, and therefore believe there should not be a greater risk of default on these obligations. However, in a purchased participation loan, we do not service the loan and thus are subject to the policies and practices of the lead lender with regard to monitoring delinquencies, pursuing collections and instituting foreclosure proceedings. In assessing whether to participate, we require a review of all of the documentation relating to any loan in which we participate, including any annual financial statements provided by a borrower. Additionally, we require periodic updates on the loan from the lead lender.

        Included in purchased participations are large syndicated loans known as shared national credits. We held $11.6 million of such loans in our portfolio at December 31, 2012, which represented three different loan relationships ranging from $155,000 to $9.8 million. At December 31, 2012, all loans are performing as agreed and one such loan relationship totaling $155,000 was classified.

        From time to time we also sell participation interests in loans where we are the lead lender and servicer. At December 31, 2012, we were the lead lender on nine loan relationships totaling $132.7 million, of which we owned $65.7 million and serviced $67.0 million for other banks. We expect that we will continue to sell participation interests to local financial institutions, primarily with respect to commercial real estate and commercial and industrial loans that approach or exceed our lending thresholds.

        Loan Approval Procedures and Authority.    Our lending activities follow written, non-discriminatory, underwriting standards and loan origination procedures established by our Board of Directors and management. The Board has granted authority to approve residential and consumer loans up to $300,000 to the Assistant Manager of the Consumer Lending Department and up to $450,000 to the Vice President of Consumer Lending. The Board has granted authority to approve commercial loans up to $1.5 million to the President and Chief Executive Officer, the Chief Operating Officer, the Chief Lending Officer and certain other senior lenders. All such loans are approved under dual authority. Commercial loans between $1.5 million and $2.75 million can be approved based on dual authority from the President and Chief Executive Officer, the Chief Operating Officer, the Chief Lending Officer and the Chief Financial Officer. Loans in excess of $2.75 million and up to $4.5 million require the approval of the Officers Loan Committee, which consists of the President and Chief Executive Officer, the Chief Operating Officer, the Chief Lending Officer and other experienced lenders and officers as appointed by the Chief Executive Officer from time to time. Loans or groups of loans above $4.5 million require an approval by the Executive Officers Loan Committee, which consists of the President and Chief Executive Officer, the Chief Operating Officer, the Chief Lending Officer, the Chief Financial Officer and other senior lending officers of Fox Chase Bank. All loans greater than $10.0 million are reviewed by the Risk Management Committee of the Board of Directors.

        Loans to One Borrower.    The maximum amount we may lend to one borrower and the borrower's related entities generally is limited, by regulation, to 15% of our stated capital and reserves. At December 31, 2012, our general regulatory limit on loans to one borrower was approximately

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$22.1 million. At that date, our largest lending relationship was a $18.0 million warehouse line facility to Philadelphia Mortgage Advisors, a mortgage banker located in Plymouth Meeting, Pennsylvania of which $15.2 million is outstanding. The second largest lending relationship was a $15.9 million commitment to a firm, located in Philadelphia, Pennsylvania, that invests in commercial real estate, of which $15.7 million is outstanding. The third largest lending relationship was a $15.0 million commitment to a firm, located in Chester County, Pennsylvania, that invests in multi-asset classes including commercial real estate and commercial and industrial businesses, of which $12.5 million is outstanding. All of these loans were performing in accordance with their contractual terms at December 31, 2012.

        Loan Commitments.    We issue commitments for commercial loans conditioned upon the occurrence of certain events. Commitments to originate commercial loans are legally binding agreements to lend to our customers. Generally, our commercial loan commitments expire within 90 days.

Investment Activities

        The Board of Directors reviews and approves our investment policy annually. The Risk Management Committee of the Board of Directors is responsible for establishing policies for conducting investment activities, including the establishment of risk limits. The Risk Management Committee of the Board of Directors reviews investment transactions on a monthly basis and monitors the composition and performance of the investment portfolio on a quarterly basis. The Board has directed the Chief Financial Officer to implement the investment policy.

        The investment portfolio is primarily viewed as a source of liquidity. The investment portfolio management policy is designed to:

1.

absorb funds when loan demand and deposit outflows are low and infuse funds into loans when loan demand is high and to fund deposit outflows;



2.

generate a favorable return on investments within established risk parameters;



3.

provide income consistent with our liquidity and safety requirements, while providing a suitable balance of quality and diversification to our balance sheet;



4.

have collateral available for pledging requirements; and



5.

provide a medium for the implementation of certain interest rate risk management measures intended to establish and maintain an appropriate level of sensitivity to changes in interest rates.

        We have authority to invest in various types of liquid assets, including U.S. Treasury obligations, securities of various federal and state agencies and municipal governments, mortgage and asset-backed securities, corporate debt instruments and certificates of deposit of federally insured institutions. Within certain regulatory and policy limits, we also may invest a percentage of our capital in mutual funds. We also are required to maintain an investment in Federal Home Loan Bank of Pittsburgh stock.

        At December 31, 2012, our investment portfolio totaled $324.5 million and consisted primarily of mortgage-backed securities issued by Fannie Mae, Freddie Mac, Ginnie Mae and, to a lesser extent, mortgage related securities issued by private issuers and corporate debt. Of this amount, $296.1 million is classified as available-for-sale and $28.4 million is classified as held-to-maturity.

Deposit Activities and Other Sources of Funds

        General.    Deposits, borrowings, repayments on loans and investment securities are the major sources of our funds for lending and other investment purposes. Loan and investment security

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repayments are a relatively stable source of funds, while deposit flows and loan and mortgage related investment security prepayments are significantly influenced by general interest rates and economic conditions.

        Deposit Accounts.    Substantially all of our depositors are residents or businesses in Pennsylvania or New Jersey. We attract deposits in our market areas through advertising and through the offering of a broad selection of deposit instruments, including noninterest-bearing demand accounts (such as checking accounts), interest-bearing accounts (such as NOW and money market accounts), regular savings accounts and certificates of deposit. Deposit account terms vary according to the minimum balance required, the time periods the funds must remain on deposit and the interest rate, among other factors. In determining the terms of our deposit accounts, we consider the rates offered by our competition, our liquidity needs, profitability, matching deposit and loan products and customer preferences and concerns. We generally review our deposit mix and pricing bi-weekly. Our current strategy is to offer competitive rates and to be in the middle of the market for rates on a variety of retail and business deposit products. During 2011, we also began to utilize brokered deposits as a funding source and had $50.6 million of such deposits at December 31, 2012.

        Cash Management Services.    We also offer a variety of deposit accounts and services designed for businesses operating in our market area. Our business banking deposit products include a variety of commercial checking, savings, and money market accounts for small businesses and middle market companies. We also offer cash management products including remote deposit capture, investment and borrowing sweep services, electronic payment initiation, and fraud mitigation products.

        Borrowings.    We utilize term borrowings from the Federal Home Loan Bank of Pittsburgh and large commercial banks to provide additional liquidity, aside from deposits, to fund our loans and investments. As of December 31, 2012, Fox Chase Bank had outstanding term borrowings of $110.0 million with the Federal Home Loan Bank of Pittsburgh and $30.0 million with a commercial bank. Additionally, we have overnight borrowing facilities with the Federal Home Loan Bank of Pittsburgh and the Federal Reserve Bank as well as federal funds lines of credit with three other commercial banks. As of December 31, 2012, we had $70.5 million in overnight borrowings. The Federal Home Loan Bank functions as a central reserve bank providing credit for its member financial institutions. As a member, we are required to own capital stock in the Federal Home Loan Bank and are authorized to apply for advances on the security of such stock and certain of our whole first mortgage loans and other assets (principally mortgage related securities), provided certain standards related to creditworthiness have been met. Advances are made under several different programs, each having its own interest rate and range of maturities. Depending on the program, limitations on the amount of advances are based either on a fixed percentage of an institution's net worth or on the Federal Home Loan Bank's assessment of the institution's creditworthiness.

Personnel

        As of December 31, 2012, we had 130 full-time employees and 22 part-time employees. We believe our relationship with our employees is good.

Subsidiaries

        Fox Chase Bank established Fox Chase Financial, Inc. in 1999. As a Delaware-chartered corporation investment company, Fox Chase Financial, Inc. manages and holds investment securities.

        In 2009, Fox Chase Bank established Fox Chase Service Corporation as a wholly-owned subsidiary. A Pennsylvania-chartered corporation, Fox Chase Service Corporation has an investment in Philadelphia Mortgage Advisors. At December 31, 2012, Fox Chase Service Corporation also held $20.0 million in commercial loans originated by the Bank. Philadelphia Mortgage Advisors is a licensed

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mortgage banker in Pennsylvania, New Jersey and Delaware that originates first and second mortgages for resale into the secondary market and to third party investors. The majority of Philadelphia Mortgage Advisors' customers are located in the Philadelphia metropolitan area, Delaware and New Jersey. Fox Chase Service Corporation currently owns a 45.1% interest in Philadelphia Mortgage Advisors

        In 2011, Fox Chase Bank established Davisville Associates, LLC and 104 S. Oakland Ave., LLC as wholly-owned subsidiaries. 104 S. Oakland Ave., LLC is a New Jersey-chartered limited liability company formed to secure, manage and hold foreclosed assets. Davisville Associates, LLC is a Pennsylvania-chartered limited liability company formed to secure, manage and hold foreclosed assets.

Regulation and Supervision

General

        As a savings and loan holding company, Fox Chase Bancorp is required by federal law to report to, and otherwise comply with the rules and regulations of, the Federal Reserve Board. Fox Chase Bank, an insured federal savings bank, is subject to extensive regulation, examination and supervision by the Office of the Comptroller of the Currency, as its primary federal regulator, and by the Federal Deposit Insurance Corporation as the insurer of its deposits.

        Fox Chase Bank is a member of the Federal Home Loan Bank System and its deposit accounts are insured up to applicable limits by the Deposit Insurance Fund managed by the Federal Deposit Insurance Corporation. Fox Chase Bank must file reports with the Office of the Comptroller of the Currency concerning its activities and financial condition in addition to obtaining regulatory approvals before entering into certain transactions such as mergers with, or acquisitions of, other financial institutions. There are periodic examinations by the Office of the Comptroller of the Currency to evaluate Fox Chase Bank's safety and soundness and compliance with various regulatory requirements. This regulatory structure is intended primarily for the protection of the insurance fund and depositors. The regulatory structure also gives the regulatory authorities extensive discretion in connection with their supervisory and enforcement activities and examination policies, including policies with respect to the classification of assets and the establishment of an adequate allowance for loan losses. Any change in such policies, whether by the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation or Congress, could have a material adverse impact on Fox Chase Bancorp and Fox Chase Bank and their operations.

        The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act") made extensive changes in the regulation of financial institutions and their holding companies. Under the Dodd-Frank Act, the Office of Thrift Supervision was eliminated and responsibility for the supervision and regulation of federal savings associations was transferred to the Office of the Comptroller of the Currency on July 21, 2011. The Office of the Comptroller of the Currency is the agency that is primarily responsible for the regulation and supervision of national banks. Additionally, on that date, responsibility for the regulation and supervision of savings and loan holding companies was transferred to the Board of Governors of the Federal Reserve System. Additionally, the Dodd-Frank Act created a new Consumer Financial Protection Bureau as an independent bureau of the Federal Reserve Board. The Consumer Financial Protection Bureau assumed responsibility for the implementation of the federal financial consumer protection and fair lending laws and regulations and has authority to impose new requirements. However, institutions of less than $10 billion in assets, such as Fox Chase Bank, will continue to be examined for compliance with consumer protection and fair lending laws and regulations by, and be subject to the enforcement authority of, their prudential regulators.

        Fox Chase Bank completed its conversion from the mutual holding company form of organization to the stock holding company structure in June 2010. Applicable regulations provide, among other

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things, that for a period of three years following the date of the completion of the conversion, no person, acting singly or together with associates in a group of persons acting in concert, may directly or indirectly offer to acquire or acquire the beneficial ownership of more than 10% of a class of Fox Chase Bancorp's equity securities without the prior written approval of the appropriate federal banking agency. Further, as part of the approval of the conversion, the Office of the Comptroller of the Currency required Fox Chase Bank to maintain a charter that subjects Fox Chase Bank to the Office of the Comptroller of the Currency's jurisdiction for three years following the completion of the conversion.

        Certain of the regulatory requirements that are or will be applicable to Fox Chase Bank and Fox Chase Bancorp are described below. This description of statutes and regulations is not intended to be a complete explanation of such statutes and regulations and their effects on Fox Chase Bank and Fox Chase Bancorp and is qualified in its entirety by reference to the actual statutes and regulations.

Federal Banking Regulation

        Business Activities.    The activities of federal savings banks are governed by federal laws and regulations. These laws and regulations delineate the nature and extent of the business activities in which federal savings banks may engage. In particular, certain lending authority for federal savings banks, e.g., commercial, non-residential real property loans and consumer loans, is limited to a specified percentage of the institution's capital or assets.

        Capital Requirements.    Applicable capital regulations require savings associations to meet three minimum capital standards: a 1.5% tangible capital to total assets ratio, a 4% Tier 1 capital to total assets leverage ratio (3% for institutions receiving the highest rating on the CAMELS examination rating system) and an 8% risk-based capital ratio. In addition, the prompt corrective action standards discussed below also establish, in effect, a minimum 2% tangible capital standard, a 4% leverage ratio (3% for institutions receiving the highest rating on the CAMELS system) and, together with the risk-based capital standard itself, a 4% Tier 1 risk-based capital standard. The regulations also require that, in meeting the tangible, leverage and risk-based capital standards, institutions must generally deduct investments in and loans to subsidiaries engaged in activities as principal that are not permissible for a national bank.

        The risk-based capital standard for savings associations requires the maintenance of Tier 1 (core) and total capital (which is defined as core capital and supplementary capital less certain specified deductions from total capital such as reciprocal holdings of depository institution capital instruments and equity investments) to risk-weighted assets of at least 4% and 8%, respectively. In determining the amount of risk-weighted assets, all assets, including certain off-balance sheet activities, recourse obligations, residual interests and direct credit substitutes, are multiplied by a risk-weight factor of 0% to 100%, assigned by the capital regulation based on the risks believed inherent in the type of asset. Tier 1 (core) capital is generally defined as common stockholders' equity (including retained earnings), certain non-cumulative perpetual preferred stock and related surplus and minority interests in equity accounts of consolidated subsidiaries, less intangibles other than certain mortgage servicing rights and credit card relationships. The components of supplementary capital (Tier 2 capital) include cumulative preferred stock, long-term perpetual preferred stock, mandatory convertible debt securities, subordinated debt and intermediate preferred stock, the allowance for loan and lease losses limited to a maximum of 1.25% of risk-weighted assets and up to 45% of unrealized gains on available-for-sale equity securities with readily determinable fair market values. Overall, the amount of supplementary capital included as part of total capital cannot exceed 100% of core capital.

        The Office of the Comptroller of the Currency also has authority to establish individual minimum capital requirements in appropriate cases upon a determination that an institution's capital level is or

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may become inadequate in light of the particular risks or circumstances. At December 31, 2012, Fox Chase Bank met each of its capital requirements.

        The current risk-based capital guidelines that apply to the Bank are based on the 1988 capital accord of the International Basel Committee on Banking Supervision ("Basel Committee"), a committee of central banks and bank supervisors, as implemented by the Federal Reserve Board. In 2004, the Basel Committee published a new capital accord, which is referred to as "Basel II," to replace Basel I. Basel II provides two approaches for setting capital standards for credit risk: an internal ratings-based approach tailored to individual institutions' circumstances and a standardized approach that bases risk weightings on external credit assessments to a much greater extent than permitted in existing risk-based capital guidelines, which became effective in 2008 for large international banks (total assets of $250 billion or more or consolidated foreign exposure of $10 billion or more). Other U.S. banking organizations can elect to adopt the requirements of this rule (if they meet applicable qualification requirements), but they are not required to apply them. Basel II emphasizes internal assessment of credit, market and operational risk, as well as supervisory assessment and market discipline in determining minimum capital requirements.

        In December 2010 and January 2011, the Basel Committee published the final texts of reforms on capital and liquidity, which is referred to as "Basel III." Although Basel III is intended to be implemented by participating countries for large, internationally active banks, its provisions are likely to be considered by United States banking regulators in developing new regulations applicable to other banks in the United States. Basel III will require bank holding companies and their bank subsidiaries to maintain substantially more capital, with a greater emphasis on common equity. The implementation of the Basel III final framework was to occur on January 1, 2013. The Federal Reserve and other government agencies responsible for implementing the Basel III framework announced in November 2012 that the originally proposed timeframe for the implementation of the rules was not achievable. No new deadline has been proposed. On January 1, 2013, banking institutions were going to be required to meet the following minimum capital ratios: (i) 3.5% Common Equity Tier 1 (generally consisting of common shares and retained earnings) to risk-weighted assets; (ii) 4.5% Tier 1 capital to risk-weighted assets; and (iii) 8.0% Total capital to risk-weighted assets.

        When fully phased-in on January 1, 2019, and if implemented by the U.S. banking agencies, Basel III will require banks to maintain:

•

a minimum ratio of Common Equity Tier 1 to risk-weighted assets of at least 4.5%, plus a 2.5% "capital conservation buffer,"

•

a minimum ratio of Tier 1 capital to risk-weighted assets of at least 6.0%, plus the capital conservation buffer,

•

a minimum ratio of Total capital to risk-weighted assets of at least 8.0%, plus the capital conservation buffer, and

•

a minimum leverage ratio of 3%, calculated as the ratio of Tier 1 capital to balance sheet exposures plus certain off-balance sheet exposures.

        Basel III also includes the following significant provisions:

•

An additional countercyclical capital buffer to be imposed by applicable national banking regulators periodically at their discretion, with advance notice.

•

Restrictions on capital distributions and discretionary bonuses applicable when capital ratios fall within the buffer zone.

•

Deduction from common equity of deferred tax assets that depend on future profitability to be realized.

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•

For capital instruments issued on or after January 13, 2013 (other than common equity), a loss-absorbency requirement that the instrument must be written off or converted to common equity if a triggering event occurs, either pursuant to applicable law or at the direction of the banking regulator. A triggering event is an event that would cause the banking organization to become nonviable without the write off or conversion, or without an injection of capital from the public sector.

        Since the Basel III framework is not self-executing, the rules and standards promulgated under Basel III require that the U.S. federal banking regulators adopt them prior to becoming effective in the U.S. Although U.S. federal banking regulators have expressed support for Basel III, the timing and scope of its implementation, as well as any potential modifications or adjustments that may result during the implementation process, are not yet known.

        Prompt Corrective Regulatory Action.    The Office of the Comptroller of the Currency is required to take certain supervisory actions against undercapitalized institutions, the severity of which depends upon the institution's degree of undercapitalization. Generally, a savings association that has a ratio of total capital to risk weighted assets of less than 8%, a ratio of Tier 1 (core) capital to risk-weighted assets of less than 4% or a ratio of core capital to total assets of less than 4% (3% or less for institutions with the highest examination rating) is considered to be "undercapitalized." A savings association that has a total risk-based capital ratio of less than 6%, a Tier 1 capital ratio of less than 3% or a leverage ratio that is less than 3% is considered to be "significantly undercapitalized" and a savings association that has a tangible capital to assets ratio equal to or less than 2% is deemed to be "critically undercapitalized." Subject to a narrow exception, the Office of the Comptroller of the Currency is required to appoint a receiver or conservator within specified time frames for an institution that is "critically undercapitalized." The regulation also provides that a capital restoration plan must be filed with the Office of the Comptroller of the Currency within 45 days of the date a savings association is deemed to have received notice that it is "undercapitalized," "significantly undercapitalized" or "critically undercapitalized." Compliance with the plan must be guaranteed by any parent holding company up to the lesser of 5% of the savings association's total assets when it was deemed to be undercapitalized or the amount necessary to achieve compliance with applicable capital requirements. In addition, numerous mandatory supervisory actions become immediately applicable to an undercapitalized institution, including, but not limited to, increased monitoring by regulators and restrictions on growth, capital distributions and expansion. The Office of the Comptroller of the Currency could also take any one of a number of discretionary supervisory actions, including the issuance of a capital directive and the replacement of senior executive officers and directors. Significantly and critically undercapitalized institutions are subject to additional mandatory and discretionary measures.

        Insurance of Deposit Accounts.    Under the Federal Deposit Insurance Corporation's risk-based assessment system, insured institutions are assigned to one of four risk categories based on supervisory evaluations, regulatory capital levels and certain other factors, with less risky institutions paying lower assessments. An institution's assessment rate depends upon the category to which it is assigned. The initial base assessment rates range from five to 35 basis points. The rate schedules will automatically adjust in the future when the Deposit Insurance Fund reaches certain milestones. No institution may pay a dividend if in default of the federal deposit insurance assessment.

        In February 2011, the FDIC adopted new rules that amend its current deposit insurance assessment regulations. The new rules implement a provision in the Dodd-Frank Act that changed the assessment base for deposit insurance premiums from one based on domestic deposits to one based on average consolidated total assets minus average tangible equity.

        The Federal Deposit Insurance Corporation imposed on all insured institutions a special emergency assessment of five basis points of total assets minus Tier 1 capital, as of June 30, 2009,

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(capped at ten basis points of an institution's deposit assessment base), to cover losses to the Deposit Insurance Fund. That special assessment was collected on September 30, 2009. In lieu of further special assessments, the Federal Deposit Insurance Corporation required insured institutions to prepay estimated quarterly risk-based assessments for the fourth quarter of 2009 through the fourth quarter of 2012. That prepayment, which included an assumed annual assessment base increase of 5%, was recorded as a prepaid expense asset as of December 30, 2009. As of December 31, 2009, and each quarter thereafter, a charge to earnings was recorded for each regular assessment with an offsetting credit to the prepaid asset.

        Due to the recent difficult economic conditions, deposit insurance per account owner was recently raised to $250,000. That coverage was made permanent by the Dodd-Frank Act. In addition, the Federal Deposit Insurance Corporation adopted an optional Temporary Liquidity Guarantee Program by which, for a fee, noninterest-bearing transaction accounts would receive unlimited insurance coverage until December 31, 2010, and certain senior unsecured debt issued by institutions and their holding companies between October 13, 2008 and June 30, 2010 would be guaranteed by the Federal Deposit Insurance Corporation through June 30, 2012, or in some cases, December 31, 2012. Fox Chase Bank participated in the unlimited noninterest-bearing transaction account coverage, which expired on December 31, 2012, while Fox Chase Bank and Fox Chase Bancorp opted not to participate in the unsecured debt guarantee program.

        The Dodd-Frank Act increased the minimum target Deposit Insurance Fund ratio from 1.15% of estimated insured deposits to 1.35% of estimated insured deposits. The Federal Deposit Insurance Corporation must seek to achieve the 1.35% ratio by September 30, 2020. Insured institutions with assets of $10 billion or more are supposed to fund the increase. The Dodd-Frank Act eliminated the 1.5% maximum fund ratio, instead leaving it to the discretion of the Federal Deposit Insurance Corporation.

        Loans to One Borrower.    Federal law provides that savings associations are generally subject to the limits on loans to one borrower applicable to national banks. Generally, subject to certain exceptions, a savings association may not make a loan or extend credit to a single or related group of borrowers in excess of 15% of its unimpaired capital and surplus. An additional amount may be lent, equal to 10% of unimpaired capital and surplus, if secured by specified readily-marketable collateral. See "Business—Loan Underwriting Risks—Loans to One Borrower."

        Qualified Thrift Lender Test.    Federal law requires savings associations to meet a qualified thrift lender test. Under the test, a savings association is required to maintain at least 65% of its "portfolio assets" (total assets less: (1) specified liquid assets up to 20% of total assets; (2) intangibles, including goodwill; and (3) the value of property used to conduct business) in certain "qualified thrift investments" (primarily residential mortgages and related investments, including certain mortgage-backed securities in at least 9 months out of each 12-month period.

        A savings association that fails the qualified thrift lender test is subject to certain operating restrictions and may be required to convert to a bank charter and the Dodd-Frank Act also specifies that failing the qualified thrift lender test is a violation of law that could result in an enforcement action and dividend limitations. As of December 31, 2012, Fox Chase Bank maintained 67.8% of its portfolio assets in qualified thrift investments. Additionally, Fox Chase Bank maintained 65% or more of its portfolio assets in qualified thrift investments for each month in the 12-month period ended December 31, 2012 and, therefore, met the qualified thrift lender test.

        Limitation on Capital Distributions.    Federal regulations impose limitations upon all capital distributions by a savings association, including cash dividends, payments to repurchase its shares and payments to shareholders of another institution in a cash-out merger. Under the regulations, an application to and the prior approval of the Federal Reserve Board is required before any capital

15

distribution if the institution does not meet the criteria for "expedited treatment" of applications under applicable regulations(i.e., generally, examination and Community Reinvestment Act ratings in the two top categories), the total capital distributions for the calendar year exceed net income for that year plus the amount of retained net income for the preceding two years, the institution would be undercapitalized following the distribution or the distribution would otherwise be contrary to a statute, regulation or agreement with the Office of the Comptroller of the Currency. If an application is not required, the institution must still provide 30 days prior written notice to the Federal Reserve Board of the capital distribution if, like Fox Chase Bank, it is a subsidiary of a holding company. Notice also must be provided to the Office of the Comptroller of the Currency if Fox Chase Bank's capital ever fell below its regulatory requirements or the Office of the Comptroller of the Currency notified it that it was in need of increased supervision, its ability to make capital distributions could be restricted. In addition, the Office of the Comptroller of the Currency could prohibit a proposed capital distribution by any institution, which would otherwise be permitted by the regulation, if the Office of the Comptroller of the Currency determines that such distribution would constitute an unsafe or unsound practice.

        Community Reinvestment Act.    All federal savings associations have a responsibility under the Community Reinvestment Act and related regulations to help meet the credit needs of their communities, including low- and moderate-income neighborhoods. An institution's failure to comply with the provisions of the Community Reinvestment Act could result in restrictions on its activities. Fox Chase Bank received a "satisfactory" Community Reinvestment Act rating in its most recently completed examination.

        Transactions with Related Parties.    Federal law limits Fox Chase Bank's authority to engage in transactions with "affiliates" (e.g., any entity that controls or is under common control with Fox Chase Bank, including Fox Chase Bancorp and their other subsidiaries). The aggregate amount of covered transactions with any individual affiliate is limited to 10% of the capital and surplus of the savings association. The aggregate amount of covered transactions with all affiliates is limited to 20% of the savings association's capital and surplus. Certain transactions with affiliates are required to be secured by collateral in an amount and of a type specified by federal law. The purchase of low quality assets from affiliates is generally prohibited. Transactions with affiliates must generally be on terms and under circumstances that are at least as favorable to the institution as those prevailing at the time for comparable transactions with non-affiliated companies. In addition, savings associations are prohibited from lending to any affiliate that is engaged in activities that are not permissible for bank holding companies and no savings association may purchase the securities of any affiliate other than a subsidiary.

        The Sarbanes-Oxley Act of 2002 generally prohibits loans by the Company to its executive officers and directors. However, the law contains a specific exception for loans by a depository institution to its executive officers and directors in compliance with federal banking laws. Under such laws, Fox Chase Bank's authority to extend credit to executive officers, directors and 10% shareholders ("insiders"), as well as entities such persons control, is limited. The laws limit both the individual and aggregate amount of loans that Fox Chase Bank may make to insiders based, in part, on Fox Chase Bank's capital level and requires that certain board approval procedures be followed. Such loans are required to be made on terms substantially the same as those offered to unaffiliated individuals and not involve more than the normal risk of repayment. There is an exception for loans made pursuant to a benefit or compensation program that is widely available to all employees of the institution and does not give preference to insiders over other employees. Loans to executive officers are subject to additional limitations based on the type of loan involved.

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        Enforcement.    The Office of the Comptroller of the Currency has primary enforcement responsibility over savings associations and has authority to bring actions against the institution and all institution-affiliated parties, including shareholders, and any attorneys, appraisers and accountants who knowingly or recklessly participate in wrongful actions likely to have an adverse effect on an insured institution. Formal enforcement action may range from the issuance of a capital directive or cease and desist order to removal of officers and/or directors to institution of receivership, conservatorship or termination of deposit insurance. Civil penalties cover a wide range of violations and can amount to $25,000 per day, or even $1 million per day in especially egregious cases. The Federal Deposit Insurance Corporation has the authority to recommend to the Office of the Comptroller of the Currency that enforcement action be taken with respect to a particular savings association. If action is not taken by the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation has authority to take such action under certain circumstances. Federal law also establishes criminal penalties for certain violations.

        Assessments.    The Office of the Comptroller of the Currency is funded through assessments imposed on regulated institutions. Assessments paid by the Company for the year ended December 31, 2012 totaled $237,000.

        Federal Home Loan Bank System.    Fox Chase Bank is a member of the Federal Home Loan Bank System, which consists of 12 regional Federal Home Loan Banks. The Federal Home Loan Bank provides a central credit facility primarily for member institutions. Fox Chase Bank, as a member of the Federal Home Loan Bank of Pittsburgh, is required to acquire and hold shares of capital stock in that Federal Home Loan Bank. Fox Chase Bank was in compliance with this requirement with an investment in Federal Home Loan Bank stock at December 31, 2012 of $8.1 million.

        Federal Reserve System.    The Federal Reserve Board regulations require savings associations to maintain non-interest earning reserves against their transaction accounts (primarily Negotiable Order of Withdrawal (NOW) and regular checking accounts). The regulations generally provide that reserves be maintained against aggregate transaction accounts as follows: a 3% reserve ratio is assessed on net transaction accounts up to and including $79.5 million; a 10% reserve ratio is applied above $79.5 million. The first $12.4 million of otherwise reservable balances (subject to adjustments by the Federal Reserve Board) are exempted from the reserve requirements. Fox Chase Bank complies with the foregoing requirements.

Other Regulations

        Fox Chase Bank's operations are also subject to federal laws applicable to credit transactions, such as the:

•

Truth-In-Lending Act, governing disclosures of credit terms to consumer borrowers;

•

Home Mortgage Disclosure Act of 1975, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the community it serves;

•

Equal Credit Opportunity Act, prohibiting discrimination on the basis of race, creed or other prohibited factors in extending credit;

•

Fair Credit Reporting Act of 1978, governing the use and provision of information to credit reporting agencies;

•

Fair Debt Collection Act, governing the manner in which consumer debts may be collected by collection agencies; and

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•

rules and regulations of the various federal agencies charged with the responsibility of implementing such federal laws.

        The operations of Fox Chase Bank also are subject to the:

•

Right to Financial Privacy Act, which imposes a duty to maintain confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records;

•

Electronic Funds Transfer Act and Regulation E promulgated thereunder, which govern automatic deposits to and withdrawals from deposit accounts and customers' rights and liabilities arising from the use of automated teller machines and other electronic banking services; and

•

Check Clearing for the 21^st Century Act (also known as "Check 21"), which gives "substitute checks," such as digital check images and copies made from that image, the same legal standing as the original paper check.

Holding Company Regulation

        General.    As a savings and loan holding company, Fox Chase Bancorp is subject to Federal Reserve Board regulations, examinations, supervision, reporting requirements and regulations concerning its activities. In addition, the Federal Reserve Board has enforcement authority over Fox Chase Bancorp and its non-savings institution subsidiaries. Among other things, this authority permits the Federal Reserve Board to restrict or prohibit activities that are determined to be a serious risk to Fox Chase Bank. Pursuant to federal law and regulations and policy, a savings and loan holding company, such as Fox Chase Bancorp, may engage in activities permitted for financial holding companies under Section 4(k) of the Bank Holding Company Act and certain other activities that have been authorized for savings and loan holding companies by regulation.

        Federal law prohibits a savings and loan holding company from, directly or indirectly or through one or more subsidiaries, acquiring more than 5% of the voting stock of another savings association or savings and loan holding company, without prior written approval of the Federal Reserve Board or from acquiring or retaining, with certain exceptions, more than 5% of a non-subsidiary holding company or savings association. A savings and loan holding company is also prohibited from acquiring more than 5% of a company engaged in activities other than those authorized by federal law or acquiring or retaining control of a depository institution that is not insured by the Federal Deposit Insurance Corporation. In evaluating applications by holding companies to acquire savings associations, the Federal Reserve Board must consider, among other things, factors such as the financial and managerial resources and future prospects of the company and institution involved, the effect of the acquisition on the risk to the deposit insurance fund, the convenience and needs of the community and competitive effects.

        The Federal Reserve Board is prohibited from approving any acquisition that would result in a multiple savings and loan holding company controlling savings associations in more than one state, except: (1) the approval of interstate supervisory acquisitions by savings and loan holding companies; and (2) the acquisition of a savings association in another state if the laws of the state of the target savings association specifically permit such acquisitions. The states vary in the extent to which they permit interstate savings and loan holding company acquisitions.

        Capital.    Savings and loan holding companies are not currently subject to specific regulatory capital requirements. The Dodd-Frank Act, however, requires the Federal Reserve Board to promulgate consolidated capital requirements for depository institution holding companies that are no less stringent, both quantitatively and in terms of components of capital, than those applicable to institutions themselves. That will eliminate the inclusion of certain instruments, such as trust preferred securities, from Tier 1 capital. Instruments issued before May 19, 2010 will be grandfathered for

18

companies with consolidated assets of $15 billion or less. There is a five-year transition period from the July 21, 2010 date enactment of the Dodd-Frank Act before the capital requirements will apply to savings and loan holding companies. However, under the most recent Notice of Proposed Rulemaking issued by the Federal Reserve Board, savings and loan holding companies may be subject to regulatory capital requirements before the end of the five-year period.

        Source of Strength.    The Dodd-Frank Act also extends the "source of strength" doctrine to savings and loan holding companies. The regulatory agencies must issue regulations implementing the "source of strength" policy that holding companies act as a source of strength to their subsidiary depository institutions by providing capital, liquidity and other support in times of financial stress.

        Acquisition of Control.    Under the Federal Change in Bank Control Act, a notice must be submitted to the Federal Reserve Board if any person (including a company), or group acting in concert, seeks to acquire direct or indirect "control" of a savings and loan holding company or savings association. Under certain circumstances, a change in control may occur, and prior notice is required, upon the acquisition of 10% or more of the outstanding voting stock of the company or institution, unless the Federal Reserve Board has found the acquisition will not result in a change in control. Under the Change in Control Act, the Federal Reserve Board has 60 days from the filing of a complete notice to act, taking into consideration certain factors, including the financial and managerial resources of the acquirer and the anti-trust effects of the acquisition. Any company that so acquires control would then be subject to regulation as a savings and loan holding company.

Federal Securities Laws

        Fox Chase Bancorp common stock is registered with the Securities and Exchange Commission under the Securities Exchange Act of 1934. As a result, Fox Chase Bancorp files quarterly and annual reports with the Securities and Exchange Commission and is subject to the information, proxy solicitation, insider trading restrictions and other requirements under the Securities Exchange Act.

EXECUTIVE OFFICERS OF THE REGISTRANT

        Our executive officers are elected by the Board of Directors and serve at the Board's discretion. The following individuals currently serve as executive officers of the Company and the Bank.

Name	Position
Thomas M. Petro	President and Chief Executive Officer of Fox Chase Bancorp, Inc. and Fox Chase Bank
Jerry D. Holbrook	Executive Vice President, Chief Operating Officer and Secretary of Fox Chase Bancorp, Inc. and Fox Chase Bank
Roger S. Deacon	Executive Vice President and Chief Financial Officer of Fox Chase Bancorp, Inc. and Fox Chase Bank
Keiron G. Lynch	Executive Vice President and Chief Payments Officer of Fox Chase Bank
Michael S. Fitzgerald	Executive Vice President and Chief Lending Officer of Fox Chase Bank

        Below is information regarding our executive officers who are not also directors. Unless otherwise stated, each executive officer has held his or her current position for at least the last five years. Ages presented are as of December 31, 2012.

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Jerry D. Holbrook, CMA, has served as Executive Vice President and Chief Operating Officer since April 2008. From 2005 to March 2008, Mr. Holbrook served as Executive Vice President and Chief Financial Officer of Fox Chase Bancorp. From 2003 to 2005, Mr. Holbrook was Executive Vice President, Chief Financial Officer and Corporate Secretary for Northeast Pennsylvania Financial Corp. and its principal subsidiary First Federal Bank, a public thrift institution. Previously, Mr. Holbrook served as Chief Financial Officer for E-Duction, Inc., a financial services start-up. Previously, he was Senior Vice President of Finance at First USA Bank (now part of J.P. Morgan Chase) where he managed the asset/liability management committee and was responsible for securitization planning and debt issuances for a $70 billion credit card portfolio. He began his banking career with WSFS Financial Corp. where he served as Senior Vice President and Controller. Mr. Holbrook holds a B.S. in Accounting from the University of Kentucky. Age 57.

Roger S. Deacon, CPA, has served as Executive Vice President and Chief Financial Officer since April 2008. From July 2007 to March 2008, Mr. Deacon served as Executive Vice President and Chief Accounting Officer of Fox Chase Bancorp. From October 2005 to June 2007, Mr. Deacon was Senior Vice President and Chief Financial Officer for NOVA Financial Holdings, Inc., a privately held bank holding company, and its principal subsidiary NOVA Savings Bank. From January 2001 to September 2005, Mr. Deacon served as Chief Financial Officer for I4 Commerce, a privately held financial services company that provided services through its Bill Me Later product. Previously, he was Senior Vice President of Finance at First USA Bank (now part of J.P. Morgan Chase) where he was responsible for all financial planning for its credit card business, which grew from $2 billion to $70 billion in managed assets. He began his career with Price Waterhouse, where he served as an Audit Manager in their Financial Services Practice Group. Mr. Deacon holds a B.S. in Business Administration from Bucknell University, majoring in Accounting with a concentration in Finance. Age 49.

Keiron G. Lynch, CTP, has served as Executive Vice President and Chief Payments Officer since April 2008. From 2005 to March 2008, Mr. Lynch served as Executive Vice President and Chief Administrative Officer. From 1999 to 2005, Mr. Lynch was Vice President of Global Visa Commerce Product Development for Visa International. Previously, he was Director of Delivery for The Source(2) Group, LLC, a joint venture between Mellon Bank and MCI Systemhouse that provided outsourced accounts payable and accounts receivables services to companies nationwide. Mr. Lynch held a number of leadership positions with Mellon Bank over 17 years culminating as Vice President and Director of New Product Development for Mellon Bank's Global Cash Management Division. Mr. Lynch holds a B.A. in Economics from Duke University. Age 55.

Michael S. Fitzgerald has served as Executive Vice President and Chief Lending Officer since November 2009. From June 2009 to October 2009 Mr. Fitzgerald served as Executive Vice President and Senior Lending Officer. From 1997 to May 2009, Mr. Fitzgerald worked for Sovereign Bank, with his most recent position as Senior Vice President and Regional Executive Manager. During his tenure at Sovereign Bank, Mr. Fitzgerald was responsible for both lending and credit functions. Mr. Fitzgerald began his banking career at Meridian Bank in 1985. Mr. Fitzgerald holds a B.A. in Business Administration from Lycoming College. Age 49.

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ITEM 1A.    RISK FACTORS

Our nonperforming loans remain elevated and we may be required to make increases in our provision for loan losses and to charge-off additional loans in the future. Further, our allowance for loan losses may prove to be insufficient to absorb losses in our loan portfolio.

        For 2012, we recorded a provision for loan losses of $3.5 million compared to a provision for loan losses of $5.7 million in 2011 and $6.2 million in 2010. We also recorded net loan charge-offs of $4.4 million in 2012 compared to net loan charge-offs of $6.1 million in 2011 and $4.4 million in 2010. Our non-performing assets increased to $25.6 million, or 2.36% of total assets and 18.3% of Tier 1 capital, at December 31, 2012 from $23.4 million, or 2.30% of total assets and 15.1% of Tier 1 capital, at December 31, 2011. Additionally, at December 31, 2012, loans that were criticized and classified as either special mention, substandard, doubtful or loss totaled $37.4 million, representing 3.4% of total assets, including nonaccrual loans of $17.1 million. Our elevated level of nonperforming loans was primarily due to the weakened economy, elevated unemployment and the soft real estate market. If the economy and/or the real estate market continues to weaken, more of our criticized and classified loans may become nonperforming and we may be required to add further reserves to our allowance for loan losses for these assets as the value of the collateral may be insufficient to pay any remaining net loan balance, which could have a negative effect on our results of operations. We maintain an allowance for loan losses to provide for loans in our portfolio that may not be repaid in their entirety. We believe that our allowance for loan losses is maintained at a level adequate to absorb probable losses inherent in our loan portfolio as of the corresponding balance sheet date. However, our allowance for loan losses may not be sufficient to cover actual loan losses, and future provisions for loan losses could materially adversely affect our operating results.

        In evaluating the adequacy of our allowance for loan losses, we consider numerous quantitative factors, including our historical charge-off experience, growth of our loan portfolio, changes in the composition of our loan portfolio and the volume of and trends in our nonperforming, delinquent and criticized and classified loans. In addition, we use information about specific borrower situations, including their financial position and estimated collateral values, to estimate the risk and amount of loss for those borrowers. Finally, we also consider many qualitative factors, including general and economic business conditions, anticipated duration of the current business cycle, current general market collateral valuations, trends apparent in any of the factors we take into account and other matters, which are, by nature, more subjective and fluid. Our estimates of the risk of loss and amount of loss on any loan are complicated by the significant uncertainties surrounding our borrowers' abilities to successfully execute their business models through changing economic environments, competitive challenges, the effect of the current and future economic conditions on collateral values and other factors. Because of the degree of uncertainty and susceptibility of these factors to change, our actual losses may vary from our current estimates.

        Our regulators, as an integral part of their examination process, periodically review our allowance for loan losses and may require us to increase our allowance for loan losses by recognizing additional provisions for loan losses charged to expense, or to decrease our allowance for loan losses by recognizing loan charge-offs. Any such additional provisions for loan losses or charge-offs, as required by our regulators, could have a material adverse effect on our financial condition and results of operations.

Assets acquired through foreclosure are carried at values which may not be realized at the ultimate disposition of the underlying assets.

        The Company had assets acquired through foreclosure of $8.5 million and $2.4 million at December 31, 2012 and 2011, respectively. For 2012, we recorded assets acquired through foreclosure expense of $2.1 million compared to $762,000 in 2011 and $543,000 in 2010, which includes valuation

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adjustments of $1.9 million, $657,000 and $436,000 for 2012, 2011 and 2010, respectively. Assets acquired through foreclosure is comprised of other real estate owned and financial assets acquired from debtors. Other real estate owned is carried at the lower of cost or fair value, less estimated selling costs. The fair value of other real estate owned is determined using appraisals obtained from approved independent appraisers or agreements of sale, where applicable. Financial assets acquired from debtors are carried at fair value as determined using valuations obtained from a third party valuation firm who utilize a discounted cash flow model. We believe that our valuation of assets acquired through foreclosure is appropriate as of the corresponding balance sheet date. However, we may not recover the respective carrying values at the time of ultimate disposition of the assets, which could result in a loss on the sale of assets acquired through foreclosure, and have a material adverse effect on our financial condition and results of operations.

A return to recessionary conditions could result in increases in our level of nonperforming assets and/or reduce demand for our products and services, which would lead to lower revenue, higher loan losses and lower earnings.

        Following a national home price peak in mid-2006, falling home prices and sharply reduced sales volumes, along with the collapse of the United States' subprime mortgage industry in early 2007, significantly contributed to a recession that officially lasted until June 2009, although the effects continued thereafter. Dramatic declines in real estate values and high levels of foreclosures resulted in significant asset write-downs by financial institutions, which have caused many financial institutions to seek additional capital, to merge with other institutions and, in some cases, to fail. Concerns over the United States' credit rating (which was downgraded by Standard & Poor's), the European sovereign debt crisis, and continued high unemployment in the United States, among other economic indicators, have contributed to increased volatility in the capital markets and diminished expectations for the economy.

        A return of recessionary conditions and/or continued negative developments in the domestic and international credit markets may significantly affect the markets in which we do business, the value of our loans and investments, and our ongoing operations, costs and profitability. Further declines in real estate values and sales volumes and continued elevated unemployment levels may result in higher than expected loan delinquencies, increases in our levels of nonperforming and criticized classified assets and a decline in demand for our products and services. These negative events may cause us to incur losses and may adversely affect our capital, liquidity and financial condition.

Our emphasis on commercial lending may expose us to increased lending risks.

        At December 31, 2012, $482.8 million, or 69.5%, of our loan portfolio consisted of multi-family and commercial real estate and commercial and industrial loans. These types of loans have historically exposed a lender to greater risk of non-payment and loss and require a commensurately higher loan loss allowance than one- to four-family residential mortgage loans because repayment of the loans often depends on the successful operation of the business and the income stream of the borrowers. Such loans typically involve larger loan balances to single borrowers or groups of related borrowers compared to one- to four-family residential mortgage loans. Also, many of our multi-family and commercial real estate and commercial business borrowers have more than one loan outstanding with us. Consequently, an adverse development with respect to one loan or one credit relationship can expose us to a significantly greater risk of loss compared to an adverse development with respect to a one- to four-family residential mortgage loan. Further, unlike one- to four-family real estate loans or multi-family and commercial real estate loans, commercial and industrial loans may be secured by collateral other than real estate, such as inventory and accounts receivable, the value of which may be more difficult to appraise and may be more susceptible to fluctuation in value.

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The unseasoned nature of our commercial loan portfolio may result in changes in estimating collectability, which may lead to additional provisions or charge-offs, which could hurt our profits.

        Our multi-family and commercial real estate and commercial and industrial loan portfolios increased $373.2 million, or 340.5%, from $109.6 million at December 31, 2007 to $482.8 million at December 31, 2012. A large portion of our commercial loan portfolio remains unseasoned and does not provide us with a significant payment history pattern from which to judge future collectability, especially in this period of unfavorable economic conditions. As a result, it may be difficult to predict the future performance of this part of our loan portfolio. These loans may have delinquency or charge-off levels above our historical experience, which could adversely affect our future performance. Further, these types of loans generally have larger balances and involve a greater risk than one- to four-family residential mortgage loans. Accordingly, if we make any errors in judgment in the collectability of our commercial loans, any resulting charge-offs may be larger on a per loan basis than those incurred historically with our residential mortgage loan or consumer loan portfolios.

Our residential mortgage loans and home equity loans expose us to a risk of loss due to declining real estate values.

        At December 31, 2012, $158.8 million, or 22.9%, of our loan portfolio consisted of one- to four-family residential mortgage loans, and $30.6 million, or 4.4%, of our loan portfolio consisted of home equity loans, home equity lines of credit and other consumer loans. Recent declines in the housing market have resulted in declines in real estate values in our market areas. These declines in real estate values could cause some of our mortgage and home equity loans to be inadequately collateralized, which would expose us to a greater risk of loss if we seek to recover on defaulted loans by selling the real estate collateral. Because of our locations in southern New Jersey, many of the properties securing our residential mortgages are second homes or rental properties. At December 31, 2012, 19.5% of our one- to four-family mortgage loans were secured by second homes and 9.2% were secured by rental properties. These loans generally are considered to be more risky than loans secured by the borrower's permanent residence, since the borrower is typically more dependent on rental income to meet debt service requirements, in the case of rental property, and when in financial difficulty is more likely to make payments on the loan secured by the borrower's primary residence before a vacation home.

Our construction loan portfolio may expose us to increased credit risk.

        At December 31, 2012, our construction loan portfolio totaled $22.6 million, of which $15.5 million represented loans to finance the construction of condominiums, apartment buildings and residential developments. In general, construction projects provide for an interest reserve that is utilized to pay the interest until a period of time until the project is expected to produce positive cash flows. To the extent such economic conditions continue, construction loan borrowers could fully utilize their interest reserve before the project is able to generate cash flows. If a borrower has insufficient liquidity to pay interest on such projects, the loan could become impaired and require an increase in the allowance for loan losses, which would adversely impact our results of operations. Our ability to work with a borrower to modify or restructure their existing loan to avoid loss lessens as the loan approaches its maturity date.

Changes in interest rates could have a material adverse effect on our earnings.

        Our net interest income is the interest we earn on loans and investments less the interest we pay on our deposits and borrowings. Our interest rate spread is the difference between the yield we earn on our assets and the interest rate we pay for deposits and our other sources of funding. Changes in interest rates could adversely affect our interest rate spread and, as a result, our net interest income and net interest margin. Although the yield we earn on our assets and our funding costs tend to move in the same direction in response to changes in interest rates, one can rise or fall faster than the other, causing our net interest margin to expand or contract. As of December 31, 2012, our models indicate

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that our assets tend to reprice faster than our liabilities, so they may adjust faster in response to change in interest rates. As a result, when interest rates fall, the yield we earn on assets may fall faster than our funding costs, causing our net interest margin to contract. This contraction could be more severe following a prolonged period of lower interest rates, as a larger proportion of our fixed-rate residential loan portfolio and fixed-rate residential related mortgage backed securities will have been originated at those lower rates and borrowers may be more reluctant to refinance or unable to sell their homes in a higher interest rate environment.

        Changes in the slope of the "yield curve"—or the spread between short-term and long-term interest rates—could also reduce our net interest margin. Normally, the yield curve is upward sloping, meaning short-term rates are lower than long-term rates. Because our assets tend to reprice faster than our liabilities, when the yield curve flattens or even inverts, we could experience pressure on our net interest margin as our cost of funds increases relative to the yield we can earn on our assets. Changes in interest rates also can affect: (1) our ability to originate loans; (2) the value of our interest-earning assets, and our ability to realize gains from the sale of such assets; (3) our ability to obtain and retain deposits in competition with other available investment alternatives; and (4) the ability of our borrowers to repay adjustable-rate loans.

        Our procedures for managing interest rate risk exposure also involves monitoring exposure to interest rate increases and decreases of as much as 300 basis points. We report on a quarterly basis the impact on net portfolio value of an immediate and parallel increase of up 300 basis points in interest rates or a 100 basis point decrease in interest rates. As of December 31, 2012, the simulations indicated that the impact of an instantaneous and parallel 300 basis point increase in rates would result in approximately 18% decrease in net portfolio value and that the impact of an instantaneous and parallel 100 basis point decrease in rates over 12 months would result in approximately 2% increase in net portfolio value.

The current low interest rate environment may cause an increase in the repayments of the Company's interest-earning assets at a rate faster than the Company's ability to reprice its interest-bearing liabilities.

        The United States ten-year Treasury rate and the one-month LIBOR are at historically low rates. The yield on the Company's loan and investment portfolios were 5.07% and 2.62%, respectively, for the year ended December 31, 2012. In the current low interest rate environment, our current portfolio yields are at levels higher than yields that can be earned on new loan originations and new investment purchases. As customers repay or reprice these assets, the average yield on interest earning assets could decrease. Additionally, our ability to lower our rates on our deposits and borrowings, and accordingly reduce interest expense, may be limited at current interest rate levels. To the extent customers repay or reprice these assets at a pace faster than the Company's ability to reprice interest-bearing liabilities, the Company's net interest income could decrease which may adversely affect our capital and results of operations.

Our business strategy includes the continuation of moderate growth plans, and our financial condition and results of operations could be negatively affected if we fail to grow or fail to manage our growth effectively.

        Our assets increased $275.4 million, or 33.9%, from $812.9 million at December 31, 2007, to $1.09 billion at December 31, 2012, primarily due to increases in investment securities and multi-family and commercial real estate loans and commercial and industrial loans funded by growth in deposits and borrowings. Over the long term, we expect to continue to experience growth in assets, deposits and the scale of our operations. However, achieving our growth targets requires us to successfully execute our business strategies, which include continuing to diversify our loan portfolio with more commercial lending thereby recognizing the value of our investments in personnel in that area. Our ability to successfully grow will also depend on the continued availability of loan opportunities that meet our stringent underwriting standards. While we believe we have the resources and internal systems in place

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to successfully achieve and manage our future growth, growth opportunities may not be available and we may not be able to successfully grow. If we do not manage our growth effectively, we may not be able to achieve our business plan, and our business and prospects could be harmed.

If we conclude that the decline in value of any of our investment securities is other than temporary, we are required to write down the value of that security, which could hurt our financial conditions and results of operation.

        We review individual securities in our investment portfolio at the end of each quarterly reporting period to determine whether the fair value is below the current carrying value. When the fair value of any of our investment securities has declined below its carrying value, we are required to assess whether the decline is other than temporary. If the decline in the market value of a security is determined to be other-than-temporary, the credit portion of the impairment is written down through earnings and the non-credit portion is an adjustment to other comprehensive income. As of December 31, 2012, our investment portfolio included securities with an amortized cost of $317.5 million and an estimated fair value of $325.6 million. Changes in the expected cash flows of these securities and/or prolonged price declines may result in our concluding in future periods that the impairment of these securities is other than temporary, which would require a charge to earnings to write down these securities to their fair value. Any charges for other-than-temporary impairment would not impact cash flow, tangible capital or liquidity.

A significant percentage of our assets are invested in securities which typically have a lower yield than our loan portfolio.

        Our results of operations are substantially dependent on our net interest income. At December 31, 2012, 29.8% of our assets were invested in investment and mortgage-backed securities. These investments yield substantially less than the loans we hold in our portfolio. While we intend to invest a greater proportion of our assets in loans with the goal of increasing our net interest income, we may not be able to increase the origination or purchase of loans acceptable to us.

Regulatory reform may have a material impact on our operations.

        In 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") was passed. The Dodd-Frank Act restructured the regulation of depository institutions. Under the Dodd-Frank Act, the Office of Thrift Supervision, which formerly regulated Fox Chase Bank, was merged into the Office of the Comptroller of the Currency, which regulates national banks. Savings and loan holding companies became regulated by the Board of Governors of the Federal Reserve System. The Dodd-Frank Act also created a new federal agency to administer consumer protection and fair lending laws, a function that was formerly performed by the depository institution regulators. The federal preemption of state laws that was formerly accorded federally chartered depository institutions was reduced as well, and State Attorneys General now have greater authority to bring a suit against a federally chartered institution for violations of certain state and federal consumer protection laws. The Dodd-Frank Act also imposed consolidated capital requirements on savings and loan holding companies effective in five years. The Dodd-Frank Act contains various other provisions designed to enhance the regulation of depository institutions and prevent the recurrence of a financial crisis such as occurred in 2008 and 2009. The full impact of the Dodd-Frank Act on our business and operations will not be known for years until regulations implementing the statute are written and adopted. The Dodd-Frank Act may have a material impact on our operations, particularly through increased regulatory burden and compliance costs.

        In addition to the enactment of the Dodd-Frank Act, the federal regulatory agencies recently have begun to take stronger supervisory actions against financial institutions that have experienced increased loan losses and other weaknesses as a result of the recent economic crisis. The actions include the

25

entering into written agreements and cease and desist orders that place certain limitations on their operations. Federal bank regulators recently have also been using with more frequency their ability to impose individual minimal capital requirements on banks, which requirements may be higher than those imposed under the Dodd-Frank Act or which would otherwise qualify the bank as being "well capitalized" under the Office of the Comptroller of the Currency's prompt corrective action regulations. If we were to become subject to a supervisory agreement or higher capital requirements, such action may have a negative impact on our ability to execute our business plan, as well as our ability to grow, pay dividends, repurchase treasury stock or engage in mergers and acquisitions and may result in restrictions in our operations.

Increased and/or special Federal Deposit Insurance Corporation assessments will hurt our earnings.

        The recent economic recession caused a high level of bank failures, which has dramatically increased Federal Deposit Insurance Corporation resolution costs and led to a significant reduction in the balance of the Deposit Insurance Fund. As a result, the Federal Deposit Insurance Corporation significantly increased the initial base assessment rates paid by financial institutions for deposit insurance. Increases in the base assessment rate increased our deposit insurance costs and negatively impacted our earnings. In addition, in May 2009, the Federal Deposit Insurance Corporation imposed a special assessment on all insured institutions. Our special assessment, which was reflected in earnings for the quarter ended June 30, 2009, was $536,000. In lieu of imposing an additional special assessment, the Federal Deposit Insurance Corporation required all institutions to prepay their assessments for all of 2010, 2011 and 2012, which for us totaled $5.0 million. Additional increases in the base assessment rate or additional special assessments would negatively impact our earnings.

We operate in a highly regulated environment and we may be adversely affected by changes in laws and regulations.

        We are subject to extensive regulation, supervision and examination by the Federal Reserve Board and the Office of the Comptroller of the Currency, our primary federal regulators, and the Federal Deposit Insurance Corporation, as insurer of our deposits. Such regulation and supervision governs the activities in which an institution and its holding company may engage, and are intended primarily for the protection of the insurance fund and the depositors and borrowers of Fox Chase Bank rather than for holders of our common stock. Regulatory authorities have extensive discretion in their supervisory and enforcement activities, including the imposition of restrictions on our operations, the classification of our assets and determination of the level of our allowance for loan losses. Any change in such regulation and oversight, whether in the form of regulatory policy, regulations, legislation or supervisory action, may have a material impact on our operations.

As a member bank, we own stock in the Federal Home Loan Bank of Pittsburgh, which has experienced financial difficulties.

        Our agreement with the Federal Home Loan Bank of Pittsburgh requires us to purchase capital stock in the Federal Home Loan Bank of Pittsburgh commensurate with the amount of our advances and unused borrowing capacity. This stock is carried at cost and was $8.1 million at December 31, 2012. If the Federal Home Loan Bank of Pittsburgh is unable to meet minimum regulatory capital requirements or is required to aid the remaining Federal Home Loan Banks, our holding of Federal Home Loan Bank stock may be determined to be other than temporarily impaired and may require a charge to our earnings, which could have a material impact on our financial condition, results of operations and cash flows.

        The FHLB of Pittsburgh has indicated it would only redeem from any member the lesser of the amount of the member's excess capital stock or 5% of the member's total capital stock. The FHLB also indicated and that it may increase its individual member stock investment requirements. The FHLB of Pittsburgh ceased paying a dividend on its common stock during the first quarter of 2009 and did not pay a dividend through December 31, 2011. Beginning in the first quarter of 2012, the FHLB of Pittsburgh reinstated its quarterly dividend.

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Strong competition within our market areas could reduce our profits.

        We face intense competition in making loans, attracting deposits and attracting and retaining key employees. This competition has made it more difficult for us to make new loans and at times has forced us to offer higher deposit rates. Price competition for loans and deposits might result in us earning less on our loans and paying more on our deposits, which would reduce net interest income. It has also made it more difficult and costly to attract and hire employees with the level of expertise we require to implement our strategic plan. Additional compensation expense increases noninterest expense, reducing net income. Competition also makes it more difficult to grow loans and deposits. At June 30, 2012, which is the most recent date for which data is available from the Federal Deposit Insurance Corporation, we held less than 1% of total deposits in counties where our offices are located. Some of the institutions with which we compete have substantially greater resources and lending limits than we have and may offer services that we do not provide. We expect competition to increase in the future as a result of legislative, regulatory and technological changes and the continuing trend of consolidation in the financial services industry. Our profitability depends upon our continued ability to compete successfully in our market areas.

ITEM 1B.    UNRESOLVED STAFF COMMENTS

        None.

ITEM 2.    PROPERTIES

        We currently conduct business through our eleven full-service banking offices in Hatboro, Philadelphia, Richboro, Willow Grove, Warminster, Lahaska, Media and West Chester, Pennsylvania and Ocean City, Egg Harbor Township and Marmora, New Jersey. We also maintain an administrative office in Blue Bell, Pennsylvania. We own all of our offices, except for those in Media and Blue Bell. The lease term for our Media office expires upon six months' notice. The lease for our Blue Bell office expires in January 2016. We have an option to extend the lease for an additional five-year period at the then prevailing market rate. The net book value of the land, buildings, furniture, fixture and equipment owned by us was $10.4 million at December 31, 2012.

ITEM 3.    LEGAL PROCEEDINGS

        Periodically, there have been various claims and lawsuits against us, such as claims to enforce liens, condemnation proceedings on properties in which we hold security interests, claims involving the making and servicing of real property loans and other issues incident to our business. We are not a party to any pending legal proceedings that we believe would have a material adverse effect on our financial condition, results of operations or cash flows.

ITEM 4.    MINE SAFETY DISCLOSURES

        Not applicable.

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ITEM 5.    MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market for Common Equity and Related Stockholder Matters

        The Company's common stock is listed on the Nasdaq Stock Market ("Nasdaq") under the trading symbol "FXCB." The following table sets forth the quarterly high and low sales prices of Fox Chase Bancorp's common stock for the two most recently completed fiscal years, as reported by Nasdaq, as well as information regarding cash dividends declared by the Company for the two most recently completed fiscal years. See Item 1, "Business—Regulation and Supervision—Federal Banking Regulation—Limitation on Capital Distributions" and note 13 in the notes to the consolidated financial statements for more information relating to restrictions on the Bank's ability to pay dividends to the Company and on the Company's payment of dividends. As of March 1, 2013, the Company had approximately 983 holders of record of common stock.

	High		Low		Dividends Declared Per Common Share
2012:
Fourth Quarter	$	16.65	$	15.05	$	0.08
Third Quarter	$	15.73	$	14.35	$	0.04
Second Quarter	$	14.50	$	12.60	$	0.04
First Quarter	$	13.20	$	12.26	$	0.04
2011:
Fourth Quarter	$	12.95	$	12.09	$	0.02
Third Quarter	$	13.97	$	12.07	$	0.02
Second Quarter	$	13.89	$	13.00	$	0.02
First Quarter	$	14.01	$	11.36	$	0.02

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Stock Performance Graph

        The following graph compares the cumulative total return of the Company common stock with the cumulative total return of the SNL Mid-Atlantic Thrift Index and the Index for the Nasdaq Stock Market (U.S. Companies, all SIC). The graph assumes that $100 was invested on December 31, 2007. Prices prior to June 29, 2010 are for Old Fox Chase Bancorp, Inc. and have been adjusted for the 1.0692 exchange ratio applied as part of the mutual-to-stock conversion. Cumulative total return assumes reinvestment of all dividends.

	Period Ending
Index	12/31/07		12/31/08		12/31/09		12/31/10		12/31/11		12/31/12
Fox Chase Bancorp, Inc.		100.00		96.49		83.51		111.14		119.20		159.36
NASDAQ Composite		100.00		60.02		87.24		103.08		102.26		120.42
SNL Mid-Atlantic Thrift		100.00		82.87		79.04		90.75		70.02		84.13

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Purchases of Equity Securities

        The table provides certain information with regard to shares repurchased by the Company in the fourth quarter of 2012:

Period	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(1)		Maximum Number of Shares that May Yet be Purchased Under the Plans or Programs(1)
October 1, 2012 through October 31, 2012		26,100	$	15.47		26,100		592,801
November 1, 2012 through November 30, 2012		40,100	$	15.39		40,100		552,701
December 1, 2012 through December 31, 2012		25,600	$	15.73		25,600		527,101
Total		91,800	$	15.50		91,800

(1)

During 2011, the Company announced two repurchase programs under which it would repurchase, in the aggregate, up to 15% of the then-outstanding shares of the Company's common stock from time to time, depending on market conditions (2,139,004 shares). On April 25, 2012, the Board of Directors approved an additional stock repurchase plan (the "April 2012 Plan") under which it would repurchase up to 5% of the then-outstanding shares of the Company's common stock (637,697 shares). Under these plans, through December 31, 2012, the Company has purchased a total of 2.2 million shares at a cost of $29.7 million for an average price paid per share of $13.19. The April 2012 Plan will continue until it is completed or terminated by the Company's Board of Directors.

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ITEM 6.    SELECTED FINANCIAL DATA

        The summary financial information presented below is derived in part from our consolidated financial statements. The following is only a summary and should be read in conjunction with the consolidated financial statements and notes beginning on page F-1 of this annual report. The information at December 31, 2012 and 2011 and for the years ended December 31, 2012, 2011 and 2010 is derived in part from the audited consolidated financial statements that appear in this annual report.

	At or For the Year Ended December 31,
	2012		2011		2010		2009			2008
	(Dollars in thousands, except per share amounts)
Financial Condition Data:
Total assets	$	1,088,341	$	1,015,863	$	1,095,503	$	1,173,818		$	931,270
Cash and cash equivalents		25,090		7,586		38,314		65,418			3,944
Securities available-for-sale		296,107		248,770		311,303		422,467			294,723
Securities held-to-maturity		28,369		41,074		51,835		—			—
Loans receivable, net		683,865		670,572		642,653		631,296			588,975
Deposits		687,409		676,594		711,763		858,277			608,472
Short-term borrowings		70,500		8,500		—		—			—
Federal Home Loan Bank advances		110,000		88,278		122,800		137,165			146,379
Other borrowed funds		30,000		50,000		50,000		50,000			50,000
Total stockholders' equity		181,465		188,192		205,704		123,634			121,220
Operating Data:
Interest income	$	41,834	$	45,946	$	49,285	$	51,398		$	45,884
Interest expense		10,117		14,495		21,725		27,635			24,061
Net interest income		31,717		31,451		27,560		23,763			21,823
Provision for loan losses		3,478		5,734		6,213		9,052			2,900
Net interest income after provision for loan losses		28,239		25,717		21,347		14,711			18,923
Noninterest income		6,315		3,343		3,889		3,767			1,405
Noninterest expense(2)		27,174		22,069		21,372		20,333			18,948
Income (loss) before income taxes		7,380		6,991		3,864		(1,855	)		1,380
Income tax provision (benefit)		2,318		2,212		1,120		(827	)		165
Net income (loss)	$	5,062	$	4,779	$	2,744	$	(1,028	)	$	1,215
Per Share Data:
Earnings (loss) per share, basic(1)	$	0.44	$	0.36	$	0.20	$	(0.07	)	$	0.08
Earnings (loss) per share, diluted(1)	$	0.43	$	0.36	$	0.20	$	(0.07	)	$	0.08

(1)

On June 29, 2010, Fox Chase Bancorp converted from the mutual holding company to stock holding company form of organization. Concurrent with the completion of the conversion, each share of Old Fox Chase Bancorp's outstanding common stock held by public stockholders was exchanged for 1.0692 shares of Bancorp common stock. All share related information for periods prior to the conversion is converted at that ratio.

(2)

Includes $3.0 million in charges related to the extinguishment of debt in 2012.

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	At or For the Year Ended December 31,
	2012			2011			2010			2009			2008
Performance Ratios:
Return (loss) on average assets		0.50	%		0.45	%		0.24	%		(0.09	)%		0.14	%
Return (loss) on average equity		2.74			2.36			1.65			(0.82	)		1.00
Interest rate spread(1)		2.83			2.52			1.98			1.75			2.01
Net interest margin(2)		3.21			3.02			2.42			2.16			2.59
Noninterest expense to average assets		2.66			2.07			1.83			1.81			2.18
Efficiency ratio(3)		64.3			63.1			71.1			79.9			82.0
Average interest-earning assets to average interest-bearing liabilities		134.9			133.7			121.7			115.6			119.7
Average equity to average assets		18.12			19.07			14.30			11.11			13.98
Capital Ratios:
Total equity to total assets		16.67			18.53			18.78			10.53			13.02
Tier 1 capital (to adjusted assets)(4)		12.90			15.30			13.60			8.51			10.70
Tier 1 capital (to risk-weighted assets)(4)		19.45			22.88			22.53			15.41			18.11
Total risk-based capital (to risk-weighted assets)(4)		20.48			23.90			23.76			16.57			19.25
Asset Quality Ratios:
Allowance for loan losses as a percent of total loans		1.61			1.77			1.90			1.65			1.05
Allowance for loan losses as a percent of nonperforming loans		65.23			57.63			46.71			35.73			107.01
Net charge-offs to average outstanding loans during the period		0.66			0.94			0.67			0.75			—
Nonperforming loans as a percent of total loans		2.46			3.07			4.07			4.62			0.98
Nonperforming assets as a percent of total assets		2.36			2.30			2.72			2.87			0.63

(1)

Represents the difference between the weighted average yield on average interest-earning assets and the weighted average cost of interest-bearing liabilities.

(2)

Represents net interest income as a percent of average interest-earning assets.

(3)

Represents noninterest expense, excluding valuation adjustments on assets acquired through foreclosure and loss on extinguishment of debt, divided by the sum of net interest income and noninterest income, excluding gains or losses on the sale of securities, premises and equipment and assets acquired through foreclosure.

(4)

Ratios are for Fox Chase Bank.

ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

        The objective of this section is to help readers understand our views on our results of operations and financial condition. You should read this discussion in conjunction with the consolidated statements of condition as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2012 that appear elsewhere in this annual report.

General Overview

        We conduct community banking activities by accepting deposits and making loans in our market area. Our lending products include residential mortgage loans, multi-family and commercial real estate loans, commercial and industrial loans and, to a lesser extent, construction and consumer loans. We

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also maintain an investment portfolio consisting primarily of mortgage-backed securities to manage our liquidity and interest rate risk. Our loan and investment portfolios are funded with deposits as well as collateralized borrowings from the Federal Home Loan Bank of Pittsburgh and commercial banks.

        Income.    Our primary source of pre-tax income is net interest income. Net interest income is the difference between interest income, which is the income that we earn on our loans and investments, and interest expense, which is the interest that we pay on our deposits and borrowings. Our net interest income is affected by a variety of factors, including the mix of interest-earning assets and interest-bearing liabilities in our portfolio and changes in levels of interest rates. Growth in net interest income is dependent upon our ability to prudently manage the balance sheet for growth, combined with how successfully we maintain our net interest margin, which is net interest income as a percentage of average interest-earning assets.

        A secondary source of income is noninterest income, or other income, which is revenue that we receive from providing products and services. The majority of our non-interest income generally comes from fee income on deposit accounts such as cash management fee income on commercial accounts and service charge income on retail accounts as well as loan fee income from mortgage servicing and lending relationships such as unused line fees and warehouse line satisfaction fees. We also earn income on bank-owned life insurance and receive income from our investment in Philadelphia Mortgage Advisors. In some years, we recognize income from the sale of loans, securities and assets acquired through foreclosure.

        Provision for Loan Losses.    The allowance for loan losses is maintained at a level representing management's best estimate of probable and inherent losses in the loan portfolio, based upon management's evaluation of the portfolio's collectability. The allowance is established through the provision for loan losses, which is charged against income. Charge-offs, if any, are charged to the allowance. Subsequent recoveries, if any, are credited to the allowance. Allocation of the allowance may be made for specific impaired loans, but the entire allowance is available for any loan that, in management's judgment, should be charged off.

        Expenses.    The noninterest expense we incur in operating our business consists of salaries, benefits and other compensation expenses, occupancy and furniture and equipment expenses, data processing costs, professional fees, marketing expenses, Federal Deposit Insurance Corporation premiums, assets acquired through foreclosure expense (including valuation adjustments) and various other miscellaneous expenses.

        Our largest noninterest expense is for salaries, benefits and other compensation, which consists primarily of salaries and wages paid to our employees, payroll taxes, expenses for health insurance, retirement plans, director and committee fees and other employee benefits, including employer 401(k) plan contributions, employee stock ownership plan allocations and equity incentive awards, such as stock options and shares of restricted stock.

        Occupancy expense includes the fixed and variable costs of buildings such as depreciation charges, maintenance, real estate taxes and costs of utilities. Depreciation of premises is computed using the straight-line method based on the useful lives of the related assets, which range from 10 to 39 years for buildings and premises. Leasehold improvements are amortized over the shorter of the useful life of the asset or the term of the lease.

        Furniture and equipment expenses, which are the fixed and variable costs of furniture and equipment, consist primarily of depreciation charges, furniture and equipment expenses and maintenance. Depreciation of equipment is computed using the straight-line method based on the useful lives of the related assets, which range from 1 to 7 years for furniture, fixtures and equipment.

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        Data processing costs include fees paid to our third-party data processing service, software and connectivity providers.

        Professional fees include fees paid to our independent auditors, co-sourced internal auditors, attorneys, compensation consultants, loan review specialists and interest rate risk management vendors.

        Marketing expense includes expenses for advertisements, promotions and premium items and public relations expenses.

        Federal Deposit Insurance Corporation assessments are a specified percentage of total assets less equity, depending on the risk characteristics of the institution. The FDIC implemented changes in its assessment rules in 2011 resulting from the Dodd-Frank Act, which reduced the amount of our assessments.

        Assets acquired through foreclosure expense includes declines in the carrying values of other real estate owned ("OREO") after we have acquired a property, changes in the fair value of financial assets acquired through foreclosure and holding costs related to these assets, net of any rental income received.

        Loss of extinguishment of debt includes fees paid to terminate borrowings in 2012 prior to their contractual maturities.

        Other expenses include expenses for stationary, printing, supplies, telephone, postage, contributions and donations, regulatory assessments, insurance premiums, certain public company expenses and other fees and expenses.

Our Business Strategy

        Our goal is to be the leading relationship-based business and consumer bank in the markets we serve by delivering a wide array of financial products and personalized customer service. We believe there is a significant opportunity for a community-focused bank to provide a full range of financial services to small and middle-market commercial and retail customers. Further, by offering quicker decision making in the delivery of banking products and services, offering customized products where appropriate and providing access to senior officers, we can distinguish ourselves from the larger banks operating in our market area. At the same time, our capital base and greater product mix enables us to effectively compete against smaller banks. The following are the key elements of our business strategy:

•

Improve earnings through an emphasis on business banking.  Emphasizing business banking improves our profitability because commercial loans generally produce higher interest rates and the associated commercial business relationships produce higher deposit balances and fee income than consumer relationships. In this regard, we have added personnel to assist us in increasing our commercial business lending. We are also seeking to increase our commercial deposits and our cash management services through our increase in commercial lending.

•

Improve asset quality.  We have sought to maintain our asset quality and moderate credit risk by using conservative underwriting standards. Since 2009, we have tightened our underwriting standards, including reducing loan-to-value ratios, and de-emphasizing certain types of lending, such as construction loans and home equity lending. Further, we have strengthened our oversight of problem assets through the formation of a special assets group in December 2009. The department, which is run by our Chief Operating Officer and consists of other loan and credit administration officers, increases the frequency with which classified and criticized credits are reviewed and aggressively acts to resolve problem assets. Although we intend to continue our efforts to originate commercial real estate and business loans, we intend to manage loan exposures and concentrations through conservative loan underwriting and credit administration standards.

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•

Improve our funding mix by focusing on core deposits.  Our strategic focus is to emphasize total relationship banking with our customers to internally fund our loan growth. We believe that a continued focus on customer relationships will increase our level of core deposits (demand, savings and money market accounts). We value core deposits because they represent longer-term customer relationships and a lower cost of funding compared to certificates of deposit. In addition to our retail branch network, we offer on-line banking and a variety of deposit accounts designed for the businesses operating in our market area, including remote capture products, sweep accounts and other cash management products and services.

•

Actively manage our balance sheet.  Recent economic conditions have underscored the importance of a strong balance sheet. We strive to achieve this through managing our interest rate risk and maintaining strong capital levels, loan loss reserves and liquidity. Diversifying our asset mix not only improves our net interest margin but also reduces the exposure of our net interest income and earnings to interest rate risk. We will continue to manage our interest rate risk by diversifying the type and maturity of our assets in our loan and investment portfolios and monitoring the maturities in our deposit portfolio and borrowing facilities. It is possible that existing minimum regulatory capital ratios may be increased by regulatory agencies in response to market and economic conditions.

•

Grow through geographic expansion.  We intend to pursue expansion in our market area in strategic locations that maximize growth opportunities. We believe the previous economic recession and increasing regulatory burden will increase the rate of consolidation in the banking industry. We will look for opportunities to expand through the acquisition of banks or other financial service companies or the acquisition of branches of other financial institutions. We currently do not have any specific plans for any such acquisitions. We will consider those opportunities that will allow us to add complementary products to our existing business or expand our franchise geographically.

•

Continued expense control.  Management continues to focus on the level of noninterest expenses and methods to identify cost savings opportunities, such as reviewing the number of employees, renegotiating key third-party contracts and reducing certain other operating expenses. In this regard, our efficiency ratios were 64.3%, 63.1% and 71.1% for 2012, 2011 and 2010, respectively.

•

Continue to serve as a strong community citizen.  As a community bank operating for approximately 145 years, we are uniquely positioned to understand the financial needs of our local customers. Further, we believe it is the role of a community bank to operate as a good corporate citizen. Towards that end, in 2006, we established the Fox Chase Bank Charitable Foundation and funded it with 144,342 shares of Old Fox Chase Bancorp common stock and $150,000 in cash. The foundation provides grants to non-profit organizations and programs in the communities we serve. We also provide support to organizations with which our employees and customers are involved through our participation in the Neighborhood Commitment Program.

Critical Accounting Policies

        The discussion and analysis of the financial condition and results of operations are based on our consolidated financial statements, which are prepared in conformity with generally accepted accounting principles in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions affecting the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of income and expenses. We consider the accounting policies discussed below to be critical accounting policies. The estimates and assumptions that we use are based on historical experience and various other factors and are believed to be reasonable under the circumstances. Actual results may differ from these estimates

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under different assumptions or conditions, resulting in a change that could have a material impact on the carrying value of our assets and liabilities and our results of operations.

        Allowance for Loan Losses.    The allowance for loan losses is maintained at a level representing management's best estimate of known and inherent losses in the portfolio, based upon management's evaluation of the portfolio's collectability. Our methodology for assessing the appropriateness of the allowance for loan losses consists of an allowance on impaired loans and a general valuation allowance on the remainder of the portfolio. Although we determine the amount of each element of the allowance separately, the entire allowance for loan losses is available for losses on the entire portfolio.

        Loans are deemed impaired when, based on current information and events, it is probable that the Company will be unable to collect all proceeds due according to the contractual terms of the loan agreement or when a loan is classified as a troubled debt restructuring. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Impairment is measured on a loan by loan basis for commercial loans by either the present value of expected future cash flows discounted at the loan's original effective interest rate, the loan's obtainable market price or the fair value of the collateral less costs to sell if the loan is collateral dependent. The Company establishes an allowance for loan losses in the amount of the difference between fair value of the impaired loan and the loan's carrying amount.

        We establish a general allowance for loans that are not considered impaired to recognize the inherent losses associated with lending activities. This general valuation allowance is determined by segmenting the loan portfolio by loan type and assigning percentages, known as loss factors, to each category. The percentages are adjusted for significant factors that, in management's judgment, affect the collectability of the portfolio as of the evaluation date. These significant factors include the size and composition of the loan portfolio, the Company's loss experience by particular segment, trends and absolute levels of nonperforming loans, trends and absolute levels of classified and criticized loans, trends and absolute levels in delinquent loans, trends in risk ratings, trends in industry charge-offs and changes in existing general economic and business conditions affecting our lending areas and the national economy. These loss factors are subject to ongoing evaluation to ensure their relevance in the current economic environment. We perform this systematic analysis of the allowance on a quarterly basis. These criteria are analyzed and the allowance is developed and maintained at the segment level.

        Additional risk is associated with the analysis of the allowance for loan losses as such evaluations are highly subjective, and future adjustments to the allowance may be necessary if conditions differ substantially from the assumptions used in making the evaluations. In addition, various regulatory agencies periodically review the Company's allowance for loan losses. Such agencies may require the Company to recognize adjustments to the allowance, based on their judgments at the time of their examination.

        For additional discussion, see "—Risk Management—Analysis and Determination of the Allowance for Loan Losses" below and the notes to the consolidated financial statements included in this annual report.

        Deferred Income Taxes.    We use the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion of the deferred tax asset will not be realized. We exercise significant judgment in evaluating the amount and timing of recognition of the resulting tax liabilities and assets. These judgments require us to make projections of future taxable income. The judgments

36

and estimates we make in determining our deferred tax assets, which are inherently subjective, are reviewed on a continual basis as regulatory and business factors change. Any reduction in estimated future taxable income may require us to record a valuation allowance against our deferred tax assets.

        Valuation and Other-Than-Temporary Impairment of Investment Securities.    Investment securities are reviewed quarterly to determine whether the fair value is below the current carrying value. When the fair value of any of our investment securities has declined below its current carrying value, management is required to assess whether the decline is other-than-temporary. A review of other-than-temporary impairment requires companies to make certain judgments regarding the nature of the decline, and the probability, extent and timing of a valuation recovery and our intent to sell the security or if it is more likely than not that the security will be required to be sold before recovery of its amortized cost. Pursuant to these requirements, we assess valuation declines to determine the extent to which such changes are attributable to (1) fundamental factors specific to the issuer, such as financial condition, business prospects or other factors, or (2) market-related factors, such as required market yields, interest rates or equity market declines. If the decline in the market value of a security is determined to be other-than-temporary, the credit portion of the impairment is written down through earnings and the non-credit portion is an adjustment to other comprehensive income.

        Valuation Assets Acquired Through Foreclosure.    Assets acquired through foreclosure consist of other real estate owned and financial assets acquired from debtors. Other real estate owned is carried at the lower of cost or fair value, less estimated selling costs. The fair value of other real estate owned is determined using appraisals obtained from approved independent appraisers or agreements of sale, where applicable. Financial assets acquired from debtors are carried at fair value under the fair value option in accordance with FASB ASC 825 "Financial Instruments". The fair value of financial assets acquired from debtors is determined using valuations obtained from a third party valuation firm who utilizes a discounted cash flow model. Changes in the fair value of assets acquired through foreclosure at future reporting dates or at the time of disposition will result in assets acquired through foreclosure expense or net gain (loss) on sale of assets acquired through foreclosure, respectively.

Balance Sheet Analysis

        General.    Total assets increased $72.5 million to $1.09 billion at December 31, 2012 from $1.02 billion at December 31, 2011. The increase was driven primarily by increases in investment and mortgage related securities of $34.6 million, cash and cash equivalents of $17.5 million and loans receivable of $13.3 million. Total liabilities increased $79.2 million primarily due to increases in short-term borrowings of $62.0 million, FHLB advances of $21.7 million and deposits of $10.8 million offset by a decrease in other borrowed funds of $20.0 million. Total stockholders' equity decreased $6.7 million primarily due to the repurchase of $9.9 million, or 724,700 shares of Company common stock, the payment of $2.4 million in dividends and a $2.0 million decrease in other comprehensive income, offset by net income of $5.1 million.

        Loans.    The largest segment of our loan portfolio is multi-family and commercial real estate loans. At December 31, 2012, these loans totaled $368.9 million and represented 53.1% of total loans compared to $313.1 million, or 45.9% of total loans, at December 31, 2011 and $249.3 million, or 38.1% of total loans, at December 31, 2010. The continued increases in 2012 and 2011 reflect the success of our commercial lenders and the opening of three new offices in 2006 and 2007. Fox Chase Bank expects to continue to emphasize this type of lending for the foreseeable future.

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        One- to four-family residential loans totaled $158.8 million, or 22.9% of total loans, at December 31, 2012 compared to $198.7 million, or 29.1% of total loans, at December 31, 2011 and $238.6 million, or 36.4% of total loans at December 31, 2010. The decreases in 2012 and 2011 were due to reduced loan originations as a result of management's reluctance to place low-rate long-term one- to four-family residential loans on the Company's balance sheet. Fox Chase Bank has not originated subprime loans in its loan portfolio. Given the recent uncertain economic environment, relatively low interest rates and increased consumer compliance costs, Fox Chase Bank does not expect to emphasize this type of lending for the foreseeable future.

        Commercial and industrial loans totaled $113.8 million, or 16.4% of total loans, at December 31, 2012 compared to $107.8 million, or 15.8% of total loans, at December 31, 2011 and $80.6 million, or 12.3% of total loans, at December 31, 2010. The increases in 2012 and 2011 reflect the hiring of a middle market lending team in 2009. Fox Chase Bank expects to continue emphasis on this type of lending for the foreseeable future.

        Construction loans totaled $22.6 million, or 3.2% of total loans, at December 31, 2012 compared to $18.2 million, or 2.7% of total loans, at December 31, 2011 and $31.2 million, or 4.8% of total loans, at December 31, 2010. The $8.6 million decrease from 2010 to 2012 was due to reduced origination efforts during 2010, 2011 and 2012 as a result of the riskier nature of construction loans and decreases in real estate values in certain parts of the Bank's lending area. The $4.4 million increase from 2011 to 2012 was primarily due to a modest increase in construction loan activity in 2012. The $13.0 million decrease from 2010 to 2011 was due to Fox Chase Bank not underwriting any significant new construction loans in 2011.

        Consumer loans totaled $30.6 million, or 4.4% of total loans, at December 31, 2012 compared to $44.7 million, or 6.5% of total loans, at December 31, 2011 and $55.2 million, or 8.4% of total loans, at December 31, 2010. The decreases in consumer loans during 2012 and 2011 were due to Fox Chase Bank de-emphasizing certain forms of consumer lending, particularly home equity lending, as a result of the decrease in real estate values in certain parts of its lending area. Given the current uncertain economic environment and increased consumer compliance costs, Fox Chase Bank does not expect to emphasize this type of lending for the foreseeable future.

        The following table sets forth the composition of our loan portfolio at the dates indicated.

	At December 31,
	2012						2011						2010						2009						2008
	Amount			Percent			Amount			Percent			Amount			Percent			Amount			Percent			Amount			Percent
	(Dollars in thousands)
Real estate loans:
One- to four-family		158,828			22.9	%		198,669			29.1	%		238,612			36.4	%		268,535			41.8	%		260,833			43.8	%
Multi-family and commercial		368,948			53.1			313,060			45.9			249,262			38.1			220,381			34.3			165,461			27.9
Construction		22,591			3.2			18,243			2.7			31,190			4.8			40,799			6.4			65,002			10.9
Total real estate loans		550,367			79.2			529,972			77.7			519,064			79.3			529,715			82.5			491,296			82.6
Consumer loans		30,585			4.4			44,667			6.5			55,169			8.4			69,362			10.8			76,086			12.8
Commercial and industrial loans		113,820			16.4			107,781			15.8			80,645			12.3			42,791			6.7			27,474			4.6
Total loans		694,772			100.0	%		682,420			100.0	%		654,878			100.0	%		641,868			100.0	%		594,856			100.0	%
Less:
Deferred loan origination costs (fees), net		263						227						218						33						379
Allowance for loan losses		(11,170	)					(12,075	)					(12,443	)					(10,605	)					(6,260	)
Net loans		683,865						670,572						642,653						631,296						588,975

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Loan Maturity

        The following tables set forth certain information at December 31, 2012 regarding scheduled contractual maturities during the periods indicated. The tables do not include any estimate of prepayments which significantly shorten the average life of all loans and may cause our actual repayment experience to differ from that shown below. Demand loans having no stated schedule of repayments and no stated maturity are reported as due in one year or less. The amounts shown below exclude deferred loan fees and costs.

	At December 31, 2012
	One- to Four-Family Loans		Multi-family and Commercial Real Estate Loans		Construction Loans		Consumer Loans		Commercial and Industrial Loans		Total Loans
	(In thousands)
Amounts due in:
One year or less		169		57,570		21,125		2,142		40,857		121,863
More than one year to two years		253		21,255		1,466		471		26,946		50,391
More than two years to three years		81		19,466		—		561		22,980		43,088
More than three years to five years		13,093		82,916		—		3,528		21,966		121,503
More than five years to ten years		9,822		145,406		—		11,585		1,071		167,884
More than ten years to fifteen years		8,549		5,226		—		3,113		—		16,888
More than fifteen years		126,861		37,109		—		9,185		—		173,155
Total	$	158,828	$	368,948	$	22,591	$	30,585	$	113,820	$	694,772

The following table sets forth the dollar amount of all scheduled maturities of loans at December 31, 2012 that are due after December 31, 2013 and have either fixed interest rates or adjustable interest rates. The amounts shown below exclude deferred loan fees, net.

	Fixed Rates		Floating or Adjustable Rates		Total
			(In thousands)
Real estate loans:
One- to four-family	$	150,884	$	7,775	$	158,659
Multi-family and commercial		214,533		96,845		311,378
Construction		—		1,466		1,466
Consumer loans		17,729		10,714		28,443
Commercial and industrial loans		19,391		53,572		72,963
Total	$	402,537	$	170,372	$	572,909

        Securities.    Our securities portfolio consists primarily of agency residential mortgage related securities, and, to a lesser extent, private label commercial mortgage securities obligations of U.S. government agencies and investment grade corporate securities. The amortized cost of total securities increased $37.8 million, or 13.5%, during 2012. Purchases in 2012 consisted of agency residential mortgage related securities totaling $217.9 million and two corporate securities in the amount of $5.3 million. These purchases were offset by principal repayments of $84.0 million, the sale of $82.3 million of residential agency mortgage related securities, the sale of US government agencies of $6.1 million, the sale of the private label residential mortgage related securities of $157,000, the redemption of $7.9

39

million in corporate securities and the call of $1.9 million of state and municipal securities. All securities purchased during the year ended December 31, 2012 were classified as available-for-sale.

        The amortized cost of securities decreased $73.3 million, or 20.2%, in 2011. Purchases in 2011 consisted of agency residential mortgage related securities totaling $35.0 million. These purchases were offset by maturities, calls, and principal repayments of $85.4 million, the sale of $13.0 million of residential agency mortgage related securities, the redemption of $3.5 million in corporate securities, and the call of $5.4 million of state and municipal securities. All securities purchased during the year ended December 31, 2011 were classified as available-for-sale.

        The following table sets forth the amortized cost and fair values of our securities portfolio at the dates indicated. All of our securities were classified as available-for-sale at the dates indicated.

	At December 31,
	2012				2011				2010
	Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value
Available for Sale:
Obligations of U.S. government agencies	$	300	$	314	$	6,424	$	6,514	$	6,489	$	6,521
State and political subdivisions		—		—		1,865		1,873		7,240		7,279
Corporate securities		12,207		12,177		15,007		14,719		18,674		18,871
		12,507		12,491		23,296		23,106		32,403		32,671
Private label residential mortgage related securities		—		—		164		122		559		166
Private label commercial mortgage related security		6,119		6,197		8,799		8,906		11,385		11,767
Agency residential mortgage related securities		270,461		277,419		206,285		216,636		256,796		266,699
Total mortgage related securities		276,580		283,616		215,248		225,664		268,740		278,632
Total available-for-sale securities	$	289,087	$	296,107	$	238,544	$	248,770	$	301,143	$	311,303
Held to Maturity:
Agency residential mortgage related securities	$	28,369	$	29,451	$	41,074	$	41,758	$	51,835	$	50,817
Total mortgage related securities		28,369		29,451		41,074		41,758		51,835		50,817
Total securities	$	317,456	$	325,558	$	279,618	$	290,528	$	352,978	$	362,120

        At December 31, 2012, we had no investments in a single issuer (other than state or U.S. Government-sponsored entity securities) that had an aggregate book value in excess of 10% of our equity.

        During the year ended December 31, 2012, the Company sold (1) agency residential mortgage related securities with an amortized cost of $82.3 million and recognized gross gains of $3.3 million, (2) a private label residential mortgage related security with an amortized cost of $157,000 and recognized a loss of $87,000 and (3) two obligations of U.S. government agencies with an amortized cost of $6.1 million and recognized a gain of $64,000.

        As of December 31, 2012, the Company held three private label commercial mortgage backed securities ("CMBS") with an amortized cost of $6.1 million. These securities had a net unrealized gain of $78,000 at December 31, 2012 and all individual securities were held at an unrealized gain. As of

40

December 31, 2011, the Company held three private label CMBS with an amortized cost of $8.8 million. These securities had a net unrealized gain of $107,000 at December 31, 2011 and all individual securities were held at an unrealized gain. During 2011, one security paid off in full.

        As a member of the FHLB of Pittsburgh, the Bank is required to acquire and hold shares of capital stock in the FHLB of Pittsburgh in an amount at least equal to 4.60% of its advances plus 0.35% of the Bank's "eligible assets," as such term is defined by the FHLB; and a maximum amount of 6.00% of its advances plus 1.0% of the Bank's "eligible assets." The FHLB of Pittsburgh has indicated it would only redeem from any member the lesser of the amount of the member's excess capital stock or 5% of the member's total capital stock. The FHLB also indicated that it may increase its individual member stock investment requirements. As of December 31, 2012, the Company's minimum stock obligation was $7.9 million and a maximum stock obligation was $12.6 million. The Company held $8.1 million in FHLB stock at that date. The FHLB of Pittsburgh ceased paying a dividend on its common stock during the first quarter of 2009 and did not pay a dividend through December 31, 2011. Beginning in the first quarter of 2012, the FHLB of Pittsburgh reinstated its quarterly dividend.

        See Note 2 to the consolidated financial statements for a schedule of gross unrealized losses and fair value of securities, aggregated by security category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2012 and 2011.

        The following table sets forth the stated maturities and weighted average yields of investment securities at December 31, 2012. Weighted average yields on tax-exempt loans and securities are not presented on a tax equivalent basis. Certain mortgage related securities have adjustable interest rates and will reprice annually within the various maturity ranges. These repricing schedules are not reflected in the table below.

	One Year or Less					More Than 1 Year to 5 Years					More Than 5 Years to 10 Years					More Than 10 Years					Total
	Fair Value		Weighted Average Yield			Fair Value		Weighted Average Yield			Fair Value		Weighted Average Yield			Fair Value		Weighted Average Yield			Fair Value		Weighted Average Yield
Available for Sale:
Obligations of U.S. government agencies	$	—		—	%	$	314		2.26	%	$	—		—	%	$	—		—	%	$	314		2.26	%
State and political subdivisions		—		—			—		—			—		—			—		—			—		—
Corporate securities		2,032		3.00			10,145		1.81			—		—			—		—			12,177		2.01
		2,032					10,459					—					—					12,491
Private label commercial mortgage related security		—		—			—		—			—		—			6,197		5.45			6,197		5.45
Agency residential mortgage related securities		6		5.01			184		5.07			21,539		3.17			255,690		1.97			277,419		2.07
Total mortgage related securities	$	6				$	184				$	21,539				$	261,887				$	283,616
Held to Maturity:
Agency residential mortgage related securities	$	—		—		$	—		—		$	16,516		1.46		$	12,935		2.05		$	29,451		1.72
Total mortgage related securities		—					—					16,516					12,935					29,451
Total securities	$	2,038				$	10,643				$	38,055				$	274,822				$	325,558

        Real Estate Held for Investment.    Fox Chase Bank had real estate held for investment of $1.6 million at December 31, 2012 and 2011, which represented undeveloped land located in Absecon, New Jersey. During 2011, the Company obtained an updated appraisal and recorded an additional impairment loss of $110,000. No additional impairment was identified during 2012.

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        In accordance with regulatory guidelines, because this real estate held for investment was not sold or placed in service by June 2011 (eight years from acquisition), for regulatory reporting purposes, the full amount of this asset is recorded as a reduction of regulatory capital at December 31, 2012 and December 31, 2011.

        Cash and Cash Equivalents.    Our primary source of short-term liquidity is comprised of branch working cash, a reserve requirement account at the Federal Reserve, an account at the Federal Home Loan Bank of Pittsburgh and money market accounts. Cash and cash equivalents increased $17.5 million during 2012, primarily as a result of increased short-term borrowings as of December 31, 2012.

        Deposits.    Our primary source of funds is our deposit accounts, which are comprised of noninterest-bearing demand accounts, interest-bearing NOW accounts, money market accounts, savings accounts, brokered deposits and certificates of deposit. These deposits are provided primarily by individuals and businesses within our market areas. Deposits increased $10.8 million, or 1.6%, for 2012 primarily as a result of an increase in noninterest bearing deposits of $23.8 million, an increase in NOW accounts of $24.2 million, an increase in savings and club accounts of $18.3 million and an increase in brokered deposits of $40.5 million, offset by decreases in money market accounts of $30.3 million and certificates of deposit of $65.7 million. The increase in noninterest-bearing deposits was primarily driven by the Company's continued focus on commercial business customers. The increase in NOW accounts and savings and club accounts was primarily driven by new products introduced in 2011 and 2012. The increase in brokered deposits is driven by the Company's desire to access this type of low-cost deposit funding. The decreases in money market accounts and certificate of deposits was primarily due to the Company not offering any promotional rates in 2012.

        Deposits decreased $35.2 million, or 4.9%, for 2011 primarily as a result of a decrease in higher-rate certificates of deposits of $68.7 million and a decrease in money market accounts of $21.2 million offset by an increase in NOW accounts of $5.4 million, an increase of $13.4 million in noninterest-bearing demand accounts, an increase of $25.8 million in savings and club accounts and an increase of $10.2 million in brokered deposits. The decrease in certificates of deposits and money market accounts was the result of the Company's decision to reduce higher rate deposits while targeting certain customers for retention. These customers include those with either previous relationships or those who reside within close proximity to our branches. During 2011, the Company had $25.8 million of promotional certificates of deposit mature at an average rate of 3.50%. Of this promotion, approximately $3.9 million were retained. The increase in noninterest-bearing demand accounts was a result of continued efforts to increase commercial deposit relationships through the efforts of our commercial lending and cash management teams.

        The following table sets forth the balances of our deposit products at the dates indicated.

	At December 31,
	2012					2011					2010
	Amount		Weighted Average Rate			Amount		Weighted Average Rate			Amount		Weighted Average Rate
Noninterest-bearing demand accounts	$	108,176		—	%	$	84,374		—	%	$	70,990		—	%
NOW accounts		70,199		0.22			45,948		0.39			40,505		0.30
Money market accounts		97,318		0.19			127,667		0.38			148,904		0.47
Savings and club accounts		99,046		0.14			80,740		0.29			54,921		0.05
Brokered deposits		50,637		0.36			10,162		0.53			—		—
Certificates of deposit		262,033		1.59			327,703		2.03			396,443		2.44
Total	$	687,409		0.70	%	$	676,594		1.12	%	$	711,763		1.48	%

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        The following table indicates the amount of jumbo certificates of deposit by time remaining until maturity at December 31, 2012. Jumbo certificates of deposit require minimum deposits of $100,000. Brokered deposits in the amount of $50.6 million at December 31, 2012 are not included in total jumbo certificates of deposit.

Maturity Period at December 31, 2012	Jumbo Certificates of Deposit
	(In thousands)
Three months or less	$	7,638
Over three through six months		6,424
Over six through twelve months		17,414
Over twelve months		31,027
Total	$	62,503

        The following table sets forth the time deposits, including brokered deposits in 2012 and 2011, classified by rates at the dates indicated.

	Year Ended December 31,
	2012		2011		2010
	(In thousands)
0.00 - 1.00%	$	191,709	$	106,920	$	82,723
1.01 - 2.00%		41,235		82,779		88,537
2.01 - 3.00%		32,104		75,808		89,887
3.01 - 4.00%		24,297		33,827		66,566
4.01 - 5.00%		23,176		38,381		49,258
5.01 - 6.00%		149		150		19,472
6.01 - greater		—		—		—
Total	$	312,670	$	337,865	$	396,443

        The following table sets forth the amount and maturities of time deposits, including brokered deposits, classified by rates at December 31, 2012.

	Amount Due
	Less Than One Year		More Than One Year to Two Years		More Than Two Years to Three Years		More Than Three Years		Total		Percent of Total Time Deposit Accounts
	(Dollars in thousands)
0.00 - 1.00%	$	149,251	$	22,623	$	14,081	$	5,754	$	191,709		61.31	%
1.01 - 2.00%		14,804		16,544		4,389		5,498		41,235		13.19
2.01 - 3.00%		9,291		5,407		7,478		9,928		32,104		10.27
3.01 - 4.00%		5,462		15,709		944		2,182		24,297		7.77
4.01 - 5.00%		11,413		8,888		2,290		585		23,176		7.41
5.01 - 6.00%		—		149		—		—		149		0.05
6.01 - greater		—		—		—		—		—		—
Total	$	190,221	$	69,320	$	29,182	$	23,947	$	312,670		100.00

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        The following table sets forth time deposit activity for the periods indicated.

	Year Ended December 31,
	2012			2011			2010
	(In thousands)
Beginning balance	$	337,865		$	396,443		$	524,026
Decrease before interest credited		(31,542	)		(66,363	)		(141,237	)
Interest credited		6,347			7,785			13,654
Net decrease in time deposits		(25,195	)		(58,578	)		(127,583	)
Ending balance	$	312,670		$	337,865		$	396,443

        Borrowings.    During 2012, the Company obtained four additional term Federal Home Loan Bank advances totaling $60.0 million. During 2012, the Company terminated $36.3 million of Federal Home Loan Bank advances at a pre-tax cost of $1.5 million. Additionally, during 2012, the Company terminated $20.0 million of other long-term borrowings at a pre-tax cost of $1.5 million. During 2012, the Company made scheduled principal payments of $2.0 million on other borrowed funds. As of December 31, 2012, Fox Chase Bank had outstanding borrowings of $110.0 million with the Federal Home Loan Bank and $30.0 million with another commercial bank.

        Fox Chase Bank did not obtain additional long-term borrowings in 2011 from either the Federal Home Loan Bank or other lenders. The Bank had a $30.0 million Federal Home Loan Bank advance that matured in August 2011 as well as two Federal Home Loan Bank advances which amortized $4.5 million of principal during 2011. As of December 31, 2011, Fox Chase Bank had outstanding borrowings of $88.3 million with the Federal Home Loan Bank and $50.0 million with other commercial banks.

        As of December 31, 2012 and December 31, 2011, the Company had $70.5 million and $8.5 million, respectively, of short-term borrowings. The short-term borrowings at December 31, 2012 and 2011 had a blended rate of 0.30% and 0.25%, respectively. Short-term borrowings consist of overnight and term borrowings with an original maturity less than one year. Short-term borrowings are obtained from commercial banks, participants in the Federal Funds market and the FHLB.

	Year Ended December 31,
	2012			2011			2010
	(Dollars in thousands)
Maximum amount of advances outstanding at any month end during the period	$	210,500		$	196,429		$	186,807
Average advances outstanding during the period		137,279			162,419			175,963
Weighted average interest rate during the period		2.75	%		3.54	%		3.66	%
Balance outstanding at end of period		210,500			146,778			172,800
Weighted average interest rate at end of period		1.51	%		3.23	%		3.67	%

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Results of Operations for the Years Ended December 31, 2012, 2011 and 2010

Overview.

	Year Ended December 31,
	2012			2011			2010
	(Dollars in thousands)
Net income	$	5,062		$	4,779		$	2,744
Basic earnings per share	$	0.44		$	0.36		$	0.20
Diluted earnings per share		0.43			0.36			0.20
Return on average assets		0.50	%		0.45	%		0.24	%
Return on average equity		2.74			2.36			1.65
Average equity to average assets		18.12			19.07			14.30

        2012 vs. 2011.    Net income increased $283,000 for 2012 compared to 2011. The 2012 results included an increase in net interest income of $266,000, a reduction of $2.3 million in the provision for loan losses, an increase of $3.0 million in noninterest income, an increase of $5.1 million in noninterest expense and an increase in tax provision of $106,000.

        2011 vs. 2010.    Net income increased $2.0 million for 2011 compared to 2010. The 2011 results included an increase in net interest income of $3.9 million, a reduction of $479,000 in the provision for loan losses, a decrease of $546,000 in noninterest income, an increase of $697,000 in noninterest expense and an increase in tax provision of $1.1 million.

Net Interest Income.

        2012 vs. 2011.    Net interest income increased $266,000, or 0.8%, for 2012. The net interest margin was 3.21% for 2012 compared to 3.02% for 2011. The increase in net interest income was primarily attributable to a decrease in the average balance and costs of interest bearing liabilities as well as increases in noninterest-bearing deposits, offset by a decrease in the yield on interest-earning assets.

        Total interest income decreased $4.1 million, or 8.9%, to $41.8 million for 2012, due primarily to a $2.2 million, or 22.2%, decrease in interest on mortgage related securities, a decrease in interest and fees on loans of $1.6 million, or 4.4%, a decrease in interest on taxable investment securities available-for-sale of $180,000, or 36.9%, a decrease in interest on nontaxable investment securities available-for-sale of $150,000, or 81.5% and a decrease in other interest income of $63,000, or 88.7%. Interest income on mortgage related securities decreased due to a reduction in the average balance of $26.0 million and a 47 basis point reduction in yield. Interest income on loans decreased due to a reduction of 33 basis points in yield offset by an increase $17.2 million in the average balance of total loans. Interest income on taxable investment securities available-for-sale decreased primarily due to a decrease in the average balance of $10.6 million. Interest income on nontaxable investment securities available-for-sale decreased $150,000 primarily due to a decrease in the average balance of $3.3 million. Other interest income decreased $63,000 to $8,000 from $71,000 primarily due to a decrease in the average balance of interest-earning demand deposits of $24.3 million and a 12 basis point reduction in yield.

        Total interest expense decreased $4.4 million, or 30.2%, to $10.1 million for 2012, due primarily to a $2.3 million decrease in interest expense on deposits, a $1.7 million decrease in interest expense on Federal Home Loan Bank advances and a $384,000 decrease in interest expense on other long-term borrowed funds. The decreased deposit expense was due to a decrease of $15.5 million in the average outstanding balance on total interest-bearing deposit accounts and a 36 basis point decrease in the average rate paid on deposits, primarily due to the lower interest rate environment as well as the re-pricing of promotional rate certificates of deposits and the utilization of lower-cost brokered deposits. Interest expense on Federal Home Loan Bank advances decreased primarily due to a

45

decrease in average borrowings of $28.1 million and a decrease in the average rate paid of 76 basis points. Interest expense on other borrowed funds decreased primarily due to a decrease in average borrowings of $10.6 million.

        The increase in net interest income includes the benefits of approximately $700,000 related to the Company's balance sheet restructuring during the second quarter of 2012. As part of the restructuring, the Company terminated $56.3 million in long-term borrowings, with an effective rate of 3.50%. The Company funded these terminations with brokered deposits with a weighted average duration of 0.9 years and a weighted average rate of 0.45%. Additionally, the Company sold investment securities totaling $72.9 million with a book yield of 2.11% and purchased investment securities totaling $74.3 million with a book yield of 1.63%.

        2011 vs. 2010.    Net interest income increased $3.9 million, or 14.1%, for 2011. The net interest margin was 3.02% for 2011 compared to 2.42% for 2010. The increase in net interest income was primarily attributable to a decrease in the average balance and cost of certificates of deposit, as well as increases in average stockholders' equity and noninterest-bearing deposits.

        Total interest income decreased $3.3 million, or 6.8%, to $45.9 million for 2011, due primarily to a $2.1 million, or 17.7%, decrease in interest on mortgage related securities, a decrease in interest and fees on loans of $892,000, or 2.5%, a decrease in other interest income of $215,000, or 75.2%, and a decrease in nontaxable investment securities available-for-sale of $150,000, or 44.9%. Interest income on mortgage related securities decreased due to a reduction in the average balance of $39.5 million. Interest income on loans decreased due to a reduction of 10 basis points in yield and a reduction of $5.6 million in the average balance of total loans. Other interest income decreased $215,000 to $71,000 from $286,000 primarily due to a decrease in the average balance of interest-earning demand deposits of $50.4 million. Interest income on nontaxable investment securities available-for-sale decreased $150,000 primarily due to a decrease in the average balance of $4.3 million.

        Total interest expense decreased $7.2 million, or 33.3%, to $14.5 million for 2011, due primarily to a $6.5 million decrease in interest expense on deposits and a $704,000 decrease in interest expense on Federal Home Loan Bank advances. The decreased deposit expense was due to a decrease of $142.4 million in the average outstanding balance on total interest-bearing deposit accounts and a 60 basis point decrease in the average rate paid on deposits, primarily due to the lower interest rate environment as well as the repricing of promotional rate certificates of deposit which were obtained in 2009. Interest expense on Federal Home Loan Bank advances decreased primarily due to a decrease in average borrowings of $15.8 million.

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        Average Balances and Yields.    The following table presents information regarding average balances of assets and liabilities, the total dollar amounts of interest income and dividends from average interest-earning assets, the total dollar amounts of interest expense on average interest-bearing liabilities, and the resulting annualized average yields and costs. The yields and costs for the periods indicated are derived by dividing income or expense by the average balances of assets or liabilities, respectively, for the periods presented. Loan fees are included in interest income on loans and are insignificant. Yields are not presented on a tax-equivalent basis. Any adjustments necessary to present yields on a tax-equivalent basis are insignificant.

	Years Ended December 31,
	2012								2011								2010
	Average Balance			Interest and Dividends		Yield/ Cost			Average Balance			Interest and Dividends		Yield/ Cost			Average Balance			Interest and Dividends		Yield/ Cost
	(Dollars in thousands)
Assets:
Interest-earning assets:
Interest-earning demand deposits	$	7,569		$	8		0.10	%	$	31,894		$	71		0.22	%	$	82,257		$	286		0.35	%
Mortgage-related securities
Available-for-sale		255,688			7,017		2.74	%		268,977			8,989		3.34	%		348,208			11,727		3.37	%
Held-to-maturity		35,120			589		1.68	%		47,803			786		1.65	%		8,025			147		1.83	%
Total mortgage-related securities		290,808			7,606		2.62	%		316,780			9,775		3.09	%		356,233			11,874		3.33	%
Taxable securities		21,220			308		1.45	%		31,818			488		1.53	%		28,197			471		1.67	%
Nontaxable securities		738			34		4.65	%		4,043			184		4.55	%		8,318			334		4.01	%
Loans:
Residential loans		178,316			8,704		4.88	%		220,418			10,976		4.98	%		262,028			13,633		5.20	%
Commercial loans		450,135			23,472		5.21	%		379,693			21,504		5.59	%		330,651			18,913		5.64	%
Consumer loans		39,312			1,702		4.33	%		50,501			2,948		5.84	%		63,488			3,774		5.94	%
Total Loans		667,763			33,878		5.07	%		650,612			35,428		5.40	%		656,167			36,320		5.50	%
Allowance for loan losses		(11,781	)							(12,895	)							(11,415	)
Net loans		655,982			33,878					637,717			35,428					644,752			36,320
Total interest-earning assets		976,317			41,834		4.23	%		1,022,252			45,946		4.41	%		1,119,757			49,285		4.33	%
Noninterest-earning assets		43,923								41,466								46,932
Total assets	$	1,020,240							$	1,063,718							$	1,166,689
Liabilities and equity:
Interest-bearing liabilities:
NOW and money market deposit accounts	$	164,364			573		0.35	%	$	174,681			739		0.42	%	$	214,111			1,504		0.70	%
Savings accounts		94,783			253		0.27	%		67,688			148		0.22	%		53,975			45		0.08	%
Brokered deposits		36,553			194		0.53	%		1,802			13		0.73	%		—			—		0.00	%
Certificates of deposit		290,722			5,327		1.83	%		357,792			7,772		2.17	%		476,258			13,654		2.87	%
Total interest-bearing deposits		586,422			6,347		1.08	%		601,963			8,672		1.44	%		744,344			15,203		2.04	%
Short-term borrowings		15,851			38		0.24	%		2,239			5		0.23	%		—			—		0.00	%
FHLB advances		82,039			2,383		2.90	%		110,180			4,085		3.66	%		125,963			4,789		3.75	%
Other borrowed funds		39,389			1,349		3.42	%		50,000			1,733		3.42	%		50,000			1,733		3.42	%
Total borrowings		137,279			3,770		2.75	%		162,419			5,823		3.54	%		175,963			6,522		3.66	%
Total interest-bearing liabilities		723,701			10,117		1.40	%		764,382			14,495		1.89	%		920,307			21,725		2.35	%
Noninterest-bearing deposits		107,143								90,460								70,256
Other noninterest-bearing liabilities		4,503								6,001								9,341
Total liabilities		835,347								860,843								999,904
Stockholders' equity		178,687								195,683								158,633
Accumulated comprehensive income		6,206								7,192								8,152
Total stockholder's equity		184,893								202,875								166,785
Total liabilities and stockholders' equity	$	1,020,240							$	1,063,718							$	1,166,689
Net interest income				$	31,717							$	31,451							$	27,560
Interest rate spread							2.83	%							2.52	%							1.98	%
Net interest margin							3.21	%							3.02	%							2.42	%
Average interest-earning assets to average interest-bearing liabilities							134.91	%							133.74	%							121.67	%

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        Rate/Volume Analysis.    The following table sets forth the effects of changing rates and volumes on our net interest income. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by current volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The net column represents the sum of the prior columns. For purposes of this table, changes attributable to changes in both rate and volume that cannot be segregated have been allocated proportionally based on the changes due to rate and the changes due to volume.

	Year Ended December 31, 2012 Compared to Year Ended December 31, 2011									Year Ended December 31, 2011 Compared to Year Ended December 31, 2010
	Increase (Decrease) Due To									Increase (Decrease) Due To
	Rate			Volume			Net			Rate			Volume			Net
Interest and dividend income:
Interest-earning demand deposits	$	(9	)	$	(54	)	$	(63	)	$	(40	)	$	(175	)	$	(215	)
Mortgage-related securities
Available for sale		(1,528	)		(444	)		(1,972	)		(69	)		(2,669	)		(2,738	)
Held to maturity		11			(208	)		(197	)		(91	)		730			639
Taxable securities		(18	)		(162	)		(180	)		(43	)		60			17
Nontaxable securities		1			(151	)		(150	)		22			(172	)		(150	)
Loans:
Residential loans		(176	)		(2,096	)		(2,272	)		(493	)		(2,164	)		(2,657	)
Commercial loans		(2,021	)		3,989			1,968			(214	)		2,805			2,591
Consumer loans		(593	)		(653	)		(1,246	)		(54	)		(772	)		(826	)
Total Loans		(2,790	)		1,240			(1,550	)		(761	)		(131	)		(892	)
Total interest-earning assets		(4,333	)		221			(4,112	)		(982	)		(2,357	)		(3,339	)
Interest Expense:
NOW and money market deposit accounts		(122	)		(44	)		(166	)		(488	)		(277	)		(765	)
Savings accounts		46			59			105			93			10			103
Brokered deposits		(72	)		253			181			—			13			13
Certificates of deposit		(988	)		(1,457	)		(2,445	)		(2,486	)		(3,396	)		(5,882	)
Total interest-bearing deposits		(1,136	)		(1,189	)		(2,325	)		(2,881	)		(3,650	)		(6,531	)
Short-term borrowings		2			31			33			—			5			5
FHLB advances		(660	)		(1,042	)		(1,702	)		(103	)		(601	)		(704	)
Other borrowed funds		(16	)		(368	)		(384	)		—			—			—
Total borrowings		(674	)		(1,379	)		(2,053	)		(103	)		(596	)		(699	)
Total interest-bearing liabilities		(1,810	)		(2,568	)		(4,378	)		(2,984	)		(4,246	)		(7,230	)
Net change in net interest income	$	(2,523	)	$	2,789		$	266		$	2,002		$	1,889		$	3,891

Provision for Loan Losses.

        2012 vs. 2011.    Fox Chase Bancorp recorded a provision for loan losses of $3.5 million in 2012 compared to $5.7 million in 2011. The $3.5 million provision was primarily a result of net charge-offs of $4.4 million of which $1.9 million related to the consumer loan portfolio, $1.4 million related to the residential mortgage portfolio and $1.1 million related to the commercial and construction loan

48

portfolios. Additionally, the decreased provision was a result of a decrease in classified and criticized assets.

        2011 vs. 2010.    Fox Chase Bancorp recorded a provision for loan losses of $5.7 million in 2011 compared to $6.2 million in 2010. The $5.7 million provision was primarily a result of net charge-offs of $6.1 million of which $5.1 million related to the commercial loan portfolio, $554,000 related to the residential mortgage portfolio and $431,000 related to the consumer loan portfolio. Additionally, the decreased provision was a result of a decrease in nonperforming loans and classified and criticized assets.

        An analysis of the changes in the allowance for loan losses is presented under "—Risk Management—Analysis and Determination of the Allowance for Loan Losses."

        Noninterest Income.    The following table shows the components of noninterest income for 2012, 2011 and 2010.

	Year Ended December 31,							$ Change			% Change			$ Change			% Change
	2012		2011			2010		2012/2011						2011/2010
	(In thousands)
Service charges and other fee income	$	1,597	$	1,630		$	1,132		(33	)		(2.0	)%		498			44.0	%
Net gain on sale of premises and equipment		—		—			6		—			—			(6	)		—
Net gain on sale of assets acquired through foreclosure		135		250			44		(115	)		(46.0	)		206			468.2
Impairment loss on real estate held for investment		—		(110	)		—		110			(100.0	)		(110	)		(100.0	)
Income on bank-owned life insurance		471		468			471		3			0.6			(3	)		(0.6	)
Equity in earnings of affiliates		690		245			166		445			181.6			79			47.6
Other		130		130			107		—			—			23			21.5
Total other-than-temporary impairment loss		—		(407	)		—		407			(100.0	)		(407	)		(100.0	)
Less: Portion of loss recognized in other comprehensive income (before taxes)		—		46			—		(46	)		(100.0	)		46			100.0
Net other-than-temporary impairment loss		—		(361	)		—		361			(100.0	)		(361	)		(100.0	)
Net gain on sale of investment securities		3,292		1,091			1,963		2,201			201.7			(872	)		(44.4	)
Net investment securities gains		3,292		730			1,963		2,562			351.0			(1,233	)		(62.8	)
Total Noninterest Income	$	6,315	$	3,343		$	3,889	$	2,972			88.9	%	$	(546	)		(14.0	)%

        2012 vs. 2011.    Noninterest income increased $3.0 million in 2012. Service charges and other fee income decreased $33,000, primarily due to decreases in loan related fees of $66,000 offset by an increase in deposit related fees of $33,000. There was no net other-than-temporary impairment loss or impairment loss on real estate held for investment during 2012, compared to $361,000 and $110,000, respectively, for 2011. Net gain on sale of investment securities was $3.3 million, compared to $1.1 million in 2011. Equity in earnings of affiliate increased $445,000 due to increased income from the Company's investment in Philadelphia Mortgage Advisors as a result of higher mortgage loan volume. Net gain on sale of assets acquired through foreclosure was $135,000 in 2012 compared to $250,000 in 2011.

        2011 vs. 2010.    Noninterest income decreased $546,000 for 2011. The decrease for 2011 was primarily due to a decrease in net investment gains of $1.2 million as the Company recorded a net other-than-temporary impairment loss of $361,000 which was offset by the gain on sale of securities of $1.1 million compared to a gain on sale of securities of $2.0 million and no net other-than-temporary

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impairment loss in 2010. In addition, the Company recorded an impairment loss on real estate held for investment of $110,000 in 2011 compared to no impairment loss in 2010. These decreases were offset by an increase in service charges and other fee income of $498,000 as a result of an increase of $377,000 in loan fee income to $627,000 from $250,000 in 2010 and an increase of $121,000 in deposit related fee income to $1.0 million from $882,000 in 2010. Loan fee income increased primarily due to an increase in commercial fee income, including unused lines and letters of credit and international banking transaction fees. Deposit related fees increased primarily as cash management fees increased $154,000 offset by decreases in other deposit related fees. Net gain on other real estate owned increased by $206,000 as the Company sold two properties during the year. Other income increased $102,000 primarily as a result of an increase of $79,000 of income earned on the Company's investment in Philadelphia Mortgage Advisors and an increase of $16,000 in merchant processing fees.

        Noninterest Expense.    The following table shows the components of noninterest expense and the percentage changes for 2012, 2011 and 2010.

	Year Ended December 31,						$ Change			% Change			$ Change			% Change
	2012		2011		2010		2012/2011						2011/2010
	(In thousands)
Salaries, benefits and other compensation	$	13,540	$	12,761	$	12,128	$	779			6.1	%	$	633			5.2	%
Occupancy expense		1,702		1,845		1,822		(143	)		(7.8	)		23			1.3
Furniture and equipment expense		537		442		454		95			21.5			(12	)		(2.6	)
Data processing costs		1,797		1,719		1,662		78			4.5			57			3.4
Professional fees		1,706		1,720		1,374		(14	)		(0.8	)		346			25.2
Marketing expense		270		356		291		(86	)		(24.2	)		65			22.3
FDIC premiums		773		870		1,401		(97	)		(11.1	)		(531	)		(37.9	)
Assets acquired through foreclosure expense		2,143		762		543		1,381			181.2			219			40.3
Loss on extinguishment of debt		3,018		—		—		3,018			100.0			—			—
Other		1,688		1,594		1,697		94			5.9			(103	)		(6.1	)
Total Noninterest Expense	$	27,174	$	22,069	$	21,372	$	5,105			23.1	%	$	697			3.3	%

        2012 vs. 2011.    In 2012, noninterest expense increased $5.1 million, or 23.1%. Salaries, benefits and other compensation increased $779,000, primarily as a result of increased staffing, annual merit increases and higher employee stock ownership plan costs due to our higher stock price. Furniture and equipment expense increased $95,000 primarily due to increased depreciation expense associated with technology investments. Occupancy expense decreased $143,000 due to decreased building maintenance expense and a reduction in rent expense. Assets acquired through foreclosure expense increased $1.4 million, primarily due to an increase in valuation adjustments of $1.3 million. Loss on extinguishment of debt was $3.0 million in conjunction with the Company's balance sheet restructuring during the quarter ended June 30, 2012.

        2011 vs. 2010.    In 2011, noninterest expense increased $697,000, or 3.3%. Salaries, benefits and compensation increased $633,000 for the year ended December 31, 2011 due to higher salary expense from annual merit increases, higher incentive compensation accruals and incremental ESOP costs as the Company increased the benefits for employees in conjunction with the mutual-to-stock conversion that was completed in the second quarter of 2010. Professional fees increased by $346,000 for the year ended December 31, 2011 primarily due to incremental legal costs associated with nonperforming assets. Assets acquired through foreclosure expense increased $219,000 due to write-downs of properties throughout the year. FDIC premiums decreased $531,000 due to a reduction in the regular assessment rate on April 1, 2011 as well as a reduction in the Company's total deposits and total assets.

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Other expense decreased $103,000 primarily due to decreases in fraud losses on checking accounts compared to 2010, as well as decreased telephone, postage and stationary and supplies as the Company continues to reduce costs.

Income Taxes.

        2012 vs. 2011.    Income tax expense for 2012 was $2.3 million compared to $2.2 million for 2011. The increase in 2012 was primarily due to a $389,000 increase in pre-tax income. The effective tax rate for 2012 and 2011 was 31.4% and 31.6%, respectively.

        2011 vs. 2010.    Income tax expense for 2011 was $2.2 million compared to $1.1 million for 2010. The increase in 2011 was primarily due to a $3.1 million increase in pre-tax income. The effective tax rate for 2011 and 2010 was 31.6% and 29.0%, respectively.

Risk Management

        Overview.    Managing risk is an essential part of successfully managing a financial institution. In the normal course of its business, the Company encounters two significant types of risk: economic risk and regulatory risk.

        There are three main components of economic risk: interest rate risk, credit risk and market risk. The Company is subject to interest rate risk to the degree that its interest-bearing liabilities mature or reprice at different speeds, or on a different basis, from its interest-earning assets. The Company's primary credit risk is the risk of defaults in the Company's loan portfolio that result from borrowers' inability or unwillingness to make contractually required payments. The Company also has credit risk related to the risk of defaults in its investment securities portfolio. The ability of the Company to realize the full value of its investment securities upon maturity or sale depends on several factors, including the cash flows, credit enhancements and underlying structures of the individual investment securities. Market risk reflects changes in the value of the collateral underlying loans, the valuation of assets acquired through foreclosure and the valuation of loans held for sale, securities, mortgage servicing assets and other investments.

        The Company is subject to the regulations of various government agencies. These regulations may change significantly from period to period. The Company also undergoes periodic examinations by regulatory agencies that may subject them to further changes with respect to asset valuations and classifications, amounts required for the allowance for loan losses and operating restrictions resulting from the regulators' judgment based on information available to them at the time of their examination.

        Other risks that we face are operational risks, liquidity risks and reputation risk. Operational risks include risks related to fraud, processing errors, technology and disaster recovery. Liquidity risk is the possible inability to fund obligations to depositors, lenders or borrowers due to unforeseen circumstances. Reputation risk is the risk that negative publicity or press, whether true or not, could cause a decline in our customer base or revenue.

        Credit Risk Management.    Our strategy for credit risk management focuses on having well-defined credit policies and uniform underwriting criteria and providing prompt attention to potential problem loans. Our Special Assets Group, which is run by our Chief Operating Officer and consists of three other loan and credit administration officers, is responsible for oversight of problem assets and increases the frequency with which criticized and classified credits are reviewed and aggressively acts to resolve problem loans.

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        When a borrower fails to make a required loan payment, we take a number of steps to have the borrower cure the delinquency and restore the loan to current status. When the loan becomes 15 days past due, a late notice is generated and sent to the borrower. A second notice is sent and phone calls are made ten days later. If payment is not received by the 30^th day of delinquency, a further notification is sent to the borrower. If payment is not received by the 45^th day of delinquency for a loan on a Pennsylvania property or the 60^th day of delinquency for a loan on a New Jersey property, a notice is sent to the borrower advising them that they have a specified period of time to cure their default before legal action begins. If no successful workout can be achieved, after a loan becomes 90 days delinquent, we typically commence foreclosure or other legal proceedings. If a foreclosure action is instituted and the loan is not brought current, paid in full, or refinanced before the foreclosure sale, the real property securing the loan generally is sold at or subsequent to foreclosure. We also may consider loan workout arrangements with certain borrowers under certain circumstances.

        Management reports to the Board of Directors or a committee of the Board monthly regarding the status of nonperforming loans, assets acquired through foreclosure, troubled debt restructurings, loans delinquent more than 30 days and any other loans requiring special attention.

        Analysis of Nonperforming and Classified Assets.    We consider assets acquired through foreclosure, loans that are 90 days or more past due and loans that are not 90 days past due, but where collection of principal or interest is in doubt, to be nonperforming assets. Loans are generally placed on nonaccrual status when they become 90 days delinquent at which time the accrual of interest ceases and any previously recorded interest is reversed and recorded as a reduction of loan interest and fee income. Generally, payments received on a nonaccrual loan are applied to the outstanding principal at the time received, unless collection of principal and interest in full is considered probable.

        Assets acquired through foreclosure consists of other real estate owned and financial assets acquired from debtors. These assets are obtained through foreclosure, by a deed-in-lieu of foreclosure, in-substance foreclosure or in exchange for satisfaction of debt. Other real estate owned is carried at the lower of cost or fair value, less estimated selling costs. Costs related to the development or improvement of an acquired property are capitalized. Holding costs and declines in carrying value after acquisition are recorded as assets acquired through foreclosure expense in the consolidated statements of operations. Financial assets acquired from debtors are carried at fair value under the fair value option in accordance with FASB ASC 825 "Financial Instruments." Increases or decreases in fair value after acquisition are recorded as assets acquired through foreclosure expense in the consolidated statements of operations.

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        The following table provides information with respect to our nonperforming assets by segment at the dates indicated.

	At December 31,
	2012			2011			2010			2009			2008
	(Dollars in thousands)
Nonaccrual Loans:
One- to four-family real estate	$	3,355		$	6,885		$	10,813		$	7,740		$	1,503
Multi-family and commercial real estate		5,284			3,814			6,180			4,738			685
Construction		6,434			6,372			9,279			15,739			3,495
Consumer		2,051			7			365			612			167
Commercial and industrial		—			—			—			250			—
Total		17,124			17,078			26,637			29,079			5,850
Accruing loans past due 90 days or more:
Multi-family and commercial real estate		—			—			—			601			—
Consumer		—			3,875			—			—			—
Total		—			3,875			—			601			—
Nonperforming loans	$	17,124		$	20,953		$	26,637		$	29,680		$	5,850
Assets acquired through foreclosure		8,524			2,423			3,186			4,052			—
Total nonperforming assets	$	25,648		$	23,376		$	29,823		$	33,732		$	5,850
Nonperforming loans to total loans		2.46	%		3.07	%		4.07	%		4.62	%		0.98	%
Total nonperforming loans to total assets		1.57			2.06			2.43			2.53			0.63
Total nonperforming assets to total assets		2.36			2.30			2.72			2.87			0.63

        The following table sets forth our nonaccrual loans by state and loan segment at December 31, 2012. The table does not include accruing loans past due 90 days or more.

	One- to Four- Family Real Estate				Multi Family and Commercial Real Estate				Construction				Consumer				Commercial and Industrial				Total
	Number of Loans		Amount		Number of Loans		Amount		Number of Loans		Amount		Number of Loans		Amount		Number of Loans		Amount		Number of Loans		Amount
	(Dollars in thousands)
Pennsylvania		7	$	1,399		1	$	1,380		2	$	6,434		8	$	189		—	$	—		18	$	9,402
New Jersey		7		1,956		4		2,738		—		—		—		—		—		—		11		4,694
Delaware		—		—		1		1,166		—		—		—		—		—		—		1		1,166
Other		—		—		—		—		—		—		3		1,862		—		—		3		1,862
Total		14	$	3,355		6	$	5,284		2	$	6,434		11	$	2,051		—	$	—		33	$	17,124

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        The following table provides a rollforward of nonperforming assets, by loan segment and assets acquired through foreclosure, from December 31, 2011 to December 31, 2012. The table does not include accruing loans past due 90 days or more.

	At December 31, 2011		Additional Non- Performing Assets, Net		Return to Accrual Status			Payments Received, Net			Net Charge-offs/ Valuation Allowances			Transfer To Assets Acquired Through Foreclosure			At December 31, 2012
	(Dollars in thousands)
Nonaccrual loans
One- to four-family real estate	$	6,885	$	2,306	$	(155	)	$	(142	)	$	(1,404	)	$	(4,135	)	$	3,355
Multi-family and commercial real estate		3,814		3,358		—			(81	)		(886	)		(922	)		5,283
Construction		6,372		2,516		—			(2,113	)		(340	)		—			6,435
Consumer		7		9,299		(251	)		(950	)		(2,041	)		(4,013	)		2,051
Commercial and industrial		—		—		—			—			—			—			—
Total		17,078		17,479		(406	)		(3,286	)		(4,671	)		(9,070	)		17,124
Assets acquired through foreclosure		2,423		469		—			(1,528	)		(1,910	)		9,070			8,524
Total nonperforming assets	$	19,501	$	17,948	$	(406	)	$	(4,814	)	$	(6,581	)	$	—		$	25,648

At December 31, 2012, nonperforming assets were comprised of the following:

•

Two construction loans for residential developments, the largest of which is collateralized by land and improvements associated with a residential housing development in Chester County, Pennsylvania. The other nonaccrual construction loan is collateralized by a residential housing development in Montgomery County, Pennsylvania.

•

Six multi-family and commercial real estate loans, the largest of which is secured by multi-use rental properties located in Montgomery County, Pennsylvania.

•

Fourteen one- to four-family loans, the largest of which is secured by a residential home located in Montgomery County, Pennsylvania.

•

Eleven consumer loans which are secured by second or third lien mortgage positions or insurance policies.

•

Assets acquired through foreclosure consisting of seven properties and eight insurance policies, with a total carrying value of $8.5 million.

        For a discussion of the allowance related to these assets, see "Analysis and Determination of the Allowance for Loan Losses—Allowance Required for Impaired Loans."

        Interest income that would have been recorded for 2012 had nonaccruing loans been current according to their original terms was approximately $1.5 million. Interest income included in net income for these loans for 2012 was $502,000.

        Federal regulations require us to review and classify our assets on a regular basis. In addition, the Office of the Comptroller of the Currency has the authority to identify problem assets and, if appropriate, require them to be classified. There are three classifications for problem assets: substandard, doubtful and loss. "Substandard assets" must have one or more defined weaknesses and are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected. "Doubtful assets" have the weaknesses of substandard assets with the additional characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions and values questionable, and there is a high possibility of loss. An asset classified "loss" is considered uncollectible and of such little value that continuance as an asset of the

54

institution is not warranted. If we classify an asset as loss, it is recorded as a loan charged off in the current period. The regulations also provide for a "special mention" category, described as criticized assets which do not currently expose us to a sufficient degree of risk to warrant classification but do possess credit deficiencies or potential weaknesses deserving our close attention.

        The following table shows the aggregate amounts of our criticized and classified assets at the dates indicated.

	At December 31,
	2012		2011		2010
	(In thousands)
Special mention assets	$	10,366	$	20,862	$	21,102
Substandard assets		37,204		36,063		45,948
Doubtful assets		—		—		—
Total criticized and classified assets	$	47,570	$	56,925	$	67,050

        At December 31, 2012, substandard assets were comprised of: (1) $17.1 million in nonaccrual loans and $8.5 million of assets acquired through foreclosure identified in the nonperforming asset table; (2) $10.0 million related to five loans that are current on principal and interest payments but are classified due to weaknesses in each of the borrower's underlying businesses and (3) $1.6 million in real estate held for investment.

        At December 31, 2012, Fox Chase Bank had eighteen loans classified as special mention, which were comprised of five multi-family and commercial real estate relationships totaling $6.7 million and six commercial and industrial relationships totaling $3.7 million.

        Delinquencies.    The following table provides information about delinquencies in our loan portfolio at the dates indicated.

	At December 31,
	2012				2011				2010
	30 - 59 Days Past Due		60 - 89 Days Past Due		30 - 59 Days Past Due		60 - 89 Days Past Due		30 - 59 Days Past Due		60 - 89 Days Past Due
	(In thousands)
One- to four-family real estate	$	18	$	284	$	370	$	252	$	96	$	144
Multi-family and commercial real estate		—		1,691		—		—		4,735		—
Construction		—		—		—		—		—		—
Consumer		23		51		1,097		169		170		—
Commercial and industrial		—		—		—		—		—		—
Total	$	41	$	2,026	$	1,467	$	421	$	5,001	$	144

        At December 31, 2012, delinquent loans were comprised of three one- to four-family real estate loans, six consumer loans and two multi-family and commercial real estate loans totaling $1.7 million, one of which (for $100,000) was current as to monetary payments but past maturity. The other $1.6 million commercial real estate loan was recorded as an accruing TDR at December 31, 2012 and was extended during February 2013.

        Troubled Debt Restructurings.    The Company may, under certain circumstances, restructure loans as a concession to borrowers who have experienced financial difficulty. Troubled debt restructurings ("TDRs") are included in impaired loans. TDRs typically result from the Company's loss mitigation activities which, among other activities, could include rate reductions, payment extension, and/or principal forgiveness.

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        At December 31, 2012, the Company had fourteen TDRs, totaling $14.3 million, of which $13.1 million were the following seven TDRs at December 31, 2011:

•

Two construction loans totaling $6.4 million.

•

Two multi-family and commercial real estate loans totaling $6.3 million.

•

Two residential loans totaling $365,000.

•

One consumer loan totaling $8,000.

        The Company had seven new TDRs during the year ended December 31, 2012, which totaled $1.2 million at December 31, 2012, and were comprised of the following:

•

Two multi-family and commercial real estate loans, totaling $590,000. The first loan, totaling $504,000 was classified as a TDR as the Company agreed to reduce payments to interest only for a period of seven months. The second loan, totaling $86,000, was classified as a TDR as the Company agreed to delay principal repayments.

•

Four residential loans, totaling $577,000, as the Company agreed to modified terms with the borrowers, which included delayed repayment of principal and/or interest.

•

One consumer loan, totaling $14,000, as the Company agreed to modified terms with the borrowers, which included delayed repayment of principal and/or interest.

        Analysis and Determination of the Allowance for Loan Losses.    The allowance for loan losses is maintained at a level representing management's best estimate of known and inherent losses in the loan portfolio, based upon management's evaluation of the portfolio's collectability. We evaluate the need to establish allowances against losses on loans on a quarterly basis. When changes in the allowance are necessary, an adjustment is made. The adjustments to the allowance are made by management and presented to the Audit Committee of the Board of Directors.

        The allowance for loan losses consists of an allowance on impaired loans and a general valuation allowance on the remainder of the loan portfolio. Although we determine the amount of each element of the allowance separately, the entire allowance for loan losses is available for losses on the entire portfolio.

        Allowance Required for Impaired Loans.    A loan is considered impaired when, based on current information and events, it is probable that Fox Chase Bank will be unable to collect future payments of principal or interest as contractually due. Fox Chase Bank applies its normal loan review procedures in determining if a loan is impaired, which includes reviewing the collectability of delinquent and internally classified loans on a regular basis and at least quarterly. Additionally, all loans classified as a TDR are considered impaired. When a loan is classified as impaired, an impairment analysis is performed within the quarter in which a loan is identified as impaired to determine if a valuation allowance is needed.

        In measuring impairment, Fox Chase Bank determines whether repayment is expected through cash flows from the borrower or the borrower's underlying business or property. In determining the likelihood of collecting principal and interest, the Company considers all available and relevant information, including the borrower's actual and projected cash flows, balance sheet strength, liquidity and overall financial position. If repayment from the borrower or the underlying business or property is determined to be unlikely, and collateral exists, Fox Chase Bank considers the loan to be collateral dependent.

        For impaired loans that are collateral dependent, the Company performs an impairment analysis in the quarter the loan is identified as impaired. In measuring the initial amount of impairment for a collateral dependent loan, the Company reviews the condition of the underlying property. Such review

56

includes visiting and examining the property, reviewing the age and value of the most recent appraisal on file, reviewing the list price if the property is for sale and calculating loan to value ratios.

        The Company reexamines each of its impaired loans on a quarterly basis to determine if any adjustments to the net carrying amount of a loan are required. For collateral dependent loans, the Company takes into consideration current facts and circumstances in analyzing whether the fair value of the collateral has increased or decreased significantly such that a change to the corresponding valuation allowance is required. Such analysis may be based on many different sources, including, but not limited to: (1) sales values of comparable properties or units within the same development relative to the appraised values for such properties or units that occurred since the date of the last appraisal; (2) sales agreements that may be entered into on the property since the date of the last appraisal; or (3) offers the Company receives on projects or properties since the date of the last appraisal. If current facts and circumstances are insufficient to determine fair value, Fox Chase Bank obtains a new appraisal. Further, the Company's policy is to obtain an appraisal on each impaired loan greater than $250,000 annually except in instances where management prepared discounted cash flow analysis are deemed to be an appropriate valuation method.

        If the fair value of a collateral dependent loan, less costs to sell, is less than the loan's carrying amount, the Company establishes a provision to the allowance for loan losses in the amount of the difference between fair value, less costs to sell, and the loan's carrying amount. The Company recognizes charge-offs associated with impaired loans when all or a portion of a loan is considered to be uncollectible. Charge-off amounts are based on appraised value, less estimated costs to sell.

        For loans that are not collateral dependent, we establish a specific allowance on impaired loans based on management's estimate of the discounted cash flows the Company expects to receive from the borrower. Factors considered in evaluating such cash flows include: (1) the type and value of collateral, if applicable; (2) the strength of our collateral position, if applicable; (3) the estimated cost to sell the collateral; (4) the borrower's effort to cure the delinquency; (5) the strength of the customer's personal or business cash flows and personal guarantees; (6) the availability of other sources of repayment; and (7) the amount due or past due.

        At December 31, 2012, the Company had $24.5 million of impaired loans comprised of: (1) $17.1 million of nonaccrual loans (See—Analysis of Nonperforming and Classified Assets) and (2) $7.4 million of TDRs (See—Troubled Debt Restructurings)

        Management has recorded an allowance for loan losses on impaired loans of $2.3 million at December 31, 2012 relating to $22.3 million in impaired loans. Such allowance for loan losses is determined based on either (1) management's estimate of discounted cash flows that the Company expects to receive over the life of the loan or (2) for collateral dependent loans, appraised value less costs to sell. At December 31, 2012, the Company had $2.2 million of impaired loans that had no related valuation allowance.

        General Valuation Allowance on the Remainder of the Loan Portfolio.    We establish a general allowance for loans (1) that are classified, but are not considered impaired and (2) that are not classified, to recognize the inherent losses associated with lending activities. This general valuation allowance is determined by segmenting the loan portfolio by loan category and assigning percentages, known as loss factors, to each category. The percentages are adjusted for significant factors that, in management's judgment, affect the collectability of the portfolio as of the evaluation date. These significant factors may include the Company's loss experience by particular segments, trends in industry charge-offs by particular segments, trends and absolute levels of classified and criticized loans, trends and absolute levels in delinquent loans, trends in risk ratings, and changes in existing general economic and business conditions affecting our lending areas and the national economy. These loss factors are subject to ongoing evaluation to ensure their relevance in the current economic environment. We perform this systematic analysis of the allowance on a quarterly basis.

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        For commercial loan relationships originated in the last twelve months, management reviews and provides a loss factor for each individual commercial loan relationship. Generally, management believes the risk of default on recently underwritten loans is relatively low at the time of origination and increases with time, at some point moderating. This is supported by the concept that the fair value of the loan at inception approximates its book value. New commercial loans are reviewed on a quarterly basis, and allowance for loan loss factors adjusted commensurate with assessed changes in the loan's risk.

        At December 31, 2012, our allowance for loan losses was $11.2 million, which represented 1.61% of total loans and 65.2% of nonperforming loans. At December 31, 2012, the allowance for loan losses for impaired loans was $2.3 million and the general valuation allowance for the loan portfolio was $8.9 million. At December 31, 2011, our allowance for loan losses was $12.1 million, which represented 1.77% of total loans and 57.6% of nonperforming loans. At December 31, 2011, the allowance for loan losses for impaired loans was $3.6 million and the general valuation allowance for the loan portfolio was $8.5 million.

        The allowance for loan losses at December 31, 2012 and 2011 represent application of loan loss policies, which comply with U.S. generally accepted accounting principles and all regulatory guidance.

        We identify loans that may need to be charged off as a loss by reviewing all nonperforming, delinquent and criticized loans which we have concerns about collectability. A loan is charged off when in our judgment; the loan or portion of a loan is considered uncollectible.

        The following table sets forth the breakdown of impaired loans by loan segment as of December 31, 2012.

	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		Impaired Loans with Allowance		Impaired Loans without Allowance
	(in thousands)
Real estate loans:
One- to four-family	$	3,355	$	507	$	—	$	3,862	$	3,862	$	—
Multi-family and commercial		5,284		6,867		—		12,151		11,770		381
Construction		6,434		—		—		6,434		6,434		—
Consumer loans		2,051		14		—		2,065		203		1,862
Commercial and industrial		—		—		—		—		—		—
Total	$	17,124	$	7,388	$	—	$	24,512	$	22,269	$	2,243

        At December 31, 2012, seven TDRs, totaling $6.9 million, are excluded from the accruing TDR column above as they are included in the nonaccrual loans. Of this amount, $6.4 million relates to two construction loans. The Company has commitments of $855,000 to lend additional funds related to these construction loans. Additionally, the Company had three residential loan TDRs totaling $435,000 and one consumer loan TDR totaling $8,000 which are included in the nonaccrual loans and total impaired loans.

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        The following table sets forth the allowance for loan loss for impaired loans and general allowance by loan segment as of December 31, 2012.

	Allowance for Loan Losses
	Impaired Loans
	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		General		Total
	(in thousands)
Real estate loans:
One- to four-family	$	337	$	5	$	—	$	342	$	300	$	642
Multi-family and commercial		530		948		—		1,478		4,849		6,327
Construction		449		—		—		449		424		873
Consumer loans		10		1		—		11		221		232
Commercial and industrial		—		—		—		—		2,630		2,630
Unallocated		—		—		—		—		466		466
Total allowance for loan losses	$	1,326	$	954	$	—	$	2,280	$	8,890	$	11,170

        The following table sets forth the breakdown of the total allowance for loan losses by loan segment at the dates indicated.

	At December 31,
	2012					2011					2010					2009					2008
	Amount		% of Loans in Category to Total Loans			Amount		% of Loans in Category to Total Loans			Amount		% of Loans in Category to Total Loans			Amount		% of Loans in Category to Total Loans			Amount		% of Loans in Category to Total Loans
	(Dollars in thousands)
Real estate loans:
One- to four-family real estate	$	642		22.9	%	$	1,760		29.1	%	$	1,990		36.4	%	$	1,455		41.8	%	$	542		43.8	%
Multi-family and commercial real estate		6,327		53.1			6,112		45.9			4,624		38.1			3,716		34.3			2,379		27.9
Construction		873		3.2			869		2.7			3,260		4.8			3,782		6.4			2,449		10.9
Consumer		232		4.4			455		6.5			665		8.4			707		10.8			370		12.8
Commercial and industrial		2,630		16.4			2,657		15.8			1,707		12.3			824		6.7			418		4.6
Unallocated		466		—			222		—			197		—			121		—			102		—
Total allowance for loan losses	$	11,170	$	100.0	%	$	12,075		100.0	%	$	12,443		100.0	%	$	10,605		100.0	%	$	6,260		100.0	%

        Although we believe that we use the best information available to establish the allowance for loan losses, future adjustments to the allowance for loan losses may be necessary and our results of operations could be adversely affected if circumstances differ substantially from the assumptions used in making the determinations. Furthermore, while we believe we have established our allowance for loan losses in conformity with U.S. generally accepted accounting principles, there can be no assurance that the Office of the Comptroller of the Currency, in reviewing our loan portfolio, will not request us to increase our allowance for loan losses. The Office of the Comptroller of the Currency may require us to increase our allowance for loan losses based on judgments different from ours. In addition, because future events affecting borrowers and collateral cannot be predicted with certainty, increases may be necessary should the quality of any loans deteriorate as a result of the factors discussed above. Any material increase in the allowance for loan losses may adversely affect our financial condition and results of operations.

59

        Analysis of Loan Loss Experience.    The following table sets forth an analysis of the allowance for loan losses for the years indicated.

	At December 31,
	2012			2011			2010			2009			2008
	(Dollars in thousands)
Allowance at beginning of period	$	12,075		$	12,443		$	10,605		$	6,260		$	3,376
Charge-offs:
Real estate loans:
One- to four-family real estate		1,408			567			1,403			148			—
Multi-family and commercial real estate		887			1,290			—			3,171			—
Construction		340			3,445			1,990			1,257			—
Consumer		1,892			433			514			131			19
Commercial and industrial		—			596			495			—			—
Total charge-offs		4,527			6,331			4,402			4,707			19
Recoveries		144			229			27			—			3
Net charge-offs		4,383			6,102			4,375			4,707			16
Provision for loan losses		3,478			5,734			6,213			9,052			2,900
Allowance at end of period		11,170			12,075			12,443			10,605			6,260
Allowance for loan losses to nonperforming loans		65.2	%		57.6	%		46.7	%		35.7	%		107.0	%
Allowance for loan losses to total loans at the end of the period		1.61			1.77			1.90			1.65			1.05
Net charge-offs (recoveries) to average loans outstanding during the period		0.66			0.94			0.67			0.75			—

        The following table provides a rollforward of the allowance for loan losses by loan segment from December 31, 2011 to December 31, 2012.

	For the Year Ended December 31, 2012
	One- to Four- Family			Multi-family and Commercial			Construction Loans			Consumer Loans			Commercial and Industrial Loans			Unallocated		Total
	(In thousands)
Balance, beginning	$	1,760		$	6,112		$	869		$	455		$	2,657		$	222	$	12,075
Provision for loan losses		286			1,064			252			1,659			(27	)		244		3,478
Loans charged off		(1,408	)		(887	)		(340	)		(1,892	)		—			—		(4,527	)
Recoveries		4			38			92			10			—			—		144
Balance, ending	$	642		$	6,327		$	873		$	232		$	2,630		$	466	$	11,170

        Interest Rate Risk Management.    We manage the interest rate sensitivity of our interest-bearing liabilities and interest-earning assets in an effort to minimize the adverse effects of changes in the interest rate environment. To reduce the volatility of our earnings, we have sought to improve the match between asset and liability maturities and rates, while maintaining an acceptable interest rate spread. Our strategy for managing interest rate risk generally is to emphasize the origination of shorter-term adjustable-rate loans, and to invest in securities that have shorter term maturities. Additionally, we have focused on increasing core deposits including non-interest bearing and money market deposit accounts, which provide greater pricing flexibility, as well as making efforts to extend maturities on certificates of deposit and wholesale borrowings to better match longer-term fixed rate assets.

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        We have a Risk Management Committee, which together with an Asset/Liability Management Committee, communicates, coordinates and controls all aspects involving asset/liability management. The committees establish and monitor the volume, maturities, pricing and mix of assets and funding sources with the objective of managing assets and funding sources to provide results that are consistent with liquidity, growth, risk limits and profitability goals.

        Net Portfolio Value Analysis.    We use a third party vendor prepared model, which incorporates actual data and management assumptions, to review our level of interest rate risk. Such analyses measure interest rate risk by computing changes in net portfolio value of our cash flows from assets, liabilities and off-balance sheet items in the event of a range of assumed changes in market interest rates. Net portfolio value represents the market value of portfolio equity and is equal to the market value of assets minus the market value of liabilities, with adjustments made for off-balance sheet items. These analyses assess the risk of loss in market risk-sensitive instruments in the event of a sudden and sustained 100 to 300 basis point increase or 100 basis point decrease in market interest rates with no effect given to any steps that we might take to counter the effect of that interest rate movement. Because of the low level of market interest rates, these analyses are not performed for decreases of more than 100 basis points.

        The following table presents the change in the net portfolio value of Fox Chase Bank at December 31, 2012 that would occur in the event of an immediate change in interest rates, with no effect given to any steps that we might take to counteract that change.

		Net Portfolio Value								Net Portfolio Value as % of Portfolio Value of Assets
Basis Point ("bp") Change in Rates		Amount		Change			% Change			NPV Ratio			Change (bp)
		(Dollars in thousands)
	300		151,058		(32,174	)		(17.6	)%		13.9	%		(3.0	)
	200		162,636		(20,596	)		(11.2	)		14.9			(1.9	)
	100		173,120		(10,112	)		(5.5	)		15.9			(0.9	)
	0		183,232								16.8
	(100)		179,917		(3,315	)		(1.8	)		16.5			(0.3	)

        The decrease in our net portfolio value shown in the preceding table that would occur reflects: (1) that a substantial portion of our interest earning assets are fixed-rate residential loans and fixed-rate investment securities; (2) the shorter duration of deposits, which reprice more frequently in response to changes in market interest rates; and (3) the size of our mortgage related securities portfolio, which would decrease in value as interest rates increase.

        The third party vendor and management use various assumptions in assessing interest rate risk. These assumptions relate to interest rates, loan prepayment rates, deposit decay rates and the market values of certain assets under differing interest rate scenarios, among others. As with any method of measuring interest rate risk, certain shortcomings are inherent in the methods of analyses presented in the foregoing table. For example, although certain assets and liabilities may have similar maturities or periods to repricing, they may react in different degrees to changes in market interest rates. Also, the interest rates on certain types of assets and liabilities may fluctuate in advance of changes in market interest rates, while interest rates on other types may lag behind changes in market rates. Additionally, certain assets, such as adjustable-rate mortgage loans, have features that restrict changes in interest rates on a short-term basis and over the life of the asset. Further, in the event of a change in interest rates, expected rates of prepayments on loans and early withdrawals from certificates could deviate significantly from those assumed in calculating the table. Prepayment rates can have a significant impact on interest income. Because of the large percentage of loans and mortgage-backed securities we hold, rising or falling interest rates have a significant impact on the prepayment speeds of our earning assets that in turn affect the rate sensitivity position. When interest rates rise, prepayments tend to slow. When interest rates fall, prepayments tend to rise. Our asset sensitivity would be reduced if

61

prepayments slow and vice versa. While we believe these assumptions to be reasonable, there can be no assurance that assumed prepayment rates will approximate actual future mortgage-backed security and loan repayment activity.

        Liquidity Management.    Liquidity is the ability to meet current and future financial obligations of a short-term nature. Our primary sources of funds consist of deposit inflows, short term and long term wholesale borrowings, brokered deposits, loan repayments and maturities and liquidation and sales of securities. While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit flows, loan prepayments and sales of securities are greatly influenced by general interest rates, economic conditions and competition.

        We regularly adjust our investments in liquid assets based upon our assessment of: (1) expected loan demand; (2) expected deposit flows; (3) yields available on interest-earning deposits and securities; and (4) the objectives of our asset/liability management policy. We use a variety of measures to assess our liquidity needs, which are provided to our Asset/Liability Management Committee on a regular basis. Our policy is to maintain net liquidity of at least 50% of our funding obligations over the next month. Additionally, our policy is to maintain an amount of cash and short-term marketable securities equal to at least 15% of net deposits and liabilities that will mature in one year or less.

        Our most liquid assets are cash and cash equivalents. The levels of these assets depend on our operating, financing, lending and investing activities during any given period. Cash and cash equivalents totaled $25.1 million at December 31, 2012. Securities classified as available-for-sale, which provide additional sources of liquidity, totaled $296.1 million at December 31, 2012. In addition, at December 31, 2012, we had the ability to borrow a total of approximately $367.0 million from the Federal Home Loan Bank of Pittsburgh, of which we had $110.0 million outstanding.

        At December 31, 2012, we had $122.2 million in unfunded loan commitments outstanding, which consisted of $17.6 million in home equity and consumer loan commitments and $104.6 million in commercial loan commitments. Additionally, we had $14.3 million in standby letters of credit and $848,000 in commercial letters of credit.

        Certificates of deposit due within one year of December 31, 2012 totaled $190.2 million, including $45.5 million of brokered deposits, representing 60.8% of total certificates of deposit at December 31, 2012. We believe the large percentage of certificates of deposit that mature within one year reflect customers' hesitancy to invest their funds for long periods in the current low interest rate environment as well as the Company's use of shorter term brokered deposits. If these maturing deposits do not remain with us, we will be required to seek other sources of funds, including other certificates of deposit and borrowings. Depending on market conditions, we may be required to pay higher rates on such deposits or other borrowings than we currently pay on the certificates of deposit due on or before December 31, 2013.

        The following table presents certain of our contractual obligations as of December 31, 2012.

			Payments Due by Period
Contractual Obligations	Total		Less Than One Year		One to Three Years		Three to Five Years		More Than Five Years
	(In thousands)
Operating lease obligations(1)	$	1,280	$	399	$	845	$	36	$	—
FHLB advances and other borrowings(2)		225,308		73,517		65,725		55,291		30,775
Other long-term obligations(3)		2,272		1,952		320		—		—
Total	$	228,860	$	75,868	$	66,890	$	55,327	$	30,775

(1)

Represents lease obligations for Fox Chase Bank's operations center and one commercial loan production office.

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(2)

Includes principal and projected interest payments.

(3)

Represents obligations to Fox Chase Bancorp's third party data processing providers and other vendors.

        Capital Management.    We have managed our capital to maintain strong protection for depositors and creditors. We are subject to various regulatory capital requirements administered by the Office of the Comptroller of the Currency, including a risk-based capital measure. The risk-based capital guidelines include both a definition of capital and a framework for calculating risk-weighted assets by assigning balance sheet assets and off-balance sheet items to broad risk categories. At December 31, 2012, we exceeded all of our regulatory capital requirements. We are considered "well capitalized" under regulatory guidelines. See "Regulation and Supervision—Regulation of Federal Banking Regulation—Capital Requirements" and the notes to the consolidated financial statements included in this Report.

        Off-Balance Sheet Arrangements.    In the normal course of operations, we engage in a variety of financial transactions that, in accordance with U.S. generally accepted accounting principles, are not recorded in our financial statements. These transactions involve, to varying degrees, elements of credit, interest rate and liquidity risk. Such transactions are used primarily to manage customers' requests for funding and take the form of loan commitments, letters of credit and lines of credit. For information about our loan commitments, letters of credit and unused lines of credit, see Note 12 of the notes to the consolidated financial statements.

Impact of Recent Accounting Pronouncements

        The information required by this item is included in Note 16 to the consolidated financial statements included in this annual report.

Effect of Inflation and Changing Prices

        The financial statements and related financial data presented in this annual report have been prepared in accordance with U.S. generally accepted accounting principles, which require the measurement of financial condition and operating results in terms of historical dollars without considering the change in the relative purchasing power of money over time due to inflation. The primary impact of inflation on our operations is reflected in increased operating costs. Unlike most industrial companies, virtually all the assets and liabilities of a financial institution are monetary in nature. As a result, interest rates generally have a more significant impact on a financial institution's performance than do general levels of inflation. Interest rates do not necessarily move in the same direction or to the same extent as the prices of goods and services.

ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

        The information required by this item is incorporated herein by reference to Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operation—Interest Rate Risk Management."

ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

        Information required by this item is included herein beginning on page F-1.

ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

        None.

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ITEM 9A.    CONTROLS AND PROCEDURES

        The Company's management, including the Company's principal executive officer and principal financial officer, have evaluated the effectiveness of the Company's "disclosure controls and procedures," as such term is defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Based upon their evaluation, the principal executive officer and principal financial officer concluded that, as of the end of the period covered by this report, the Company's disclosure controls and procedures were effective for ensuring that the information required to be disclosed in the reports that the Company files or submits under the Exchange Act with the Securities and Exchange Commission (the "SEC"): (1) is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and (2) is accumulated and communicated to the Company's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

        No change in the Company's internal control over financial reporting occurred during the quarter ended December 31, 2012 that has materially affected, or is reasonably likely to affect, the Company's internal control over financial reporting.

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Management's Report on Internal Control Over Financial Reporting

The management of Fox Chase Bancorp, Inc. (the "Company") is responsible for establishing and maintaining adequate internal control over financial reporting. The internal control process has been designed under our supervision to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company's financial statements for external reporting purposes in accordance with U.S. generally accepted accounting principles.

Management conducted an assessment of the effectiveness of the Company's internal control over financial reporting as of December 31, 2012, utilizing the framework established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on this assessment, management has determined that the Company's internal control over financial reporting as of December 31, 2012 is effective.

Our internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that accurately and fairly reflect, in reasonable detail, transactions and dispositions of assets; and provide reasonable assurances that: (1) transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles; (2) receipts and expenditures are being made only in accordance with authorizations of management and the directors of the Company; and (3) unauthorized acquisition, use, or disposition of the Company's assets that could have a material effect on the Company's financial statements are prevented or timely detected.

All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

KPMG LLP, an independent registered public accounting firm, has audited the Company's consolidated financial statements as of and for the year ended December 31, 2012, and the effectiveness of the Company's internal control over financial reporting as of December 31, 2012, as stated in their reports, which are included herein.

/s/ THOMAS M. PETRO
Thomas M. Petro
President and Chief Executive Officer

/s/ ROGER S. DEACON
Roger S. Deacon
Chief Financial Officer

March 13, 2013

65

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders
Fox Chase Bancorp, Inc.:

We have audited Fox Chase Bancorp, Inc.'s (the Company) internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed 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. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Fox Chase Bancorp, Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control—Integrated Framework issued by the COSO.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated statements of condition of the Fox Chase Bancorp, Inc., and subsidiary as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2012, and our report dated March 13, 2013 expressed an unqualified opinion on those consolidated financial statements.

/s/ KPMG LLP

Philadelphia, Pennsylvania
March 13, 2013

66

ITEM 9B.    OTHER INFORMATION

        None.

PART III

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Directors

        For information relating to the directors of Fox Chase Bancorp, the section captioned "Items to be Voted on by Stockholders—Item 1—Election of Directors" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders is incorporated herein by reference.

Executive Officers

        For information concerning officers of the Company, see Part I, Item I, "Business—Executive Officers."

Compliance with Section 16(a) of the Exchange Act

        For information regarding compliance with Section 16(a) of the Exchange Act, the cover page to this Annual Report on Form 10-K and the section captioned "Other Information Relating to Directors and Executive Officers—Section 16(a) Beneficial Ownership Reporting Compliance" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders are incorporated herein by reference.

Disclosure of Code of Ethics

        For information concerning Fox Chase Bancorp's code of ethics, the information contained under the section captioned "Corporate Governance and Board Matters—Code of Ethics and Business Conduct" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders is incorporated herein by reference. A copy of the Company's Code of Ethics and Business Conduct is available to stockholders on the Governance Documents portion of the Investors Relations section on Fox Chase Bancorp's website at www.foxchasebank.com.

Corporate Governance

        For information regarding the audit committee and its composition and the audit committee financial expert, the section captioned "Corporate Governance and Board Matters—Committees of the Board of Directors—Audit Committee" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders is incorporated herein by reference.

ITEM 11.    EXECUTIVE COMPENSATION

Executive Compensation

        For information regarding executive compensation, the sections captioned "Compensation Discussion and Analysis," "Executive Compensation" and "Corporate Governance and Board Matters—Directors' Compensation" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders are incorporated herein by reference.

67

Corporate Governance

        For information regarding the compensation committee report, the section captioned "Report of the Compensation Committee" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders is incorporated herein by reference.

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERS MATTERS

(a)

Security Ownership of Certain Beneficial Owners

Information required by this item is incorporated herein by reference to the section captioned "Stock Ownership" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders.

(b)

Security Ownership of Management

Information required by this item is incorporated herein by reference to the section captioned "Stock Ownership" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders.

(c)

Changes in Control

Management of Fox Chase Bancorp knows of no arrangements, including any pledge by any person or securities of Fox Chase Bancorp, the operation of which may at a subsequent date result in a change in control of the registrant.

(d)

Equity Compensation Plan Information

        The following table sets forth information about the Company common stock that may be issued upon the exercise of stock options, warrants and rights under all of the Company's equity compensation plans as of December 31, 2012.

Plan Category	(a) Number of securities to be issued upon exercise of outstanding options, warrants and rights		(b) Weighted-average exercise price of outstanding options, warrants and rights		(c) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
Equity Compensation plans approved by security holders		877,669	$	11.57		518,401
Equity Compensation plans not approved by security holders		—		—		—
Total		877,669	$	11.57		518,401

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

Certain Relationships and Related Transactions

        For information regarding certain relationships and related transactions, the sections captioned "Other Information Relating to Directors and Executive Officers—Policies and Procedures Governing Related Persons Transactions" and "Transactions with Related Persons" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders are incorporated herein by reference.

68

Corporate Governance

        For information regarding director independence, the section captioned "Corporate Governance and Board Matters—Director Independence" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders is incorporated herein by reference.

ITEM 14.    PRINCIPAL ACCOUNTANT FEES AND SERVICES

        For information regarding the principal accountant fees and expenses, the sections captioned "Audit-Related Matters—Audit Fees" and "Policy on Pre-Approval of Audit and Permissible Non-Audit Services" in Fox Chase Bancorp's Proxy Statement for the 2013 Annual Meeting of Stockholders are incorporated herein by reference.

PART IV

ITEM 15.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(1)

The financial statements required in response to this item are incorporated by reference from Item 8 of this Report.



(2)

All financial statement schedules are omitted because they are not required or applicable, or the required information is shown in the consolidated financial statements or the notes thereto.



(3)

Exhibits

Exhibit No		Description	Location
	3.1	Articles of Incorporation of Fox Chase Bancorp, Inc.	Incorporated herein by reference to Exhibit 3.1 to the Fox Chase Bancorp, Inc. Registration Statement on Form S-1 (No. 333-165416) as filed on March 12, 2010.
	3.2	Bylaws of Fox Chase Bancorp, Inc.	Incorporated herein by reference to Exhibit 3.2 to the Fox Chase Bancorp, Inc. Registration Statement on Form S-1 (No. 333-165416) as filed on March 12, 2010.
	4.1	Stock Certificate of Fox Chase Bancorp, Inc.	Incorporated herein by reference to Exhibit 4.0 to the Fox Chase Bancorp, Inc. Registration Statement on Form S-1 (No. 333-165416) as filed on March 12, 2010.
	10.1	*Fox Chase Bank 401(k) Profit-Sharing Plan and Trust	Incorporated herein by reference to Exhibit 10.3 to the Fox Chase Bancorp, Inc. Registration Statement on Form S-1/A (No. 333-134160) as filed on July 5, 2006.
	10.2	*Employment Agreement between Thomas M. Petro, Fox Chase Bancorp, Inc. and Fox Chase Bank, as amended and restated	Incorporated herein by reference to Exhibit 10.2 to the Fox Chase Bancorp, Inc. Annual Report on Form 10-K (File No. 0-54025) as filed on March 12, 2012.
	10.3	*Employment Agreement between Jerry D. Holbrook, Fox Chase Bancorp, Inc. and Fox Chase Bank, as amended and restated	Incorporated herein by reference to Exhibit 10.3 to the Fox Chase Bancorp, Inc. Annual Report on Form 10-K (File No. 0-54025) as filed on March 12, 2012.

69

Exhibit No		Description	Location
	10.4	*Employment Agreement between Keiron G. Lynch, Fox Chase Bancorp, Inc. and Fox Chase Bank, as amended and restated	Incorporated herein by reference to Exhibit 10.4 to the Fox Chase Bancorp, Inc. Annual Report on Form 10-K (File No. 0-54025) as filed on March 12, 2012.
	10.5	*Employment Agreement between Roger S. Deacon, Fox Chase Bancorp, Inc. and Fox Chase Bank, as amended and restated	Incorporated herein by reference to Exhibit 10.5 to the Fox Chase Bancorp, Inc. Annual Report on Form 10-K (File No. 0-54025) as filed on March 12, 2012.
	10.6	*Employment Agreement between Michael S. Fitzgerald, Fox Chase Bancorp, Inc. and Fox Chase Bank, as amended and restated	Incorporated herein by reference to Exhibit 10.6 to the Fox Chase Bancorp, Inc. Annual Report on Form 10-K (File No. 0-54025) as filed on March 12, 2012.
	10.7	*Fox Chase Bank Executive Long-Term Incentive Plan	Incorporated herein by reference to Exhibit 10.9 to the Fox Chase Bancorp, Inc. Registration Statement on Form S-1 (No. 333-134160) as filed on May 16, 2006.
	10.8	*Fox Chase Bank Employee Severance Compensation Plan, as amended and restated	Filed herewith
	10.9	*Fox Chase Bancorp, Inc. 2007 Equity Incentive Plan	Incorporated herein by reference to Appendix A to the Fox Chase Bancorp, Inc. Definitive Proxy Statement (File No. 1-132971) as filed on April 12, 2007.
	10.10	*Fox Chase Bancorp, Inc. Executive Incentive Compensation Plan	Incorporated herein by reference to Exhibit 10.0 to the Fox Chase Bancorp, Inc. Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 (File No. 0-54025) as filed on August 6, 2012.
	10.11	*Fox Chase Bancorp, Inc. 2011 Equity Incentive Plan	Incorporated herein by reference to Appendix A to the Fox Chase Bancorp, Inc. Definitive Proxy Statement (File No. 0-54025) as filed on July 5, 2011.
	21.0	List of Subsidiaries	Filed herewith
	23.1	Consent of KPMG LLP	Filed herewith
	31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer	Filed herewith
	31.2	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer	Filed herewith
	32	Section 1350 Certification of Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer	Filed herewith

70

Exhibit No		Description	Location
	101.0	The following materials from the Company's Annual Report on Form 10-K for the year ended December 31, 2012, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Statements of Condition, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Changes in Equity, (iv) the Consolidated Statements of Cash Flows, and (v) the Notes to Consolidated Financial Statements	Filed herewith

*

Management contract or compensatory plan or arrangement

71

Index to Financial Statements of Fox Chase Bancorp, Inc.

	Page
Report of Independent Registered Public Accounting Firm		F-1
Consolidated Statements of Condition as of December 31, 2012 and 2011		F-2
Consolidated Statements of Operations for the Years Ended December 31, 2012, 2011 and 2010		F-3
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2012, 2011 and 2010		F-4
Consolidated Statements of Changes in Equity for the Years Ended December 31, 2012, 2011 and 2010		F-5
Consolidated Statements of Cash Flows for the Years Ended December 31, 2012, 2011 and 2010		F-6
Notes to Consolidated Financial Statements		F-7

* * * *

FOX CHASE BANCORP, INC.

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders
Fox Chase Bancorp, Inc.:

We have audited the accompanying consolidated statements of condition of Fox Chase Bancorp, Inc. and subsidiary (the Company) as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2012. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We did not audit the financial statements of Philadelphia Mortgage Advisors, Inc., (PMA), a 45 percent owned investee company. The Company's investment in PMA at December 31, 2012 and 2011, was $2.0 million and $1.5 million, respectively, and its equity in earnings of PMA was $690,000, $245,000 and $166,000 for the years 2012, 2011 and 2010, respectively. The financial statements of PMA were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for PMA, is based solely on the report of the other auditors.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits and the report of the other auditors provide a reasonable basis for our opinion.

In our opinion, based on our audits and the report of the other auditors, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Fox Chase Bancorp, Inc. and subsidiary as of December 31, 2012 and 2011, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 2012, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Fox Chase Bancorp, Inc., internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated March13, 2013 expressed an unqualified opinion on the effectiveness of Fox Chase Bancorp, Inc.'s, internal control over financial reporting.

/s/ KPMG LLP

Philadelphia, Pennsylvania
March 13, 2013

F-1

FOX CHASE BANCORP, INC.
CONSOLIDATED STATEMENTS OF CONDITION (IN THOUSANDS, EXCEPT SHARE DATA)

	December 31,
	2012			2011
ASSETS
Cash and due from banks	$	162		$	734
Interest-earning demand deposits in other banks		24,928			6,852
Total cash and cash equivalents		25,090			7,586
Investment securities available-for-sale		12,491			23,106
Mortgage related securities available-for-sale		283,616			225,664
Mortgage related securities held-to-maturity (fair value of $29,451 at December 31, 2012 and $41,758 at December 31, 2011)		28,369			41,074
Loans, net of allowance for loan losses of $11,170 at December 31, 2012 and $12,075 at December 31, 2011		683,865			670,572
Federal Home Loan Bank stock, at cost		8,097			8,074
Bank-owned life insurance		14,077			13,606
Premises and equipment, net		10,443			10,431
Assets acquired through foreclosure		8,524			2,423
Real estate held for investment		1,620			1,620
Accrued interest receivable		3,223			4,578
Mortgage servicing rights, net		170			316
Deferred tax asset, net		2,953			1,682
Other assets		5,803			5,131
Total Assets	$	1,088,341		$	1,015,863
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits	$	687,409		$	676,594
Short-term borrowings		70,500			8,500
Federal Home Loan Bank advances		110,000			88,278
Other borrowed funds		30,000			50,000
Advances from borrowers for taxes and insurance		1,699			1,736
Accrued interest payable		330			418
Accrued expenses and other liabilities		6,938			2,145
Total Liabilities		906,876			827,671
COMMITMENTS AND CONTINGENCIES (Note 12)
STOCKHOLDERS' EQUITY
Preferred stock ($.01 par value; 1,000,000 shares authorized, none issued and outstanding at December 31, 2012 and December 31, 2011)		—			—
Common stock ($.01 par value; 60,000,000 shares authorized, 12,356,564 shares issued and outstanding at December 31, 2012 and 13,037,310 shares issued and outstanding at December 31, 2011)		146			146
Additional paid-in capital		136,132			134,871
Treasury stock, at cost (2,249,600 shares at December 31, 2012 and 1,524,900 shares at December 31, 2011)		(29,733	)		(19,822	)
Common stock acquired by benefit plans		(10,228	)		(11,541	)
Retained earnings		80,608			77,971
Accumulated other comprehensive income, net		4,540			6,567
Total Stockholders' Equity		181,465			188,192
Total Liabilities and Stockholders' Equity	$	1,088,341		$	1,015,863

The accompanying notes are an integral part of these consolidated financial statements.

F-2

FOX CHASE BANCORP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE DATA)

	Years Ended December 31,
	2012		2011			2010
INTEREST INCOME
Interest and fees on loans	$	33,878	$	35,428		$	36,320
Interest on mortgage related securities		7,606		9,775			11,874
Interest on investment securities available-for-sale
Taxable		308		488			471
Nontaxable		34		184			334
Other interest income		8		71			286
Total Interest Income		41,834		45,946			49,285
INTEREST EXPENSE
Deposits		6,347		8,672			15,203
Short-term borrowings		38		5			—
Federal Home Loan Bank advances		2,383		4,085			4,789
Other borrowed funds		1,349		1,733			1,733
Total Interest Expense		10,117		14,495			21,725
Net Interest Income		31,717		31,451			27,560
Provision for loan losses		3,478		5,734			6,213
Net Interest Income after Provision for Loan Losses		28,239		25,717			21,347
NONINTEREST INCOME
Service charges and other fee income		1,597		1,630			1,132
Net gain on sale of premises and equipment		—		—			6
Net gain on sale of loans		—		—			—
Net gain on sale of assets acquired through foreclosure		135		250			44
Impairment loss on real estate held for investment		—		(110	)		—
Income on bank-owned life insurance		471		468			471
Equity in earnings of affiliates		690		245			166
Other		130		130			107
Total other-than-temporary impairment loss		—		(407	)		—
Less: Portion of loss recognized in other comprehensive income (before taxes)		—		46			—
Net other-than-temporary impairment loss		—		(361	)		—
Net gain on sale of investment securities		3,292		1,091			1,963
Net investment securities gains		3,292		730			1,963
Total Noninterest Income		6,315		3,343			3,889
NONINTEREST EXPENSE
Salaries, benefits and other compensation		13,540		12,761			12,128
Occupancy expense		1,702		1,845			1,822
Furniture and equipment expense		537		442			454
Data processing costs		1,797		1,719			1,662
Professional fees		1,706		1,720			1,374
Marketing expense		270		356			291
FDIC premiums		773		870			1,401
Assets acquired through foreclosure expense		2,143		762			543
Loss on extinguishment of debt		3,018		—			—
Other		1,688		1,594			1,697
Total Noninterest Expense		27,174		22,069			21,372
Income Before Income Taxes		7,380		6,991			3,864
Income tax provision		2,318		2,212			1,120
Net Income	$	5,062	$	4,779		$	2,744
Earnings per share:
Basic	$	0.44	$	0.36		$	0.20
Diluted	$	0.43	$	0.36		$	0.20

The accompanying notes are an integral part of these consolidated financial statements.

F-3

FOX CHASE BANCORP, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (IN THOUSANDS)

	December 31,
	2012			2011			2010
Net income	$	5,062		$	4,779		$	2,744
Other comprehensive income (loss):
Unrealized holding gains arising during the period, net of tax of $7, $424, and $767 for the years ended December 31, 2012, 2011 and 2010, respectively		91			779			1,291
Non-credit related unrealized loss on other-than temporary impaired securities, net of tax of $0, $(16) and $0 for the years ended December 31, 2012, 2011 and 2010, respectively		—			(30	)		—
Reclassification adjustments for net investment securities gains included in net income, net of tax of $1,208, $371 and $667 for the years ended December 31, 2012, 2011 and 2010, respectively		(2,171	)		(720	)		(1,296	)
Reclassification adjustment for loss included in net income for other-than temporary impaired investment sold, net of tax of ($34) for the year ended December 31, 2012		53			—			—
Other comprehensive (loss) income		(2,027	)		29			(5	)
Comprehensive income	$	3,035		$	4,808		$	2,739

The accompanying notes are an integral part of these consolidated financial statements.

F-4

FOX CHASE BANCORP, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (IN THOUSANDS)

For the Years Ended December 31, 2012, 2011 and 2010

	Common Stock			Additional Paid in Capital			Treasury Stock			Common Stock Acquired by Benefit Plans			Retained Earnings			Accumulated Other Comprehensive Income (Loss), Net			Total Equity
BALANCE—DECEMBER 31, 2009	$	147		$	64,016		$	(11,814	)	$	(6,862	)	$	71,604		$	6,543		$	123,634
Stock based compensation expense		—			929			—			—			—			—			929
Issuance of stock for vested equity awards		—			(519	)		—			560			(41	)		—			—
Unallocated ESOP shares committed to employees		—			18			—			504			—			—			522
Shares allocated in long-term incentive plan		—			89			—			—			—			—			89
Forfeited LTI shares converted to treasury		—			30			(30	)		—			—			—			—
Corporate Reorganization:		—			—			—			—			—			—			—
Merger of Fox Chase Mutual Holding Company		(81	)		188			—			—			—			—			107
Treasury stock retired		(11	)		(11,833	)		11,844			—			—			—			—
Exchange of common stock		(55	)		55			—			—			—			—			—
Proceeds from stock offering, net of offering expenses		145			81,024			—			—			—			—			81,169
Purchase of common stock by ESOP		—			—			—			(3,485	)		—			—			(3,485	)
Net income		—			—			—			—			2,744			—			2,744
Other comprehensive loss		—			—			—			—			—			(5	)		(5	)
BALANCE—DECEMBER 31, 2010	$	145		$	133,997		$	—		$	(9,283	)	$	74,307		$	6,538		$	205,704
Purchase of treasury stock, net		—			—			(19,822	)		—			—			—			(19,822	)
Purchase of common stock for equity incentive plan		—			—			—			(3,474	)		—			—			(3,474	)
Stock based compensation expense		—			1,041			—			—			—			—			1,041
Unallocated ESOP shares committed to employees		—			216			—			624			—			—			840
Issuance of stock for vested equity awards		—			(544	)		—			592			(48	)		—			—
Common stock issued for exercise of vested stock options		1			161			—			—			—			—			162
Dividends paid ($0.08 per share)		—			—			—			—			(1,067	)		—			(1,067	)
Net income		—			—			—			—			4,779			—			4,779
Other comprehensive income		—			—			—			—			—			29			29
BALANCE—DECEMBER 31, 2011	$	146		$	134,871		$	(19,822	)	$	(11,541	)	$	77,971		$	6,567		$	188,192
Purchase of treasury stock, net		—			—			(9,911	)		—			—			—			(9,911	)
Stock based compensation expense		—			1,042			—			—			—			—			1,042
Unallocated ESOP shares committed to employees		—			297			—			624			—			—			921
Issuance of stock for vested equity awards		—			(646	)		—			689			(43	)		—			—
Common stock issued for exercise of vested stock options		—			480			—			—			—			—			— 480
Excess tax benefit from exercise of stock options and vesting of restricted stock		—			88			—			—			—			—			88
Dividends paid ($0.20 per share)		—			—			—			—			(2,382	)		—			(2,382	)
Net income		—			—			—			—			5,062			—			5,062
Other comprehensive loss		—			—			—			—			—			(2,027	)		(2,027	)
BALANCE—DECEMBER 31, 2012	$	146		$	136,132		$	(29,733	)	$	(10,228	)	$	80,608		$	4,540		$	181,465

The accompanying notes are an integral part of these consolidated financial statements.

F-5

FOX CHASE BANCORP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS)

	Years Ended December 31,
	2012			2011			2010
Cash Flows From Operating Activities
Net income	$	5,062		$	4,779		$	2,744
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses		3,478			5,734			6,213
Valuation adjustment for other real estate owned		1,219			657			436
Change in fair value of financial assets acquired from debtors		692			—			—
Impairment loss on real estate held for investment		—			110			—
Depreciation		822			709			693
Net amortization of securities premiums and discounts		2,898			3,289			4,713
Benefit for deferred income taxes		(90	)		(343	)		(9	)
Stock compensation from benefit plans		1,963			1,881			1,540
Net gain on sale of assets acquired through foreclosure		(135	)		(250	)		(44	)
Net gain on sale of premises and equipment		—			—			(6	)
Net gains on sales of investment securities		(3,292	)		(1,091	)		(1,963	)
Net other-than-temporary impairment loss		—			361			—
Income on bank-owned life insurance		(471	)		(468	)		(471	)
Excess tax benefit from exercise of stock options and vesting of restricted stock		(88	)		—			—
Decrease in mortgage servicing rights, net		146			132			235
Decrease in accrued interest receivable and other assets		598			746			1,454
Increase(decrease) in accrued interest payable, accrued expenses and other liabilities		4,793			(777	)		717
Net Cash Provided by Operating Activities		17,595			15,469			16,252
Cash Flows from Investing Activities
Equity investment in unconsolidated entity		180			45			—
Investment securities—available-for-sale:
Purchases		(5,269	)		—			(19,786	)
Proceeds from sales		6,157			—			—
Proceeds from maturities, calls and principal repayments		9,866			9,094			6,882
Mortgage related securities—available-for-sale:
Purchases		(217,894	)		(35,031	)		(46,229	)
Proceeds from sales		85,686			13,976			36,480
Proceeds from maturities, calls and principal repayments		71,739			73,187			131,519
Mortgage related securities—held-to-maturity:
Purchases		—			—			(52,601	)
Proceeds from maturities, calls and principal repayments		12,189			10,040			661
Net (increase) decrease in loans		(3,507	)		(2,581	)		8,866
Purchases of loans and loan participations		(22,350	)		(32,655	)		(27,788	)
Net (increase) decrease in Federal Home Loan Bank stock		(23	)		1,839			522
Purchases of premises and equipment		(833	)		(447	)		(243	)
Additions to assets acquired through foreclosure		(470	)		—			—
Proceeds from sales and payments on assets acquired through foreclosure		1,663			1,888			1,672
Net Cash (Used in) Provided by Investing Activities		(62,866	)		39,355			39,955
Cash Flows from Financing Activities
Net increase (decrease) in deposits		10,815			(35,169	)		(146,514	)
Decrease in advances from borrowers for taxes and insurance		(37	)		(160	)		(223	)
Principal payments on other borrowed funds		(20,000	)		—			—
Proceeds from Federal Home Loan Bank Advances		60,000			—			—
Principal payments on Federal Home Loan Bank advances		(38,278	)		(34,522	)		(14,365	)
Net increase in short-term borrowings		62,000			8,500			—
Excess tax benefit from exercise of stock options and vesting of restricted stock		88			—			—
Common stock issued for exercise of stock options		480			162			—
Acquisition of common stock for equity incentive plan		—			(3,474	)		—
Purchase of treasury stock		(9,911	)		(19,822	)		—
Cash dividends paid		(2,382	)		(1,067	)		—
Merger of Fox Chase Mutual Holding Company		—			—			107
Proceeds from stock offering, net of offering expenses		—			—			81,169
Purchase of common stock by ESOP		—			—			(3,485	)
Net Cash Provided by (Used in) Financing Activities		62,775			(85,552	)		(83,311	)
Net Increase (Decrease) in Cash and Cash Equivalents		17,504			(30,728	)		(27,104	)
Cash and Cash Equivalents—Beginning		7,586			38,314			65,418
Cash and Cash Equivalents—Ending	$	25,090		$	7,586		$	38,314
Supplemental Disclosure of Cash Flow Information
Interest paid	$	10,205		$	14,657		$	21,841
Income taxes paid	$	2,438		$	2,500		$	1,501
Transfers of loans to assets acquired through foreclosure	$	9,070		$	1,479		$	1,198
Net charge-offs	$	4,383		$	6,102		$	4,375

The accompanying notes are an integral part of these consolidated financial statements.

F-6

FOX CHASE BANCORP, INC.

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business

        Fox Chase Bancorp, Inc. (the "Bancorp") is a Maryland corporation that was incorporated in March 2010 to be the successor corporation to old Fox Chase Bancorp, Inc. ("Old Fox Chase Bancorp"), the federal corporation and the former stock holding company for Fox Chase Bank (the "Bank"), upon completion of the mutual-to-stock conversion of Fox Chase MHC, the former mutual holding company for Fox Chase Bank.

        The mutual-to-stock conversion was completed on June 29, 2010. In connection with the conversion, Bancorp sold 8,712,500 shares of common stock at $10.00 per share in a public offering. Concurrent with the completion of the offering, shares of Old Fox Chase Bancorp's common stock owned by public stockholders were exchanged for 1.0692 shares of Bancorp common stock. Additionally, as part of the mutual-to-stock conversion, the Bank's Employee Stock Ownership Plan ("ESOP") acquired 348,500 shares, or 4.0% of Bancorp's issued shares, at $10.00 per share. Net proceeds from the conversion and offering, after the loan made to the ESOP, were approximately $77.8 million.

        Financial information presented in this Annual Report on Form 10-K is derived from the consolidated financial statements of Fox Chase Bancorp, Inc. and subsidiaries on and after June 29, 2010 and from the consolidated financial statements of Old Fox Chase Bancorp and subsidiaries prior to June 29, 2010.

        The Bancorp's primary business has been that of holding the common stock of the Bank and making two loans to the ESOP. The Bancorp is authorized to pursue other business activities permissible by laws and regulations for savings and loan holding companies.

        The Bancorp and the Bank (collectively referred to as the "Company") provide a wide variety of financial products and services to individuals and businesses through the Bank's eleven branches in Philadelphia, Richboro, Willow Grove, Warminster, Lahaska, Hatboro, Media and West Chester, Pennsylvania, and Ocean City, Marmora and Egg Harbor Township, New Jersey. The operations of the Company are managed as a single business segment. The Company competes with other financial institutions and other companies that provide financial services. The Bank also owns approximately 45% of Philadelphia Mortgage Advisors, a mortgage banker located in Plymouth Meeting, Pennsylvania and Ocean City, New Jersey.

        The Company is subject to regulations of certain federal banking agencies. These regulations can and do change significantly from period to period. The Company also undergoes periodic examinations by regulatory agencies which may subject them to further changes with respect to asset valuations and classifications, amounts of required loan loss allowances and operating restrictions resulting from the regulators' judgments based on information available to them at the time of their examinations. Pursuant to the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"), effective July 21, 2011, the regulation and supervision of federal savings institutions, such as the Bank, was transferred from the Office of Thrift Supervision to the Office of the Comptroller of the Currency, the agency that regulates national banks. As a result, the Office of the Comptroller of the Currency assumed primary responsibility for examining the Bank and implementing and enforcing many of the laws and regulations applicable to federal savings associations. In addition, pursuant to the provisions of the Dodd-Frank Act, effective July 21, 2011, savings and loan holding companies, such as the Bancorp, became regulated by the Board of Governors of the Federal Reserve System.

F-7

FOX CHASE BANCORP, INC.

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Principles of Consolidation and Presentation

        The consolidated financial statements include the accounts of the Bancorp and the Bank. The Bank's operations include the accounts of its wholly owned subsidiaries, Fox Chase Financial, Inc., Fox Chase Service Corporation, 104 S. Oakland Ave., LLC and Davisville Associates, LLC. Fox Chase Financial Inc. is a Delaware-chartered investment holding company and its sole purpose is to manage and hold investment securities. Fox Chase Service Corporation is a Pennsylvania-chartered company and its purposes are to facilitate the Bank's investment in PMA and, for regulatory purposes, to hold commercial loans. At December 31, 2012, Fox Chase Service Corporation held $20.0 million in commercial loans. 104 S. Oakland Ave., LLC is a New Jersey-chartered limited liability company formed to secure, manage and hold foreclosed real estate. Davisville Associates, LLC is a Pennsylvania-chartered limited liability company formed to secure, manage and hold foreclosed real estate. All material inter-company transactions and balances have been eliminated in consolidation. Prior period amounts are reclassified, when necessary, to conform with the current year's presentation.

        The Company follows accounting principles and reporting practices that are in compliance with U.S. generally accepted accounting principles ("GAAP"). The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, the valuation and realizability of deferred tax assets, the evaluation of other-than-temporary impairment and the valuation of investment securities and assets acquired through foreclosure.

Risk and Uncertainties

        In the normal course of its business, the Company encounters two significant types of risk: economic risk and regulatory risk. There are three main components of economic risk: interest rate risk, credit risk and market risk. The Company is subject to interest rate risk to the degree that its interest-bearing liabilities mature or reprice at different speeds, or on a different basis, from its interest-earning assets. The Company's primary credit risk is the risk of defaults in the Company's loan portfolio that result from borrowers' inability or unwillingness to make contractually required payments. The Company's lending activities are concentrated in Southeastern Pennsylvania and Southern New Jersey. The ability of the Company's borrowers to repay amounts owed is dependent on several factors, including the economic conditions in the borrowers' geographic regions and the borrowers' financial conditions. The Company also has credit risk related to the risk of defaults in its investment securities portfolio. The ability of the Company to realize the full value of its investment securities upon sale or maturity depends on several factors, including the cash flows, credit enhancements and underlying structures of the individual investment securities. Market risk reflects changes in the value of the collateral underlying loans, the valuation of assets acquired through foreclosure, and the valuation of securities, mortgage servicing assets and other investments.

        The Company is subject to the regulations of various government agencies. These regulations may change significantly from period to period. The Company also undergoes periodic examinations by regulatory agencies that may subject them to further changes with respect to asset valuations and classifications, amounts required for the allowance for loan losses and operating restrictions resulting from the regulators' judgment based on information available to them at the time of their examination.

F-8

FOX CHASE BANCORP, INC.

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Cash and Cash Equivalents

        For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks, interest-earning demand deposits in other banks and money market funds. At times, such balances exceed the FDIC limits for insurance coverage.

        The Company accounts for cash accounts that are in a net overdraft position as a liability and reports changes in book overdraft positions in operating cash flows.

Investment and Mortgage Related Securities

        The Company accounts for its investment securities in accordance with standards that require, among other things, that debt and equity securities are classified into three categories and accounted for as follows:

•

Debt securities with the positive intention to hold to maturity are classified as "held-to-maturity" and reported at amortized cost.

•

Debt and equity securities purchased with the intention of selling them in the near future are classified as "trading securities" and are reported at fair value, with unrealized gains and losses included in earnings. As of the balance sheet dates, the Company did not have any trading securities.

•

Debt and equity securities not classified in either of the above categories are classified as "available-for-sale securities" and reported at fair value, with unrealized gains and losses excluded from earnings and reported, net of tax, as increases or decreases in other comprehensive income, a separate component of stockholders' equity. Securities classified as available-for-sale are those securities that the Company intends to hold for an indefinite period of time but not necessarily to maturity. Any decision to sell a security classified as available-for-sale would be based on various factors, including movement in interest rates, changes in the maturity or mix of the Company's assets and liabilities, liquidity needs, regulatory capital considerations and other factors.

        Management determines the appropriate classification of debt securities at the time of purchase and re-evaluates such designation as of each balance sheet date.

        The Company records other-than-temporary impairment charges, through earnings, if they have the intent to sell, or will more likely than not be required to sell, an impaired debt security before a recovery of its amortized cost basis. In addition, the Company records other-than-temporary impairment charges through earnings for the amount of credit losses, regardless of the intent or requirement to sell. Credit loss is measured as the difference between the present value of an impaired debt security's cash flows and its amortized cost basis. Non-credit related write-downs to fair value are recorded as decreases to accumulated other comprehensive income as long as the Company has no intent or requirement to sell an impaired security before a recovery of amortized cost basis.

        Purchase premiums and discounts are recognized in interest income using the interest method over the expected life for mortgage related securities and the contractual life for all other securities. Because of volatility of the financial markets in which securities are traded, there is the risk that any future fair value could be significantly less than that recorded or disclosed in the accompanying financial statements. Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method.

F-9

FOX CHASE BANCORP, INC.

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Loans, Loan Origination Fees and Uncollected Interest

        Loans are recorded at cost, net of unearned discounts, deferred fees and allowances. Discounts or premiums on purchased loans are amortized using the interest method over the remaining contractual life of the purchased loans, adjusted for actual prepayments. Loan origination fees and certain direct origination costs are deferred and amortized using the interest method over the contractual life as an adjustment to yield on the loans. Interest income is accrued on the unpaid principal balance. From time-to-time, the Company sells certain loans for liquidity purposes or to manage interest rate risk.

        The accrual of interest is generally discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about further collectability of principal or interest, even though the loan is currently performing. A loan that is more than 90 days past due may remain on accrual status if it is in the process of collection and is either guaranteed or well secured. When a loan is placed on nonaccrual status, unpaid interest income is reversed and the amortization of net deferred loan fees is suspended. Interest received on nonaccrual loans generally is either applied against principal or reported as interest income, according to management's judgment as to the ultimate collectability of principal. Generally, loans are restored to accrual status when the obligation is brought current, has performed in accordance with the contractual terms for a reasonable period of time and the ultimate collectability of the total contractual principal and interest is no longer in doubt.

Allowance for Loan Losses

        The allowance for loan losses is adjusted through increases or reductions in the provisions for loan losses charged against or credited to income. Loans deemed to be uncollectible are charged against the allowance for loan losses, and subsequent recoveries, if any, are credited to the allowance.

        The allowance for loan losses is maintained at a level representing management's best estimate of known and inherent losses in the portfolio, based upon management's evaluation of the portfolio's collectability. Our methodology for assessing the appropriateness of the allowance for loan losses consists of an allowance on impaired loans and a general valuation allowance on the remainder of the portfolio. Although we determine the amount of each element of the allowance separately, the entire allowance for loan losses is available for losses on the entire portfolio.

        Loans are deemed impaired when, based on current information and events, it is probable that the Company will be unable to collect all proceeds due according to the contractual terms of the loan agreement or when a loan is classified as a troubled debt restructuring. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Impairment is measured on a loan by loan basis for commercial loans by either the present value of expected future cash flows discounted at the loan's original effective interest rate, the loan's obtainable market price or the fair value of the collateral less costs to sell if the loan is collateral dependent. The Company establishes an allowance for loan loss in the amount of the difference between fair value of the impaired loan and the loan's carrying amount.

        We establish a general allowance for loans that are not considered impaired to recognize the inherent losses associated with lending activities. This general valuation allowance is determined by segmenting the loan portfolio by loan segments (described below) and assigning percentages, known as loss factors, to each category. The percentages are adjusted for significant factors that, in management's

F-10

FOX CHASE BANCORP, INC.

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

judgment, affect the collectability of the portfolio as of the evaluation date. These significant factors include the size and composition of the loan portfolio, the Company's loss experience by particular segment, trends and absolute levels of nonperforming loans, trends and absolute levels of classified and criticized loans, trends and absolute levels in delinquent loans, trends in risk ratings, trends in industry charge-offs and changes in existing general economic and business conditions affecting our lending areas and the national economy. These loss factors are subject to ongoing evaluation to ensure their relevance in the current economic environment. We perform this systematic analysis of the allowance on a quarterly basis. These criteria are analyzed and the allowance is developed and maintained at the segment level.

        Additional risk is associated with the analysis of the allowance for loan losses as such evaluations are highly subjective, and future adjustments to the allowance may be necessary if conditions differ substantially from the assumptions used in making the evaluations. In addition, various regulatory agencies periodically review the Company's allowance for loan losses. Such agencies may require the Company to recognize adjustments to the allowance, based on their judgments at the time of their examination.

        The loan segments utilized by management to develop the allowance for loan losses are (1) one- to four-family real estate, (2) multi-family and commercial real estate, (3) construction, (4) consumer and (5) commercial and industrial loans.

        One- to four-family real estate lending risks generally include the borrower's ability to make repayment from his or her employment or other income, and if the borrower defaults, the ability to obtain repayment from sale of the underlying collateral securing the loan. Risk associated with one- to four-family lending would be higher during a period of increased unemployment or reduced real estate value.

        Multi-family and commercial real estate lending risks generally relate to the borrower's creditworthiness and the feasibility and cash flow potential of the underlying project. Payments on loans secured by income properties often depend on successful operation and management of the properties. As a result, repayment of such loans may be subject to adverse conditions in the real estate market or the economy.

        Construction lending is generally considered to have a higher degree of lending risk than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property's value at completion of construction, the estimated cost (including interest) of construction and the ability of the project to be sold or refinanced upon completion.

        Commercial and industrial loans are typically made on the basis of the borrower's ability to make repayment from the cash flows of the borrower's underlying business. As a result, the availability of funds for the repayment of commercial loans may depend substantially on the success of the business itself. Further, any collateral securing such loans may depreciate over time, may be difficult to appraise and may fluctuate in value.

        Consumer lending includes unsecured lending or loans secured by assets that depreciate rapidly. In such cases, repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment for the outstanding loan and the remaining deficiency often does not warrant further substantial collection efforts against the borrower. Consumer loan collections depend on the borrower's

F-11

FOX CHASE BANCORP, INC.

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

continuing financial stability. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount that can be recovered on such loans.

Troubled Debt Restructurings

        Loans whose terms are modified are classified as troubled debt restructurings if the Company grants such borrowers concessions and it is deemed that those borrowers are experiencing financial difficulty. Concessions granted under a troubled debt restructuring generally involve a reduction in interest rate, extension of a loan's stated maturity date, temporary deferral of payments or granting credit to a borrower who is unable to obtain credit from another financial institution. Accrual of interest continues upon modification if the borrower has demonstrated a history of making payment as contractually due and has provided evidence which supports the borrower's ability to make payments. The accrual of interest income on accruing troubled debt restructurings is generally discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about continued collectability of principal or interest, even though the loan is currently performing. Troubled debt restructurings which are subsequently reported as non-accrual remain as such until they demonstrate consistent payment performance for a minimum period of six months. All loans classified as troubled debt restructurings are considered impaired.

Bank-Owned Life Insurance

        The Company has invested in bank-owned life insurance ("BOLI"). BOLI involves the purchasing of life insurance by the Company on a chosen group of employees and directors. The Company is the owner and beneficiary of the policies. This life insurance investment is carried at the cash surrender value of the underlying policies. Income from the increase in cash surrender value of the policies is included in noninterest income in the consolidated statements of operations.

Premises and Equipment

        Premises and equipment are carried at cost less accumulated depreciation. Depreciation is computed on the straight-line method over the assets' estimated useful lives or, for leasehold improvements, over the life of the related lease if less than the estimated useful life of the asset. The estimated useful life is generally 10-39 years for buildings and 3-7 years for furniture and equipment. When assets are retired, or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts. The cost of maintenance and repairs is charged to expense when incurred and renewals and improvements are capitalized. Rental concessions on leased properties are recognized over the life of the lease.

Assets Acquired through Foreclosure

        Assets acquired through foreclosure consists of other real estate owned and financial assets acquired from debtors. These assets are obtained through foreclosure, by a deed-in-lieu of foreclosure, in-substance foreclosure or in exchange for satisfaction of debt.

        Other real estate owned is carried at the lower of cost or fair value, less estimated selling costs. Costs related to the development or improvement of an acquired property are capitalized. Holding costs and declines in carrying value after acquisition are recorded as assets acquired through foreclosure expense in the consolidated statements of operations.

F-12

FOX CHASE BANCORP, INC.

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

        Financial assets acquired from debtors are carried at fair value under the fair value option in accordance with FASB ASC 825 "Financial Instruments". Increases or decreases in fair value after acquisition are recorded as assets acquired through foreclosure expense in the consolidated statements of operations.

Real Estate Held for Investment

        Real estate held for investment is carried at cost and is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. As of December 31, 2012 and December 31, 2011, real estate held for investment represented undeveloped land located in Absecon, New Jersey. The property was acquired by the Company in 2003 to expand the Company's retail branch network in southern New Jersey. As of December 31, 2011, the property was carried at $1,620,000 based on an appraisal obtained during 2011, which resulted in an impairment loss of $110,000 during the year ended December 31, 2011. As of December 31, 2012, the property continued to be carried at $1,620,000.

        In accordance with regulatory guidelines, because this real estate held for investment was not sold or placed in service by June 2011 (eight years from acquisition); for regulatory reporting purposes, the full amount of this asset is recorded as a reduction of regulatory capital at December 31, 2012 and 2011.

Mortgage Servicing Rights

        Upon the sale of a residential mortgage loan where the Company retains servicing rights, a mortgage servicing right is recorded. GAAP requires that mortgage servicing rights on these loans be amortized into income over the estimated life of the loans sold using the interest method. At each reporting period, such assets are subject to an impairment test. The impairment test stratifies servicing assets based on predominant risk characteristics of the underlying financial assets. The Company has stratified its mortgage servicing assets by date of sale, which approximates date of origination.

        In conjunction with the impairment test, the Company records a valuation allowance when the fair value of the stratified servicing asset is less than amortized cost. Subsequent changes in the valuation of the assets are recorded as either an increase or a reduction of the valuation allowance, however, if the fair value exceeds amortized cost, such excess will not be recognized.

Transfers of Financial Assets

        Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before maturity.

Income Taxes

        The Company accounts for income taxes under the asset/liability method. Deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of

F-13

FOX CHASE BANCORP, INC.

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company files a consolidated federal income tax return and its subsidiaries file individual state income tax returns.

        The Company recognizes a tax position if it is more likely than not that the tax position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. If the tax position meets the more-likely-than-not recognition threshold, the position is measured to determine the amount of the benefit to recognize and is measured at the largest amount of benefit that is greater than 50% likely of being realized upon settlement. The Company has no material tax exposure matters that were accrued as of December 31, 2012 or 2011. The Company's policy is to account for interest and penalties as components of income tax expense.

Equity Method Investments

        Under the equity method, the Company recognizes its portion of net income of unconsolidated affiliates, net of eliminations, in equity in earnings of affiliates on the consolidated statements of operations. Equity method investments are included in other assets on the consolidated statements of condition.

Marketing and Advertising

        The Company expenses marketing and advertising costs as incurred.

Off-Balance Sheet Financial Instruments

        In the ordinary course of business, the Company has entered into off-balance sheet financial instruments consisting of commitments to extend credit. Such financial instruments are recorded in the balance sheet when they are funded. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet financial instruments.

Fair Value of Financial Instruments

        Certain of the Company's financial instruments are carried at fair value. Generally, fair value is the price that a willing buyer and a willing seller would agree upon in an other than a distressed sale situation. Because of the uncertainties inherent in determining fair value, fair value estimates may not be precise. Many of the fair value estimates are based on highly subjective judgments and assumptions made about market information and economic conditions. See Note 14 for a detailed discussion of fair value measurements and methodology used to determine fair value.

Employee Stock Ownership Plan

        The ESOP borrows funds from the Bancorp to purchase shares of common stock in the Bancorp. The funds borrowed by the ESOP from Old Fox Chase Bancorp to purchase shares of common stock in Old Fox Chase Bancorp's initial public offering in 2006 are being repaid from the Bank's contributions over a period of 15 years from 2006 to 2020. The funds borrowed by the ESOP from the Bancorp to purchase shares of common stock in the Bancorp's mutual-to-stock conversion in 2010 are

F-14

FOX CHASE BANCORP, INC.

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

being repaid from the Bank's contributions over a period of 14.5 years from 2010 to 2024. The Bancorp's common stock not yet allocated to participants is recorded as a reduction of stockholders' equity at cost. The Bancorp's loans to the ESOP and the ESOP's note payables are not reflected in the consolidated statements of condition. Compensation expense for the ESOP is based on the average market price of the Company's stock and is recognized as shares are committed to be released to participants. The notes receivable and related interest income are included in the parent company financial statements presented in Note 17.

        For purposes of computing basic and diluted earnings per share, ESOP shares that have been committed to be released are considered outstanding. ESOP shares that have not been committed to be released are not considered outstanding.

Stock Based Compensation

        The Company grants equity awards to employees, consisting of stock options and restricted stock, under its Long-Term Incentive Plan, its 2007 Equity Incentive Plan and its 2011 Equity Incentive Plan. The Company classifies share-based compensation for employees and outside directors within "Salaries, benefits and other compensation" in the Consolidated Statements of Operations to correspond with the same line item as compensation paid. Additionally, the Company reports (1) the expense associated with the grants as an adjustment to operating cash flows and (2) any benefits of realized tax deductions in excess of previously recognized tax benefits on compensation expense as a financing cash flow. Excess tax benefits totaled $88,000 in 2012. There were no such excess tax benefits in 2011 and 2010.

        Stock options vest over a five-year service period and expire ten years after grant date. The Company recognizes compensation expense for the fair values of stock options using the straight-line method over the requisite service period for the entire award.

        Non-performance based restricted shares vest over a five-year service period. The Company recognizes compensation expense for the fair value of restricted shares on a straight-line basis over the requisite service period for the entire award.

        Performance based restricted shares vest over a five-year based on service and achievement of performance metrics. The performance metrics to be evaluated during the performance period are (1) return on assets compared to peer group and (2) earnings growth rate compared to peer group. On the third anniversary of the grant date, the Company's level of performance relative to the performance metrics are evaluated and, if such performance metrics have been achieved, an amount of shares that will vest at that time and over the following two years will be determined. Of the shares that will vest, 50% of the shares vest on the third anniversary of the date of grant and 25% vest on each of the fourth and fifth anniversaries of the date of grant.

Per Share Information

        Basic earnings per share exclude dilution and is computed by dividing income available to common stockholders by the weighted-average common shares outstanding during the period. Diluted earnings per share takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted into common stock. Proceeds assumed to have been received on such exercises are assumed to be used to purchase shares of the Company's common stock at the average market price during the periods, as required by the treasury stock method of accounting. Unallocated shares in the ESOP and shares purchased to fund the Bancorp's Equity Incentive Plans

F-15

FOX CHASE BANCORP, INC.

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

are not included in either basic or diluted earnings per share. As a result of the mutual-to-stock conversion, all share information for periods prior to June 30, 2010 has been revised to reflect the 1.0692 exchange ratio.

        Earnings per share ("EPS"), basic and diluted, were $0.44 and $0.43, respectively for the year ended December 31, 2012. EPS, both basic and diluted, were $0.36 and $0.20 for the years ended December 31, 2011 and 2010, respectively.

        The following table presents the reconciliation of the numerators and denominators of the basic and diluted EPS computations.

	Year Ended December 31,
	2012			2011			2010
Net income	$	5,062,000		$	4,779,000		$	2,744,000
Weighted-average common shares outstanding(1)		12,624,068			14,112,359			14,548,812
Average common stock acquired by stock benefit plans:
Unvested shares—long-term incentive plan		—			—			(7,582	)
ESOP shares unallocated		(651,538	)		(716,530	)		(607,235	)
Shares purchased by trust		(372,653	)		(249,670	)		(199,111	)
Weighted-average common shares used to calculate basic earnings per share		11,599,877			13,146,159			13,734,884
Dilutive effect of:
Unvested shares—long-term incentive plans		—			—			7,582
Restricted stock awards		29,653			33,089			10,132
Stock option awards		117,731			52,582			—
Weighted-average common shares used to calculate diluted earnings per share		11,747,261			13,231,830			13,752,598
Earnings per share—basic	$	0.44		$	0.36		$	0.20
Earnings per share—diluted	$	0.43		$	0.36		$	0.20
Outstanding common stock equivalents having no dilutive effect		860,842			822,461			807,827

(1)

Excludes treasury stock.

F-16

FOX CHASE BANCORP, INC.

NOTE 2—INVESTMENT AND MORTGAGE RELATED SECURITIES

        The amortized cost and fair value of securities available-for-sale and held-to-maturity as of December 31, 2012 and 2011 are summarized as follows:

	December 31, 2012
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			OTTI in AOCI		Fair Value
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	300	$	14	$	—		$	—	$	314
Corporate securities		12,207		91		(121	)		—		12,177
		12,507		105		(121	)		—		12,491
Private label commercial mortgage related securities		6,119		78		—			—		6,197
Agency residential mortgage related securities		270,461		7,023		(65	)		—		277,419
Total mortgage related securities		276,580		7,101		(65	)		—		283,616
Total available-for-sale securities	$	289,087	$	7,206	$	(186	)	$	—	$	296,107
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	28,369	$	1,082	$	—		$	—	$	29,451
Total mortgage related securities		28,369		1,082		—			—		29,451
Total held-to-maturity securities	$	28,369	$	1,082	$	—		$	—	$	29,451

F-17

FOX CHASE BANCORP, INC.

NOTE 2—INVESTMENT AND MORTGAGE RELATED SECURITIES (Continued)

	December 31, 2011
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			OTTI in AOCI			Fair Value
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	6,424	$	90	$	—		$	—		$	6,514
State and political subdivisions		1,865		8		—			—			1,873
Corporate securities		15,007		16		(304	)		—			14,719
		23,296		114		(304	)		—			23,106
Private label residential mortgage related security		164		4		—			(46	)		122
Private label commercial mortgage related securities		8,799		107		—			—			8,906
Agency residential mortgage related securities		206,285		10,357		(6	)		—			216,636
Total mortgage related securities		215,248		10,468		(6	)		(46	)		225,664
Total available-for-sale securities	$	238,544	$	10,582	$	(310	)	$	(46	)	$	248,770
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	41,074	$	684	$	—		$	—		$	41,758
Total mortgage related securities		41,074		684		—			—			41,758
Total held-to-maturity securities	$	41,074	$	684	$	—		$	—		$	41,758

        Obligations of U.S. government agencies represents debt issued by the Federal Home Loan Bank and are not backed by the full faith and credit of the United States government.

F-18

FOX CHASE BANCORP, INC.

NOTE 2—INVESTMENT AND MORTGAGE RELATED SECURITIES (Continued)

        The following tables show gross unrealized losses and fair value of securities, aggregated by security category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2012 and 2011:

	December 31, 2012
	Less than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	—	$	—		$	—	$	—		$	—	$	—
State and political subdivisions		—		—			—		—			—		—
Corporate securities		—		—			2,879		(121	)		2,879		(121	)
		—		—			2,879		(121	)		2,879		(121	)
Private label commercial mortgage related securities		—		—			—		—			—		—
Agency residential mortgage related securities		29,092		(65	)		—		—			29,092		(65	)
Total mortgage related securities		29,092		(65	)		—		—			29,092		(65	)
Total available-for-sale securities	$	29,092	$	(65	)	$	2,879	$	(121	)	$	31,971	$	(186	)
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	—	$	—		$	—	$	—		$	—	$	—
Total mortgage related securities		—		—			—		—			—		—
Total held-to-maturity securities	$	—	$	—		$	—	$	—		$	—	$	—
Total Temporarily Impaired Securities	$	29,092	$	(65	)	$	2,879	$	(121	)	$	31,971	$	(186	)

F-19

FOX CHASE BANCORP, INC.

NOTE 2—INVESTMENT AND MORTGAGE RELATED SECURITIES (Continued)

	December 31, 2011
	Less than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses Plus OTTI in AOCI			Fair Value		Unrealized Losses
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	—	$	—		$	—	$	—		$	—	$	—
State and political subdivisions		—		—			—		—			—		—
Corporate securities		4,799		(182	)		2,878		(122	)		7,677		(304	)
		4,799		(182	)		2,878		(122	)		7,677		(304	)
Private label residential mortgage related security		—		—			122		(42	)		122		(42	)
Private label commercial mortgage related securities		—		—			—		—			—		—
Agency residential mortgage related securities		1,538		(6	)		—		—			1,538		(6	)
Total mortgage related securities		1,538		(6	)		122		(42	)		1,660		(48	)
Total available-for-sale securities	$	6,337	$	(188	)	$	3,000	$	(164	)	$	9,337	$	(352	)
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	—	$	—		$	—	$	—		$	—	$	—
Total mortgage related securities		—		—			—		—			—		—
Total held-to-maturity securities	$	—	$	—		$	—	$	—		$	—	$	—
Total Temporarily Impaired Securities	$	6,337	$	(188	)	$	3,000	$	(164	)	$	9,337	$	(352	)

        During the year ended December 31, 2012, the Company sold (1) mortgage related securities with an amortized cost of $82.3 million and recognized gross gains of $3.3 million, (2) a private label residential mortgage related security with an amortized cost of $157,000 and recognized a loss of $87,000 and (3) two obligations of U.S. government agencies with an amortized cost of $6.1 million and recognized a gain of $64,000.

        As of December 31, 2012, the Company held three private label CMBS with an amortized cost of $6.1 million. These securities had a net unrealized gain of $78,000 at December 31, 2012 and all individual securities were held at an unrealized gain. As of December 31, 2011, the Company held three private label CMBS with an amortized cost of $8.8 million. These securities had a net unrealized gain of $107,000 at December 31, 2011 and all individual securities were held at an unrealized gain. During 2011, one security paid off in full.

        The Company evaluates current characteristics of each of these private label securities such as fair value, delinquency and foreclosure levels, credit enhancement, projected losses, coverage and actual and projected cash flows, on a quarterly basis. It is possible that the underlying collateral of these securities will perform worse than current expectations, which may lead to adverse changes in cash flows on these securities and potential future other-than-temporary impairment losses. Events that may

F-20

FOX CHASE BANCORP, INC.

NOTE 2—INVESTMENT AND MORTGAGE RELATED SECURITIES (Continued)

trigger material declines in fair values for these securities in the future would include but are not limited to deterioration of credit metrics, significantly higher levels of default and severity of loss on the underlying collateral, deteriorating credit enhancement and loss coverage ratios, or further illiquidity.

        At December 31, 2011, after other-than-temporary impairment charges, the Company held one private label residential mortgage related security which had an amortized cost of $164,000, a fair value of $122,000 with a remaining net unrealized loss, including other-than-temporary impairment in accumulated other comprehensive income, of $42,000. There was no other-than-temporary credit impairment recognized on this investment during the year ended December 31, 2010. During the year ended December 31, 2011, management determined that there was additional other-than-temporary impairment in the amount of $407,000, $361,000 of which was recognized on the statement of operations and $46,000 of which was recognized on the statement of condition in accumulated other comprehensive income (before taxes). This additional impairment was primarily due to a slowdown in principal payment speeds, an increase in default rates and an increase in estimated loss severity at default on the underlying residential mortgage collateral. The Company sold the private label residential mortgage related security during the three months ended June 30, 2012.

        Securities that have been impaired greater than twelve months as of December 31, 2012 consist of one corporate security with a fair value of $2.9 million with a rating of "Baa2", with an unrealized loss of $121,000. This unrealized loss is deemed to be temporary as the issuer continues to have an investment grade rating, all contractual payments have been made and the Company does not have the intention or requirement to sell this security prior to recovery of the amortized cost basis.

        Of the ten securities with a temporary impairment at December 31, 2012, nine have a rating of "AAA". The security with a rating of less than AAA is one corporate security with a fair value of $2.9 million and a rating of "Baa2".

        The following schedule provides a summary of the components of net gains on sale of investment securities in the Company's Consolidated Statement of Operations:

	Twelve Months Ended December 31, 2012:
	Gross Realized Gains		Gross Realized Losses			Other-than- Temporary Impairment Losses		Portion of OTTI in OCI		Net Gains (Losses)
	(in thousands)
Obligations of U.S. government agencies	$	64	$	—		$	—	$	—	$	64
State and political subdivisions		—		—			—		—		—
Corporate securities		—		—			—		—		—
		64		—			—		—		64
Private label residential mortgage related security		—		(87	)		—		—		(87	)
Private label commercial mortgage related securities		—		—			—		—		—
Agency residential mortgage related securities		3,315		—			—		—		3,315
Total mortgage related securities		3,315		(87	)		—		—		3,228
Total securities available-for-sale	$	3,379	$	(87	)	$	—	$	—	$	3,292

F-21

FOX CHASE BANCORP, INC.

NOTE 2—INVESTMENT AND MORTGAGE RELATED SECURITIES (Continued)

	Twelve Months Ended December 31, 2011:
	Gross Realized Gains		Gross Realized Losses		Other-than- Temporary Impairment Losses			Portion of OTTI in OCI		Net Gains (Losses)
	(in thousands)
Obligations of U.S. government agencies	$	—	$	—	$	—		$	—	$	—
State and political subdivisions		—		—		—			—		—
Corporate securities		—		—		—			—		—
		—		—		—			—		—
Private label residential mortgage related security		—		—		(407	)		46		(361	)
Private label commercial mortgage related securities		—		—		—			—		—
Agency residential mortgage related securities		1,091		—		—			—		1,091
Total mortgage related securities		1,091		—		(407	)		46		730
Total securities available-for-sale	$	1,091	$	—	$	(407	)	$	46	$	730

	Twelve Months Ended December 31, 2010:
	Gross Realized Gains		Gross Realized Losses		Other-than- Temporary Impairment Losses		Portion of OTTI in OCI		Net Gains (Losses)
	(in thousands)
Obligations of U.S. government agencies	$	—	$	—	$	—	$	—	$	—
State and political subdivisions		—		—		—		—		—
Corporate securities		—		—		—		—		—
		—		—		—		—		—
Private label residential mortgage related security		—		—		—		—		—
Private label commercial mortgage related securities		50		—		—		—		50
Agency residential mortgage related securities		1,913		—		—		—		1,913
Total mortgage related securities		1,963		—		—		—		1,963
Total securities available-for-sale	$	1,963	$	—	$	—	$	—	$	1,963

F-22

FOX CHASE BANCORP, INC.

NOTE 2—INVESTMENT AND MORTGAGE RELATED SECURITIES (Continued)

        The amortized cost and estimated fair value of investment securities available-for-sale and held-to-maturity at December 31, 2012 and 2011 by contractual maturity are as follows:

	Available for Sale				Held to Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In Thousands)
December 31, 2012
Due in one year or less	$	2,019	$	2,032	$	—	$	—
Due after one year through five years		10,488		10,459		—		—
Due after five years through ten years		—		—		—		—
Due after ten years		—		—		—		—
Total mortgage related securities		276,580		283,616		28,369		29,451
	$	289,087	$	296,107	$	28,369	$	29,451
December 31, 2011
Due in one year or less	$	8,022	$	8,013	$	—	$	—
Due after one year through five years		14,072		13,886		—		—
Due after five years through ten years		763		766		—		—
Due after ten years		439		441		—		—
Total mortgage related securities		215,248		225,664		41,074		41,758
	$	238,544	$	248,770	$	41,074	$	41,758

        Securities with a carrying value of $8.3 million and $8.1 million at December 31, 2012 and 2011, respectively, were pledged to secure public deposits and for other purposes as required or permitted by law.

        Securities with a carrying value of $46.6 million and $63.2 million at December 31, 2012 and 2011, respectively, were used to secure other borrowed funds. See Note 8.

F-23

FOX CHASE BANCORP, INC.

NOTE 3—LOANS

        The composition of net loans at December 31, 2012 and 2011 is provided below (in thousands):

	December 31, 2012			December 31, 2011
Real estate loans:
One- to four-family	$	158,828		$	198,669
Multi-family and commercial		368,948			313,060
Construction		22,591			18,243
		550,367			529,972
Consumer loans		30,585			44,667
Commercial and industrial loans		113,820			107,781
Total loans		694,772			682,420
Deferred loan origination cost, net		263			227
Allowance for loan losses		(11,170	)		(12,075	)
Net loans	$	683,865		$	670,572

        The Company had approximately $197.9 million and $210.4 million of loans in New Jersey at December 31, 2012 and 2011, respectively. Other than the loans in New Jersey, the majority of the Company's loans are in the geographic areas near the Company's branches in Southeastern Pennsylvania.

        The Company reclassified $8,000 and $21,000 of deposit accounts that were overdrawn to other consumer loans as of December 31, 2012 and 2011, respectively.

        The following table presents changes in the allowance for loan losses (in thousands):

	Years Ended December 31,
	2012			2011			2010
Balance, beginning	$	12,075		$	12,443		$	10,605
Provision for loan losses		3,478			5,734			6,213
Loans charged off		(4,527	)		(6,331	)		(4,402	)
Recoveries		144			229			27
Balance, ending	$	11,170		$	12,075		$	12,443

F-24

FOX CHASE BANCORP, INC.

NOTE 3—LOANS (Continued)

        The following tables present changes in the allowance for loan losses by loan segment for the years ended December 31, 2012 and 2011:

	For the Year Ended December 31, 2012
	One- to Four- Family			Multi-family and Commercial			Construction Loans			Consumer Loans			Commercial and Industrial Loans			Unallocated		Total
	(in thousands)
Balance, beginning	$	1,760		$	6,112		$	869		$	455		$	2,657		$	222	$	12,075
Provision for loan losses		286			1,064			252			1,659			(27	)		244		3,478
Loans charged off		(1,408	)		(887	)		(340	)		(1,892	)		—			—		(4,527	)
Recoveries		4			38			92			10			—			—		144
Balance, ending	$	642		$	6,327		$	873		$	232		$	2,630		$	466	$	11,170

	For the Year Ended December 31, 2011
	One- to Four- Family			Multi-family and Commercial			Construction Loans			Consumer Loans			Commercial and Industrial Loans			Unallocated		Total
	(in thousands)
Balance, beginning	$	1,990		$	4,624		$	3,260		$	665		$	1,707		$	197	$	12,443
Provision for loan losses		324			2,608			1,010			221			1,546			25		5,734
Loans charged off		(567	)		(1,290	)		(3,445	)		(433	)		(596	)		—		(6,331	)
Recoveries		13			170			44			2			—			—		229
Balance, ending	$	1,760		$	6,112		$	869		$	455		$	2,657		$	222	$	12,075

        The following tables set forth the breakdown of impaired loans by loan segment as of December 31, 2012 and 2011.

December 31, 2012

	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		Impaired Loans with Allowance		Impaired Loans without Allowance
	(in thousands)
Real estate loans:
One- to four-family	$	3,355	$	507	$	—	$	3,862	$	3,862	$	—
Multi-family and commercial		5,284		6,867		—		12,151		11,770		381
Construction		6,434		—		—		6,434		6,434		—
Consumer loans		2,051		14		—		2,065		203		1,862
Commercial and industrial		—		—		—		—		—
Total	$	17,124	$	7,388	$	—	$	24,512	$	22,269	$	2,243

F-25

FOX CHASE BANCORP, INC.

NOTE 3—LOANS (Continued)

December 31, 2011

	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		Impaired Loans with Allowance		Impaired Loans without Allowance
	(in thousands)
Real estate loans:
One- to four-family	$	6,885	$	307	$	—	$	7,192	$	7,192	$	—
Multi-family and commercial		3,814		6,836		—		10,650		9,570		1,080
Construction		6,372		—		—		6,372		6,372		—
Consumer loans		7		64		6,229		6,300		6,300		—
Commercial and industrial		—		—		—		—		—		—
Total	$	17,078	$	7,207	$	6,229	$	30,514	$	29,434	$	1,080

        For the years ended December 31, 2012, 2011 and 2010, the average recorded investment in impaired loans was $28.7 million, $32.0 million and $42.0 million, respectively. The interest income recognized on these impaired loans was $502,000, $825,000 and $399,000 for the years ended December 31, 2012, 2011 and 2010, respectively.

        At December 31, 2012, seven troubled debt restructurings ("TDRs"), totaling $6.9 million, are excluded from the accruing TDR column above as they are included in the nonaccrual loans. Of this amount, $6.4 million relates to two construction loans. The Company has commitments of $855,000 to lend additional funds related to these construction loans. Additionally, the Company had four residential loan TDRs totaling $435,000 and one consumer loan TDR totaling $8,000 which are included in the nonaccrual loans and total impaired loans. At December 31, 2011, two TDRs, totaling $5.2 million, were excluded from the accruing TDR column above as they are included in the nonaccrual loans. These TDRs relate to two construction loans.

        Loans on which the accrual of interest has been discontinued amounted to $17.1 million at December 31, 2012 and $17.1 million at December 31, 2011. If interest on such loans had been recorded in accordance with contractual terms, interest income would have increased by $1.5 million, $1.1 million and $1.5 million in 2012, 2011 and 2010, respectively. There was $0, $3.9 million and $0 of loans past due 90 days or more and still accruing interest at December 31, 2012, 2011 and 2010, respectively.

F-26

FOX CHASE BANCORP, INC.

NOTE 3—LOANS (Continued)

        The following tables set forth a summary of the TDR activity for the twelve months ended December 31, 2012 and 2011:

	As of and for the Twelve Months Ended December 31, 2012
	Restructured Current Period						TDRs that Defaulted in Current Period that were Restructured in the Prior Twelve Months
	Number of Loans		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Number of Loans		Post- Modification Outstanding Recorded Investment
	(Dollars in Thousands)
Real estate loans:
One- to four-family		4	$	582	$	582		3	$	254
Multi-family and commercial		2		604		604		—		—
Construction		—		—		—		—		—
Consumer loans		1		14		14		1		8
Commercial and industrial		—		—		—		—		—
Total		7	$	1,200	$	1,200		4	$	262

	As of and for the Twelve Months Ended December 31, 2011
	Restructured Current Period						TDRs that Defaulted in Current Period that were Restructured in the Prior Twelve Months
	Number of Loans		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Number of Loans		Post- Modification Outstanding Recorded Investment
	(Dollars in Thousands)
Real estate loans:
One- to four-family		2	$	307	$	307		—	$	—
Multi-family and commercial		1		4,673		4,673		—		—
Construction		—		—		—		1		3,115
Consumer loans		2		64		64		—		—
Commercial and industrial		—		—		—		1		600
Total		5	$	5,044	$	5,044		2	$	3,715

        The Company may, under certain circumstances, restructure loans as a concession to borrowers who have experienced financial difficulty. TDRs are included in impaired loans. TDRs typically result from the Company's loss mitigation activities which, among other activities, could include rate reductions, payment extension, and/or principal forgiveness.

        At December 31, 2012, the Company had fourteen TDRs, totaling $14.3 million, of which $13.1 million were the following seven TDRs at December 31, 2011:

•

Two construction loans totaling $6.4 million.

F-27

FOX CHASE BANCORP, INC.

NOTE 3—LOANS (Continued)

•

Two multi-family and commercial real estate loans totaling $6.3 million.

•

Two residential loans totaling $365,000.

•

One consumer loan totaling $8,000.

        The Company had seven new TDRs during the year ended December 31, 2012, which totaled $1.2 million at December 31, 2012, and were comprised of the following:

•

Two multi-family and commercial real estate loans, totaling $590,000. The first loan, totaling $504,000 was classified as a TDR as the Company agreed to reduce payments to interest only for a period of seven months. The second loan, totaling $86,000, was classified as a TDR as the Company agreed to delay principal repayments.

•

Four residential loans, totaling $577,000, as the Company agreed to modified terms with the borrowers, which included delayed repayment of principal and/or interest.

•

One consumer loan, totaling $14,000, as the Company agreed to modified terms with the borrowers, which included delayed repayment of principal and/or interest.

        At December 31, 2011, the Company had eight TDRs, totaling $12.4 million, of which $7.4 million were the following three TDRs at December 31, 2010:

•

Two construction loans totaling $5.6 million.

•

One multi-family and commercial real estate loan totaling $1.8 million.

        The Company had five new TDRs during the year ended December 31, 2011, which totaled $5.0 million at December 31, 2011, and were comprised of the following:

•

One multi-family and commercial real estate loan, totaling $4.7 million. The loan was classified as a TDR as the Company agreed to restructure the terms of the loan, which included reducing payments to interest only for a period of nine months and reducing the rate for the term of the interest only period.

•

Two residential loans, totaling $307,000, as the Company agreed to modified terms with the borrowers, which included delayed repayment of principal and/or interest.

•

Two consumer loans, totaling $64,000, as the Company agreed to modified terms with the borrowers, which included delayed repayment of principal and/or interest.

F-28

FOX CHASE BANCORP, INC.

NOTE 3—LOANS (Continued)

        The following tables set forth the allowance for loan loss for impaired loans and general allowance by loan segment as of December 31, 2012 and December 31, 2011:

December 31, 2012

	Allowance for Loan Losses
	Impaired Loans
	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		General		Total
	(in thousands)
Real estate loans:
One- to four-family	$	337	$	5	$	—	$	342	$	300	$	642
Multi-family and commercial		530		948		—		1,478		4,849		6,327
Construction		449		—		—		449		424		873
Consumer loans		10		1		—		11		221		232
Commercial and industrial		—		—		—		—		2,630		2,630
Unallocated		—		—		—		—		466		466
Total allowance for loan losses	$	1,326	$	954	$	—	$	2,280	$	8,890	$	11,170

December 31, 2011

	Allowance for Loan Losses
	Impaired Loans
	Nonaccrual Loans		Accruing TDR's		Other Impaired Loans		Total Impaired Loans		General		Total
	(in thousands)
Real estate loans:
One- to four-family	$	1,394	$	3	$	—	$	1,397	$	363	$	1,760
Multi-family and commercial		466		975		—		1,441		4,671		6,112
Construction		565		—		—		565		304		869
Consumer loans		7		7		156		170		285		455
Commercial and industrial		—		—		—		—		2,657		2,657
Unallocated		—		—		—		—		222		222
Total allowance for loan losses	$	2,432	$	985	$	156	$	3,573	$	8,502	$	12,075

F-29

FOX CHASE BANCORP, INC.

NOTE 3—LOANS (Continued)

        The following table sets forth past due loans by segment as of December 31, 2012 and 2011.

	At December 31,
	2012				2011
	30 - 59 Days Past Due		60 - 89 Days Past Due		30 - 59 Days Past Due		60 - 89 Days Past Due
	(In thousands)
One- to four-family real estate	$	18	$	284	$	370	$	252
Multi-family and commercial real estate		—		1,691		—		—
Construction		—		—		—		—
Consumer		23		51		1,097		169
Commercial and industrial		—		—		—		—
Total	$	41	$	2,026	$	1,467	$	421

        We use six primary classifications for loans: pass, pass watch, special mention, substandard, doubtful and loss, of which three classifications are for problem loans: substandard, doubtful and loss. "Substandard loans" must have one or more defined weaknesses and are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected. "Doubtful loans" have the weaknesses of substandard loans with the additional characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions and values questionable, and there is a high possibility of loss. A loan classified "loss" is considered uncollectible and of such little value that continuance as a loan of the institution is not warranted. We also maintain a "special mention" category, described as loans which do not currently expose us to a sufficient degree of risk to warrant classification but do possess credit deficiencies or potential weaknesses deserving our close attention. If we classify an asset as loss, it is recorded as a loan charged off in the current period.

        The following tables set forth criticized and classified loans by segment as of December 31, 2012 and 2011:

	At December 31, 2012
	One- to Four-Family Loans		Multi-family and Commercial		Construction Loans		Consumer Loans		Commercial and Industrial Loans		Total
	(In thousands)
Pass and Pass watch	$	155,473	$	347,150	$	16,157	$	28,534	$	110,032	$	657,346
Special mention loans		—		6,733		—		—		3,633		10,366
Substandard loans		3,355		15,065		6,434		2,051		155		27,060
Doubtful loans		—		—		—		—		—		—
Total loans	$	158,828	$	368,948	$	22,591	$	30,585	$	113,820	$	694,772

F-30

FOX CHASE BANCORP, INC.

NOTE 3—LOANS (Continued)

	At December 31, 2011
	One- to Four-Family Loans		Multi-family and Commercial		Construction Loans		Consumer Loans		Commercial and Industrial Loans		Total
	(In thousands)
Pass and Pass watch	$	191,784	$	285,515	$	11,871	$	38,431	$	102,101	$	629,702
Special mention loans		—		13,226		—		6,229		1,407		20,862
Substandard loans		6,885		14,319		6,372		7		4,273		31,856
Doubtful loans		—		—		—		—		—		—
Total loans	$	198,669	$	313,060	$	18,243	$	44,667	$	107,781	$	682,420

NOTE 4—DERIVATIVES AND HEDGING

Interest Rate Swaps

        On November 3, 2006, the Company entered an interest rate swap with a current notional amount of $950,000, which is used to hedge a 15-year fixed rate loan that is earning interest at 7.43%. The Company is receiving variable rate payments of one-month LIBOR plus 224 basis points and is paying fixed rate payments of 7.43%. The swap matures in April 2022 and had a fair value loss position of $203,000 and $214,000 at December 31, 2012 and 2011, respectively. The interest rate swap is carried at fair value in accordance with FASB ASC 815 "Derivatives and Hedging" and is included in other liabilities on the consolidated statements of condition. The loan is carried at fair value under the fair value option as permitted by FASB ASC 825 "Financial Instruments".

        On October 12, 2011, the Company entered an interest rate swap with a current notional amount of $1.6 million, which is used to hedge a 10-year fixed rate loan that is earning interest at 5.83%. The Company is receiving variable rate payments of one-month LIBOR plus 350 basis points and is paying fixed rate payments of 5.83%. The Company designated this relationship as a fair value hedge. The swap matures in October 2021 and had a fair value loss position of $105,000 and $65,000 at December 31, 2012 and December 31, 2011, respectively, which was included in other liabilities on the consolidated statements of condition. The difference between changes in the fair values of interest rate swap agreement and the hedged loan represents hedge ineffectiveness and is recorded in other non-interest income in the consolidated statements of operations. Hedge ineffectiveness resulted in expense of $4,000 for the year ended December 31, 2012 and expense of $5,000 for the year ended December 31, 2011.

Credit Derivatives

        We enter into agreements with a third-party financial institution whereby the financial institution enters into interest rate derivative contracts and foreign currency swap contracts with customers referred to them by us. By the terms of the agreements, the financial institution has recourse to the Company for any exposure created under each swap contract in the event the customer defaults on the swap agreement and the agreement is in a paying position to the third-party financial institution. These transactions represent credit derivatives and are a customary arrangement that allows financial institutions like us to provide access to interest rate and foreign currency swap transactions for our customers without creating the swap ourselves. The Company records the fair value of credit derivatives in other liabilities on the consolidated statement of condition. The Company recognizes changes in the

F-31

FOX CHASE BANCORP, INC.

NOTE 4—DERIVATIVES AND HEDGING (Continued)

fair value of credit derivatives, net of any fees received, as service charges and other fee income in the consolidated statements of operations.

        At December 31, 2012, there were four variable-rate to fixed-rate interest rate swap transactions between the third-party financial institution and our customers with a notional amount of $13.3 million, and remaining maturities ranging from 7 to 10 years. The fair value of the swaps to the customers was a liability of $213,000 as of December 31, 2012 and all swaps were in paying positions to the third-party financial institution. As of December 31, 2012, the fair value of the Company's interest rate swap credit derivatives was a liability of $12,000. During the year ended December 31, 2012, the Company recognized income of $67,000 from interest rate swap credit derivatives.

        At December 31, 2012, there were no foreign currency swap transactions between the third-party financial institution and our customers. During the year ended December 31, 2012, the Company recognized income of $35,000 from foreign currency swap credit derivatives.

        The maximum potential payments by the Company to the financial institution under these credit derivatives are not estimable as they are contingent on future interest rates and exchange rates, and the agreement does not provide for a limitation of the maximum potential payment amount.

NOTE 5—MORTGAGE SERVICING ACTIVITY

        Loans serviced for others are not included in the accompanying consolidated statements of condition. The unpaid principal balances of these loans were $36.6 million at December 31, 2012, $50.0 million at December 31, 2011, and $65.7 million at December 31, 2010. The Company received fees, net of amortization, from the servicing of loans of $(16,000), $25,000 and $11,000 during 2012, 2011 and 2010, respectively.

        The following summarizes mortgage-servicing rights activity for the years ended December 31, 2012, 2011 and 2010 (in thousands):

	Servicing Rights			Valuation Allowance			Net Carrying Value
Balance at December 31, 2009	$	768		$	(85	)	$	683
Additions		—			(46	)		(46	)
Amortization		(189	)		—			(189	)
Balance at December 31, 2010	$	579		$	(131	)	$	448
Additions		—			(8	)		(8	)
Amortization		(124	)		—			(124	)
Balance at December 31, 2011	$	455		$	(139	)	$	316
Additions		—			(16	)		(16	)
Amortization		(130	)		—			(130	)
Balance at December 31, 2012	$	325		$	(155	)	$	170

F-32

FOX CHASE BANCORP, INC.

NOTE 5—MORTGAGE SERVICING ACTIVITY (Continued)

        The estimated amortization expense of amortizing mortgage servicing rights for each of the five succeeding fiscal years after December 31, 2012 is as follows (in thousands):

Year
2013	$	93
2014		67
2015		48
2016		34
2017		25
Thereafter		58
Total	$	325

        As of December 31, 2012 and 2011, the fair value of the mortgage servicing rights ("MSRs") was $170,000 and $322,000, respectively. The fair value at these dates was determined using a third-party valuation model that calculates the present value of estimated future servicing income. The model incorporates assumptions that market participants use in estimating future net servicing income, including estimates of prepayment speeds and discount rates. Mortgage loan prepayment speed is the annual rate at which borrowers are forecasted to repay their mortgage loan principal and is based on historical experience and current interest rates. The discount rate used to determine the present value of future net servicing income is the required rate of return the market would expect for an asset with similar risk. Both assumptions can, and generally will, change quarterly valuations as market conditions and interest rates change.

        The valuation allowance was increased by $16,000, $8,000 and $46,000, during the years ended December 31, 2012, 2011, and 2010 respectively, due to continued low interest rates and high level of prepayments. The amount of the valuation adjustment is recorded as an adjustment to service charges and other fee income in the Company's consolidated statement of operations.

NOTE 6—PREMISES AND EQUIPMENT

        The components of premises and equipment at December 31, 2012 and 2011 were as follows (in thousands):

	December 31,
	2012			2011
Land	$	3,207		$	3,207
Buildings		13,661			13,479
Leasehold improvements		201			190
Furniture, fixtures and equipment		4,827			5,125
		21,896			22,001
Less: accumulated depreciation		(11,453	)		(11,570	)
Premises and equipment, net	$	10,443		$	10,431

        As of December 31, 2012, the Company leased space for an operations center in Blue Bell, Pennsylvania, a branch location in Media, Pennsylvania and certain office equipment. The leases are accounted for as operating leases. The Blue Bell lease expires in January 2016 and, upon expiration,

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FOX CHASE BANCORP, INC.

NOTE 6—PREMISES AND EQUIPMENT (Continued)

the Company has the option to extend the lease for an additional five year period at the then prevailing market rate. The following rental expenses were included in the Company's financial statements (in thousands):

	December 31,
	2012		2011		2010
	(In thousands)
Office rent	$	449	$	486	$	470
Equipment lease		2		2		6
	$	451	$	488	$	476

The following table shows the minimum future rental payments under non-cancelable leases for premises and equipment as of December 31, 2012 (in thousands):

Year
2013	$	399
2014		417
2015		428
2016		36
2017		—

NOTE 7—DEPOSITS

        The weighted average interest rate and balance of deposits at December 31, 2012 and 2011 consisted of the following (dollars in thousands):

	December 31, 2012					December 31, 2011
	Weighted Average Interest Rate			Amount		Weighted Average Interest Rate			Amount
Noninterest-bearing demand accounts		—	%	$	108,176		—	%	$	84,374
NOW accounts		0.22			70,199		0.39			45,948
Money market accounts		0.19			97,318		0.38			127,667
Savings and club accounts		0.14			99,046		0.29			80,740
Brokered deposits		0.36			50,637		0.53			10,162
Certificates of deposit		1.59			262,033		2.03			327,703
		0.70	%	$	687,409		1.12	%	$	676,594

F-34

FOX CHASE BANCORP, INC.

NOTE 7—DEPOSITS (Continued)

        The scheduled maturities of certificates of deposit and brokered deposits for periods subsequent to December 31, 2012 are as follows (in thousands):

	December 31,
Year	Certificates of Deposit		Brokered Deposits		Total
2013	$	144,692	$	45,529	$	190,221
2014		64,212		5,108		69,320
2015		29,182		—		29,182
2016		11,493		—		11,493
2017		4,823		—		4,823
Thereafter		7,631		—		7,631
	$	262,033	$	50,637	$	312,670

        A summary of interest expense on deposits for the years ended December 31, 2012, 2011 and 2010 is as follows (in thousands):

	2012		2011		2010
NOW accounts	$	234	$	143	$	210
Money market accounts		339		596		1,294
Savings and club accounts		253		148		45
Brokered deposits		194		13		—
Certificates of deposit		5,327		7,772		13,654
	$	6,347	$	8,672	$	15,203

        The aggregate amount of certificates of deposit with a minimum denomination of $100,000 was $62.5 million and $81.6 million at December 31, 2012 and 2011, respectively. Deposits in excess of $250,000 are not insured by the Federal Deposit Insurance Corporation (the "FDIC").

NOTE 8—BORROWINGS

        The following is a summary of borrowed funds by type:

	Balance at End of Year		Weighted Average Coupon Rate			Maximum Amount Outstanding at Month End During the Year		Average Amount Outstanding During the Year		Weighted Average Interest Rate During the Year
	(Dollars in thousands)
2012
FHLB advances	$	110,000		1.80	%	$	110,000	$	82,039		2.90	%
Other borrowed funds		30,000		3.30			50,000		39,389		3.42
Short-term borrowings		70,500		0.30			70,500		15,851		0.24
2011
FHLB advances	$	88,278		3.41	%	$	122,429	$	110,180		3.66	%
Other borrowed funds		50,000		3.42			50,000		50,000		3.42
Short-term borrowings		8,500		0.25			24,000		2,239		0.23

F-35

FOX CHASE BANCORP, INC.

NOTE 8—BORROWINGS (Continued)

Federal Home Loan Bank Advances

Maturity Date	Amount		Coupon Rate			Call Date	Rate if Called
	(In thousands)
August 2014		10,000		0.52	%	Not Applicable	Not Applicable
September 2014		15,000		0.41	%	Not Applicable	Not Applicable
December 2014		15,000		0.43	%	Not Applicable	Not Applicable
March 2015		10,000		0.49	%	Not Applicable	Not Applicable
August 2015		10,000		0.68	%	Not Applicable	Not Applicable
November 2017		15,000		3.62	%	February 2013	LIBOR + 0.10%
November 2017		15,000		3.87	%	February 2013	LIBOR + 0.10%
December 2017		20,000		2.83	%	March 2013	LIBOR + 0.11%
	$	110,000		1.80	%

        Advances from the FHLB of Pittsburgh with coupon rates ranging from 0.41% to 3.87% are due as follows.

Maturity	Amount		Weighted Average Coupon Rate
	(Dollars in thousands)
2013	$	—		—	%
2014		40,000		0.45
2015		20,000		0.58
2016		—		—
2017		50,000		3.38
	$	110,000		1.80	%

        During the three months ended June 30, 2012, the Company terminated $36.3 million of FHLB borrowings at a pre-tax cost of $1.5 million, which was recorded in loss on extinguishment of debt in the consolidated statement of operations.

        For the borrowings which have "Call Dates" disclosed in the above table, if the borrowing is called, the Company has the option to either pay off the borrowing without penalty or the borrowing's fixed rate resets to a variable LIBOR based rate, as noted in the above table. Subsequent to the call date, the borrowings are callable by the FHLB quarterly. Accordingly, the contractual maturities above may differ from actual maturities.

        Pursuant to collateral agreements with the FHLB, advances are secured by qualifying first mortgage loans, qualifying fixed-income securities, FHLB stock and an interest-bearing demand deposit account with the FHLB. As of December 31, 2012, the Company has $161.9 million in qualifying collateral pledged against its advances.

        The Bank had a maximum borrowing capacity with the FHLB of Pittsburgh of approximately $367.0 million at December 31, 2012. Additionally, as of December 31, 2012, the Bank has a maximum borrowing capacity of $53.8 million with the Federal Reserve Bank of Philadelphia through the Discount Window.

F-36

FOX CHASE BANCORP, INC.

NOTE 8—BORROWINGS (Continued)

        As a member of the FHLB of Pittsburgh, the Bank is required to acquire and hold shares of capital stock in the FHLB of Pittsburgh in an amount at least equal to 4.60% of its advances plus 0.35% of the Bank's "eligible assets," as such term is defined by the FHLB; and a maximum amount of 6.00% of its advances plus 1.0% of the Bank's "eligible assets." The FHLB of Pittsburgh has indicated it would only redeem from any member the lesser of the amount of the member's excess capital stock or 5% of the member's total capital stock. The FHLB also indicated that it may increase its individual member stock investment requirements at any time. As of December 31, 2012, the Company's minimum stock obligation was $7.9 million and a maximum stock obligation was $12.6 million. The Company held $8.1 million in FHLB stock at that date. The FHLB of Pittsburgh ceased paying a dividend on its common stock during the first quarter of 2009 and did not pay a dividend through December 31, 2011. Beginning in the first quarter of 2012, the FHLB of Pittsburgh reinstated its quarterly dividend.

Other Borrowed Funds

Maturity Date	Amount		Coupon Rate			Next Call Date	Subsequent Call Frequency
	(In thousands)
September 2018		10,000		3.40	%	Not Applicable	Not Applicable
September 2018		5,000		3.20	%	Not Applicable	Not Applicable
October 2018		5,000		3.15	%	January 2013	Quarterly
October 2018		5,000		3.27	%	Not Applicable	Not Applicable
November 2018		5,000		3.37	%	November 2013	Not Applicable
	$	30,000		3.30	%

        During 2012, the Company terminated $20.0 million of other long-term borrowings at a pre-tax cost of $1.5 million, which was recorded in loss on extinguishment of debt in the consolidated statement of operations.

        Other borrowed funds obtained from large commercial banks under security repurchase agreements totaled $30.0 million at December 31, 2012. These borrowings contractually mature with dates ranging from September 2018 through November 2018 and may be called by the lender based on the underlying agreements. Accordingly, the contractual maturities below may differ from actual maturities.

        Mortgage backed securities with a fair value of $37.4 million at December 31, 2012 were used to secure these other borrowed funds.

Short-term borrowings

        As of December 31, 2012 and December 31, 2011, the Company had $70.5 million and $8.5 million, respectively, of short-term borrowings. The short-term borrowings at December 31, 2012 and 2011 had a blended rate of 0.30% and 0.25%, respectively. Short-term borrowings consist of overnight and term borrowings with an original maturity less than one year. Short-term borrowings are obtained from commercial banks, participants in the Federal Funds market and the FHLB.

F-37

FOX CHASE BANCORP, INC.

NOTE 9—EMPLOYEE BENEFITS

401(k) Plan

        The Bank has a 401(k) retirement plan covering all employees meeting certain eligibility requirements. Employees may contribute a percentage of their salary to the Plan each year, subject to limitations set by law. The Bank matches a portion of each employee contribution and also may make discretionary contributions, based on the Bank's performance. The Bank provides a matching contribution equivalent to 33% of the first 6% of the contribution made by an employee. The Bank's contributions to the plan on behalf of its employees resulted in an expenditure of $131,000, $121,000 and $110,000 for the years ended December 31, 2012, 2011 and 2010, respectively.

Employee Stock Ownership Plan

        The ESOP is a tax-qualified plan designed to invest in the Bancorp's common stock that provides employees meeting certain eligibility requirements with the opportunity to receive a funded retirement benefit, based on the value of the Bancorp's common stock. The ESOP has purchased 963,767 shares of common stock and has total loans outstanding of $6.7 million as of December 31, 2012. The ESOP purchased shares in two separate transactions as described in the next paragraph.

        The ESOP initially purchased 615,267 shares of common stock in Old Fox Chase Bancorp's initial stock offering in 2006 at a price of $9.35 per share with the proceeds of a loan from Old Fox Chase Bancorp to the ESOP. The outstanding loan principal balance on the initial ESOP transaction at December 31, 2012 and 2011 was $3.7 million and $4.0 million, respectively. ESOP shares from this transaction that were unallocated at December 31, 2012 totaled 328,142 and had a fair market value of $5.5 million.

        The ESOP purchased an additional 348,500 shares of common stock in conjunction with the Bancorp's mutual-to-stock conversion completed on June 29, 2010 at a price of $10.00 per share with the proceeds of a second loan from the Bancorp to the ESOP. The outstanding loan principal balance at December 31, 2012 and 2011 was $3.0 million and $3.2 million, respectively. ESOP shares from this transaction that were unallocated at December 31, 2012 totaled 288,415 and had a fair market value of $4.8 million.

        Shares of the Bancorp's common stock pledged as collateral for the loan are released from the pledge for allocation to Plan participants as loan payments are made. The Bank releases 65,053 shares annually based upon the ratio that the current principal and interest payment bears to the current and remaining scheduled future principal and interest payments. Dividends declared on common stock held by the ESOP and not allocated to the account of a participant are used to repay the loan. Dividends declared on common stock held by the ESOP that are allocated to the account of a participant are paid to the participant once a year.

        As of December 31, 2012, there were no shares committed to employees, 347,210 shares allocated to employees and 616,557 unallocated shares to be released in future periods.

        Total ESOP compensation expense for the year ended December 31, 2012, 2011 and 2010 was $921,000, $840,000 and $522,000, respectively, representing the average fair market value of shares allocated during the year.

F-38

FOX CHASE BANCORP, INC.

NOTE 9—EMPLOYEE BENEFITS (Continued)

Long-Term Incentive Plan

        The Bank maintains the Fox Chase Bank Executive Long-Term Incentive Plan (the "Incentive Plan"). All plan assets are invested in Bancorp common stock. The Incentive Plan became effective January 1, 2006. During 2012, 2011 and 2010, the Bank recorded compensation expense of $0, $0 and $89,000, respectively, for the Incentive Plan. All shares in the plan were fully vested on January 1, 2011.

NOTE 10—STOCK BASED COMPENSATION

        In 2007, stockholders approved the Fox Chase Bancorp, Inc. 2007 Equity Incentive Plan (the "2007 Plan"). The Plan provides that 769,083 shares of common stock may be issued in connection with the exercise of stock options and 307,633 shares of common stock may be issued as restricted stock. The Plan allows for the granting of non-statutory stock options ("NSOs"), incentive stock options and restricted stock. Options are granted at no less than the fair value of the Bancorp's common stock on the date of the grant. In 2007, Old Fox Chase Bancorp's Board of Directors approved the funding of a trust that purchased 307,395 shares of Bancorp's common stock to fund restricted stock awards under the Plan. The 307,395 shares were purchased by the trust at a weighted average cost of $12.18 per share.

        In August 2011, stockholders approved the Fox Chase Bancorp, Inc. 2011 Equity Incentive Plan (the "2011 Plan"). The 2011 Plan provides that 685,978 shares of common stock may be issued in connection with the exercise of stock options and 274,391 shares of common stock may be issued as restricted stock, including performance based restricted stock. In August 2011, the Board of Directors approved the funding of a trust that purchased 274,391 shares of Bancorp's common stock to fund restricted stock awards under the 2011 Plan. During the year ended December 31, 2011, 274,391 shares were purchased by the trust at a weighted average cost of $12.66 per share.

        During 2011, the Company granted 10,668 shares of performance based restricted stock to certain executive officers of the Company. During 2012, the Company granted 22,500 shares of performance based restricted stock to certain executive officers of the Company.

        During the years ended December 31, 2012, 2011 and 2010, the Company recorded $1.0 million, $1.0 million, and $929,000 of stock based compensation expense, respectively, comprised of stock option expense of $420,000, $436,000 and $400,000, respectively, and restricted stock expense of $621,000, $606,000 and $529,000, respectively.

        As a result of the mutual-to-stock conversion, all presented share information for periods prior to June 30, 2010 has been revised to reflect the 1.0692 exchange ratio.

F-39

FOX CHASE BANCORP, INC.

NOTE 10—STOCK BASED COMPENSATION (Continued)

        The following is a summary of Bancorp's stock option activity and related information for the 2007 Plan and 2011 Plan for the years ended December 31, 2012, 2011 and 2010:

	Number of Stock Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
Outstanding at December 31, 2009		677,381		$	11.03	7.9 years	$	105,000
Granted		39,500			9.67
Exercised		—			—
Forfeited / Cancelled		(24,703	)		10.45
Outstanding at December 31, 2010		692,178		$	10.97	7.1 years	$	608,000
Granted		135,494			12.49
Exercised		(15,037	)		10.69
Forfeited / Cancelled		(24,493	)		11.24
Outstanding at December 31, 2011		788,142		$	11.23	6.6 years	$	1,111,000
Granted		146,550			13.15
Exercised		(43,954	)		10.94
Forfeited / Cancelled		(13,069	)		11.10
Outstanding at December 31, 2012		877,669		$	11.57	6.3 years	$	4,461,000
Exercisable at December 31, 2012		567,008		$	11.26	5.1 years	$	3,055,000

        Management estimated the fair values of all option grants using the Black-Scholes option-pricing model. Through June 30, 2011, as limited historical information on the volatility of the Company's stock existed, management considered the average volatilities of comparable public companies over a period equal to the expected life of the options in determining the expected volatility rate. Beginning in the quarter ended September 30, 2011, management began to utilize the Company's actual volatility in determining the expected volatility rate. Management estimated the expected life of the options using the simplified method allowed under certain accounting standards. The risk-free rate was determined utilizing the Treasury yield for the expected life of the option contract.

        The fair value of the stock option grants was estimated with the following weighted average assumptions:

	2012	2011	2010
Expected Dividend Yield	1.82%	1.90% - 2.00%		1.90	%
Expected Volatility	32.0% - 32.5%	33.0% - 40.0%		35.00	%
Risk-Free Interest Rate	0.86% - 1.10%	1.21% - 2.51%		2.04	%
Expected Option Life in Years	6.50	6.50		6.50

F-40

FOX CHASE BANCORP, INC.

NOTE 10—STOCK BASED COMPENSATION (Continued)

        The following is a summary of the Company's unvested options as of December 31, 2012, 2011 and 2010 and changes therein during the years then ended:

	Number of Stock Options			Weighted Average Grant Date Fair Value
Unvested at December 31, 2009		455,806		$	2.91
Granted		39,500			2.97
Exercised		—			—
Vested		(133,561	)		2.97
Forfeited / Cancelled		(17,748	)		2.73
Unvested at December 31, 2010		343,997		$	2.90
Granted		135,494			3.60
Exercised		—			—
Vested		(135,464	)		2.98
Forfeited / Cancelled		(21,497	)		3.06
Unvested at December 31, 2011		322,530		$	3.15
Granted		146,550			3.57
Exercised		—			—
Vested		(145,350	)		3.10
Forfeited / Cancelled		(13,069	)		3.17
Unvested at December 31, 2012		310,661		$	3.36

        Expected future expense relating to the 310,661 unvested options outstanding as of December 31, 2012 is $871,000 over a weighted average period of 3.8 years.

F-41

FOX CHASE BANCORP, INC.

NOTE 10—STOCK BASED COMPENSATION (Continued)

        The following is a summary of the status of the Company's restricted stock as of December 31, 2012, 2011 and 2010 and changes therein during the years then ended:

	Number of Restricted Shares			Weighted Average Grant Date Fair Value
Unvested at December 31, 2009		148,813		$	11.16
Granted		15,640			9.67
Vested		(45,888	)		11.30
Forfeited / Cancelled		(1,134	)		10.87
Unvested at December 31, 2010		117,431		$	10.91
Granted		57,036			12.54
Vested		(48,620	)		11.19
Forfeited / Cancelled		(5,857	)		11.72
Unvested at December 31, 2011		119,990		$	11.54
Granted		69,950			13.14
Vested		(56,358	)		11.46
Forfeited / Cancelled		(3,025	)		12.08
Unvested at December 31, 2012		130,557		$	12.41

        Expected future compensation expense relating to the 130,557 restricted shares at December 31, 2012 is $1.4 million over a weighted average period of 3.9 years.

NOTE 11—INCOME TAXES

        The components of income tax expense (benefit) for the years ended December 31, 2012, 2011 and 2010 are as follows (in thousands):

	December 31,
	2012			2011			2010
Federal:
Current	$	2,408		$	2,555		$	1,129
Deferred		(140	)		(359	)		(13	)
		2,268			2,196			1,116
State:
Current		—			—			—
Deferred		50			16			4
		50			16			4
	$	2,318		$	2,212		$	1,120

F-42

FOX CHASE BANCORP, INC.

NOTE 11—INCOME TAXES (Continued)

        The provision for income taxes differs from the statutory rate of 34% due to the following (in thousands):

	December 31,
	2012			2011			2010
Federal income tax at statutory rate of 34%	$	2,509		$	2,377		$	1,314
Tax exempt interest, net		(62	)		(62	)		(113	)
Bank-owned life insurance		(160	)		(159	)		(160	)
ESOP compensation expense		101			73			6
Equity incentive plans		—			1			46
Other, net		13			13			23
Dividends received from equity method investments		(49	)		(13	)		—
Dividends paid on benefit plans		(67	)		(26	)		—
State taxes, net		304			126			436
Decrease in valuation allowance		(271	)		(118	)		(432	)
Total Provision	$	2,318		$	2,212		$	1,120
Effective tax rate		31.41	%		31.64	%		28.99	%

        The net deferred tax asset consisted of the following components as of December 31, 2012 and 2011 (in thousands):

	December 31,
	2012			2011
Deferred tax assets:
Allowance for loan losses, net	$	3,798		$	4,106
Provision for loss on assets acquired through foreclosure		966			402
Nonaccrual interest		569			502
Accrued compensation		151			151
Equity incentive plans		734			644
Accrued expenses		370			345
Deferred lease liability		51			10
Impairment loss on investments		—			176
State net operating loss carryforward		73			343
		6,712			6,679
Valuation allowance		(36	)		(307	)
		6,676			6,372
Deferred tax liability
Prepaid expense deduction		238			181
Mortgage servicing rights		58			107
Loan origination costs		39			58
Deferrable earnings on investments		439			227
Depreciation of premises and equipment		471			458
Unrealized gains on securities available-for-sale		2,478			3,659
		3,723			4,690
Net Deferred Tax Asset	$	2,953		$	1,682

F-43

FOX CHASE BANCORP, INC.

NOTE 11—INCOME TAXES (Continued)

        Based on the Company's history of earnings and its expectation of future taxable income, management anticipates that it is more likely than not that the above deferred tax assets will be realized, except for the $36,000 gross deferred tax assets related to Fox Chase Bank's state net operating loss carryforward.

        Retained earnings include $6.0 million at December 31, 2012, 2011 and 2010 for which no provision for federal income tax has been made. This amount represents deductions for bad debt reserves for tax purposes, which were only allowed to savings institutions that met certain criteria prescribed by the Internal Revenue Code of 1986, as amended. The Small Business Job Protection Act of 1996 (the "Act") eliminated the special bad debt deduction granted solely to thrifts. Under the terms of the Act, there would be no recapture of the pre-1988 (base year) reserves. However, these pre-1988 reserves would be subject to recapture under the rules of the Internal Revenue Code if the Company pays a cash dividend in excess of earnings and profits, or liquidates.

        Approximately $73,000 of gross deferred tax assets were related to state tax net operating losses at December 31, 2012. Of this amount, $36,000 is related to the Bank and has a full valuation allowance of $36,000 on this deferred tax asset due to an expectation of such net operating losses expiring before being utilized. The remaining $37,000 of gross deferred tax assets were related to state tax net operating losses on Fox Chase Service Corporation and have no valuation allowance as it is more likely than not that it will be fully utilized before it expires. The Company has $517,000 of state net operating losses remaining as of December 31, 2012 for the Bank, which will begin to expire December 31, 2013. The Company has $368,000 of state net operating losses remaining as of December 31, 2012 for Fox Chase Service Corporation, which will begin to expire December 31, 2029.

        As of December 31, 2012 and prior periods, the Company had no material unrecognized tax benefits or accrued interest and penalties. The Company's policy is to account for interest and penalties as a component of income tax expense. Federal and state tax years 2009 through 2011 were open for examination as of December 31, 2012.

NOTE 12—COMMITMENTS AND CONTINGENCIES

Lending Operations

        The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized on the statements of financial condition.

        The Company's exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments.

F-44

FOX CHASE BANCORP, INC.

NOTE 12—COMMITMENTS AND CONTINGENCIES (Continued)

        A summary of the Company's financial instrument commitments at December 31, 2012 and 2011 is as follows (in thousands):

	December 31,
	2012		2011
Commitments to grant loans	$	23,644	$	74,372
Unfunded commitments under lines of credit		98,537		105,983
Standby letters of credit		14,348		12,010
Commercial letters of credit		848		—
	$	137,377	$	192,365

        Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The Company evaluates each customer's credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management's credit evaluation. Collateral held varies, but includes principally residential or commercial real estate, accounts receivable or inventory. Fixed rate commitments to grant loans were $2.6 million and $15.5 million as of December 31, 2012 and December 31, 2011, respectively. The interest rates on these fixed rate loans ranged from 4.75% to 6.00% as of December 31, 2012 and 5.25% to 6.00% as of December 31, 2011.

Legal Proceedings

        The Company is periodically subject to various pending and threatened legal actions, which involve claims for monetary relief. Based upon information presently available to the Company, it is the Company's opinion that any legal and financial responsibility arising from such claims will not have a material adverse effect on the Company's results of operations.

Service Contracts

        The Company has entered into contracts with third-party providers to manage the Company's network operations, data processing and other related services. The projected amount of the Company's future minimum payments contractually due after December 31, 2012 is as follows (in thousands):

Year	Amount
2013	$	1,952
2014		224
2015		96
2016		—
2017		—

During January 2013, the Company signed a new agreement with one of its third-party data processing providers, which extends the contract through December 2015 and modifies future contractual payments due to $1.7 million in 2013, $1.6 million in 2014 and $1.4 million in 2015.

F-45

FOX CHASE BANCORP, INC.

NOTE 13—STOCKHOLDERS' EQUITY

        The Bank is subject to various regulatory capital requirements administered by federal banking agencies. The Bancorp, as a savings and loan holding company, is not subject to separate capital requirements. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Bank's consolidated financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank's assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The Bank's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

        Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth below) of Total and Tier 1 capital (as defined in the regulations) to risk-weighted assets, and of Tier 1 capital to total assets, as defined. Management believes, as of December 31, 2012, that the Bank meets all capital adequacy requirements to which it was subject.

        As of December 31, 2012, the Bank is categorized as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the Bank's category.

        The Bank's actual capital amounts and ratios at December 31, 2012 and 2011 and the minimum amounts and ratios required for capital adequacy purposes and to be well capitalized under the prompt corrective action provisions are as follows:

	Actual					For Capital Adequacy Purposes					To be Well Capitalized under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in Thousands)
December 31, 2012
Total risk-based capital (to risk-weighted assets)		147,659		20.48	%		³57,682		³8.0	%		³72,103		³10.0	%
Tier 1 capital (to risk-weighted assets)		140,240		19.45			³28,841		³4.0			³43,262		³6.0
Tier 1 capital (to adjusted assets)		140,240		12.90			³43,475		³4.0			³54,344		³5.0
December 31, 2011
Total risk-based capital (to risk-weighted assets)		161,494		23.90	%		³54,054		³8.0	%		³67,567		³10.0	%
Tier 1 capital (to risk-weighted assets)		154,623		22.88			³27,027		³4.0			³40,540		³6.0
Tier 1 capital (to adjusted assets)		154,787		15.30			³40,461		³4.0			³50,576		³5.0

        The Bancorp's ability to pay dividends is limited by statutory and regulatory requirements. The Bancorp may not declare nor pay dividends on its stock if such declaration or payment would violate statutory or regulatory requirements. The Bancorp paid a cash dividend of $0.04 per common share during each of the first three quarters of 2012 and two dividends, totaling $0.08, per common share during the fourth quarter of 2012. Additionally, the Bancorp paid a cash dividend of $0.06 per common share on March 5, 2013.

F-46

FOX CHASE BANCORP, INC.

NOTE 13—STOCKHOLDERS' EQUITY (Continued)

        The Bancorp raised net proceeds of $77.8 million from the mutual to stock conversion completed on June 29, 2010. During 2010, the Bancorp contributed $48.5 million to the Bank, $7.5 million in the first quarter and $41.0 million in the second quarter in conjunction with the mutual-to-stock conversion.

        During the second quarter of 2012, the Bancorp received a $7.9 million dividend from the Bank, equaling the amount of the Bank's 2010 and 2011 net income. During the third quarter of 2012, the Bancorp received a $1.9 million dividend from the Bank, equaling the amount of the Bank's net income for the six months ended June 30, 2012. During the fourth quarter of 2012, the Bancorp received a dividend of $11.5 million from the Bank, which was comprised of $1.5 million representing the Bank's net income for the three months ended September 2012 plus a special dividend of $10.0 million.

        The Bancorp repurchased 724,700 shares of common stock during the year ended December 31, 2012 in conjunction with stock repurchase programs. There were 1,524,900 shares repurchased during the year ended December 31, 2011. The aggregate purchases were recorded as treasury stock, at cost, on the Bancorp's statement of condition in the amount of $29.7 million at December 31, 2012.

NOTE 14—FAIR VALUE

        Management uses its best judgment in estimating the fair value of the Company's financial instruments; however, there are inherent weaknesses in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates herein are not necessarily indicative of the amounts the Company could have realized in a sales transaction on the dates indicated. The estimated fair value amounts have been measured as of the respective year ends, and have not been reevaluated or updated for purposes of these consolidated financial statements subsequent to those respective dates. As such, the estimated fair values of these financial instruments subsequent to the respective reporting dates may be different than the amounts reported at each year end.

        The Company determines the fair value of financial instruments using three levels of input:

Level 1—Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that are accessible at the measurement date.

Level 2—Inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3—Valuations are observed from unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

        The following information should not be interpreted as an estimate of the fair value of the entire Company since a fair value calculation is only provided for a limited portion of the Company's assets and liabilities. Due to a wide range of valuation techniques and the degree of subjectivity used in making the estimates, comparisons between the Company's disclosures and those of other companies may not be meaningful. The following methods and assumptions were used to estimate the fair values of the Company's financial instruments at December 31, 2012 and 2011:

Cash and Cash Equivalents

        The carrying amounts of cash and cash equivalents approximate their fair value.

F-47

FOX CHASE BANCORP, INC.

NOTE 14—FAIR VALUE (Continued)

Investment and Mortgage Related Securities—Available-for-Sale and Held-to-Maturity

        Fair values for investment securities and mortgage related securities are obtained from one external pricing service ("primary pricing service") as the provider of pricing on the investment portfolio on a quarterly basis. We generally obtain one quote per investment security. If quoted market prices are not available, fair values are based on quoted market prices of comparable securities. If quoted market prices are not available for comparable securities, fair value is based on quoted bids for the security or comparable securities. We review the estimates of fair value provided by the pricing service to determine if they are representative of fair value based upon our general knowledge of market conditions and relative changes in interest rates and the credit environment. The Company made no adjustments to the values obtained from the primary pricing service.

Loans Receivable, Net

        To determine the fair values of loans that are not impaired, we employ discounted cash flow analyses that use interest rates and terms similar to those currently being offered to borrowers. We do not record loans at fair value on a recurring basis. We record fair value adjustments to loans on a nonrecurring basis to reflect full and partial charge-offs due to impairment. For impaired loans, we use a variety of techniques to measure fair value, such as using the current appraised value of the collateral, agreements of sale, discounting the contractual cash flows, and analyzing market data that we may adjust due to specific characteristics of the loan or collateral. This technique does not contemplate an exit price.

Federal Home Loan Bank Stock

        The fair value of the Federal Home Loan Bank stock is assumed to equal its cost, since the stock is nonmarketable but redeemable at its par value.

Mortgage Servicing Rights

        The fair value of the MSRs for these periods was determined using a third-party valuation model that calculates the present value of estimated future servicing income. The model incorporates assumptions that market participants use in estimating future net servicing income, including estimates of prepayment speeds and discount rates.

Financial Assets Acquired from Debtors

        The fair value of life insurance policies was determined using valuations obtained from a third party valuation firm who utilized a discounted cash flow model to calculate the fair value of the policies. The significant assumptions used in the valuation were the life expectancies of the insured parties, future premium payments and discount rates.

Accrued Interest Receivable and Accrued Interest Payable

        The carrying amount of accrued interest receivable and accrued interest payable approximates fair value.

F-48

FOX CHASE BANCORP, INC.

NOTE 14—FAIR VALUE (Continued)

Deposit Liabilities

        Fair values for demand deposits (including NOW accounts), savings and club accounts and money market deposits are, by definition, equal to the amount payable on demand at the reporting date. Fair values of fixed-maturity certificates of deposit, including brokered deposits, are estimated using a discounted cash flow calculation that applies interest rates currently being offered on similar instruments with similar maturities.

Short-term Borrowings, Federal Home Loan Bank Advances and Other Borrowed Funds

        Fair value of short-term borrowings, Federal Home Loan Bank advances and other borrowed funds are estimated using discounted cash flow analyses, based on rates currently available to the Bank for advances with similar terms and remaining maturities.

Derivative Contracts

        The fair values of derivative contracts are based upon the estimated amount the Company would receive or pay to terminate the contracts or agreements, taking into account underlying interest rates, creditworthiness of underlying customers for credit derivatives and, when appropriate, the creditworthiness of the counterparties.

Off-Balance Sheet Financial Instruments

        Fair value of commitments to extend credit are estimated using the fees currently charged to enter into similar agreements, taking into account market interest rates, the remaining terms and present creditworthiness of the counterparties. These amounts are deemed to be insignificant.

F-49

FOX CHASE BANCORP, INC.

NOTE 14—FAIR VALUE (Continued)

        The estimated fair values of the Company's financial instruments at December 31, 2012 and 2011 were as follows (in thousands):

		December 31, 2012				December 31, 2011
	Fair Value Hierarchy Level	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Financial assets:
Cash and cash equivalents	Level 1	$	25,090	$	25,090	$	7,586	$	7,586
Available for sale securities:
Investment securities available-for-sale	Level 2		12,491		12,491		23,106		23,106
Private label residential mortgage related security	Level 3		—		—		122		122
Private label commercial mortgage related securities	Level 3		6,197		6,197		8,906		8,906
Agency residential mortgage related securities	Level 2		277,419		277,419		216,636		216,636
Held to maturity securities:
Agency mortgage related securities	Level 2		28,369		29,451		41,074		41,758
Loans receivable, net	Level 3		683,865		686,867		670,572		672,847
Federal Home Loan Bank stock	Level 3		8,097		8,097		8,074		8,074
Accrued interest receivable	Level 3		3,223		3,223		4,578		4,578
Mortgage servicing rights	Level 2		170		170		316		322
Financial assets acquired from debtors	Level 3		3,714		3,714		—		—
Financial liabilities:
Savings and club accounts	Level 2		99,046		99,046		80,740		80,740
Demand, NOW and money market deposits	Level 2		275,693		275,693		257,989		257,989
Brokered deposits	Level 2		50,637		50,715		10,162		10,129
Certificates of deposit	Level 2		262,033		264,694		327,703		330,941
Short-term borrowings	Level 2		70,500		70,500		8,500		8,500
Federal Home Loan Bank advances	Level 2		110,000		115,767		88,278		95,878
Other borrowed funds	Level 2		30,000		33,651		50,000		55,103
Accrued interest payable	Level 2		330		330		418		418
Derivative contracts	Level 2, 3		320		320		279		279

The following assets and liabilities were carried at fair value and classified as Level 3 as of December 31, 2012 and 2011:

•

Private label commercial mortgage related securities ("CMBS"), the fair value of which are difficult to determine because they are not actively traded in securities markets. The net unrealized gain in the private label CMBS portfolio was $78,000 and $107,000 at December 31, 2012 and December 31, 2011, respectively.

•

Two loans, since lending credit risk is not an observable input for these commercial loans (see Note 4). The unrealized gain on the two loans was $293,000 at December 31, 2012 compared to $268,000 at December 31, 2011.

•

Financial assets acquired from debtors include eight life insurance policies. The life expectancies of the insured parties, future premium payments and discount rates which are used to value

F-50

FOX CHASE BANCORP, INC.

NOTE 14—FAIR VALUE (Continued)

these policies are significant unobservable inputs. Losses resulting from changes in fair value, totaling $692,000, for the year ended December 31, 2012, were recorded in assets acquired through foreclosure expense in the consolidated statements of operations. At December 31, 2011, the company did not hold any financial assets acquired from debtors.

•

Credit derivatives which are valued based on creditworthiness of the underlying borrower which is a significant unobservable input. The unrealized loss on the credit derivatives was $12,000 at December 31, 2012 compared to $0 at December 31, 2011.

•

A private label collateralized mortgage obligation ("CMO"), the fair value of which is more difficult to determine because they are not actively traded in securities markets. The net unrealized loss, including other-than-temporary impairment in accumulated other comprehensive income, in the private label CMO was $42,000 at December 31, 2011. This security was sold during 2012.

The following measures were made on a recurring basis as of December 31, 2012 and 2011:

				Fair Value Measurements at Reporting Date Using
Description	As of December 31, 2012			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Other Unobservable Inputs (Level 3)
	(In Thousands)
Available for Sale Securities:
Obligations of U.S. government agencies	$	314		$	—	$	314		$	—
State and political subdivisions		—			—		—			—
Corporate securities		12,177			—		12,177			—
Private label commercial mortgage related securities		6,197			—		—			6,197
Agency residential mortgage related securities		277,419			—		277,419			—
Loans(1)		2,806			—		—			2,806
Financial assets acquired from debtors		3,714			—		—			3,714
Derivative contracts(1)		(320	)		—		(308	)		(12	)
Total	$	302,307		$	—	$	289,602		$	12,705

F-51

FOX CHASE BANCORP, INC.

NOTE 14—FAIR VALUE (Continued)

				Fair Value Measurements at Reporting Date Using
Description	As of December 31, 2011			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Other Unobservable Inputs (Level 3)
	(In Thousands)
Available for Sale Securities:
Obligations of U.S. government agencies	$	6,514		$	—	$	6,514		$	—
State and political subdivisions		1,873			—		1,873			—
Corporate securities		14,719			—		14,719			—
Private label residential mortgage related security		122			—		—			122
Private label commercial mortgage related securities		8,906			—		—			8,906
Agency residential mortgage related securities		216,636			—		216,636			—
Loans(1)		2,877			—		—			2,877
Derivative contracts(1)		(279	)		—		(279	)		—
Total	$	251,368		$	—	$	239,463		$	11,905

(1)

Such financial instruments are recorded at fair value as further described in Note 4.

        The following measures were made on a non-recurring basis as of December 31, 2012 and 2011:

        Loans, which were partially charged off at December 31, 2012 and 2011. The loans' fair values are based on Level 3 inputs, which are either an appraised value or a sales agreement, less costs to sell. These amounts do not include fully charged-off loans, because we carry fully charged-off loans at zero on our balance sheet.

        MSR's, the fair value was determined using a third-party valuation model that calculates the present value of estimated future servicing income. The model incorporates assumptions that market participants use in estimating future net servicing income, including estimates of prepayment speeds and discount rates.

F-52

FOX CHASE BANCORP, INC.

NOTE 14—FAIR VALUE (Continued)

        Other real estate owned, we used Level 3 inputs, which consists of appraisals or agreements of sale. Other real estate owned is recorded on our balance sheet at fair value, net of costs to sell, when we obtain control of the property.

			Fair Value Measurements at Reporting Date Using
Description	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
	(In Thousands)
As of December 31, 2012
Loans	$	2,951	$	—	$	—	$	2,951
Mortgage servicing rights		170		—		170		—
Other real estate owned		4,810		—		—		4,810
Total	$	7,931	$	—	$	170	$	7,761
As of December 31, 2011
Loans	$	2,490	$	—	$	—	$	2,490
Mortgage servicing rights		282		—		282		—
Other real estate owned		2,423		—		—		2,423
Total	$	5,195	$	—	$	282	$	4,913

        The following table includes a roll forward of the financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3), on a recurring basis, for the period of December 31, 2010 to December 31, 2012.

	Private Label Residential Mortgage Related Security			Private Label Commercial Mortgage Related Securities			Derivative Contracts			Financial Assets Acquired from Debtors			Loan			Total
	(In thousands)
Beginning balance, December 31, 2010	$	166		$	11,767		$	—		$	—		$	1,241		$	13,174
Purchases/additions		—			—			—			—			1,600			1,600
Sales		—			—			—			—			—			—
Payments received		(34	)		(2,570	)		—			—			(71	)		(2,675	)
Premium amortization, net		—			(16	)		—			—			—			(16	)
Increase/(decrease) in value		(10	)		(275	)		—			—			107			(178	)
Reclassification to Level 3		—			—			—			—			—			—
Ending balance, December 31, 2011	$	122		$	8,906		$	—		$	—		$	2,877		$	11,905
Purchases/additions		—			—			(39	)		4,013			—			3,974
Sales		(70	)		—			—			—			—			(70	)
Payments (received) made		(7	)		(2,668	)		—			393			(97	)		(2,379	)
Premium amortization, net		—			(12	)		—			—			—			(12	)
Increase/(decrease) in value		(45	)		(29	)		27			(692	)		26			(713	)
Reclassification to Level 3		—			—			—			—			—			—
Ending balance, December 31, 2012	$	—		$	6,197		$	(12	)	$	3,714		$	2,806		$	12,705

        There were no transfers made between levels during the years ended December 31, 2012 and 2011.

F-53

FOX CHASE BANCORP, INC.

NOTE 15—RELATED PARTY TRANSACTIONS

Transactions with Directors, Officers and Employees

        The Company may from time to time enter into transactions with its directors, officers and employees. Such transactions are made in the ordinary course of business on substantially the same terms and conditions, including interest rates and collateral, as those prevailing at the same time for comparable transactions with other customers, and do not, in the opinion of management, involve more than the normal credit risk or present other unfavorable features.

        There were no loans to directors and executive officers as of December 31, 2012 and 2011.

Equity Method Investments

        As of December 31, 2012, 2011 and 2010, Fox Chase Bank owned approximately 45% of Philadelphia Mortgage Advisors, Inc. ("PMA"). During 2012, 2011 and 2010, the Company engaged in certain business activities with PMA. These activities included providing a warehouse line of credit to PMA, as well as acquiring residential mortgage loans from PMA. The Company recorded interest income from PMA on the warehouse line of $460,000, $220,000 and $285,000 for the years ended December 31, 2012, 2011 and 2010, respectively, as well as loan satisfaction fees, which are recorded in service charges and other fee income, of $66,000, $50,000 and $65,000 for the years ended December 31, 2012, 2011 and 2010, respectively. The balance outstanding on the warehouse line was $15.2 million and $9.5 million at December 31, 2012 and 2011, respectively. In addition, the Company acquired total loans from PMA of $14.4 million, $10.6 million and $23.9 million for the years ended December 31, 2012, 2011 and 2010, respectively, which includes the cost of the loans.

        During 2010, the Company provided PMA a term loan in the amount of $1.2 million, which was secured by a residential property owned by PMA. The Company recorded interest income from PMA on this term loan of $25,000 and $15,000 for the years ended December 31, 2011 and 2010, respectively. The loan was paid off during the second quarter of 2011.

        The Company's investment in PMA was $2.0 million and $1.5 million at December 31, 2012 and 2011, respectively, and was included in other assets on the consolidated statements of condition.

        PMA had total assets of $32.5 million and $16.4 million as of December 31, 2012 and 2011, respectively. PMA had total liabilities of $28.5 million and $13.5 million as of December 31, 2012 and 2011, respectively. PMA had net revenues of $7.8 million, $5.0 million and $4.9 million as of December 31, 2012, 2011 and 2010, respectively. PMA had expenses (including income taxes) of $6.3 million, $4.4 million and $4.5 million as of December 31, 2012, 2011 and 2010, respectively. PMA had net income of $1.5 million, $557,000 and $438,000 as of December 31, 2012, 2011 and 2010, respectively.

NOTE 16—ACCOUNTING PRONOUNCEMENTS

        Accounting Standards Update (ASU) No. 2011-03—Transfers and Servicing (Topic 860):    Reconsideration of Effective Control for Repurchase Agreements. This update 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 No. 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.

F-54

FOX CHASE BANCORP, INC.

NOTE 16—ACCOUNTING PRONOUNCEMENTS (Continued)

ASU No. 2011-03 was effective for the Company on January 1, 2012 and did not have a material impact on the Company's financial position or results of operations.

        Accounting Standards Update (ASU) No. 2011-04—Fair Value Measurement (Topic 820):    Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. The amendments were issued to achieve convergence between U.S. GAAP and IFRS. The guidance clarifies how a principal market is determined, addresses the fair value measurement of instruments with offsetting market or counterparty credit risks and the concept of valuation premise and highest and best use, extends the prohibition on blockage factors to all three levels of the fair value hierarchy, and requires additional disclosures. ASU No. 2011-04 was effective for the Company on January 1, 2012 and was to be applied prospectively. Adoption of this update did not have a material impact on the Company's financial position or results of operations but did result in additional disclosures within the fair value footnote.

        Accounting Standards Update (ASU) No. 2011-05—Comprehensive Income (Topic 220): Presentation of Comprehensive Income.    The provisions of ASU No. 2011-05 are intended to improve the comparability, consistency and transparency of financial reporting and to increase prominence of the items reported in other comprehensive income. The guidance requires entities to report the total of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous financial statement or in two separate financial statements. This update was effective for the Company on January 1, 2012, and was to be applied retrospectively. Adoption of this update resulted in the addition of the Consolidated Statements of Comprehensive Income and the removal of the Comprehensive Income footnote.

        Accounting Standards Update (ASU) No. 2011-11—Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities.    The provisions of ASU No. 2011-11 are intended to enhance current disclosure requirements on offsetting financial assets and liabilities. The new disclosures will enable financial statement users to compare balance sheets prepared under U.S. GAAP and International Financial Reporting Standards (IFRS), which are subject to different offsetting models. The disclosures will be limited to financial instruments (and derivatives) subject to enforceable master netting arrangements or similar agreements and will be effective for the Company on January 1, 2013 and is to be applied retrospectively. The Company has evaluated the guidance included in this update and has determined that it is not expected to have a material impact on the Company's financial position or results of operations.

        Accounting Standards Update (ASU) No. 2013-01—Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities.    This update clarifies that the scope of ASU No. 2011-11 applies to derivatives accounted for in accordance with Topic 815, Derivatives and Hedging, including bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are either offset in accordance with Section 210-20-45 or Section 815-10-45 or subject to an enforceable master netting arrangement or similar agreement. An entity is required to apply the amendments for fiscal years beginning on or after January 1, 2013, and interim periods within those annual periods. An entity should provide the required disclosures retrospectively for all comparative periods presented. The Company has evaluated the guidance included in this update and has determined that it is not expected to have a material impact on the Company's financial position or results of operations.

F-55

FOX CHASE BANCORP, INC.

NOTE 16—ACCOUNTING PRONOUNCEMENTS (Continued)

        Accounting Standards Update (ASU) No. 2013-02—Comprehensive Income (Topic 220)—Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.    This update requires an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required under U.S. GAAP to be reclassified in its entirety to net income. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures required under U.S. GAAP that provide additional detail about those amounts. This would be the case when a portion of the amount reclassified out of accumulated other comprehensive income is reclassified to a balance sheet account instead of directly to income or expense in the same reporting period. For the Company, the amendment is effective prospectively for reporting periods beginning after December 15, 2012. The Company does not expect the guidance will have a material impact on its financial statements but will result in a revised presentation of reclassifications of items out of accumulated other comprehensive income.

NOTE 17—PARENT COMPANY ONLY FINANCIAL STATEMENTS

        The following condensed financial statements for Fox Chase Bancorp, Inc. (parent company only) reflect the investment in its wholly owned subsidiary, Fox Chase Bank, using the equity method of accounting.

CONDENSED BALANCE SHEET

	December 31,
	2012		2011
	(In Thousands)
ASSETS
Cash and due from banks	$	94	$	444
Interest-earning deposits with banks		29,513		18,783
Total cash and cash equivalents		29,607		19,227
Investment in subsidiary		144,781		161,353
Due from subsidiary, net		—		266
ESOP loans		6,659		7,175
Other assets		549		241
Total Assets		181,596		188,262
LIABILITIES AND STOCKHOLDERS' EQUITY
Due to subsidiary, net		19		—
Other liabilities		112		70
Total Liabilities		131		70
Stockholders' Equity		181,465		188,192
Total Liabilities and Stockholders' Equity	$	181,596	$	188,262

F-56

FOX CHASE BANCORP, INC.

NOTE 17—PARENT COMPANY ONLY FINANCIAL STATEMENTS (Continued)

CONDENSED STATEMENTS OF OPERATIONS

	Years Ended December 31,
	2012			2011			2010
INCOME
Interest on deposits with banks	$	66		$	219		$	182
Interest on ESOP loans		432			463			432
Total Income		498			682			614
EXPENSES
Other expenses		1,000			970			841
Total Expenses		1,000			970			841
Loss before income tax benefit and equity in undistributed net earnings of subsidiary		(502	)		(288	)		(227	)
Income tax benefit		(171	)		(98	)		(77	)
Loss before equity in undistributed net earnings of subsidiary		(331	)		(190	)		(150	)
Equity in undistributed net earnings of subsidiary		5,393			4,969			2,894
Net Income	$	5,062		$	4,779		$	2,744

F-57

FOX CHASE BANCORP, INC.

NOTE 17—PARENT COMPANY ONLY FINANCIAL STATEMENTS (Continued)

CONDENSED STATEMENTS OF CASH FLOWS

	Years Ended December 31,
	2012			2011			2010
Cash Flows From Operating Activities
Net income	$	5,062		$	4,779		$	2,744
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in undistributed loss of subsidiary		(5,393	)		(4,969	)		(2,894	)
Decrease in deferred tax asset		—			—			89
Decrease in due from/to subsidiary, net		259			84			118
Excess tax benefit from exercise of stock options and vesting of restricted stock		(88	)		—			—
Increase in other assets		(308	)		(100	)		(79	)
Increase in other liabilities		130			1			5
Net Cash Used in Operating Activities		(338	)		(205	)		(17	)
Cash Flows from Investing Activities
Loan payment received on ESOP loans		516			487			364
Cash dividends received from subsidiary		21,281			—			—
Net Cash Provided by Investing Activities		21,797			487			364
Cash Flows from Financing Activities
Purchase of treasury stock		(9,911	)		(19,822	)		—
Acquisition of common stock for equity incentive plan		—			(3,474	)		—
Excess tax benefit from exercise of stock options and vesting of restricted stock		88			—			—
Receipt from subsidiary related to vesting of stock in equity incentive plan		646			544			519
Common stock issued for exercise of stock options		480			162			—
Capital contribution to subsidiary		—			—			(48,500	)
Purchase of common stock by ESOP		—			—			(3,485	)
Merger of Fox Chase Mutual Holding Company		—			—			107
Proceeds from stock offering, net of offering expenses		—			—			81,169
Cash dividends paid		(2,382	)		(1,067	)		—
Net Cash Used in Financing Activities		(11,079	)		(23,657	)		29,810
Net Increase in Cash and Cash Equivalents		10,380			(23,375	)		30,157
Cash and Cash Equivalents—Beginning		19,227			42,602			12,445
Cash and Cash Equivalents—Ending	$	29,607		$	19,227		$	42,602

NOTE 18—QUARTERLY FINANCIAL DATA (UNAUDITED)

        The following represents summarized quarterly financial data of Fox Chase Bancorp, Inc. and subsidiary, which, in the opinion of management, reflects all adjustments (comprising only normal recurring accruals) necessary for a fair presentation. The Company reported net income of $1.9 million

F-58

FOX CHASE BANCORP, INC.

NOTE 18—QUARTERLY FINANCIAL DATA (UNAUDITED) (Continued)

for the quarter ended December 31, 2012 and net income of $1.0 million for the quarter ended December 31, 2011.

        The net income for the quarter ended December 31, 2012 included a provision for loan losses of $442,000, valuation adjustments of assets acquired through foreclosure of $979,000, and a gain of $952,000 on the sale of $15.7 million of mortgage related securities.

        The net income for the quarter ended December 31, 2011 included a provision for loan losses of $2.8 million, primarily related to specific impairments totaling $2.2 million on three commercial loans, all of which are located in Southern New Jersey, and a gain of $1.1 million on the sale of $12.8 million of mortgage related securities.

Three Months Ended	12/31/12		9/30/12		6/30/12		3/31/12		12/31/11		9/30/11		6/30/11		3/31/11
Interest income	$	9,950	$	10,531	$	10,411	$	10,942	$	11,102	$	11,606	$	11,607	$	11,631
Interest expense		2,117		2,298		2,740		2,962		3,114		3,545		3,827		4,009
Net interest income		7,833		8,233		7,671		7,980		7,988		8,061		7,780		7,622
Provision for loan losses		442		470		1,291		1,275		2,825		1,034		900		975
Net interest income after
provision for loan losses		7,391		7,763		6,380		6,705		5,163		7,027		6,880		6,647
Noninterest income		1,804		737		3,080		694		1,959		467		450		467
Noninterest expense		6,437		6,398		8,699		5,640		5,601		5,690		5,480		5,298
Income before taxes		2,758		2,102		761		1,759		1,521		1,804		1,850		1,816
Income tax provision		858		666		222		572		477		572		593		570
Net Income	$	1,900	$	1,436	$	539	$	1,187	$	1,044	$	1,232	$	1,257	$	1,246
Per Common Share Data
Weighted average common shares—basic		11,431,957		11,535,146		11,624,120		11,808,632		12,214,704		13,087,582		13,662,264		13,636,010
Weighted average common shares—diluted		11,622,035		11,718,308		11,750,623		11,901,737		12,287,733		13,175,689		13,770,934		13,678,887
Net income per share—basic	$	0.17	$	0.12	$	0.05	$	0.10	$	0.09	$	0.09	$	0.09	$	0.09
Net income per share—diluted	$	0.16	$	0.12	$	0.05	$	0.10	$	0.09	$	0.09	$	0.09	$	0.09

F-59

SIGNATURES

        Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	FOX CHASE BANCORP, INC.
Date: March 13, 2013	By:	/s/ THOMAS M. PETRO Thomas M. Petro President and Chief Executive Officer

        Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Name	Title	Date
/s/ THOMAS M. PETRO Thomas M. Petro	President, Chief Executive Officer and Director (principal executive officer)	March 13, 2013
/s/ ROGER S. DEACON Roger S. Deacon	Chief Financial Officer (principal accounting and financial officer)	March 13, 2013
/s/ ROGER H. BALLOU Roger H. Ballou	Director	March 13, 2013
/s/ RICHARD E. BAUER Richard E. Bauer	Director	March 13, 2013
/s/ TODD S. BENNING Todd S. Benning	Director	March 13, 2013
/s/ RICHARD M. EISENSTAEDT Richard M. Eisenstaedt	Director	March 13, 2013
/s/ ANTHONY A. NICHOLS, SR. Anthony A. Nichols, Sr.	Director	March 13, 2013
/s/ ROSEANN B. ROSENTHAL RoseAnn Rosenthal	Director	March 13, 2013

EX-10.8

Exhibit 10.8

FOX CHASE BANK

EMPLOYEE SEVERANCE COMPENSATION PLAN

(as amended and restated effective January 1, 2012)

1.Effective Date

The Fox Chase Bank Employee Severance Compensation Plan was originally approved by the Board of Directors of Fox Chase Bank (the “Bank”) as a general severance policy for all eligible employees effective October 5, 2005.  The policy was later approved by the Office of Thrift Supervision in connection with the Bank’s mutual holding company reorganization and amended and restated in its entirety into the Fox Chase Bank Employee Severance Compensation Plan.  Effective January 1, 2012, the Fox Chase Bank Employee Severance Compensation Plan was subsequently amended and restated in its entirety (the “Plan”) to reflect the Bank’s second step conversion and clarify certain terms and conditions of the Plan.

2.Purpose

The purpose of this Plan is to:  (a) provide management with guidelines to ensure fair and consistent treatment of Employees when employment is terminated by the Bank for any reason other than Termination for Cause or a Change in Control; and (b) to assure the Bank of the services of Covered Employees in the event of a Change in Control by providing Covered Employees who are terminated voluntarily or involuntarily within one (1) year of a Change in Control with severance benefits.  For purposes of paragraphs 4(a) and 4(b) hereof, this Plan is intended solely as a guideline for management and is not intended as a contractual commitment on the part of the Bank to any Employee.  Unless otherwise stated, all capitalized terms noted herein are defined in Section 3 of this Plan.

3.Definitions

a.“Base Compensation” means and includes all regular weekly cash wages or weekly salary, but excludes bonuses, commissions and any other compensation, if any, paid or accrued as consideration for an Employee’s service to the Bank.  Notwithstanding the foregoing, for purposes of Employees paid solely on a commission basis, “Base Compensation” shall include commissions earned up to $50,000 per annum.  In the case of an hourly Employee or a part-time Employee, “Base Compensation” shall be determined by reference to compensation earned during the Employee’s average weekly work schedule during the 30 days preceding the termination date.

b.“Change in Control” means the occurrence of one of the following events:

(a)Merger:  The Company merges into or consolidates with another entity, or merges another entity into the Company and, as a result, less than a

majority of the combined voting power of the resulting entity immediately after the merger or consolidation is held by persons who were stockholders of the Company immediately before the merger or consolidation;

(b)Change in Board Composition:  During any period of two consecutive years, individuals who constitute the Company’s Board of Directors at the beginning of the two-year period cease for any reason to constitute at least a majority of the Board; provided, however, that for purposes of this clause (b) each director who is first elected by the Board (or first nominated by the Board for election by stockholders) by a vote of at least two-thirds (2/3) of the directors who were directors at the beginning of the two-year period shall be deemed to have also been a director at the beginning of the two-year period; or

(c)Acquisition of Significant Share Ownership:  There is filed, or required to be filed, a report on Schedule 13D or another form or schedule (other than Schedule 13G) required under Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, if the schedule discloses that the filing person or persons acting in concert has or have become the beneficial owner(s) of 25% or more of a class of the Company’s voting securities, however this clause (c) shall not apply to beneficial ownership of Company voting shares held in a fiduciary capacity by an entity of which the Company directly or indirectly beneficially owns 50% or more of its outstanding voting securities.

(d)Sale of Assets: The Company sells to a third party all or substantially all of its assets.

c.“Comparable Position” shall mean a position that would (i) provide a Covered Employee with Base Compensation that is comparable to those provided to the Covered Employee prior to the Change in Control; (ii) be in a location that would be more than thirty (30) miles from the Employee’s place of employment at the Bank or Company immediately prior to the Change in Control; and (iii) have job skill requirements and duties that are comparable to the requirements and duties of the position held by the Covered Employee prior to the Change in Control.

d.“Company” means Fox Chase Bancorp, Inc., a Maryland corporation.

e.“Covered Employee” means any full-time or part-time employee of the Bank or any subsidiary of the Bank that has worked at least one (1) year with the Bank or subsidiary as of his or her termination date.

f.“Employee” means any full-time or part-time employee of the Bank or any subsidiary of the Bank; provided, however, that any individual who is covered or

2

hereinafter becomes covered by an employment contract shall not be considered to be an “Employee” for purposes of this Plan.

g.“Termination for Cause” shall include termination because of an Employee’s personal dishonesty, incompetence, willful misconduct, any breach of fiduciary duty involving personal profit, intentional failure to perform stated duties, willful violation of any law, rule or regulation (other than traffic violations or similar offenses) or Employee’s personal violation of any final cease-and desist order.  In determining incompetence, the acts or omissions shall be measured against standards generally prevailing in the financial services industry.

h.“Year of Service” means each 12-month period of service following an Employee’s date of hire.  The taking of a leave of absence shall not eliminate a period of time from being a Year of Service if the period of time otherwise qualifies as a Year of Service.  A “leave of absence” means (i) the taking of an authorized or approved leave of absence under the provisions of the federal Family and Medical Leave Act (“FMLA”), (ii) any state law providing qualitatively similar benefits as the FMLA, or (iii) a leave of absence authorized under the policies of the Bank.

4.Amount of Payment

a.Unless otherwise determined by the Board of Directors of the Bank, an Employee whose employment with the Bank is terminated by the Bank for reasons other than Termination for Cause or Change in Control will be eligible to receive a termination benefit from the Bank equal to the product of (i) two weeks of Base Compensation in effect as of the Employee’s termination date and (ii) the Employee’s Years of Service (including partial years). In no event shall an Employee receive a cash payment less than four (4) weeks Base Compensation.

b.Unless otherwise determined by the Board of Directors of the Bank, in addition to any payment authorized under paragraph (a) above, an Employee who receives a benefit under this Plan will also be eligible to receive a lump sum cash payment equal to three (3) months of the cost of the employer portion of an Employee’s COBRA health benefits (“COBRA Payment”); provided, however, that only those Employees participating in the Bank’s medical benefits programs prior to their termination of employment will qualify for a COBRA Payment.  An Employee will receive his or her COBRA payment as soon as practical following the Bank’s receipt of written confirmation that the Employee has applied for COBRA.

c.Notwithstanding anything herein to the contrary, the maximum benefit payable to an Employee paid under this Plan, including Bank-paid COBRA Benefits, as applicable, shall not exceed an amount equal to fifty-two weeks of Base Compensation, less one dollar.

3

d.Any Employee whose employment is terminated as a result of a Termination for Cause shall receive no benefits under this Plan.

4

5.Change in Control Severance Benefits

a.Eligibility.  Covered Employees shall be eligible to receive a Change in Control Severance Benefit (as defined below) if, within the period beginning on the effective date of a Change in Control and ending on the first anniversary date of such date, (i) the Covered Employee’s employment with the Bank is involuntarily terminated or (ii) the Covered Employee terminates employment with the Bank voluntarily after being offered continued employment in a position that is not a Comparable Position.  No Covered Employee shall be eligible for a Change in Control Severance Benefit: (i) in connection with a Termination for Cause; (ii) if he or she is offered a Comparable Position within the Bank and declines to accept such position; or (iii) if the Covered Employee, at the time of termination or employment, is a party to a Change in Control Agreement or Employment Agreement with the Bank or the Company.

b.Change in Control Severance Benefit.  Any Covered Employee who becomes entitled to receive a Change in Control Severance Benefit payment under this Plan shall receive a cash payment equal to the product of (i) two weeks of Base Compensation and (ii) the Covered Employee’s Years of Service (including partial years), plus a lump sum cash payment equal to three (3) months of the cost of the employer portion of an Employee’s COBRA health benefits (“COBRA Change in Control Payment”); provided, however, that only those Employees participating in the Bank’s medical benefits programs prior to their termination of employment will qualify for a COBRA Change in Control Payment.  In no event shall any Covered Employee receive a cash payment less than four (4) weeks Base Compensation.  Notwithstanding anything herein to the contrary, the maximum benefit payable to an Employee paid under this Plan, including the COBRA Change in Control Payment, as applicable, shall not exceed an amount equal to fifty-two weeks of Base Compensation, less one dollar.

6.Other Benefits Not Affected

This Plan does not affect other benefits, such as payment for accrued and unused paid time off, and other such benefits that are offered to Employees of the Bank from time to time.

7.Employment Status

This Plan does not constitute a contract of employment or impose on the Employee or the Bank any obligation to retain the services of Employees, to change the status of employment, or to change the Bank’s policies regarding termination of employment.

8.Amendment or Termination

This Plan may be amended, suspended or terminated at any time by a written resolution of the Board of Directors of the Bank, in its sole discretion.  Except however, with respect to the

5

Change in Control Severance Benefits provided under this Plan, paragraph 5 of the Plan may not be amended or terminated if a Change in Control has occurred.

9.Miscellaneous

a.All payments will be subject to customary withholding for federal, state and local tax purposes.

b.This Plan is administered by the Board of Directors of the Bank, which shall have the discretion to interpret the terms of the plan and to make all determinations about eligibility and payments of benefits.  All decisions of the Board of Directors of the Bank are conclusive and binding on all persons.  The Board of Directors may delegate and reallocate any authority and responsibility with respect to the Plan.

c.All amounts payable under the Plan will be paid from the general funds of the Bank; no separate fund will be established under the Plan; and the Plan will have no assets.

d.Notwithstanding anything in this Plan to the contrary, if a Change in Control Benefit that is otherwise payable to an Employee who is a “disqualified individual” would constitute an “excess parachute payment,” taking into account payments under this Plan and otherwise, then the benefit payable under this Plan shall be reduced to the maximum amount which does not include an excess parachute payment.  The terms “disqualified individual” and “excess parachute payment” shall have the same meanings as under Section 280G of the Code.

10.Required Provisions

a.In the event any of the provisions of this paragraph 10 are in conflict with the terms of this Plan, this paragraph 10 shall prevail.

b.The Bank may terminate an Employee’s employment at any time, but any termination by the Bank, other than Termination for Cause, shall not prejudice the Employee’s right to compensation or other benefits under this Plan.  An Employee shall not have the right to receive compensation or other benefits for any period after Termination for Cause.

c.If an Employee is suspended from office and/or temporarily prohibited from participating in the conduct of the Bank’s affairs by a notice served under Section 8(e)(3) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(3) or (g)(1); the Bank’s obligations under this Plan shall be suspended as of the date of service, unless stayed by appropriate proceedings.  If the charges in the notice are dismissed, the Bank may in its discretion:  (i) pay the Employee all or part of the compensation withheld while their contract obligations were

6

suspended; and (ii) reinstate (in whole or in part) any of the obligations which were suspended.

d.If an Employee is removed and/or permanently prohibited from participating in the conduct of the Bank’s affairs by an order issued under Section 8(e)(4) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(4) or (g)(1), all obligations of the Bank under this Plan shall terminate as of the effective date of the order, but vested rights of the Plan participants shall not be affected.

e.If the Bank is in default as defined in Section 3(x)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1813(x)(1), all obligations of the Bank under this Plan shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the Plan participants.

f.All obligations under this Plan shall be terminated, except to the extent determined that continuation of the Plan is necessary for the continued operation of the Bank: (i) by the Director of the Comptroller of the Currency (the “Comptroller”) (or his designee), at the time the Federal Deposit Insurance Corporation (“FDIC”) or the Resolution Trust Corporation enters into an agreement to provide assistance to or on behalf of the Bank under the authority contained in Section 13(c) of the Federal Deposit Insurance Act, 12 U.S.C. §1823(c); or (ii) by the Director of the OCC (or his designee) at the time the Director (or his designee) approves a supervisory merger to resolve problems related to the operations of the Bank or when the Bank is determined by the Director to be in an unsafe or unsound condition.  Any rights of the participants that have already vested, however, shall not be affected by such action.

g.Any payments made to Employees pursuant to this policy, or otherwise, are subject to and conditioned upon their compliance with 12 U.S.C. §1828(k) and FDIC regulation 12 C.F.R. Part 359, Golden Parachute and Indemnification Payments.

Attest:	FOX CHASE BANK
/s/ JERRY D. HOLBROOK		By:	/s/ THOMAS M. PETRO
Secretary		Thomas M. Petro
		President and Chief Executive Officer

7

EX-21.0

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Exhibit 21.0

Subsidiaries

Registrant	Percentage Ownership			Jurisdiction or State of Incorporation
Fox Chase Bancorp, Inc.				Maryland
Subsidiaries
Fox Chase Bank		100	%	United States
Fox Chase Financial, Inc.(1)		100	%	Delaware
Fox Chase Service Corporation(1)		100	%	Pennsylvania
Davisville Associates, LLC(1)		100	%	Pennsylvania
104 S. Oakland Ave., LLC(1)		100	%	New Jersey

(1)

Wholly owned subsidiary of Fox Chase Bank.

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Exhibit 21.0

Subsidiaries

EX-23.1

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Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

The Board of Directors
Fox Chase Bancorp, Inc.:

        We consent to the incorporation by reference in the registration statements No. 333-167942, No. 333-167941 and No. 333-176398 on Form S-8 of Fox Chase Bancorp, Inc. (the Company) of our reports dated March 13, 2013, with respect to the consolidated statements of condition of Fox Chase Bancorp, Inc. and subsidiary as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2012, and the effectiveness of internal control over financial reporting as of December 31, 2012, which reports appear in the December 31, 2012 annual report on Form 10-K of Fox Chase Bancorp, Inc.

/s/ KPMG LLP

Philadelphia, Pennsylvania
March 13, 2013

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Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

EX-31.1

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Exhibit 31.1

CERTIFICATION

I, Thomas M. Petro, certify that:

1.

I have reviewed this Annual Report on Form 10-K of Fox Chase Bancorp, Inc.:

2.

Based on my knowledge, this annual 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 annual report;

3.

Based on my knowledge, the financial statements, and other financial information included in this annual 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 annual 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 controls 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 annual 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 annual report our conclusions about the effectiveness of the disclosure controls and procedures, as the end of the period covered by this annual 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 (the registrant's fourth fiscal quarter in the case of an annual report) 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 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: March 13, 2013 /s/ THOMAS M. PETRO
Thomas M. Petro
President and Chief Executive Officer
(principal executive officer)

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Exhibit 31.1

CERTIFICATION

EX-31.2

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Exhibit 31.2

CERTIFICATION

I, Roger S. Deacon, certify that:

1.

I have reviewed this Annual Report on Form 10-K of Fox Chase Bancorp, Inc.:

2.

Based on my knowledge, this annual 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 annual report;

3.

Based on my knowledge, the financial statements, and other financial information included in this annual 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 annual 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 controls 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 annual 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 annual report our conclusions about the effectiveness of the disclosure controls and procedures, as the end of the period covered by this annual 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 (the registrant's fourth fiscal quarter in the case of an annual report) 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 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: March 13, 2013 /s/ ROGER S. DEACON
Roger S. Deacon
Chief Financial Officer
(principal financial officer)

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Exhibit 31.2

CERTIFICATION

EX-32

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Exhibit 32

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADDED BY
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

        In connection with the Annual Report of Fox Chase Bancorp, Inc. (the "Company") on Form 10-K for the year ended December 31, 2012 as filed with the Securities and Exchange Commission (the "Report"), the undersigned hereby certify, pursuant to 18 U.S.C. §1350, as added by § 906 of the Sarbanes-Oxley Act of 2002, that:

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and



(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the Report.

/s/ THOMAS M. PETRO
Thomas M. Petro
President and Chief Executive Officer

/s/ ROGER S. DEACON
Roger S. Deacon
Chief Financial Officer

Date: March 13, 2013

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Exhibit 32

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADDED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

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STOCKHOLDERS' EQUITY (Tables)

12 Months Ended

Dec. 31, 2012

STOCKHOLDERS' EQUITY

Schedule of capital amounts and ratios

	Actual					For Capital Adequacy Purposes					To be Well Capitalized under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in Thousands)
December 31, 2012
Total risk-based capital (to risk-weighted assets)		147,659		20.48	%		³57,682		³8.0	%		³72,103		³10.0	%
Tier 1 capital (to risk-weighted assets)		140,240		19.45			³28,841		³4.0			³43,262		³6.0
Tier 1 capital (to adjusted assets)		140,240		12.90			³43,475		³4.0			³54,344		³5.0
December 31, 2011
Total risk-based capital (to risk-weighted assets)		161,494		23.90	%		³54,054		³8.0	%		³67,567		³10.0	%
Tier 1 capital (to risk-weighted assets)		154,623		22.88			³27,027		³4.0			³40,540		³6.0
Tier 1 capital (to adjusted assets)		154,787		15.30			³40,461		³4.0			³50,576		³5.0

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LOANS (Details 2) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Changes in allowance for loan losses
Balance, beginning	$ 12,075	$ 12,443	$ 10,605
Provision for loan losses	3,478	5,734	6,213
Loans charged off	(4,527)	(6,331)	(4,402)
Recoveries	144	229	27
Balance, ending	$ 11,170	$ 12,075	$ 12,443

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 6) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Net income	$ 1,900	$ 1,436	$ 539	$ 1,187	$ 1,044	$ 1,232	$ 1,257	$ 1,246	$ 5,062	$ 4,779	$ 2,744
Weighted-average common shares outstanding (in shares)									12,624,068	14,112,359	14,548,812
Average common stock acquired by stock benefit plans:
Unvested shares - long -term incentive plan											(7,582)
ESOP shares unallocated									(651,538)	(716,530)	(607,235)
Shares purchased by trust									(372,653)	(249,670)	(199,111)
Weighted-average common shares used to calculate basic earnings per share (in shares)	11,431,957	11,535,146	11,624,120	11,808,632	12,214,704	13,087,582	13,662,264	13,636,010	11,599,877	13,146,159	13,734,884
Dilutive effect of:
Unvested shares - long -term incentive plan											7,582
Restricted stock awards									29,653	33,089	10,132
Stock option awards									117,731	52,582
Weighted average common share-diluted (in shares)	11,622,035	11,718,308	11,750,623	11,901,737	12,287,733	13,175,689	13,770,934	13,678,887	11,747,261	13,231,830	13,752,598
Earnings per share-basic (in dollars per share)	$ 0.17	$ 0.12	$ 0.05	$ 0.10	$ 0.09	$ 0.09	$ 0.09	$ 0.09	$ 0.44	$ 0.36	$ 0.20
Earnings per share-diluted (in dollars per share)	$ 0.16	$ 0.12	$ 0.05	$ 0.10	$ 0.09	$ 0.09	$ 0.09	$ 0.09	$ 0.43	$ 0.36	$ 0.20
Outstanding common stock equivalents having no dilutive effect (in shares)									860,842	822,461	807,827

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EMPLOYEE BENEFITS (Details) (USD $)	12 Months Ended									0 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2012 ESOP item	Dec. 31, 2011 ESOP	Dec. 31, 2010 ESOP	Dec. 31, 2006 ESOP Initial 2006 stock offering	Dec. 31, 2012 ESOP Initial 2006 stock offering	Dec. 31, 2011 ESOP Initial 2006 stock offering	Jun. 29, 2010 ESOP Mutual-to-stock conversion	Dec. 31, 2012 ESOP Mutual-to-stock conversion	Dec. 31, 2011 ESOP Mutual-to-stock conversion
401(k) Plan
Employer's matching contribution on the first 6% of employee contribution (as a percent)	33.00%
Percentage of employee's discretionary contribution matched by 33% of employer contribution	6.00%
Contribution by employer	$ 131,000	$ 121,000	$ 110,000
Employee Stock Ownership Plan
Number of shares purchased				963,767			615,267			348,500
Loans outstanding				6,700,000				3,700,000	4,000,000		3,000,000	3,200,000
Number of stock purchase transactions				2
Purchase price (in dollars per share)							$ 9.35			$ 10.00
Shares allocated	347,210			347,210
Unallocated shares	616,557			616,557				328,142			288,415
Shares annually released based upon the ratio that the current principal and interest payment bears to the current and remaining scheduled future principal and interest payments				65,053
Fair market value of unallocated shares								5,500,000			4,800,000
Compensation expense				$ 921,000	$ 840,000	$ 522,000

XML

LOANS (Details 3) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Changes in allowance for loan losses
Balance, beginning	$ 12,075	$ 12,443	$ 10,605
Provision for loan losses	3,478	5,734	6,213
Loans charged off	(4,527)	(6,331)	(4,402)
Recoveries	144	229	27
Balance, ending	11,170	12,075	12,443
One- to Four-Family
Changes in allowance for loan losses
Balance, beginning	1,760	1,990
Provision for loan losses	286	324
Loans charged off	(1,408)	(567)
Recoveries	4	13
Balance, ending	642	1,760
Multi-family and Commercial
Changes in allowance for loan losses
Balance, beginning	6,112	4,624
Provision for loan losses	1,064	2,608
Loans charged off	(887)	(1,290)
Recoveries	38	170
Balance, ending	6,327	6,112
Construction Loans
Changes in allowance for loan losses
Balance, beginning	869	3,260
Provision for loan losses	252	1,010
Loans charged off	(340)	(3,445)
Recoveries	92	44
Balance, ending	873	869
Consumer Loans
Changes in allowance for loan losses
Balance, beginning	455	665
Provision for loan losses	1,659	221
Loans charged off	(1,892)	(433)
Recoveries	10	2
Balance, ending	232	455
Commercial and Industrial Loans
Changes in allowance for loan losses
Balance, beginning	2,657	1,707
Provision for loan losses	(27)	1,546
Loans charged off		(596)
Balance, ending	2,630	2,657
Unallocated
Changes in allowance for loan losses
Balance, beginning	222	197
Provision for loan losses	244	25
Balance, ending	$ 466	$ 222

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FAIR VALUE (Details) (USD $)	12 Months Ended
	Dec. 31, 2012 item	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
FAIR VALUE
Number of external pricing service providers	1
Number of quotes per investment security obtained	1
Financial assets:
Cash and cash equivalents	$ 25,090,000	$ 7,586,000	$ 38,314,000	$ 65,418,000
Investment securities available-for-sale	296,107,000	248,770,000
Mortgage related securities	283,616,000	225,664,000
Held to maturity securities	29,451,000	41,758,000
Federal Home Loan Bank stock	8,097,000	8,074,000
Accrued interest receivable	3,223,000	4,578,000
Financial liabilities:
Savings and club accounts	99,046,000	80,740,000
Accrued interest payable	330,000	418,000
Private label residential mortgage related security
Financial assets:
Investment securities available-for-sale		122,000
Private label commercial mortgage related securities
Financial assets:
Investment securities available-for-sale	6,197,000	8,906,000
Agency residential mortgage related securities
Financial assets:
Investment securities available-for-sale	277,419,000	216,636,000
Held to maturity securities	29,451,000	41,758,000
Carrying Amount | Level 1
Financial assets:
Cash and cash equivalents	25,090,000	7,586,000
Carrying Amount | Level 2
Financial assets:
Investment securities available-for-sale	12,491,000	23,106,000
Mortgage servicing rights	170,000	316,000
Financial liabilities:
Savings and club accounts	99,046,000	80,740,000
Demand, NOW and money market deposits	275,693,000	257,989,000
Brokered deposits	50,637,000	10,162,000
Certificates of deposit	262,033,000	327,703,000
Short-term borrowings	70,500,000	8,500,000
Federal Home Loan Bank advances	110,000,000	88,278,000
Other borrowed funds	30,000,000	50,000,000
Accrued interest payable	330,000	418,000
Carrying Amount | Level 3
Financial assets:
Loans receivable, net	683,865,000	670,572,000
Federal Home Loan Bank stock	8,097,000	8,074,000
Accrued interest receivable	3,223,000	4,578,000
Financial assets acquired from debtors	3,714,000
Carrying Amount | Level 2, 3
Financial liabilities:
Derivative contracts	320,000	279,000
Carrying Amount | Private label residential mortgage related security | Level 3
Financial assets:
Mortgage related securities		122,000
Carrying Amount | Private label commercial mortgage related securities | Level 3
Financial assets:
Mortgage related securities	6,197,000	8,906,000
Carrying Amount | Agency residential mortgage related securities | Level 2
Financial assets:
Mortgage related securities	277,419,000	216,636,000
Held to maturity securities	28,369,000	41,074,000
Estimated Fair Value | Level 1
Financial assets:
Cash and cash equivalents	25,090,000	7,586,000
Estimated Fair Value | Level 2
Financial assets:
Investment securities available-for-sale	12,491,000	23,106,000
Mortgage servicing rights	170,000	322,000
Financial liabilities:
Savings and club accounts	99,046,000	80,740,000
Demand, NOW and money market deposits	275,693,000	257,989,000
Brokered deposits	50,715,000	10,129,000
Certificates of deposit	264,694,000	330,941,000
Short-term borrowings	70,500,000	8,500,000
Federal Home Loan Bank advances	115,767,000	95,878,000
Other borrowed funds	33,651,000	55,103,000
Accrued interest payable	330,000	418,000
Estimated Fair Value | Level 3
Financial assets:
Loans receivable, net	686,867,000	672,847,000
Federal Home Loan Bank stock	8,097,000	8,074,000
Accrued interest receivable	3,223,000	4,578,000
Financial assets acquired from debtors	3,714,000
Estimated Fair Value | Level 2, 3
Financial liabilities:
Derivative contracts	320,000	279,000
Estimated Fair Value | Private label residential mortgage related security | Level 3
Financial assets:
Mortgage related securities		122,000
Estimated Fair Value | Private label commercial mortgage related securities | Level 3
Financial assets:
Mortgage related securities	6,197,000	8,906,000
Estimated Fair Value | Agency residential mortgage related securities | Level 2
Financial assets:
Mortgage related securities	277,419,000	216,636,000
Held to maturity securities	$ 29,451,000	$ 41,758,000

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 4)	12 Months Ended
	Dec. 31, 2012
Initial 2006 stock offering
Employee Stock Ownership Plan
Period over which borrowed funds will be repaid	15 years
Mutual-to-stock conversion
Employee Stock Ownership Plan
Period over which borrowed funds will be repaid	14 years 6 months

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PREMISES AND EQUIPMENT (Tables)

12 Months Ended

Dec. 31, 2012

PREMISES AND EQUIPMENT

Schedule of components of premises and equipment

The components of premises and equipment at December 31, 2012 and 2011 were as follows (in thousands):

	December 31,
	2012			2011
Land	$	3,207		$	3,207
Buildings		13,661			13,479
Leasehold improvements		201			190
Furniture, fixtures and equipment		4,827			5,125
		21,896			22,001
Less: accumulated depreciation		(11,453	)		(11,570	)
Premises and equipment, net	$	10,443		$	10,431

Schedule of rental expenses

The following rental expenses were included in the Company's financial statements (in thousands):

	December 31,
	2012		2011		2010
	(In thousands)
Office rent	$	449	$	486	$	470
Equipment lease		2		2		6
	$	451	$	488	$	476

Schedule of minimum future rental payments under non-cancelable leases for premises and equipment

The following table shows the minimum future rental payments under non-cancelable leases for premises and equipment as of December 31, 2012 (in thousands):

Year
2013	$	399
2014		417
2015		428
2016		36
2017		—

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FAIR VALUE (Details 2) (USD $)	12 Months Ended
	Dec. 31, 2012 item	Dec. 31, 2011
Fair value measurement
Net unrealized gain	$ 7,206,000	$ 10,582,000
Number of life insurance policies acquired	8
Losses resulting from changes in fair value	692,000
Net unrealized loss, including other-than-temporary impairment in accumulated other comprehensive income	186,000	310,000
Available for Sale Securities	296,107,000	248,770,000
Private label commercial mortgage related securities
Fair value measurement
Net unrealized gain	78,000	107,000
Loans
Fair value measurement
Number of loans	2
Unrealized gain on loans	293,000	268,000
Private label collateralized mortgage obligation
Fair value measurement
Net unrealized loss, including other-than-temporary impairment in accumulated other comprehensive income		42,000
Recurring basis | Balance
Fair value measurement
Financial assets acquired from debtors	3,714,000
Assets	302,307,000	251,368,000
Recurring basis | Balance | Obligations of U.S. government agencies
Fair value measurement
Available for Sale Securities	314,000	6,514,000
Recurring basis | Balance | State and political subdivisions
Fair value measurement
Available for Sale Securities		1,873,000
Recurring basis | Balance | Corporate securities
Fair value measurement
Available for Sale Securities	12,177,000	14,719,000
Recurring basis | Balance | Private label residential mortgage related security
Fair value measurement
Available for Sale Securities		122,000
Recurring basis | Balance | Private label commercial mortgage related securities
Fair value measurement
Available for Sale Securities	6,197,000	8,906,000
Recurring basis | Balance | Agency residential mortgage related securities
Fair value measurement
Available for Sale Securities	277,419,000	216,636,000
Recurring basis | Balance | Loans
Fair value measurement
Assets	2,806,000	2,877,000
Recurring basis | Balance | Derivatives contracts
Fair value measurement
Liabilities	(320,000)	(279,000)
Recurring basis | Significant Other Observable Inputs (Level 2)
Fair value measurement
Assets	289,602,000	239,463,000
Recurring basis | Significant Other Observable Inputs (Level 2) | Obligations of U.S. government agencies
Fair value measurement
Available for Sale Securities	314,000	6,514,000
Recurring basis | Significant Other Observable Inputs (Level 2) | State and political subdivisions
Fair value measurement
Available for Sale Securities		1,873,000
Recurring basis | Significant Other Observable Inputs (Level 2) | Corporate securities
Fair value measurement
Available for Sale Securities	12,177,000	14,719,000
Recurring basis | Significant Other Observable Inputs (Level 2) | Agency residential mortgage related securities
Fair value measurement
Available for Sale Securities	277,419,000	216,636,000
Recurring basis | Significant Other Observable Inputs (Level 2) | Derivatives contracts
Fair value measurement
Liabilities	(308,000)	(279,000)
Recurring basis | Significant Other Unobservable Inputs (Level 3)
Fair value measurement
Financial assets acquired from debtors	3,714,000
Assets	12,705,000	11,905,000
Recurring basis | Significant Other Unobservable Inputs (Level 3) | Private label residential mortgage related security
Fair value measurement
Available for Sale Securities		122,000
Recurring basis | Significant Other Unobservable Inputs (Level 3) | Private label commercial mortgage related securities
Fair value measurement
Available for Sale Securities	6,197,000	8,906,000
Recurring basis | Significant Other Unobservable Inputs (Level 3) | Loans
Fair value measurement
Assets	2,806,000	2,877,000
Recurring basis | Significant Other Unobservable Inputs (Level 3) | Derivatives contracts
Fair value measurement
Unrealized loss on credit derivatives	12,000
Liabilities	(12,000)
Non-recurring basis | Balance
Fair value measurement
Mortgage servicing rights	170,000	282,000
Assets	7,931,000	5,195,000
Non-recurring basis | Balance | Loans
Fair value measurement
Assets	2,951,000	2,490,000
Non-recurring basis | Balance | Other real estate owned
Fair value measurement
Assets	4,810,000	2,423,000
Non-recurring basis | Significant Other Observable Inputs (Level 2)
Fair value measurement
Mortgage servicing rights	170,000	282,000
Assets	170,000	282,000
Non-recurring basis | Significant Other Unobservable Inputs (Level 3)
Fair value measurement
Assets	7,761,000	4,913,000
Non-recurring basis | Significant Other Unobservable Inputs (Level 3) | Loans
Fair value measurement
Assets	2,951,000	2,490,000
Non-recurring basis | Significant Other Unobservable Inputs (Level 3) | Other real estate owned
Fair value measurement
Assets	$ 4,810,000	$ 2,423,000

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INCOME TAXES (Details) (USD $)	3 Months Ended								12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Components of income tax expense (benefits)
Current									$ 2,408,000	$ 2,555,000	$ 1,129,000
Deferred									(140,000)	(359,000)	(13,000)
Federal income tax expense (benefit)									2,268,000	2,196,000	1,116,000
Deferred									50,000	16,000	4,000
State income tax expense (benefit)									50,000	16,000	4,000
Income tax expense (benefit)	858,000	666,000	222,000	572,000	477,000	572,000	593,000	570,000	2,318,000	2,212,000	1,120,000
Statutory rate (as a percent)									34.00%
Income tax rate reconciliation
Federal income tax at statutory rate									2,509,000	2,377,000	1,314,000
Tax exempt interest, net									(62,000)	(62,000)	(113,000)
Bank-owned life insurance									(160,000)	(159,000)	(160,000)
ESOP compensation expense									101,000	73,000	6,000
Equity incentive plans										1,000	46,000
Other, net									13,000	13,000	23,000
Dividends received from equity method investments									(49,000)	(13,000)
Dividends paid on benefit plans									(67,000)	(26,000)
State taxes, net									304,000	126,000	436,000
Decrease in valuation allowance									(271,000)	(118,000)	(432,000)
Total Provision									2,318,000	2,212,000	1,120,000
Effective tax rate (as a percent)									31.41%	31.64%	28.99%
Deferred tax assets:
Allowance for loan losses, net	3,798,000				4,106,000				3,798,000	4,106,000
Provision for loss on assets acquired through foreclosure	966,000				402,000				966,000	402,000
Nonaccrual interest	569,000				502,000				569,000	502,000
Accrued compensation	151,000				151,000				151,000	151,000
Equity incentive plans	734,000				644,000				734,000	644,000
Accrued expenses	370,000				345,000				370,000	345,000
Deferred lease liability	51,000				10,000				51,000	10,000
Impairment loss on investments					176,000					176,000
State net operating loss carryforward	73,000				343,000				73,000	343,000
Total	6,712,000				6,679,000				6,712,000	6,679,000
Valuation allowance	(36,000)				(307,000)				(36,000)	(307,000)
Net	6,676,000				6,372,000				6,676,000	6,372,000
Deferred tax liability
Prepaid expense deduction	238,000				181,000				238,000	181,000
Mortgage servicing rights	58,000				107,000				58,000	107,000
Loan origination costs	39,000				58,000				39,000	58,000
Deferrable earnings on investments	439,000				227,000				439,000	227,000
Depreciation of premises and equipment	471,000				458,000				471,000	458,000
Unrealized gains on securities available-for-sale	2,478,000				3,659,000				2,478,000	3,659,000
Deferred tax liability	3,723,000				4,690,000				3,723,000	4,690,000
Net Deferred Tax Asset	2,953,000				1,682,000				2,953,000	1,682,000
Other income tax disclosures
State net operating loss carryforward not likely to be realized	36,000								36,000
Amount for which no federal income tax provision has been made	6,000,000				6,000,000				6,000,000	6,000,000	6,000,000
State net operating loss	517,000								517,000
Fox Chase Service Corporation | State
Deferred tax assets:
State net operating loss carryforward	37,000								37,000
Other income tax disclosures
State net operating loss	$ 368,000								$ 368,000

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LOANS (Details 5) (USD $)	12 Months Ended
	Dec. 31, 2012 loan	Dec. 31, 2011 loan	Dec. 31, 2010
TDR activity
Number of Loans, Restructured Current Year	7	5
Pre-Modification Outstanding Recorded Investment, Restructured Current Year	$ 1,200,000	$ 5,044,000
Post-Modification Outstanding Recorded Investment, Restructured Current Year	1,200,000	5,044,000
Number of Loans Defaulted, Restructured in Prior Twelve Months	4	2
Post-Modification Outstanding Recorded Investment, Restructured in Prior Twelve Months	262,000	3,715,000
TDRs additional disclosure
Number of troubled debt restructurings, nonaccrual status	7	2
Troubled debt restructurings excluded from accruing TDR	6,900,000	5,200,000
Total TDRs	14,300,000	12,400,000
TDRs at prior fiscal year end	13,100,000	7,400,000
New TDRs during the period	1,200,000	5,000,000
Number of incremental loans classified as TDRs during the period	7	5
Number of loans classified as TDRs	14	8
Loans on which accrual of interest has been discontinued	17,124,000	17,078,000
Increase in interest income, if recognized	1,500,000	1,100,000	1,500,000
Loans past due 90 days or more and still accruing interest	0	3,900,000	0
One- to four-family
TDR activity
Number of Loans, Restructured Current Year	4	2
Pre-Modification Outstanding Recorded Investment, Restructured Current Year	582,000	307,000
Post-Modification Outstanding Recorded Investment, Restructured Current Year	582,000	307,000
Number of Loans Defaulted, Restructured in Prior Twelve Months	3
Post-Modification Outstanding Recorded Investment, Restructured in Prior Twelve Months	254,000
TDRs additional disclosure
Loans on which accrual of interest has been discontinued	3,355,000	6,885,000
Multi-family and commercial
TDR activity
Number of Loans, Restructured Current Year	2	1
Pre-Modification Outstanding Recorded Investment, Restructured Current Year	604,000	4,673,000
Post-Modification Outstanding Recorded Investment, Restructured Current Year	604,000	4,673,000
TDRs additional disclosure
TDRs at prior fiscal year end	6,300,000	1,800,000
New TDRs during the period	590,000	4,700,000
Number of incremental loans classified as TDRs during the period	2	1
Period for payment of interest by borrower on troubled debt restructuring loan		9 months
Numbers of loans classified as TDRs at prior fiscal year end which remain TDRs at current period end	2	1
Loans on which accrual of interest has been discontinued	5,284,000	3,814,000
Multi-family and commercial, one
TDRs additional disclosure
New TDRs during the period	504,000
Period for payment of interest by borrower on troubled debt restructuring loan	7 months
Multi-family and commercial, two
TDRs additional disclosure
New TDRs during the period	86,000
Construction
TDR activity
Number of Loans Defaulted, Restructured in Prior Twelve Months		1
Post-Modification Outstanding Recorded Investment, Restructured in Prior Twelve Months		3,115,000
TDRs additional disclosure
Number of troubled debt restructurings, included in nonaccrual status and total impaired loans	2	2
Troubled debt restructurings excluded from accruing TDR	6,400,000
TDRs at prior fiscal year end	6,400,000	5,600,000
Commitments to lend additional funds	855,000
Numbers of loans classified as TDRs at prior fiscal year end which remain TDRs at current period end	2	2
Loans on which accrual of interest has been discontinued	6,434,000	6,372,000
Consumer loans
TDR activity
Number of Loans, Restructured Current Year	1	2
Pre-Modification Outstanding Recorded Investment, Restructured Current Year	14,000	64,000
Post-Modification Outstanding Recorded Investment, Restructured Current Year	14,000	64,000
Number of Loans Defaulted, Restructured in Prior Twelve Months	1
Post-Modification Outstanding Recorded Investment, Restructured in Prior Twelve Months	8,000
TDRs additional disclosure
Number of troubled debt restructurings, nonaccrual status	1
Troubled debt restructurings excluded from accruing TDR	8,000
TDRs at prior fiscal year end	8,000
New TDRs during the period	14,000	64,000
Number of incremental loans classified as TDRs during the period	1	2
Numbers of loans classified as TDRs at prior fiscal year end which remain TDRs at current period end	1
Loans on which accrual of interest has been discontinued	2,051,000	7,000
Commercial and industrial loans
TDR activity
Number of Loans Defaulted, Restructured in Prior Twelve Months		1
Post-Modification Outstanding Recorded Investment, Restructured in Prior Twelve Months		600,000
Residential loans
TDRs additional disclosure
Number of troubled debt restructurings, nonaccrual status	4
Troubled debt restructurings excluded from accruing TDR	435,000
TDRs at prior fiscal year end	365,000
New TDRs during the period	$ 577,000	$ 307,000
Number of incremental loans classified as TDRs during the period	4	2
Numbers of loans classified as TDRs at prior fiscal year end which remain TDRs at current period end	2

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STOCKHOLDERS' EQUITY (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Total risk-based capital (to risk-weighted assets)
Actual, Amount	$ 147,659	$ 161,494
Actual, Ratio (as a percent)	20.48%	23.90%
Tier 1 capital (to risk-weighted assets)
Actual, Amount	140,240	154,623
Actual, Ratio (as a percent)	19.45%	22.88%
Tier 1 capital (to adjusted assets)
Actual, Amount	140,240	154,787
Actual, Ratio (as a percent)	12.90%	15.30%
Minimum
Total risk-based capital (to risk-weighted assets)
For Capital Adequacy Purposes, Amount	57,682	54,054
For Capital Adequacy Purposes, Ratio (as a percent)	8.00%	8.00%
To Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	72,103	67,567
To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio (as a percent)	10.00%	10.00%
Tier 1 capital (to risk-weighted assets)
For Capital Adequacy Purposes, Amount	28,841	27,027
For Capital Adequacy Purposes, Ratio (as a percent)	4.00%	4.00%
To Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	43,262	40,540
To Be Well Capitalized Under Prompt Corrective Action Provisions Ratio (as a percent)	6.00%	6.00%
Tier 1 capital (to adjusted assets)
For Capital Adequacy Purposes, Amount	43,475	40,461
For Capital Adequacy Purposes, Ratio (as a percent)	4.00%	4.00%
To Be Well Capitalized Under Prompt Corrective Action Provisions, Amount	$ 54,344	$ 50,576
To Be Well Capitalized Under Prompt Corrective Action Provisions, Ratio (as a percent)	5.00%	5.00%

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RELATED PARTY TRANSACTIONS (Details) (PMA, USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
RELATED PARTY TRANSACTIONS
Ownership percentage	45.00%	45.00%	45.00%
Loans acquired	$ 14,400,000	$ 10,600,000	$ 23,900,000
Value of investments	2,000,000	1,500,000
Value of assets	32,500,000	16,400,000
Value of liabilities	28,500,000	13,500,000
Net revenues	7,800,000	5,000,000	4,900,000
Expenses (including income taxes)	6,300,000	4,400,000	4,500,000
Net income	1,500,000	557,000	438,000
Warehouse line of credit facility
RELATED PARTY TRANSACTIONS
Interest income	460,000	220,000	285,000
Loan satisfaction fees	66,000	50,000	65,000
Balance outstanding	15,200,000	9,500,000
Term loan
RELATED PARTY TRANSACTIONS
Interest income		25,000	15,000
Loans issued			$ 1,200,000

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STOCKHOLDERS' EQUITY (Details 2) (USD $)	0 Months Ended	3 Months Ended					12 Months Ended			0 Months Ended		3 Months Ended				12 Months Ended
	Jun. 29, 2010	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Jun. 30, 2010	Mar. 31, 2010	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Jun. 29, 2010 Mutual-to-stock conversion	Mar. 05, 2013 Common Stock	Dec. 31, 2012 Common Stock item	Sep. 30, 2012 Common Stock	Jun. 30, 2012 Common Stock	Mar. 31, 2012 Common Stock	Dec. 31, 2012 Common Stock	Dec. 31, 2011 Common Stock
STOCKHOLDERS' EQUITY
Cash dividend on common share (in dollars per share)							$ 0.20	$ 0.08			$ 0.06	$ 0.08	$ 0.04	$ 0.04	$ 0.04
Number of dividends paid												2
Proceeds from mutual to stock conversion	$ 77,800,000									$ 77,800,000
Capital contribution to subsidiary					41,000,000	7,500,000			48,500,000
Dividend received from subsidiary		11,500,000	1,900,000	7,900,000
Net income of subsidiary			1,500,000
Special dividend received from subsidiary		10,000,000
Common stock repurchased (in shares)																724,700	1,524,900
Common stock repurchased							$ 9,911,000	$ 19,822,000								$ 29,700,000

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EMPLOYEE BENEFITS (Details 2) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Long-Term Incentive Plan
Compensation expense	$ 1,000,000	$ 1,000,000	$ 929,000
Long term incentive plan
Long-Term Incentive Plan
Compensation expense	$ 0	$ 0	$ 89,000

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ACCOUNTING PRONOUNCEMENTS

12 Months Ended

Dec. 31, 2012

ACCOUNTING PRONOUNCEMENTS

ACCOUNTING PRONOUNCEMENTS

NOTE 16—ACCOUNTING PRONOUNCEMENTS

        Accounting Standards Update (ASU) No. 2011-03—Transfers and Servicing (Topic 860):    Reconsideration of Effective Control for Repurchase Agreements. This update 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 No. 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 No. 2011-03 was effective for the Company on January 1, 2012 and did not have a material impact on the Company's financial position or results of operations.

        Accounting Standards Update (ASU) No. 2011-04—Fair Value Measurement (Topic 820):    Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS. The amendments were issued to achieve convergence between U.S. GAAP and IFRS. The guidance clarifies how a principal market is determined, addresses the fair value measurement of instruments with offsetting market or counterparty credit risks and the concept of valuation premise and highest and best use, extends the prohibition on blockage factors to all three levels of the fair value hierarchy, and requires additional disclosures. ASU No. 2011-04 was effective for the Company on January 1, 2012 and was to be applied prospectively. Adoption of this update did not have a material impact on the Company's financial position or results of operations but did result in additional disclosures within the fair value footnote.

        Accounting Standards Update (ASU) No. 2011-05—Comprehensive Income (Topic 220): Presentation of Comprehensive Income.    The provisions of ASU No. 2011-05 are intended to improve the comparability, consistency and transparency of financial reporting and to increase prominence of the items reported in other comprehensive income. The guidance requires entities to report the total of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous financial statement or in two separate financial statements. This update was effective for the Company on January 1, 2012, and was to be applied retrospectively. Adoption of this update resulted in the addition of the Consolidated Statements of Comprehensive Income and the removal of the Comprehensive Income footnote.

        Accounting Standards Update (ASU) No. 2011-11—Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities.    The provisions of ASU No. 2011-11 are intended to enhance current disclosure requirements on offsetting financial assets and liabilities. The new disclosures will enable financial statement users to compare balance sheets prepared under U.S. GAAP and International Financial Reporting Standards (IFRS), which are subject to different offsetting models. The disclosures will be limited to financial instruments (and derivatives) subject to enforceable master netting arrangements or similar agreements and will be effective for the Company on January 1, 2013 and is to be applied retrospectively. The Company has evaluated the guidance included in this update and has determined that it is not expected to have a material impact on the Company's financial position or results of operations.

        Accounting Standards Update (ASU) No. 2013-01—Balance Sheet (Topic 210): Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities.    This update clarifies that the scope of ASU No. 2011-11 applies to derivatives accounted for in accordance with Topic 815, Derivatives and Hedging, including bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are either offset in accordance with Section 210-20-45 or Section 815-10-45 or subject to an enforceable master netting arrangement or similar agreement. An entity is required to apply the amendments for fiscal years beginning on or after January 1, 2013, and interim periods within those annual periods. An entity should provide the required disclosures retrospectively for all comparative periods presented. The Company has evaluated the guidance included in this update and has determined that it is not expected to have a material impact on the Company's financial position or results of operations.

        Accounting Standards Update (ASU) No. 2013-02—Comprehensive Income (Topic 220)—Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.    This update requires an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required under U.S. GAAP to be reclassified in its entirety to net income. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures required under U.S. GAAP that provide additional detail about those amounts. This would be the case when a portion of the amount reclassified out of accumulated other comprehensive income is reclassified to a balance sheet account instead of directly to income or expense in the same reporting period. For the Company, the amendment is effective prospectively for reporting periods beginning after December 15, 2012. The Company does not expect the guidance will have a material impact on its financial statements but will result in a revised presentation of reclassifications of items out of accumulated other comprehensive income.

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INVESTMENT AND MORTGAGE RELATED SECURITIES (Details 2) (USD $)	12 Months Ended
	Dec. 31, 2012 security	Dec. 31, 2011
INVESTMENT AND MORTGAGE RELATED SECURITIES
Amortized Cost	$ 289,087,000	$ 238,544,000
Fair Value	296,107,000	248,770,000
Other-than-temporarily impairment amount recognized on statement of operations		361,000
Other-than-temporarily impairment amount		407,000
Other-than-temporary impairment in accumulated other comprehensive income		46,000
Net unrealized gain	7,206,000	10,582,000
Fair Value of securities impaired greater than twelve months	2,879,000	3,000,000
Number of securities with temporary impairment	10
Net unrealized loss	186,000	310,000
AAA
INVESTMENT AND MORTGAGE RELATED SECURITIES
Number of securities with temporary impairment	9
Mortgage related securities
INVESTMENT AND MORTGAGE RELATED SECURITIES
Amortized cost of securities sold	82,300,000
Recognized gains (losses)	3,300,000
Amortized Cost	276,580,000	215,248,000
Fair Value	283,616,000	225,664,000
Net unrealized gain	7,101,000	10,468,000
Fair Value of securities impaired greater than twelve months		122,000
Net unrealized loss	65,000	6,000
Corporate securities
INVESTMENT AND MORTGAGE RELATED SECURITIES
Amortized Cost	12,207,000	15,007,000
Fair Value	12,177,000	14,719,000
Net unrealized gain	91,000	16,000
Fair Value of securities impaired greater than twelve months	2,879,000	2,878,000
Net unrealized loss	121,000	304,000
Corporate securities | Baa2
INVESTMENT AND MORTGAGE RELATED SECURITIES
Number of securities impaired greater than twelve months	1
Fair Value of securities impaired greater than twelve months	2,900,000
Net unrealized loss	121,000
Private label residential mortgage related security
INVESTMENT AND MORTGAGE RELATED SECURITIES
Amortized cost of securities sold	157,000
Recognized gains (losses)	(87,000)
Amortized Cost		164,000
Fair Value		122,000
Number of securities held		1
Other-than-temporary impairment in accumulated other comprehensive income		42,000
Net unrealized gain		4,000
Fair Value of securities impaired greater than twelve months		122,000
Private label commercial mortgage related securities
INVESTMENT AND MORTGAGE RELATED SECURITIES
Amortized Cost	6,119,000	8,799,000
Fair Value	6,197,000	8,906,000
Number of securities held	3	3
Net unrealized gain	78,000	107,000
Obligations of U.S. government agencies
INVESTMENT AND MORTGAGE RELATED SECURITIES
Amortized cost of securities sold	6,100,000
Recognized gains (losses)	64,000
Amortized Cost	300,000	6,424,000
Fair Value	314,000	6,514,000
Number of securities sold	2
Net unrealized gain	$ 14,000	$ 90,000

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QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables)

12 Months Ended

Dec. 31, 2012

QUARTERLY FINANCIAL DATA (UNAUDITED)

Schedule of quarterly financial data (unaudited)

Three Months Ended	12/31/12		9/30/12		6/30/12		3/31/12		12/31/11		9/30/11		6/30/11		3/31/11
Interest income	$	9,950	$	10,531	$	10,411	$	10,942	$	11,102	$	11,606	$	11,607	$	11,631
Interest expense		2,117		2,298		2,740		2,962		3,114		3,545		3,827		4,009
Net interest income		7,833		8,233		7,671		7,980		7,988		8,061		7,780		7,622
Provision for loan losses		442		470		1,291		1,275		2,825		1,034		900		975
Net interest income after
provision for loan losses		7,391		7,763		6,380		6,705		5,163		7,027		6,880		6,647
Noninterest income		1,804		737		3,080		694		1,959		467		450		467
Noninterest expense		6,437		6,398		8,699		5,640		5,601		5,690		5,480		5,298
Income before taxes		2,758		2,102		761		1,759		1,521		1,804		1,850		1,816
Income tax provision		858		666		222		572		477		572		593		570
Net Income	$	1,900	$	1,436	$	539	$	1,187	$	1,044	$	1,232	$	1,257	$	1,246
Per Common Share Data
Weighted average common shares—basic		11,431,957		11,535,146		11,624,120		11,808,632		12,214,704		13,087,582		13,662,264		13,636,010
Weighted average common shares—diluted		11,622,035		11,718,308		11,750,623		11,901,737		12,287,733		13,175,689		13,770,934		13,678,887
Net income per share—basic	$	0.17	$	0.12	$	0.05	$	0.10	$	0.09	$	0.09	$	0.09	$	0.09
Net income per share—diluted	$	0.16	$	0.12	$	0.05	$	0.10	$	0.09	$	0.09	$	0.09	$	0.09

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COMMITMENTS AND CONTINGENCIES (Details 2) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012 Third-party providers	Jan. 31, 2013 One of third-party providers
Future minimum payments contractually due
2013	$ 1,952	$ 1,700
2014	224	1,600
2015	$ 96	$ 1,400

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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2012

INCOME TAXES

Schedule of components of income tax expense (benefit)

The components of income tax expense (benefit) for the years ended December 31, 2012, 2011 and 2010 are as follows (in thousands):

	December 31,
	2012			2011			2010
Federal:
Current	$	2,408		$	2,555		$	1,129
Deferred		(140	)		(359	)		(13	)
		2,268			2,196			1,116
State:
Current		—			—			—
Deferred		50			16			4
		50			16			4
	$	2,318		$	2,212		$	1,120

Schedule of differences between income tax expense and statutory rate

The provision for income taxes differs from the statutory rate of 34% due to the following (in thousands):

	December 31,
	2012			2011			2010
Federal income tax at statutory rate of 34%	$	2,509		$	2,377		$	1,314
Tax exempt interest, net		(62	)		(62	)		(113	)
Bank-owned life insurance		(160	)		(159	)		(160	)
ESOP compensation expense		101			73			6
Equity incentive plans		—			1			46
Other, net		13			13			23
Dividends received from equity method investments		(49	)		(13	)		—
Dividends paid on benefit plans		(67	)		(26	)		—
State taxes, net		304			126			436
Decrease in valuation allowance		(271	)		(118	)		(432	)
Total Provision	$	2,318		$	2,212		$	1,120
Effective tax rate		31.41	%		31.64	%		28.99	%

Schedule of components of net deferred tax asset

The net deferred tax asset consisted of the following components as of December 31, 2012 and 2011 (in thousands):

	December 31,
	2012			2011
Deferred tax assets:
Allowance for loan losses, net	$	3,798		$	4,106
Provision for loss on assets acquired through foreclosure		966			402
Nonaccrual interest		569			502
Accrued compensation		151			151
Equity incentive plans		734			644
Accrued expenses		370			345
Deferred lease liability		51			10
Impairment loss on investments		—			176
State net operating loss carryforward		73			343
		6,712			6,679
Valuation allowance		(36	)		(307	)
		6,676			6,372
Deferred tax liability
Prepaid expense deduction		238			181
Mortgage servicing rights		58			107
Loan origination costs		39			58
Deferrable earnings on investments		439			227
Depreciation of premises and equipment		471			458
Unrealized gains on securities available-for-sale		2,478			3,659
		3,723			4,690
Net Deferred Tax Asset	$	2,953		$	1,682

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INVESTMENT AND MORTGAGE RELATED SECURITIES (Details 4) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Available for Sale, Amortized Cost
Due in one year or less	$ 2,019,000	$ 8,022,000
Due after one year through five years	10,488,000	14,072,000
Due after five years through ten years		763,000
Due after ten years		439,000
Total mortgage related securities	276,580,000	215,248,000
Total Amortized Cost	289,087,000	238,544,000
Available for Sale, Fair Value
Due in one year or less	2,032,000	8,013,000
Due after one year through five years	10,459,000	13,886,000
Due after five years through ten years		766,000
Due after ten years		441,000
Total mortgage related securities	283,616,000	225,664,000
Total Fair Value	296,107,000	248,770,000
Held to Maturity, Amortized Cost
Total mortgage related securities	28,369,000	41,074,000
Total Amortized Cost	28,369,000	41,074,000
Held to Maturity, Fair Value
Total mortgage related securities	29,451,000	41,758,000
Total Fair Value	29,451,000	41,758,000
Carrying value of securities pledged to secure public deposits and for other purposes as required or permitted by law	8,300,000	8,100,000
Securities pledged as collateral for other borrowed funds	46,600,000	63,200,000
Mortgage related securities
Available for Sale, Fair Value
Total Fair Value	283,616,000	225,664,000
Corporate securities
Available for Sale, Fair Value
Total Fair Value	12,177,000	14,719,000
Private label residential mortgage related security
Available for Sale, Fair Value
Total Fair Value		122,000
Private label commercial mortgage related securities
Available for Sale, Fair Value
Total Fair Value	6,197,000	8,906,000
Obligations of U.S. government agencies
Available for Sale, Fair Value
Total Fair Value	$ 314,000	$ 6,514,000

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DEPOSITS (Details 3) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Interest expense on deposits
NOW accounts	$ 234,000	$ 143,000	$ 210,000
Money market accounts	339,000	596,000	1,294,000
Savings and club accounts	253,000	148,000	45,000
Brokered deposits	194,000	13,000
Certificates of deposit	5,327,000	7,772,000	13,654,000
Interest expense on deposits, total	6,347,000	8,672,000	15,203,000
Certificates of deposit with a minimum denomination of $100,000
Amount of certificates of deposit with a minimum denomination of $100,000	62,500,000	81,600,000
Maximum amount of deposits insured by the FDIC	$ 250,000

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DERIVATIVES AND HEDGING (Details) (USD $)	1 Months Ended	12 Months Ended		1 Months Ended	12 Months Ended
	Nov. 30, 2006 Interest rate swap maturing in April 2022	Dec. 31, 2012 Interest rate swap maturing in April 2022	Dec. 31, 2011 Interest rate swap maturing in April 2022	Oct. 31, 2011 Interest rate swap maturing in October 2021	Dec. 31, 2012 Interest rate swap maturing in October 2021	Dec. 31, 2011 Interest rate swap maturing in October 2021	Dec. 31, 2012 Credit Derivatives (Interest Rate Swap Underlyings) item	Dec. 31, 2012 Credit Derivatives (Foreign Currency Swap Underlyings)
Derivative
Notional amount, interest rate swap derivative		$ 950,000			$ 1,600,000
Notional amount of Credit Swap derivative (Protection Sold)							13,300,000
Fixed rate loan term	15 years			10 years
Fixed interest rate to be paid under hedge (as a percent)		7.43%			5.83%
Variable interest rate basis		one-month LIBOR			one-month LIBOR
Margin added to derivative interest rate (as a percent)		2.24%			3.50%
Fair value loss position on interest rate swap derivative		203,000	214,000		105,000	65,000
Fair value loss position on interest rate swap derivative, ineffective portion					4,000	5,000
Number of derivative transactions							4
Fair value of swap liability							213,000
Derivative liability							12,000
Remaining maturity period, minimum							7 years
Remaining maturity period, maximum							10 years
Recognized income							$ 67,000	$ 35,000

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 5) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012
STOCK BASED COMPENSATION
Excess tax benefits	$ 88
Stock options
STOCK BASED COMPENSATION
Vesting period	5 years
Expiration period	10 years
Non-performance based restricted stock
STOCK BASED COMPENSATION
Vesting period	5 years
Performance based restricted stock
STOCK BASED COMPENSATION
Vesting period	5 years
Awarded performance based stock that will vest on third anniversary (as a percent)	50.00%
Awarded performance based stock that vest on fourth anniversary (as a percent)	25.00%
Awarded performance based stock that vest on fifth anniversary (as a percent)	25.00%

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CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Cash Flows From Operating Activities
Net income	$ 5,062	$ 4,779	$ 2,744
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	3,478	5,734	6,213
Valuation adjustment for other real estate owned	1,219	657	436
Change in fair value of financial assets acquired from debtors	692
Impairment loss on real estate held for investment		110
Depreciation	822	709	693
Net amortization of securities premiums and discounts	2,898	3,289	4,713
Benefit for deferred income taxes	(90)	(343)	(9)
Stock compensation from benefit plans	1,963	1,881	1,540
Net gain on sale of assets acquired through foreclosure	(135)	(250)	(44)
Net gain on sale of premises and equipment			(6)
Net gains on sales of investment securities	(3,292)	(1,091)	(1,963)
Net other-than-temporary impairment loss		361
Income on bank-owned life insurance	(471)	(468)	(471)
Excess tax benefit from exercise of stock options and vesting of restricted stock	(88)
Decrease in mortgage servicing rights, net	146	132	235
Decrease in accrued interest receivable and other assets	598	746	1,454
Increase (decrease) in accrued interest payable, accrued expenses and other liabilities	4,793	(777)	717
Net Cash Provided by Operating Activities	17,595	15,469	16,252
Cash Flows from Investing Activities
Equity investment in unconsolidated entity	180	45
Investment securities - available-for-sale:
Purchases	(5,269)		(19,786)
Proceeds from sales	6,157
Proceeds from maturities, calls and principal repayments	9,866	9,094	6,882
Mortgage related securities - available-for-sale:
Purchases	(217,894)	(35,031)	(46,229)
Proceeds from sales	85,686	13,976	36,480
Proceeds from maturities, calls and principal repayments	71,739	73,187	131,519
Mortgage related securities - held-to-maturity:
Purchases			(52,601)
Proceeds from maturities, calls and principal repayments	12,189	10,040	661
Net (increase) decrease in loans	(3,507)	(2,581)	8,866
Purchases of loans and loan participations	(22,350)	(32,655)	(27,788)
Net (increase) decrease in Federal Home Loan Bank stock	(23)	1,839	522
Purchases of premises and equipment	(833)	(447)	(243)
Additions to assets acquired through foreclosure	(470)
Proceeds from sales and payments on assets acquired through foreclosure	1,663	1,888	1,672
Net Cash (Used in) Provided by Investing Activities	(62,866)	39,355	39,955
Cash Flows from Financing Activities
Net increase (decrease) in deposits	10,815	(35,169)	(146,514)
Decrease in advances from borrowers for taxes and insurance	(37)	(160)	(223)
Principal payments on other borrowed funds	(20,000)
Proceeds from Federal Home Loan Bank Advances	60,000
Principal payments on Federal Home Loan Bank advances	(38,278)	(34,522)	(14,365)
Net increase in short-term borrowings	62,000	8,500
Excess tax benefit from exercise of stock options and vesting of restricted stock	88
Common stock issued for exercise of stock options	480	162
Acquisition of common stock for equity incentive plan		(3,474)
Purchase of treasury stock	(9,911)	(19,822)
Cash dividends paid	(2,382)	(1,067)
Merger of Fox Chase Mutual Holding Company			107
Proceeds from stock offering, net of offering expenses			81,169
Purchase of common stock by ESOP			(3,485)
Net Cash Provided by (Used in) Financing Activities	62,775	(85,552)	(83,311)
Net Increase (Decrease) in Cash and Cash Equivalents	17,504	(30,728)	(27,104)
Cash and Cash Equivalents - Beginning	7,586	38,314	65,418
Cash and Cash Equivalents - Ending	25,090	7,586	38,314
Supplemental Disclosure of Cash Flow Information
Interest paid	10,205	14,657	21,841
Income taxes paid	2,438	2,500	1,501
Transfers of loans to assets acquired through foreclosure	9,070	1,479	1,198
Net charge-offs	$ 4,383	$ 6,102	$ 4,375

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MORTGAGE SERVICING ACTIVITY (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Mortgage servicing activity
Unpaid principal balances of loans serviced for others	$ 36,600,000	$ 50,000,000	$ 65,700,000
Fees, net of amortization, from the servicing of loans	(16,000)	25,000	11,000
Net Carrying Value
Balance at the beginning of the period	316,000
Balance at the end of the period	170,000	316,000
Mortgage servicing rights
Servicing Rights
Balance at the beginning of the period	455,000	579,000	768,000
Amortization	(130,000)	(124,000)	(189,000)
Balance at the end of the period	325,000	455,000	579,000
Valuation Allowance
Balance at the beginning of the period	(139,000)	(131,000)	(85,000)
Additions	(16,000)	(8,000)	(46,000)
Balance at the end of the period	(155,000)	(139,000)	(131,000)
Net Carrying Value
Balance at the beginning of the period	316,000	448,000	683,000
Additions	(16,000)	(8,000)	(46,000)
Amortization	(130,000)	(124,000)	(189,000)
Balance at the end of the period	170,000	316,000	448,000
Estimated amortization expense
2013	93,000
2014	67,000
2015	48,000
2016	34,000
2017	25,000
Thereafter	58,000
Total	325,000
Increase in valuation allowance	16,000	8,000	46,000
Fair value of MSRs	$ 170,000	$ 322,000

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) In Millions, except Share data, unless otherwise specified	0 Months Ended	12 Months Ended
	Jun. 29, 2010	Dec. 31, 2012 item
Business
Net proceeds from the conversion and offering	$ 77.8
Loans, Loan Origination Fees and Uncollected Interest
Number of days after which the contractual payment of principal or interest has become past due before loans are placed on nonaccrual status		90 days
Troubled Debt Restructurings
Minimum consistent payment performance period for troubled debt restructurings to be removed from non-accrual status		6 months
Number of branches		11
Fox Chase Service Corporation
Principles of Consolidation and Presentation
Commercial loans held		20.0
PMA
Troubled Debt Restructurings
Ownership (as a percent)		45.00%
ESOP
Troubled Debt Restructurings
Number of loans to ESOP		2
Mutual-to-stock conversion
Business
Net proceeds from the conversion and offering	$ 77.8
Mutual-to-stock conversion | ESOP
Business
Issue price (in dollars per share)	$ 10.00
Number of shares acquired by Employee Stock Ownership Plan ("ESOP")	348,500
Shares acquired by Employee Stock Ownership Plan ("ESOP") as percentage of issued shares	4.00%
Common Stock
Business
Shares sold	8,712,500
Issue price (in dollars per share)	$ 10.00
Share exchange ratio (in shares)	106.92%

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Schedule of the reconciliation of the numerators and denominators of the basic and diluted earnings per share computations

	Year Ended December 31,
	2012			2011			2010
Net income	$	5,062,000		$	4,779,000		$	2,744,000
Weighted-average common shares outstanding(1)		12,624,068			14,112,359			14,548,812
Average common stock acquired by stock benefit plans:
Unvested shares—long-term incentive plan		—			—			(7,582	)
ESOP shares unallocated		(651,538	)		(716,530	)		(607,235	)
Shares purchased by trust		(372,653	)		(249,670	)		(199,111	)
Weighted-average common shares used to calculate basic earnings per share		11,599,877			13,146,159			13,734,884
Dilutive effect of:
Unvested shares—long-term incentive plans		—			—			7,582
Restricted stock awards		29,653			33,089			10,132
Stock option awards		117,731			52,582			—
Weighted-average common shares used to calculate diluted earnings per share		11,747,261			13,231,830			13,752,598
Earnings per share—basic	$	0.44		$	0.36		$	0.20
Earnings per share—diluted	$	0.43		$	0.36		$	0.20
Outstanding common stock equivalents having no dilutive effect		860,842			822,461			807,827

(1)

Excludes treasury stock.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation and Presentation

• Principles of Consolidation and Presentation

        The consolidated financial statements include the accounts of the Bancorp and the Bank. The Bank's operations include the accounts of its wholly owned subsidiaries, Fox Chase Financial, Inc., Fox Chase Service Corporation, 104 S. Oakland Ave., LLC and Davisville Associates, LLC. Fox Chase Financial Inc. is a Delaware-chartered investment holding company and its sole purpose is to manage and hold investment securities. Fox Chase Service Corporation is a Pennsylvania-chartered company and its purposes are to facilitate the Bank's investment in PMA and, for regulatory purposes, to hold commercial loans. At December 31, 2012, Fox Chase Service Corporation held $20.0 million in commercial loans. 104 S. Oakland Ave., LLC is a New Jersey-chartered limited liability company formed to secure, manage and hold foreclosed real estate. Davisville Associates, LLC is a Pennsylvania-chartered limited liability company formed to secure, manage and hold foreclosed real estate. All material inter-company transactions and balances have been eliminated in consolidation. Prior period amounts are reclassified, when necessary, to conform with the current year's presentation.

        The Company follows accounting principles and reporting practices that are in compliance with U.S. generally accepted accounting principles ("GAAP"). The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, the valuation and realizability of deferred tax assets, the evaluation of other-than-temporary impairment and the valuation of investment securities and assets acquired through foreclosure.

Risk and Uncertainties

• Risk and Uncertainties

        In the normal course of its business, the Company encounters two significant types of risk: economic risk and regulatory risk. There are three main components of economic risk: interest rate risk, credit risk and market risk. The Company is subject to interest rate risk to the degree that its interest-bearing liabilities mature or reprice at different speeds, or on a different basis, from its interest-earning assets. The Company's primary credit risk is the risk of defaults in the Company's loan portfolio that result from borrowers' inability or unwillingness to make contractually required payments. The Company's lending activities are concentrated in Southeastern Pennsylvania and Southern New Jersey. The ability of the Company's borrowers to repay amounts owed is dependent on several factors, including the economic conditions in the borrowers' geographic regions and the borrowers' financial conditions. The Company also has credit risk related to the risk of defaults in its investment securities portfolio. The ability of the Company to realize the full value of its investment securities upon sale or maturity depends on several factors, including the cash flows, credit enhancements and underlying structures of the individual investment securities. Market risk reflects changes in the value of the collateral underlying loans, the valuation of assets acquired through foreclosure, and the valuation of securities, mortgage servicing assets and other investments.

        The Company is subject to the regulations of various government agencies. These regulations may change significantly from period to period. The Company also undergoes periodic examinations by regulatory agencies that may subject them to further changes with respect to asset valuations and classifications, amounts required for the allowance for loan losses and operating restrictions resulting from the regulators' judgment based on information available to them at the time of their examination.

Cash and Cash Equivalents

• Cash and Cash Equivalents

        For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks, interest-earning demand deposits in other banks and money market funds. At times, such balances exceed the FDIC limits for insurance coverage.

        The Company accounts for cash accounts that are in a net overdraft position as a liability and reports changes in book overdraft positions in operating cash flows

Investment and Mortgage Related Securities

• Investment and Mortgage Related Securities

        The Company accounts for its investment securities in accordance with standards that require, among other things, that debt and equity securities are classified into three categories and accounted for as follows:

• •

  Debt securities with the positive intention to hold to maturity are classified as "held-to-maturity" and reported at amortized cost.

  •

  Debt and equity securities purchased with the intention of selling them in the near future are classified as "trading securities" and are reported at fair value, with unrealized gains and losses included in earnings. As of the balance sheet dates, the Company did not have any trading securities.

  •

  Debt and equity securities not classified in either of the above categories are classified as "available-for-sale securities" and reported at fair value, with unrealized gains and losses excluded from earnings and reported, net of tax, as increases or decreases in other comprehensive income, a separate component of stockholders' equity. Securities classified as available-for-sale are those securities that the Company intends to hold for an indefinite period of time but not necessarily to maturity. Any decision to sell a security classified as available-for-sale would be based on various factors, including movement in interest rates, changes in the maturity or mix of the Company's assets and liabilities, liquidity needs, regulatory capital considerations and other factors.

        Management determines the appropriate classification of debt securities at the time of purchase and re-evaluates such designation as of each balance sheet date.

        The Company records other-than-temporary impairment charges, through earnings, if they have the intent to sell, or will more likely than not be required to sell, an impaired debt security before a recovery of its amortized cost basis. In addition, the Company records other-than-temporary impairment charges through earnings for the amount of credit losses, regardless of the intent or requirement to sell. Credit loss is measured as the difference between the present value of an impaired debt security's cash flows and its amortized cost basis. Non-credit related write-downs to fair value are recorded as decreases to accumulated other comprehensive income as long as the Company has no intent or requirement to sell an impaired security before a recovery of amortized cost basis.

        Purchase premiums and discounts are recognized in interest income using the interest method over the expected life for mortgage related securities and the contractual life for all other securities. Because of volatility of the financial markets in which securities are traded, there is the risk that any future fair value could be significantly less than that recorded or disclosed in the accompanying financial statements. Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method.

Loans, Loan Origination Fees and Uncollected Interest

• Loans, Loan Origination Fees and Uncollected Interest

        Loans are recorded at cost, net of unearned discounts, deferred fees and allowances. Discounts or premiums on purchased loans are amortized using the interest method over the remaining contractual life of the purchased loans, adjusted for actual prepayments. Loan origination fees and certain direct origination costs are deferred and amortized using the interest method over the contractual life as an adjustment to yield on the loans. Interest income is accrued on the unpaid principal balance. From time-to-time, the Company sells certain loans for liquidity purposes or to manage interest rate risk.

        The accrual of interest is generally discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about further collectability of principal or interest, even though the loan is currently performing. A loan that is more than 90 days past due may remain on accrual status if it is in the process of collection and is either guaranteed or well secured. When a loan is placed on nonaccrual status, unpaid interest income is reversed and the amortization of net deferred loan fees is suspended. Interest received on nonaccrual loans generally is either applied against principal or reported as interest income, according to management's judgment as to the ultimate collectability of principal. Generally, loans are restored to accrual status when the obligation is brought current, has performed in accordance with the contractual terms for a reasonable period of time and the ultimate collectability of the total contractual principal and interest is no longer in doubt.

Allowance for Loan Losses

• Allowance for Loan Losses

        The allowance for loan losses is adjusted through increases or reductions in the provisions for loan losses charged against or credited to income. Loans deemed to be uncollectible are charged against the allowance for loan losses, and subsequent recoveries, if any, are credited to the allowance.

        The allowance for loan losses is maintained at a level representing management's best estimate of known and inherent losses in the portfolio, based upon management's evaluation of the portfolio's collectability. Our methodology for assessing the appropriateness of the allowance for loan losses consists of an allowance on impaired loans and a general valuation allowance on the remainder of the portfolio. Although we determine the amount of each element of the allowance separately, the entire allowance for loan losses is available for losses on the entire portfolio.

        Loans are deemed impaired when, based on current information and events, it is probable that the Company will be unable to collect all proceeds due according to the contractual terms of the loan agreement or when a loan is classified as a troubled debt restructuring. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Impairment is measured on a loan by loan basis for commercial loans by either the present value of expected future cash flows discounted at the loan's original effective interest rate, the loan's obtainable market price or the fair value of the collateral less costs to sell if the loan is collateral dependent. The Company establishes an allowance for loan loss in the amount of the difference between fair value of the impaired loan and the loan's carrying amount.

        We establish a general allowance for loans that are not considered impaired to recognize the inherent losses associated with lending activities. This general valuation allowance is determined by segmenting the loan portfolio by loan segments (described below) and assigning percentages, known as loss factors, to each category. The percentages are adjusted for significant factors that, in management's judgment, affect the collectability of the portfolio as of the evaluation date. These significant factors include the size and composition of the loan portfolio, the Company's loss experience by particular segment, trends and absolute levels of nonperforming loans, trends and absolute levels of classified and criticized loans, trends and absolute levels in delinquent loans, trends in risk ratings, trends in industry charge-offs and changes in existing general economic and business conditions affecting our lending areas and the national economy. These loss factors are subject to ongoing evaluation to ensure their relevance in the current economic environment. We perform this systematic analysis of the allowance on a quarterly basis. These criteria are analyzed and the allowance is developed and maintained at the segment level.

        Additional risk is associated with the analysis of the allowance for loan losses as such evaluations are highly subjective, and future adjustments to the allowance may be necessary if conditions differ substantially from the assumptions used in making the evaluations. In addition, various regulatory agencies periodically review the Company's allowance for loan losses. Such agencies may require the Company to recognize adjustments to the allowance, based on their judgments at the time of their examination.

        The loan segments utilized by management to develop the allowance for loan losses are (1) one- to four-family real estate, (2) multi-family and commercial real estate, (3) construction, (4) consumer and (5) commercial and industrial loans.

        One- to four-family real estate lending risks generally include the borrower's ability to make repayment from his or her employment or other income, and if the borrower defaults, the ability to obtain repayment from sale of the underlying collateral securing the loan. Risk associated with one- to four-family lending would be higher during a period of increased unemployment or reduced real estate value.

        Multi-family and commercial real estate lending risks generally relate to the borrower's creditworthiness and the feasibility and cash flow potential of the underlying project. Payments on loans secured by income properties often depend on successful operation and management of the properties. As a result, repayment of such loans may be subject to adverse conditions in the real estate market or the economy.

        Construction lending is generally considered to have a higher degree of lending risk than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property's value at completion of construction, the estimated cost (including interest) of construction and the ability of the project to be sold or refinanced upon completion.

        Commercial and industrial loans are typically made on the basis of the borrower's ability to make repayment from the cash flows of the borrower's underlying business. As a result, the availability of funds for the repayment of commercial loans may depend substantially on the success of the business itself. Further, any collateral securing such loans may depreciate over time, may be difficult to appraise and may fluctuate in value.

        Consumer lending includes unsecured lending or loans secured by assets that depreciate rapidly. In such cases, repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment for the outstanding loan and the remaining deficiency often does not warrant further substantial collection efforts against the borrower. Consumer loan collections depend on the borrower's continuing financial stability. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount that can be recovered on such loans.

Troubled Debt Restructurings

• Troubled Debt Restructurings

        Loans whose terms are modified are classified as troubled debt restructurings if the Company grants such borrowers concessions and it is deemed that those borrowers are experiencing financial difficulty. Concessions granted under a troubled debt restructuring generally involve a reduction in interest rate, extension of a loan's stated maturity date, temporary deferral of payments or granting credit to a borrower who is unable to obtain credit from another financial institution. Accrual of interest continues upon modification if the borrower has demonstrated a history of making payment as contractually due and has provided evidence which supports the borrower's ability to make payments. The accrual of interest income on accruing troubled debt restructurings is generally discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about continued collectability of principal or interest, even though the loan is currently performing. Troubled debt restructurings which are subsequently reported as non-accrual remain as such until they demonstrate consistent payment performance for a minimum period of six months. All loans classified as troubled debt restructurings are considered impaired.

Bank-Owned Life Insurance

• Bank-Owned Life Insurance

        The Company has invested in bank-owned life insurance ("BOLI"). BOLI involves the purchasing of life insurance by the Company on a chosen group of employees and directors. The Company is the owner and beneficiary of the policies. This life insurance investment is carried at the cash surrender value of the underlying policies. Income from the increase in cash surrender value of the policies is included in noninterest income in the consolidated statements of operations.

Premises and Equipment

• Premises and Equipment

        Premises and equipment are carried at cost less accumulated depreciation. Depreciation is computed on the straight-line method over the assets' estimated useful lives or, for leasehold improvements, over the life of the related lease if less than the estimated useful life of the asset. The estimated useful life is generally 10-39 years for buildings and 3-7 years for furniture and equipment. When assets are retired, or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts. The cost of maintenance and repairs is charged to expense when incurred and renewals and improvements are capitalized. Rental concessions on leased properties are recognized over the life of the lease.

Assets Acquired through Foreclosure

• Assets Acquired through Foreclosure

        Assets acquired through foreclosure consists of other real estate owned and financial assets acquired from debtors. These assets are obtained through foreclosure, by a deed-in-lieu of foreclosure, in-substance foreclosure or in exchange for satisfaction of debt.

        Other real estate owned is carried at the lower of cost or fair value, less estimated selling costs. Costs related to the development or improvement of an acquired property are capitalized. Holding costs and declines in carrying value after acquisition are recorded as assets acquired through foreclosure expense in the consolidated statements of operations.

        Financial assets acquired from debtors are carried at fair value under the fair value option in accordance with FASB ASC 825 "Financial Instruments". Increases or decreases in fair value after acquisition are recorded as assets acquired through foreclosure expense in the consolidated statements of operations.

Real Estate Held for Investment

• Real Estate Held for Investment

        Real estate held for investment is carried at cost and is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. As of December 31, 2012 and December 31, 2011, real estate held for investment represented undeveloped land located in Absecon, New Jersey. The property was acquired by the Company in 2003 to expand the Company's retail branch network in southern New Jersey. As of December 31, 2011, the property was carried at $1,620,000 based on an appraisal obtained during 2011, which resulted in an impairment loss of $110,000 during the year ended December 31, 2011. As of December 31, 2012, the property continued to be carried at $1,620,000.

        In accordance with regulatory guidelines, because this real estate held for investment was not sold or placed in service by June 2011 (eight years from acquisition); for regulatory reporting purposes, the full amount of this asset is recorded as a reduction of regulatory capital at December 31, 2012 and 2011.

Mortgage Servicing Rights

• Mortgage Servicing Rights

        Upon the sale of a residential mortgage loan where the Company retains servicing rights, a mortgage servicing right is recorded. GAAP requires that mortgage servicing rights on these loans be amortized into income over the estimated life of the loans sold using the interest method. At each reporting period, such assets are subject to an impairment test. The impairment test stratifies servicing assets based on predominant risk characteristics of the underlying financial assets. The Company has stratified its mortgage servicing assets by date of sale, which approximates date of origination.

        In conjunction with the impairment test, the Company records a valuation allowance when the fair value of the stratified servicing asset is less than amortized cost. Subsequent changes in the valuation of the assets are recorded as either an increase or a reduction of the valuation allowance, however, if the fair value exceeds amortized cost, such excess will not be recognized.

Transfers of Financial Assets

• Transfers of Financial Assets

        Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before maturity.

Income Taxes

• Income Taxes

        The Company accounts for income taxes under the asset/liability method. Deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company files a consolidated federal income tax return and its subsidiaries file individual state income tax returns.

        The Company recognizes a tax position if it is more likely than not that the tax position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. If the tax position meets the more-likely-than-not recognition threshold, the position is measured to determine the amount of the benefit to recognize and is measured at the largest amount of benefit that is greater than 50% likely of being realized upon settlement. The Company has no material tax exposure matters that were accrued as of December 31, 2012 or 2011. The Company's policy is to account for interest and penalties as components of income tax expense.

Equity Method Investments

• Equity Method Investments

        Under the equity method, the Company recognizes its portion of net income of unconsolidated affiliates, net of eliminations, in equity in earnings of affiliates on the consolidated statements of operations. Equity method investments are included in other assets on the consolidated statements of condition.

Marketing and Advertising

• Marketing and Advertising

        The Company expenses marketing and advertising costs as incurred.

Off-Balance Sheet Financial Instruments

• Off-Balance Sheet Financial Instruments

        In the ordinary course of business, the Company has entered into off-balance sheet financial instruments consisting of commitments to extend credit. Such financial instruments are recorded in the balance sheet when they are funded. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet financial instruments.

Fair Value of Financial Instruments

• Fair Value of Financial Instruments

        Certain of the Company's financial instruments are carried at fair value. Generally, fair value is the price that a willing buyer and a willing seller would agree upon in an other than a distressed sale situation. Because of the uncertainties inherent in determining fair value, fair value estimates may not be precise. Many of the fair value estimates are based on highly subjective judgments and assumptions made about market information and economic conditions. See Note 14 for a detailed discussion of fair value measurements and methodology used to determine fair value.

Employee Stock Ownership Plan

• Employee Stock Ownership Plan

        The ESOP borrows funds from the Bancorp to purchase shares of common stock in the Bancorp. The funds borrowed by the ESOP from Old Fox Chase Bancorp to purchase shares of common stock in Old Fox Chase Bancorp's initial public offering in 2006 are being repaid from the Bank's contributions over a period of 15 years from 2006 to 2020. The funds borrowed by the ESOP from the Bancorp to purchase shares of common stock in the Bancorp's mutual-to-stock conversion in 2010 are being repaid from the Bank's contributions over a period of 14.5 years from 2010 to 2024. The Bancorp's common stock not yet allocated to participants is recorded as a reduction of stockholders' equity at cost. The Bancorp's loans to the ESOP and the ESOP's note payables are not reflected in the consolidated statements of condition. Compensation expense for the ESOP is based on the average market price of the Company's stock and is recognized as shares are committed to be released to participants. The notes receivable and related interest income are included in the parent company financial statements presented in Note 17.

        For purposes of computing basic and diluted earnings per share, ESOP shares that have been committed to be released are considered outstanding. ESOP shares that have not been committed to be released are not considered outstanding.

Stock Based Compensation

• Stock Based Compensation

        The Company grants equity awards to employees, consisting of stock options and restricted stock, under its Long-Term Incentive Plan, its 2007 Equity Incentive Plan and its 2011 Equity Incentive Plan. The Company classifies share-based compensation for employees and outside directors within "Salaries, benefits and other compensation" in the Consolidated Statements of Operations to correspond with the same line item as compensation paid. Additionally, the Company reports (1) the expense associated with the grants as an adjustment to operating cash flows and (2) any benefits of realized tax deductions in excess of previously recognized tax benefits on compensation expense as a financing cash flow. Excess tax benefits totaled $88,000 in 2012. There were no such excess tax benefits in 2011 and 2010.

        Stock options vest over a five-year service period and expire ten years after grant date. The Company recognizes compensation expense for the fair values of stock options using the straight-line method over the requisite service period for the entire award.

        Non-performance based restricted shares vest over a five-year service period. The Company recognizes compensation expense for the fair value of restricted shares on a straight-line basis over the requisite service period for the entire award.

        Performance based restricted shares vest over a five-year based on service and achievement of performance metrics. The performance metrics to be evaluated during the performance period are (1) return on assets compared to peer group and (2) earnings growth rate compared to peer group. On the third anniversary of the grant date, the Company's level of performance relative to the performance metrics are evaluated and, if such performance metrics have been achieved, an amount of shares that will vest at that time and over the following two years will be determined. Of the shares that will vest, 50% of the shares vest on the third anniversary of the date of grant and 25% vest on each of the fourth and fifth anniversaries of the date of grant.

Per Share Information

• Per Share Information

        Basic earnings per share exclude dilution and is computed by dividing income available to common stockholders by the weighted-average common shares outstanding during the period. Diluted earnings per share takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted into common stock. Proceeds assumed to have been received on such exercises are assumed to be used to purchase shares of the Company's common stock at the average market price during the periods, as required by the treasury stock method of accounting. Unallocated shares in the ESOP and shares purchased to fund the Bancorp's Equity Incentive Plans are not included in either basic or diluted earnings per share. As a result of the mutual-to-stock conversion, all share information for periods prior to June 30, 2010 has been revised to reflect the 1.0692 exchange ratio.

        Earnings per share ("EPS"), basic and diluted, were $0.44 and $0.43, respectively for the year ended December 31, 2012. EPS, both basic and diluted, were $0.36 and $0.20 for the years ended December 31, 2011 and 2010, respectively.

        The following table presents the reconciliation of the numerators and denominators of the basic and diluted EPS computations.

	Year Ended December 31,
	2012			2011			2010
Net income	$	5,062,000		$	4,779,000		$	2,744,000
Weighted-average common shares outstanding(1)		12,624,068			14,112,359			14,548,812
Average common stock acquired by stock benefit plans:
Unvested shares—long-term incentive plan		—			—			(7,582	)
ESOP shares unallocated		(651,538	)		(716,530	)		(607,235	)
Shares purchased by trust		(372,653	)		(249,670	)		(199,111	)
Weighted-average common shares used to calculate basic earnings per share		11,599,877			13,146,159			13,734,884
Dilutive effect of:
Unvested shares—long-term incentive plans		—			—			7,582
Restricted stock awards		29,653			33,089			10,132
Stock option awards		117,731			52,582			—
Weighted-average common shares used to calculate diluted earnings per share		11,747,261			13,231,830			13,752,598
Earnings per share—basic	$	0.44		$	0.36		$	0.20
Earnings per share—diluted	$	0.43		$	0.36		$	0.20
Outstanding common stock equivalents having no dilutive effect		860,842			822,461			807,827

(1)

Excludes treasury stock.

XML

LOANS (Details 4) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Impaired loans by loan segment
Nonaccrual Loans	$ 17,124,000	$ 17,078,000
Accruing TDRs	7,388,000	7,207,000
Other Impaired Loans		6,229,000
Total Impaired Loans	24,512,000	30,514,000
Impaired Loans with Allowance	22,269,000	29,434,000
Impaired Loans without Allowance	2,243,000	1,080,000
Average recorded investment in impaired loans	28,700,000	32,000,000	42,000,000
Interest income recognized on impaired loans	502,000	825,000	399,000
One- to four-family
Impaired loans by loan segment
Nonaccrual Loans	3,355,000	6,885,000
Accruing TDRs	507,000	307,000
Total Impaired Loans	3,862,000	7,192,000
Impaired Loans with Allowance	3,862,000	7,192,000
Multi-family and commercial
Impaired loans by loan segment
Nonaccrual Loans	5,284,000	3,814,000
Accruing TDRs	6,867,000	6,836,000
Total Impaired Loans	12,151,000	10,650,000
Impaired Loans with Allowance	11,770,000	9,570,000
Impaired Loans without Allowance	381,000	1,080,000
Construction
Impaired loans by loan segment
Nonaccrual Loans	6,434,000	6,372,000
Total Impaired Loans	6,434,000	6,372,000
Impaired Loans with Allowance	6,434,000	6,372,000
Consumer loans
Impaired loans by loan segment
Nonaccrual Loans	2,051,000	7,000
Accruing TDRs	14,000	64,000
Other Impaired Loans		6,229,000
Total Impaired Loans	2,065,000	6,300,000
Impaired Loans with Allowance	203,000	6,300,000
Impaired Loans without Allowance	$ 1,862,000

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2)	12 Months Ended
	Dec. 31, 2012
Buildings | Minimum
PREMISES AND EQUIPMENT
Useful life	10 years
Buildings | Maximum
PREMISES AND EQUIPMENT
Useful life	39 years
Furniture and equipment | Minimum
PREMISES AND EQUIPMENT
Useful life	3 years
Furniture and equipment | Maximum
PREMISES AND EQUIPMENT
Useful life	7 years

XML

INVESTMENT AND MORTGAGE RELATED SECURITIES (Tables)

12 Months Ended

Dec. 31, 2012

INVESTMENT AND MORTGAGE RELATED SECURITIES

Schedule of amortized cost and fair value of securities available-for-sale and held-to-maturity

	December 31, 2012
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			OTTI in AOCI		Fair Value
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	300	$	14	$	—		$	—	$	314
Corporate securities		12,207		91		(121	)		—		12,177
		12,507		105		(121	)		—		12,491
Private label commercial mortgage related securities		6,119		78		—			—		6,197
Agency residential mortgage related securities		270,461		7,023		(65	)		—		277,419
Total mortgage related securities		276,580		7,101		(65	)		—		283,616
Total available-for-sale securities	$	289,087	$	7,206	$	(186	)	$	—	$	296,107
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	28,369	$	1,082	$	—		$	—	$	29,451
Total mortgage related securities		28,369		1,082		—			—		29,451
Total held-to-maturity securities	$	28,369	$	1,082	$	—		$	—	$	29,451

	December 31, 2011
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			OTTI in AOCI			Fair Value
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	6,424	$	90	$	—		$	—		$	6,514
State and political subdivisions		1,865		8		—			—			1,873
Corporate securities		15,007		16		(304	)		—			14,719
		23,296		114		(304	)		—			23,106
Private label residential mortgage related security		164		4		—			(46	)		122
Private label commercial mortgage related securities		8,799		107		—			—			8,906
Agency residential mortgage related securities		206,285		10,357		(6	)		—			216,636
Total mortgage related securities		215,248		10,468		(6	)		(46	)		225,664
Total available-for-sale securities	$	238,544	$	10,582	$	(310	)	$	(46	)	$	248,770
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	41,074	$	684	$	—		$	—		$	41,758
Total mortgage related securities		41,074		684		—			—			41,758
Total held-to-maturity securities	$	41,074	$	684	$	—		$	—		$	41,758

Schedule of gross unrealized losses and fair value of securities, aggregated by security category and length of time that individual securities have been in a continuous unrealized loss position

	December 31, 2012
	Less than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	—	$	—		$	—	$	—		$	—	$	—
State and political subdivisions		—		—			—		—			—		—
Corporate securities		—		—			2,879		(121	)		2,879		(121	)
		—		—			2,879		(121	)		2,879		(121	)
Private label commercial mortgage related securities		—		—			—		—			—		—
Agency residential mortgage related securities		29,092		(65	)		—		—			29,092		(65	)
Total mortgage related securities		29,092		(65	)		—		—			29,092		(65	)
Total available-for-sale securities	$	29,092	$	(65	)	$	2,879	$	(121	)	$	31,971	$	(186	)
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	—	$	—		$	—	$	—		$	—	$	—
Total mortgage related securities		—		—			—		—			—		—
Total held-to-maturity securities	$	—	$	—		$	—	$	—		$	—	$	—
Total Temporarily Impaired Securities	$	29,092	$	(65	)	$	2,879	$	(121	)	$	31,971	$	(186	)

	December 31, 2011
	Less than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses Plus OTTI in AOCI			Fair Value		Unrealized Losses
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	—	$	—		$	—	$	—		$	—	$	—
State and political subdivisions		—		—			—		—			—		—
Corporate securities		4,799		(182	)		2,878		(122	)		7,677		(304	)
		4,799		(182	)		2,878		(122	)		7,677		(304	)
Private label residential mortgage related security		—		—			122		(42	)		122		(42	)
Private label commercial mortgage related securities		—		—			—		—			—		—
Agency residential mortgage related securities		1,538		(6	)		—		—			1,538		(6	)
Total mortgage related securities		1,538		(6	)		122		(42	)		1,660		(48	)
Total available-for-sale securities	$	6,337	$	(188	)	$	3,000	$	(164	)	$	9,337	$	(352	)
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	—	$	—		$	—	$	—		$	—	$	—
Total mortgage related securities		—		—			—		—			—		—
Total held-to-maturity securities	$	—	$	—		$	—	$	—		$	—	$	—
Total Temporarily Impaired Securities	$	6,337	$	(188	)	$	3,000	$	(164	)	$	9,337	$	(352	)

Schedules of components of net gains on sale of investment securities

	Twelve Months Ended December 31, 2012:
	Gross Realized Gains		Gross Realized Losses			Other-than- Temporary Impairment Losses		Portion of OTTI in OCI		Net Gains (Losses)
	(in thousands)
Obligations of U.S. government agencies	$	64	$	—		$	—	$	—	$	64
State and political subdivisions		—		—			—		—		—
Corporate securities		—		—			—		—		—
		64		—			—		—		64
Private label residential mortgage related security		—		(87	)		—		—		(87	)
Private label commercial mortgage related securities		—		—			—		—		—
Agency residential mortgage related securities		3,315		—			—		—		3,315
Total mortgage related securities		3,315		(87	)		—		—		3,228
Total securities available-for-sale	$	3,379	$	(87	)	$	—	$	—	$	3,292

	Twelve Months Ended December 31, 2011:
	Gross Realized Gains		Gross Realized Losses		Other-than- Temporary Impairment Losses			Portion of OTTI in OCI		Net Gains (Losses)
	(in thousands)
Obligations of U.S. government agencies	$	—	$	—	$	—		$	—	$	—
State and political subdivisions		—		—		—			—		—
Corporate securities		—		—		—			—		—
		—		—		—			—		—
Private label residential mortgage related security		—		—		(407	)		46		(361	)
Private label commercial mortgage related securities		—		—		—			—		—
Agency residential mortgage related securities		1,091		—		—			—		1,091
Total mortgage related securities		1,091		—		(407	)		46		730
Total securities available-for-sale	$	1,091	$	—	$	(407	)	$	46	$	730

	Twelve Months Ended December 31, 2010:
	Gross Realized Gains		Gross Realized Losses		Other-than- Temporary Impairment Losses		Portion of OTTI in OCI		Net Gains (Losses)
	(in thousands)
Obligations of U.S. government agencies	$	—	$	—	$	—	$	—	$	—
State and political subdivisions		—		—		—		—		—
Corporate securities		—		—		—		—		—
		—		—		—		—		—
Private label residential mortgage related security		—		—		—		—		—
Private label commercial mortgage related securities		50		—		—		—		50
Agency residential mortgage related securities		1,913		—		—		—		1,913
Total mortgage related securities		1,963		—		—		—		1,963
Total securities available-for-sale	$	1,963	$	—	$	—	$	—	$	1,963

Schedule of amortized cost and estimated fair value of investment securities available-for-sale and held-to-maturity by contractual maturity

	Available for Sale				Held to Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In Thousands)
December 31, 2012
Due in one year or less	$	2,019	$	2,032	$	—	$	—
Due after one year through five years		10,488		10,459		—		—
Due after five years through ten years		—		—		—		—
Due after ten years		—		—		—		—
Total mortgage related securities		276,580		283,616		28,369		29,451
	$	289,087	$	296,107	$	28,369	$	29,451
December 31, 2011
Due in one year or less	$	8,022	$	8,013	$	—	$	—
Due after one year through five years		14,072		13,886		—		—
Due after five years through ten years		763		766		—		—
Due after ten years		439		441		—		—
Total mortgage related securities		215,248		225,664		41,074		41,758
	$	238,544	$	248,770	$	41,074	$	41,758

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LOANS (Tables)

12 Months Ended

Dec. 31, 2012

LOANS

Schedule of composition of net loans

 The composition of net loans at December 31, 2012 and 2011 is provided below (in thousands):

	December 31, 2012			December 31, 2011
Real estate loans:
One- to four-family	$	158,828		$	198,669
Multi-family and commercial		368,948			313,060
Construction		22,591			18,243
		550,367			529,972
Consumer loans		30,585			44,667
Commercial and industrial loans		113,820			107,781
Total loans		694,772			682,420
Deferred loan origination cost, net		263			227
Allowance for loan losses		(11,170	)		(12,075	)
Net loans	$	683,865		$	670,572

Schedule of changes in allowance for loan losses

The following table presents changes in the allowance for loan losses (in thousands):

	Years Ended December 31,
	2012			2011			2010
Balance, beginning	$	12,075		$	12,443		$	10,605
Provision for loan losses		3,478			5,734			6,213
Loans charged off		(4,527	)		(6,331	)		(4,402	)
Recoveries		144			229			27
Balance, ending	$	11,170		$	12,075		$	12,443

Schedule of changes in allowance for loan losses by loan segment

	For the Year Ended December 31, 2012
	One- to Four- Family			Multi-family and Commercial			Construction Loans			Consumer Loans			Commercial and Industrial Loans			Unallocated		Total
	(in thousands)
Balance, beginning	$	1,760		$	6,112		$	869		$	455		$	2,657		$	222	$	12,075
Provision for loan losses		286			1,064			252			1,659			(27	)		244		3,478
Loans charged off		(1,408	)		(887	)		(340	)		(1,892	)		—			—		(4,527	)
Recoveries		4			38			92			10			—			—		144
Balance, ending	$	642		$	6,327		$	873		$	232		$	2,630		$	466	$	11,170

	For the Year Ended December 31, 2011
	One- to Four- Family			Multi-family and Commercial			Construction Loans			Consumer Loans			Commercial and Industrial Loans			Unallocated		Total
	(in thousands)
Balance, beginning	$	1,990		$	4,624		$	3,260		$	665		$	1,707		$	197	$	12,443
Provision for loan losses		324			2,608			1,010			221			1,546			25		5,734
Loans charged off		(567	)		(1,290	)		(3,445	)		(433	)		(596	)		—		(6,331	)
Recoveries		13			170			44			2			—			—		229
Balance, ending	$	1,760		$	6,112		$	869		$	455		$	2,657		$	222	$	12,075

Schedule of breakdown of impaired loans by loan segment

December 31, 2012

	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		Impaired Loans with Allowance		Impaired Loans without Allowance
	(in thousands)
Real estate loans:
One- to four-family	$	3,355	$	507	$	—	$	3,862	$	3,862	$	—
Multi-family and commercial		5,284		6,867		—		12,151		11,770		381
Construction		6,434		—		—		6,434		6,434		—
Consumer loans		2,051		14		—		2,065		203		1,862
Commercial and industrial		—		—		—		—		—
Total	$	17,124	$	7,388	$	—	$	24,512	$	22,269	$	2,243

December 31, 2011

	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		Impaired Loans with Allowance		Impaired Loans without Allowance
	(in thousands)
Real estate loans:
One- to four-family	$	6,885	$	307	$	—	$	7,192	$	7,192	$	—
Multi-family and commercial		3,814		6,836		—		10,650		9,570		1,080
Construction		6,372		—		—		6,372		6,372		—
Consumer loans		7		64		6,229		6,300		6,300		—
Commercial and industrial		—		—		—		—		—		—
Total	$	17,078	$	7,207	$	6,229	$	30,514	$	29,434	$	1,080

Summary of TDR activity for the period

	As of and for the Twelve Months Ended December 31, 2012
	Restructured Current Period						TDRs that Defaulted in Current Period that were Restructured in the Prior Twelve Months
	Number of Loans		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Number of Loans		Post- Modification Outstanding Recorded Investment
	(Dollars in Thousands)
Real estate loans:
One- to four-family		4	$	582	$	582		3	$	254
Multi-family and commercial		2		604		604		—		—
Construction		—		—		—		—		—
Consumer loans		1		14		14		1		8
Commercial and industrial		—		—		—		—		—
Total		7	$	1,200	$	1,200		4	$	262

	As of and for the Twelve Months Ended December 31, 2011
	Restructured Current Period						TDRs that Defaulted in Current Period that were Restructured in the Prior Twelve Months
	Number of Loans		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Number of Loans		Post- Modification Outstanding Recorded Investment
	(Dollars in Thousands)
Real estate loans:
One- to four-family		2	$	307	$	307		—	$	—
Multi-family and commercial		1		4,673		4,673		—		—
Construction		—		—		—		1		3,115
Consumer loans		2		64		64		—		—
Commercial and industrial		—		—		—		1		600
Total		5	$	5,044	$	5,044		2	$	3,715

Schedule of allowance for loan loss for impaired loans and general allowance by loan segment

December 31, 2012

	Allowance for Loan Losses
	Impaired Loans
	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		General		Total
	(in thousands)
Real estate loans:
One- to four-family	$	337	$	5	$	—	$	342	$	300	$	642
Multi-family and commercial		530		948		—		1,478		4,849		6,327
Construction		449		—		—		449		424		873
Consumer loans		10		1		—		11		221		232
Commercial and industrial		—		—		—		—		2,630		2,630
Unallocated		—		—		—		—		466		466
Total allowance for loan losses	$	1,326	$	954	$	—	$	2,280	$	8,890	$	11,170

December 31, 2011

	Allowance for Loan Losses
	Impaired Loans
	Nonaccrual Loans		Accruing TDR's		Other Impaired Loans		Total Impaired Loans		General		Total
	(in thousands)
Real estate loans:
One- to four-family	$	1,394	$	3	$	—	$	1,397	$	363	$	1,760
Multi-family and commercial		466		975		—		1,441		4,671		6,112
Construction		565		—		—		565		304		869
Consumer loans		7		7		156		170		285		455
Commercial and industrial		—		—		—		—		2,657		2,657
Unallocated		—		—		—		—		222		222
Total allowance for loan losses	$	2,432	$	985	$	156	$	3,573	$	8,502	$	12,075

Schedule of past due loans by segment

	At December 31,
	2012				2011
	30 - 59 Days Past Due		60 - 89 Days Past Due		30 - 59 Days Past Due		60 - 89 Days Past Due
	(In thousands)
One- to four-family real estate	$	18	$	284	$	370	$	252
Multi-family and commercial real estate		—		1,691		—		—
Construction		—		—		—		—
Consumer		23		51		1,097		169
Commercial and industrial		—		—		—		—
Total	$	41	$	2,026	$	1,467	$	421

Schedule of criticized and classified loans by segment

	At December 31, 2012
	One- to Four-Family Loans		Multi-family and Commercial		Construction Loans		Consumer Loans		Commercial and Industrial Loans		Total
	(In thousands)
Pass and Pass watch	$	155,473	$	347,150	$	16,157	$	28,534	$	110,032	$	657,346
Special mention loans		—		6,733		—		—		3,633		10,366
Substandard loans		3,355		15,065		6,434		2,051		155		27,060
Doubtful loans		—		—		—		—		—		—
Total loans	$	158,828	$	368,948	$	22,591	$	30,585	$	113,820	$	694,772

	At December 31, 2011
	One- to Four-Family Loans		Multi-family and Commercial		Construction Loans		Consumer Loans		Commercial and Industrial Loans		Total
	(In thousands)
Pass and Pass watch	$	191,784	$	285,515	$	11,871	$	38,431	$	102,101	$	629,702
Special mention loans		—		13,226		—		6,229		1,407		20,862
Substandard loans		6,885		14,319		6,372		7		4,273		31,856
Doubtful loans		—		—		—		—		—		—
Total loans	$	198,669	$	313,060	$	18,243	$	44,667	$	107,781	$	682,420

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CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Dividends paid (in dollars per share)	$ 0.20	$ 0.08

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MORTGAGE SERVICING ACTIVITY (Tables)

12 Months Ended

Dec. 31, 2012

MORTGAGE SERVICING ACTIVITY

Summary of activity of mortgage-servicing rights for the period ended

The following summarizes mortgage-servicing rights activity for the years ended December 31, 2012, 2011 and 2010 (in thousands):

	Servicing Rights			Valuation Allowance			Net Carrying Value
Balance at December 31, 2009	$	768		$	(85	)	$	683
Additions		—			(46	)		(46	)
Amortization		(189	)		—			(189	)
Balance at December 31, 2010	$	579		$	(131	)	$	448
Additions		—			(8	)		(8	)
Amortization		(124	)		—			(124	)
Balance at December 31, 2011	$	455		$	(139	)	$	316
Additions		—			(16	)		(16	)
Amortization		(130	)		—			(130	)
Balance at December 31, 2012	$	325		$	(155	)	$	170

Schedule of estimated amortization expense of amortizing mortgage servicing rights

The estimated amortization expense of amortizing mortgage servicing rights for each of the five succeeding fiscal years after December 31, 2012 is as follows (in thousands):

Year
2013	$	93
2014		67
2015		48
2016		34
2017		25
Thereafter		58
Total	$	325

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PARENT COMPANY ONLY FINANCIAL STATEMENTS (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
INCOME
Total Interest Income	$ 9,950	$ 10,531	$ 10,411	$ 10,942	$ 11,102	$ 11,606	$ 11,607	$ 11,631	$ 41,834	$ 45,946	$ 49,285
EXPENSES
Income Before Income Taxes	2,758	2,102	761	1,759	1,521	1,804	1,850	1,816	7,380	6,991	3,864
Income tax benefit	858	666	222	572	477	572	593	570	2,318	2,212	1,120
Net Income	1,900	1,436	539	1,187	1,044	1,232	1,257	1,246	5,062	4,779	2,744
Parent company
INCOME
Interest on deposits with banks									66	219	182
Interest on ESOP loan									432	463	432
Total Interest Income									498	682	614
EXPENSES
Other expenses									1,000	970	841
Total Expenses									1,000	970	841
Income Before Income Taxes									(502)	(288)	(227)
Income tax benefit									(171)	(98)	(77)
Loss before equity in undistributed net earnings of subsidiary									(331)	(190)	(150)
Equity in undistributed earnings of subsidiary									5,393	4,969	2,894
Net Income									$ 5,062	$ 4,779	$ 2,744

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FAIR VALUE

12 Months Ended

Dec. 31, 2012

FAIR VALUE

Fair value of financial instruments

The estimated fair values of the Company's financial instruments at December 31, 2012 and 2011 were as follows (in thousands):

		December 31, 2012				December 31, 2011
	Fair Value Hierarchy Level	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Financial assets:
Cash and cash equivalents	Level 1	$	25,090	$	25,090	$	7,586	$	7,586
Available for sale securities:
Investment securities available-for-sale	Level 2		12,491		12,491		23,106		23,106
Private label residential mortgage related security	Level 3		—		—		122		122
Private label commercial mortgage related securities	Level 3		6,197		6,197		8,906		8,906
Agency residential mortgage related securities	Level 2		277,419		277,419		216,636		216,636
Held to maturity securities:
Agency mortgage related securities	Level 2		28,369		29,451		41,074		41,758
Loans receivable, net	Level 3		683,865		686,867		670,572		672,847
Federal Home Loan Bank stock	Level 3		8,097		8,097		8,074		8,074
Accrued interest receivable	Level 3		3,223		3,223		4,578		4,578
Mortgage servicing rights	Level 2		170		170		316		322
Financial assets acquired from debtors	Level 3		3,714		3,714		—		—
Financial liabilities:
Savings and club accounts	Level 2		99,046		99,046		80,740		80,740
Demand, NOW and money market deposits	Level 2		275,693		275,693		257,989		257,989
Brokered deposits	Level 2		50,637		50,715		10,162		10,129
Certificates of deposit	Level 2		262,033		264,694		327,703		330,941
Short-term borrowings	Level 2		70,500		70,500		8,500		8,500
Federal Home Loan Bank advances	Level 2		110,000		115,767		88,278		95,878
Other borrowed funds	Level 2		30,000		33,651		50,000		55,103
Accrued interest payable	Level 2		330		330		418		418
Derivative contracts	Level 2, 3		320		320		279		279

Schedule of fair value measurements on a recurring basis

				Fair Value Measurements at Reporting Date Using
Description	As of December 31, 2012			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Other Unobservable Inputs (Level 3)
	(In Thousands)
Available for Sale Securities:
Obligations of U.S. government agencies	$	314		$	—	$	314		$	—
State and political subdivisions		—			—		—			—
Corporate securities		12,177			—		12,177			—
Private label commercial mortgage related securities		6,197			—		—			6,197
Agency residential mortgage related securities		277,419			—		277,419			—
Loans(1)		2,806			—		—			2,806
Financial assets acquired from debtors		3,714			—		—			3,714
Derivative contracts(1)		(320	)		—		(308	)		(12	)
Total	$	302,307		$	—	$	289,602		$	12,705

				Fair Value Measurements at Reporting Date Using
Description	As of December 31, 2011			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Other Unobservable Inputs (Level 3)
	(In Thousands)
Available for Sale Securities:
Obligations of U.S. government agencies	$	6,514		$	—	$	6,514		$	—
State and political subdivisions		1,873			—		1,873			—
Corporate securities		14,719			—		14,719			—
Private label residential mortgage related security		122			—		—			122
Private label commercial mortgage related securities		8,906			—		—			8,906
Agency residential mortgage related securities		216,636			—		216,636			—
Loans(1)		2,877			—		—			2,877
Derivative contracts(1)		(279	)		—		(279	)		—
Total	$	251,368		$	—	$	239,463		$	11,905

(1)

Such financial instruments are recorded at fair value as further described in Note 4.

Schedule of fair value measurements on a non-recurring basis

			Fair Value Measurements at Reporting Date Using
Description	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
	(In Thousands)
As of December 31, 2012
Loans	$	2,951	$	—	$	—	$	2,951
Mortgage servicing rights		170		—		170		—
Other real estate owned		4,810		—		—		4,810
Total	$	7,931	$	—	$	170	$	7,761
As of December 31, 2011
Loans	$	2,490	$	—	$	—	$	2,490
Mortgage servicing rights		282		—		282		—
Other real estate owned		2,423		—		—		2,423
Total	$	5,195	$	—	$	282	$	4,913

Rollforward of Level 3 Fair Value Financial Instruments

	Private Label Residential Mortgage Related Security			Private Label Commercial Mortgage Related Securities			Derivative Contracts			Financial Assets Acquired from Debtors			Loan			Total
	(In thousands)
Beginning balance, December 31, 2010	$	166		$	11,767		$	—		$	—		$	1,241		$	13,174
Purchases/additions		—			—			—			—			1,600			1,600
Sales		—			—			—			—			—			—
Payments received		(34	)		(2,570	)		—			—			(71	)		(2,675	)
Premium amortization, net		—			(16	)		—			—			—			(16	)
Increase/(decrease) in value		(10	)		(275	)		—			—			107			(178	)
Reclassification to Level 3		—			—			—			—			—			—
Ending balance, December 31, 2011	$	122		$	8,906		$	—		$	—		$	2,877		$	11,905
Purchases/additions		—			—			(39	)		4,013			—			3,974
Sales		(70	)		—			—			—			—			(70	)
Payments (received) made		(7	)		(2,668	)		—			393			(97	)		(2,379	)
Premium amortization, net		—			(12	)		—			—			—			(12	)
Increase/(decrease) in value		(45	)		(29	)		27			(692	)		26			(713	)
Reclassification to Level 3		—			—			—			—			—			—
Ending balance, December 31, 2012	$	—		$	6,197		$	(12	)	$	3,714		$	2,806		$	12,705

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LOANS (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
LOANS
Total loans	$ 694,772,000	$ 682,420,000
Deferred loan origination cost, net	263,000	227,000
Allowance for loan losses	(11,170,000)	(12,075,000)	(12,443,000)	(10,605,000)
Net loans	683,865,000	670,572,000
Reclassification of overdrawn deposit accounts	8,000	21,000
New Jersey
LOANS
Total loans	197,900,000	210,400,000
Real estate loans:
LOANS
Total loans	550,367,000	529,972,000
One- to four-family
LOANS
Total loans	158,828,000	198,669,000
Allowance for loan losses	(642,000)	(1,760,000)	(1,990,000)
Multi-family and commercial
LOANS
Total loans	368,948,000	313,060,000
Allowance for loan losses	(6,327,000)	(6,112,000)	(4,624,000)
Construction
LOANS
Total loans	22,591,000	18,243,000
Allowance for loan losses	(873,000)	(869,000)	(3,260,000)
Consumer loans
LOANS
Total loans	30,585,000	44,667,000
Allowance for loan losses	(232,000)	(455,000)	(665,000)
Commercial and industrial loans
LOANS
Total loans	113,820,000	107,781,000
Allowance for loan losses	$ (2,630,000)	$ (2,657,000)	$ (1,707,000)

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STOCK BASED COMPENSATION (Details) (USD $)	6 Months Ended	12 Months Ended																		12 Months Ended		12 Months Ended
	Jun. 30, 2010	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2012 Stock options	Dec. 31, 2011 Stock options	Dec. 31, 2010 Stock options	Dec. 31, 2009 Stock options	Dec. 31, 2012 Stock options Minimum	Dec. 31, 2011 Stock options Minimum	Dec. 31, 2012 Stock options Maximum	Dec. 31, 2011 Stock options Maximum	Dec. 31, 2012 Restricted stock	Dec. 31, 2011 Restricted stock	Dec. 31, 2010 Restricted stock	Dec. 31, 2012 Performance based restricted stock	Dec. 31, 2012 Performance based restricted stock Executive officer	Dec. 31, 2011 Performance based restricted stock Executive officer	Dec. 31, 2007 2007 Plan Stock options	Dec. 31, 2007 2007 Plan Restricted stock	Aug. 31, 2011 2011 Plan Stock options	Dec. 31, 2011 2011 Plan Restricted stock	Aug. 31, 2011 2011 Plan Restricted stock
STOCK BASED COMPENSATION
Shares reserved for issuance																			769,083	307,633	685,978		274,391
Shares purchased																				307,395		274,391
Weighted average cost per share of shares purchased (in dollars per share)																				$ 12.18		$ 12.66
Stock based compensation expense		$ 1,000,000	$ 1,000,000	$ 929,000	$ 420,000	$ 436,000	$ 400,000						$ 621,000	$ 606,000	$ 529,000
Exchange ratio as a result of mutual-to-stock conversion	106.92%
Number of Stock Options
Outstanding at the beginning of the period (in shares)					788,142	692,178	677,381
Granted (in shares)					146,550	135,494	39,500
Exercised (in shares)					(43,954)	(15,037)
Forfeited / Cancelled (in shares)					(13,069)	(24,493)	(24,703)
Outstanding at the end of the period (in shares)					877,669	788,142	692,178	677,381
Exercisable at the end of the period (in shares)					567,008
Weighted Average Exercise Price
Outstanding at the beginning of the period (in dollars per share)					$ 11.23	$ 10.97	$ 11.03
Granted (in dollars per share)					$ 13.15	$ 12.49	$ 9.67
Exercised (in dollars per share)					$ 10.94	$ 10.69
Forfeited / Cancelled (in dollars per share)					$ 11.10	$ 11.24	$ 10.45
Outstanding at the end of the period (in dollars per share)					$ 11.57	$ 11.23	$ 10.97	$ 11.03
Exercisable at the end of the period (in dollars per share)					$ 11.26
Weighted Average Remaining Contractual Life
Outstanding at the beginning of the period					6 years 3 months 18 days	6 years 7 months 6 days	7 years 1 month 6 days	7 years 10 months 24 days
Outstanding at the end of the period					6 years 3 months 18 days	6 years 7 months 6 days	7 years 1 month 6 days	7 years 10 months 24 days
Exercisable at the end of the period					5 years 1 month 6 days
Aggregate Intrinsic Value
Outstanding at the beginning of the period					1,111,000	608,000	105,000
Outstanding at the end of the period					4,461,000	1,111,000	608,000	105,000
Exercisable at the end of the period					3,055,000
Assumptions used to determine fair value of options granted
Expected dividend yield (as a percent)					1.82%		1.90%			1.90%		2.00%
Expected volatility (as a percent)							35.00%		32.00%	33.00%	32.50%	40.00%
Risk-free interest rate (as a percent)							2.04%		0.86%	1.21%	1.10%	2.51%
Expected option life					6 years 6 months	6 years 6 months	6 years 6 months
Number of Stock Options, Unvested
Unvested at the beginning of the period (in shares)					322,530	343,997	455,806
Granted (in shares)					146,550	135,494	39,500
Vested (in shares)					(145,350)	(135,464)	(133,561)
Forfeited / Cancelled (in shares)					(13,069)	(21,497)	(17,748)
Unvested at the end of the period (in shares)					310,661	322,530	343,997	455,806
Weighted Average Grant Date Fair Value, Unvested
Unvested at the beginning of the period (in dollars per share)					$ 3.15	$ 2.90	$ 2.91
Granted (in dollars per share)					$ 3.57	$ 3.60	$ 2.97
Vested (in dollars per share)					$ 3.10	$ 2.98	$ 2.97
Forfeited / Cancelled (in dollars per share)					$ 3.17	$ 3.06	$ 2.73
Unvested at the end of the period (in dollars per share)					$ 3.36	$ 3.15	$ 2.90	$ 2.91
Compensation cost not yet recognized, nonvested awards
Expected future compensation expense, non-vested options					871,000
Expected future compensation expense, restricted shares													$ 1,400,000
Weighted average period					3 years 9 months 18 days								3 years 10 months 24 days
Number of Restricted Shares
Unvested at the beginning of the period (in shares)													119,990	117,431	148,813
Granted (in shares)													69,950	57,036	15,640		22,500	10,668
Vested (in shares)													(56,358)	(48,620)	(45,888)
Forfeited / Cancelled (in shares)													(3,025)	(5,857)	(1,134)
Unvested at the end of the period (in shares)													130,557	119,990	117,431
Weighted Average Grant Date Fair Value
Unvested at the beginning of the period (in dollars per share)													$ 11.54	$ 10.91	$ 11.16
Granted (in dollars per share)													$ 13.14	$ 12.54	$ 9.67
Vested (in dollars per share)													$ 11.46	$ 11.19	$ 11.30
Forfeited / Cancelled (in dollars per share)													$ 12.08	$ 11.72	$ 10.87
Unvested at the end of the period (in dollars per share)													$ 12.41	$ 11.54	$ 10.91
Awarded performance based stock that will vest on third anniversary (as a percent)																50.00%
Awarded performance based stock that vest on fourth anniversary (as a percent)																25.00%
Awarded performance based stock that vest on fifth anniversary (as a percent)																25.00%

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CONSOLIDATED STATEMENTS OF CONDITION (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
ASSETS
Cash and due from banks	$ 162	$ 734
Interest-earning demand deposits in other banks	24,928	6,852
Total cash and cash equivalents	25,090	7,586
Investment securities available-for-sale	12,491	23,106
Mortgage related securities available-for-sale	283,616	225,664
Mortgage related securities held-to-maturity (fair value of $29,451 at December 31, 2012 and $41,758 at December 31, 2011)	28,369	41,074
Loans, net of allowance for loan losses of $11,170 at December 31, 2012 and $12,075 at December 31, 2011	683,865	670,572
Federal Home Loan Bank stock, at cost	8,097	8,074
Bank-owned life insurance	14,077	13,606
Premises and equipment, net	10,443	10,431
Assets acquired through foreclosure	8,524	2,423
Real estate held for investment	1,620	1,620
Accrued interest receivable	3,223	4,578
Mortgage servicing rights, net	170	316
Deferred tax asset, net	2,953	1,682
Other assets	5,803	5,131
Total Assets	1,088,341	1,015,863
LIABILITIES
Deposits	687,409	676,594
Short-term borrowings	70,500	8,500
Federal Home Loan Bank advances	110,000	88,278
Other borrowed funds	30,000	50,000
Advances from borrowers for taxes and insurance	1,699	1,736
Accrued interest payable	330	418
Accrued expenses and other liabilities	6,938	2,145
Total Liabilities	906,876	827,671
COMMITMENTS AND CONTINGENCIES (Note 12)
STOCKHOLDERS' EQUITY
Preferred stock ($.01 par value; 1,000,000 shares authorized, none issued and outstanding at December 31, 2012 and December 31, 2011)
Common stock ($.01 par value; 60,000,000 shares authorized, 12,356,564 shares issued and outstanding at December 31, 2012 and 13,037,310 shares issued and outstanding at December 31, 2011)	146	146
Additional paid-in capital	136,132	134,871
Treasury stock, at cost (2,249,600 shares at December 31, 2012 and 1,524,900 shares at December 31, 2011)	(29,733)	(19,822)
Common stock acquired by benefit plans	(10,228)	(11,541)
Retained earnings	80,608	77,971
Accumulated other comprehensive income, net	4,540	6,567
Total Stockholders' Equity	181,465	188,192
Total Liabilities and Stockholders' Equity	$ 1,088,341	$ 1,015,863

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 3) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Real Estate Held for Investment
Carrying value of property	$ 1,620	$ 1,620
Impairment loss on real estate property held for investment		$ 110
Minimum period for investment in real estate to be sold or placed in service	8 years

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Unrealized holding gains arising during period, tax expense	$ 7	$ 424	$ 767
Non-credit related unrealized loss on other-than temporary impaired securities, tax expense (benefit)	0	(16)	0
Reclassification adjustments for net investment securities gains included in net income, tax expense	1,208	371	667
Reclassification adjustment for loss included in net income for other-than temporary impaired investment sold, tax (benefit)	$ (34)

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LOANS (Details 7) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Past due loans
30 - 59 Days Past Due	$ 41	$ 1,467
60 - 89 Days Past Due	2,026	421
One- to four-family real estate
Past due loans
30 - 59 Days Past Due	18	370
60 - 89 Days Past Due	284	252
Multi-family and commercial real estate
Past due loans
60 - 89 Days Past Due	1,691
Consumer loans
Past due loans
30 - 59 Days Past Due	23	1,097
60 - 89 Days Past Due	$ 51	$ 169

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BORROWINGS (Tables)

12 Months Ended

Dec. 31, 2012

BORROWINGS

Summary of borrowed funds by type

	Balance at End of Year		Weighted Average Coupon Rate			Maximum Amount Outstanding at Month End During the Year		Average Amount Outstanding During the Year		Weighted Average Interest Rate During the Year
	(Dollars in thousands)
2012
FHLB advances	$	110,000		1.80	%	$	110,000	$	82,039		2.90	%
Other borrowed funds		30,000		3.30			50,000		39,389		3.42
Short-term borrowings		70,500		0.30			70,500		15,851		0.24
2011
FHLB advances	$	88,278		3.41	%	$	122,429	$	110,180		3.66	%
Other borrowed funds		50,000		3.42			50,000		50,000		3.42
Short-term borrowings		8,500		0.25			24,000		2,239		0.23

Schedule of FHLB advances

Maturity Date	Amount		Coupon Rate			Call Date	Rate if Called
	(In thousands)
August 2014		10,000		0.52	%	Not Applicable	Not Applicable
September 2014		15,000		0.41	%	Not Applicable	Not Applicable
December 2014		15,000		0.43	%	Not Applicable	Not Applicable
March 2015		10,000		0.49	%	Not Applicable	Not Applicable
August 2015		10,000		0.68	%	Not Applicable	Not Applicable
November 2017		15,000		3.62	%	February 2013	LIBOR + 0.10%
November 2017		15,000		3.87	%	February 2013	LIBOR + 0.10%
December 2017		20,000		2.83	%	March 2013	LIBOR + 0.11%
	$	110,000		1.80	%

Schedule of maturity of FHLB advances with weighted average coupon by year

Maturity	Amount		Weighted Average Coupon Rate
	(Dollars in thousands)
2013	$	—		—	%
2014		40,000		0.45
2015		20,000		0.58
2016		—		—
2017		50,000		3.38
	$	110,000		1.80	%

Schedule of other long-term borrowings

Maturity Date	Amount		Coupon Rate			Next Call Date	Subsequent Call Frequency
	(In thousands)
September 2018		10,000		3.40	%	Not Applicable	Not Applicable
September 2018		5,000		3.20	%	Not Applicable	Not Applicable
October 2018		5,000		3.15	%	January 2013	Quarterly
October 2018		5,000		3.27	%	Not Applicable	Not Applicable
November 2018		5,000		3.37	%	November 2013	Not Applicable
	$	30,000		3.30	%

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DEPOSITS (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Weighted Average Interest Rate
NOW accounts	0.22%	0.39%
Money market accounts	0.19%	0.38%
Savings and club accounts	0.14%	0.29%
Brokered deposits	0.36%	0.53%
Certificates of deposit	1.59%	2.03%
Deposits	0.70%	1.12%
Deposits
Noninterest-bearing demand accounts	$ 108,176	$ 84,374
NOW accounts	70,199	45,948
Money market accounts	97,318	127,667
Savings and club accounts	99,046	80,740
Brokered deposits	50,637	10,162
Certificates of deposit	262,033	327,703
Total deposits amount	$ 687,409	$ 676,594

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STOCKHOLDERS' EQUITY

12 Months Ended

Dec. 31, 2012

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY

NOTE 13—STOCKHOLDERS' EQUITY

        The Bank is subject to various regulatory capital requirements administered by federal banking agencies. The Bancorp, as a savings and loan holding company, is not subject to separate capital requirements. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Bank's consolidated financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank's assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The Bank's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

        Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth below) of Total and Tier 1 capital (as defined in the regulations) to risk-weighted assets, and of Tier 1 capital to total assets, as defined. Management believes, as of December 31, 2012, that the Bank meets all capital adequacy requirements to which it was subject.

        As of December 31, 2012, the Bank is categorized as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the Bank's category.

        The Bank's actual capital amounts and ratios at December 31, 2012 and 2011 and the minimum amounts and ratios required for capital adequacy purposes and to be well capitalized under the prompt corrective action provisions are as follows:

	Actual					For Capital Adequacy Purposes					To be Well Capitalized under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in Thousands)
December 31, 2012
Total risk-based capital (to risk-weighted assets)		147,659		20.48	%		³57,682		³8.0	%		³72,103		³10.0	%
Tier 1 capital (to risk-weighted assets)		140,240		19.45			³28,841		³4.0			³43,262		³6.0
Tier 1 capital (to adjusted assets)		140,240		12.90			³43,475		³4.0			³54,344		³5.0
December 31, 2011
Total risk-based capital (to risk-weighted assets)		161,494		23.90	%		³54,054		³8.0	%		³67,567		³10.0	%
Tier 1 capital (to risk-weighted assets)		154,623		22.88			³27,027		³4.0			³40,540		³6.0
Tier 1 capital (to adjusted assets)		154,787		15.30			³40,461		³4.0			³50,576		³5.0

        The Bancorp's ability to pay dividends is limited by statutory and regulatory requirements. The Bancorp may not declare nor pay dividends on its stock if such declaration or payment would violate statutory or regulatory requirements. The Bancorp paid a cash dividend of $0.04 per common share during each of the first three quarters of 2012 and two dividends, totaling $0.08, per common share during the fourth quarter of 2012. Additionally, the Bancorp paid a cash dividend of $0.06 per common share on March 5, 2013.

        The Bancorp raised net proceeds of $77.8 million from the mutual to stock conversion completed on June 29, 2010. During 2010, the Bancorp contributed $48.5 million to the Bank, $7.5 million in the first quarter and $41.0 million in the second quarter in conjunction with the mutual-to-stock conversion.

        During the second quarter of 2012, the Bancorp received a $7.9 million dividend from the Bank, equaling the amount of the Bank's 2010 and 2011 net income. During the third quarter of 2012, the Bancorp received a $1.9 million dividend from the Bank, equaling the amount of the Bank's net income for the six months ended June 30, 2012. During the fourth quarter of 2012, the Bancorp received a dividend of $11.5 million from the Bank, which was comprised of $1.5 million representing the Bank's net income for the three months ended September 2012 plus a special dividend of $10.0 million.

        The Bancorp repurchased 724,700 shares of common stock during the year ended December 31, 2012 in conjunction with stock repurchase programs. There were 1,524,900 shares repurchased during the year ended December 31, 2011. The aggregate purchases were recorded as treasury stock, at cost, on the Bancorp's statement of condition in the amount of $29.7 million at December 31, 2012.

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STOCK BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2012

STOCK BASED COMPENSATION

Summary of stock option activity and related information

	Number of Stock Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
Outstanding at December 31, 2009		677,381		$	11.03	7.9 years	$	105,000
Granted		39,500			9.67
Exercised		—			—
Forfeited / Cancelled		(24,703	)		10.45
Outstanding at December 31, 2010		692,178		$	10.97	7.1 years	$	608,000
Granted		135,494			12.49
Exercised		(15,037	)		10.69
Forfeited / Cancelled		(24,493	)		11.24
Outstanding at December 31, 2011		788,142		$	11.23	6.6 years	$	1,111,000
Granted		146,550			13.15
Exercised		(43,954	)		10.94
Forfeited / Cancelled		(13,069	)		11.10
Outstanding at December 31, 2012		877,669		$	11.57	6.3 years	$	4,461,000
Exercisable at December 31, 2012		567,008		$	11.26	5.1 years	$	3,055,000

Schedule of assumptions to determine the fair value of the options

	2012	2011	2010
Expected Dividend Yield	1.82%	1.90% - 2.00%		1.90	%
Expected Volatility	32.0% - 32.5%	33.0% - 40.0%		35.00	%
Risk-Free Interest Rate	0.86% - 1.10%	1.21% - 2.51%		2.04	%
Expected Option Life in Years	6.50	6.50		6.50

Summary of unvested options and changes during the period

	Number of Stock Options			Weighted Average Grant Date Fair Value
Unvested at December 31, 2009		455,806		$	2.91
Granted		39,500			2.97
Exercised		—			—
Vested		(133,561	)		2.97
Forfeited / Cancelled		(17,748	)		2.73
Unvested at December 31, 2010		343,997		$	2.90
Granted		135,494			3.60
Exercised		—			—
Vested		(135,464	)		2.98
Forfeited / Cancelled		(21,497	)		3.06
Unvested at December 31, 2011		322,530		$	3.15
Granted		146,550			3.57
Exercised		—			—
Vested		(145,350	)		3.10
Forfeited / Cancelled		(13,069	)		3.17
Unvested at December 31, 2012		310,661		$	3.36

Summary of the status of the Company's restricted stock activity and balances

	Number of Restricted Shares			Weighted Average Grant Date Fair Value
Unvested at December 31, 2009		148,813		$	11.16
Granted		15,640			9.67
Vested		(45,888	)		11.30
Forfeited / Cancelled		(1,134	)		10.87
Unvested at December 31, 2010		117,431		$	10.91
Granted		57,036			12.54
Vested		(48,620	)		11.19
Forfeited / Cancelled		(5,857	)		11.72
Unvested at December 31, 2011		119,990		$	11.54
Granted		69,950			13.14
Vested		(56,358	)		11.46
Forfeited / Cancelled		(3,025	)		12.08
Unvested at December 31, 2012		130,557		$	12.41

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RELATED PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2012

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

NOTE 15—RELATED PARTY TRANSACTIONS

Transactions with Directors, Officers and Employees

        The Company may from time to time enter into transactions with its directors, officers and employees. Such transactions are made in the ordinary course of business on substantially the same terms and conditions, including interest rates and collateral, as those prevailing at the same time for comparable transactions with other customers, and do not, in the opinion of management, involve more than the normal credit risk or present other unfavorable features.

        There were no loans to directors and executive officers as of December 31, 2012 and 2011.

Equity Method Investments

        As of December 31, 2012, 2011 and 2010, Fox Chase Bank owned approximately 45% of Philadelphia Mortgage Advisors, Inc. ("PMA"). During 2012, 2011 and 2010, the Company engaged in certain business activities with PMA. These activities included providing a warehouse line of credit to PMA, as well as acquiring residential mortgage loans from PMA. The Company recorded interest income from PMA on the warehouse line of $460,000, $220,000 and $285,000 for the years ended December 31, 2012, 2011 and 2010, respectively, as well as loan satisfaction fees, which are recorded in service charges and other fee income, of $66,000, $50,000 and $65,000 for the years ended December 31, 2012, 2011 and 2010, respectively. The balance outstanding on the warehouse line was $15.2 million and $9.5 million at December 31, 2012 and 2011, respectively. In addition, the Company acquired total loans from PMA of $14.4 million, $10.6 million and $23.9 million for the years ended December 31, 2012, 2011 and 2010, respectively, which includes the cost of the loans.

        During 2010, the Company provided PMA a term loan in the amount of $1.2 million, which was secured by a residential property owned by PMA. The Company recorded interest income from PMA on this term loan of $25,000 and $15,000 for the years ended December 31, 2011 and 2010, respectively. The loan was paid off during the second quarter of 2011.

        The Company's investment in PMA was $2.0 million and $1.5 million at December 31, 2012 and 2011, respectively, and was included in other assets on the consolidated statements of condition.

        PMA had total assets of $32.5 million and $16.4 million as of December 31, 2012 and 2011, respectively. PMA had total liabilities of $28.5 million and $13.5 million as of December 31, 2012 and 2011, respectively. PMA had net revenues of $7.8 million, $5.0 million and $4.9 million as of December 31, 2012, 2011 and 2010, respectively. PMA had expenses (including income taxes) of $6.3 million, $4.4 million and $4.5 million as of December 31, 2012, 2011 and 2010, respectively. PMA had net income of $1.5 million, $557,000 and $438,000 as of December 31, 2012, 2011 and 2010, respectively.

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BORROWINGS (Details) (USD $) In Thousands, unless otherwise specified								12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012 0.52% borrowing, due August 2014	Dec. 31, 2012 0.41% borrowing, due September 2014	Dec. 31, 2012 0.43% borrowing, due December 2014	Dec. 31, 2012 0.49% borrowing, due March 2015	Dec. 31, 2012 0.68% borrowing, due August 2015	Dec. 31, 2012 3.62% borrowing, due November 2017	Dec. 31, 2012 3.87% borrowing, due November 2017	Dec. 31, 2012 2.83% borrowing, due on December 2017	Dec. 31, 2012 FHLB of Pittsburgh	Dec. 31, 2012 FHLB advances	Dec. 31, 2011 FHLB advances	Dec. 31, 2012 Other borrowed funds	Dec. 31, 2011 Other borrowed funds	Dec. 31, 2012 Short-term borrowings	Dec. 31, 2011 Short-term borrowings
Borrowings
Balance at End of Year														$ 30,000	$ 50,000
Balance at End of Year	70,500	8,500														70,500	8,500
Balance at End of Year	110,000	88,278	10,000	15,000	15,000	10,000	10,000	15,000	15,000	20,000	110,000	110,000	88,278
Interest rate (as a percent)			0.52%	0.41%	0.43%	0.49%	0.68%	3.62%	3.87%	2.83%		1.80%	3.41%	3.30%	3.42%	0.30%	0.25%
Maximum Amount Outstanding during the period												110,000	122,429	50,000	50,000	70,500	24,000
Average Amount Outstanding during the period												82,039	110,180	39,389	50,000	15,851	2,239
Blended weighted average interest rate (as a percent)											1.80%	2.90%	3.66%	3.42%	3.42%	0.24%	0.23%
Reference rate, description								LIBOR	LIBOR	LIBOR
Interest rate added to reference rate (as a percent)								0.10%	0.10%	0.11%
FHLB lower coupon rate												0.41%
FHLB higher coupon rate												3.87%
Maturity of FHLB advances
2014												40,000
2015												20,000
2017												50,000
Total												$ 110,000
FHLB advances by interest rate type, by maturity
2014												0.45%
2015												0.58%
2017												3.38%
Total												1.80%

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CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (USD $) In Thousands, unless otherwise specified	Total	Common Stock	Additional Paid in Capital	Treasury Stock	Common Stock Acquired by Benefit Plans	Retained Earnings	Accumulated Other Comprehensive Income (Loss), Net
BALANCE at Dec. 31, 2009	$ 123,634	$ 147	$ 64,016	$ (11,814)	$ (6,862)	$ 71,604	$ 6,543
Increase (Decrease) in Stockholders' Equity
Stock based compensation expense	929		929
Issuance of stock for vested equity awards			(519)		560	(41)
Unallocated ESOP shares committed to employees	522		18		504
Shares allocated in long-term incentive plan	89		89
Forfeited LTI shares converted to treasury			30	(30)
Corporate Reorganization: Merger of Fox Chase Mutual Holding Company	107	(81)	188
Corporate Reorganization: Treasury stock retired		(11)	(11,833)	11,844
Corporate Reorganization: Exchange of common stock		(55)	55
Corporate Reorganization: Proceeds from stock offering, net of offering expenses	81,169	145	81,024
Purchase of common stock by ESOP	(3,485)				(3,485)
Net income	2,744					2,744
Other comprehensive income (loss)	(5)						(5)
BALANCE at Dec. 31, 2010	205,704	145	133,997		(9,283)	74,307	6,538
Increase (Decrease) in Stockholders' Equity
Purchase of treasury stock, net	(19,822)			(19,822)
Purchase of common stock for equity incentive plan	(3,474)				(3,474)
Stock based compensation expense	1,041		1,041
Issuance of stock for vested equity awards			(544)		592	(48)
Unallocated ESOP shares committed to employees	840		216		624
Common stock issued for exercise of vested stock options	162	1	161
Dividends paid ($0.20 and $0.08 per share for the years ended December 31, 2012 and 2011, respectively)	(1,067)					(1,067)
Net income	4,779					4,779
Other comprehensive income (loss)	29						29
BALANCE at Dec. 31, 2011	188,192	146	134,871	(19,822)	(11,541)	77,971	6,567
Increase (Decrease) in Stockholders' Equity
Purchase of treasury stock, net	(9,911)			(9,911)
Stock based compensation expense	1,042		1,042
Issuance of stock for vested equity awards			(646)		689	(43)
Unallocated ESOP shares committed to employees	921		297		624
Common stock issued for exercise of vested stock options	480		480
Excess tax benefit from exercise of stock options and vesting of restricted stock	88		88
Dividends paid ($0.20 and $0.08 per share for the years ended December 31, 2012 and 2011, respectively)	(2,382)					(2,382)
Net income	5,062					5,062
Other comprehensive income (loss)	(2,027)						(2,027)
BALANCE at Dec. 31, 2012	$ 181,465	$ 146	$ 136,132	$ (29,733)	$ (10,228)	$ 80,608	$ 4,540

XML

CONSOLIDATED STATEMENTS OF CONDITION (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
CONSOLIDATED STATEMENTS OF CONDITION
Mortgage related securities held-to-maturity, fair value (in dollars)	$ 29,451	$ 41,758
Loans, allowance for loan losses (in dollars)	$ 11,170	$ 12,075
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	60,000,000	60,000,000
Common stock, shares issued	12,356,564	13,037,310
Common stock, shares outstanding	12,356,564	13,037,310
Treasury stock, shares	2,249,600	1,524,900

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BORROWINGS

12 Months Ended

Dec. 31, 2012

BORROWINGS

BORROWINGS

NOTE 8—BORROWINGS

        The following is a summary of borrowed funds by type:

	Balance at End of Year		Weighted Average Coupon Rate			Maximum Amount Outstanding at Month End During the Year		Average Amount Outstanding During the Year		Weighted Average Interest Rate During the Year
	(Dollars in thousands)
2012
FHLB advances	$	110,000		1.80	%	$	110,000	$	82,039		2.90	%
Other borrowed funds		30,000		3.30			50,000		39,389		3.42
Short-term borrowings		70,500		0.30			70,500		15,851		0.24
2011
FHLB advances	$	88,278		3.41	%	$	122,429	$	110,180		3.66	%
Other borrowed funds		50,000		3.42			50,000		50,000		3.42
Short-term borrowings		8,500		0.25			24,000		2,239		0.23

Federal Home Loan Bank Advances

Maturity Date	Amount		Coupon Rate			Call Date	Rate if Called
	(In thousands)
August 2014		10,000		0.52	%	Not Applicable	Not Applicable
September 2014		15,000		0.41	%	Not Applicable	Not Applicable
December 2014		15,000		0.43	%	Not Applicable	Not Applicable
March 2015		10,000		0.49	%	Not Applicable	Not Applicable
August 2015		10,000		0.68	%	Not Applicable	Not Applicable
November 2017		15,000		3.62	%	February 2013	LIBOR + 0.10%
November 2017		15,000		3.87	%	February 2013	LIBOR + 0.10%
December 2017		20,000		2.83	%	March 2013	LIBOR + 0.11%
	$	110,000		1.80	%

        Advances from the FHLB of Pittsburgh with coupon rates ranging from 0.41% to 3.87% are due as follows.

Maturity	Amount		Weighted Average Coupon Rate
	(Dollars in thousands)
2013	$	—		—	%
2014		40,000		0.45
2015		20,000		0.58
2016		—		—
2017		50,000		3.38
	$	110,000		1.80	%

        During the three months ended June 30, 2012, the Company terminated $36.3 million of FHLB borrowings at a pre-tax cost of $1.5 million, which was recorded in loss on extinguishment of debt in the consolidated statement of operations.

        For the borrowings which have "Call Dates" disclosed in the above table, if the borrowing is called, the Company has the option to either pay off the borrowing without penalty or the borrowing's fixed rate resets to a variable LIBOR based rate, as noted in the above table. Subsequent to the call date, the borrowings are callable by the FHLB quarterly. Accordingly, the contractual maturities above may differ from actual maturities.

        Pursuant to collateral agreements with the FHLB, advances are secured by qualifying first mortgage loans, qualifying fixed-income securities, FHLB stock and an interest-bearing demand deposit account with the FHLB. As of December 31, 2012, the Company has $161.9 million in qualifying collateral pledged against its advances.

        The Bank had a maximum borrowing capacity with the FHLB of Pittsburgh of approximately $367.0 million at December 31, 2012. Additionally, as of December 31, 2012, the Bank has a maximum borrowing capacity of $53.8 million with the Federal Reserve Bank of Philadelphia through the Discount Window.

        As a member of the FHLB of Pittsburgh, the Bank is required to acquire and hold shares of capital stock in the FHLB of Pittsburgh in an amount at least equal to 4.60% of its advances plus 0.35% of the Bank's "eligible assets," as such term is defined by the FHLB; and a maximum amount of 6.00% of its advances plus 1.0% of the Bank's "eligible assets." The FHLB of Pittsburgh has indicated it would only redeem from any member the lesser of the amount of the member's excess capital stock or 5% of the member's total capital stock. The FHLB also indicated that it may increase its individual member stock investment requirements at any time. As of December 31, 2012, the Company's minimum stock obligation was $7.9 million and a maximum stock obligation was $12.6 million. The Company held $8.1 million in FHLB stock at that date. The FHLB of Pittsburgh ceased paying a dividend on its common stock during the first quarter of 2009 and did not pay a dividend through December 31, 2011. Beginning in the first quarter of 2012, the FHLB of Pittsburgh reinstated its quarterly dividend.

• Other Borrowed Funds

Maturity Date	Amount		Coupon Rate			Next Call Date	Subsequent Call Frequency
	(In thousands)
September 2018		10,000		3.40	%	Not Applicable	Not Applicable
September 2018		5,000		3.20	%	Not Applicable	Not Applicable
October 2018		5,000		3.15	%	January 2013	Quarterly
October 2018		5,000		3.27	%	Not Applicable	Not Applicable
November 2018		5,000		3.37	%	November 2013	Not Applicable
	$	30,000		3.30	%

        During 2012, the Company terminated $20.0 million of other long-term borrowings at a pre-tax cost of $1.5 million, which was recorded in loss on extinguishment of debt in the consolidated statement of operations.

        Other borrowed funds obtained from large commercial banks under security repurchase agreements totaled $30.0 million at December 31, 2012. These borrowings contractually mature with dates ranging from September 2018 through November 2018 and may be called by the lender based on the underlying agreements. Accordingly, the contractual maturities below may differ from actual maturities.

        Mortgage backed securities with a fair value of $37.4 million at December 31, 2012 were used to secure these other borrowed funds.

• Short-term borrowings

        As of December 31, 2012 and December 31, 2011, the Company had $70.5 million and $8.5 million, respectively, of short-term borrowings. The short-term borrowings at December 31, 2012 and 2011 had a blended rate of 0.30% and 0.25%, respectively. Short-term borrowings consist of overnight and term borrowings with an original maturity less than one year. Short-term borrowings are obtained from commercial banks, participants in the Federal Funds market and the FHLB.

XML

Document and Entity Information (USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Mar. 01, 2013	Jun. 30, 2012
Document and Entity Information
Entity Registrant Name	Fox Chase Bancorp Inc
Entity Central Index Key	0001485176
Document Type	10-K
Document Period End Date	Dec. 31, 2012
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 168.7
Entity Common Stock, Shares Outstanding		12,305,564
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	FY

XML

EMPLOYEE BENEFITS

12 Months Ended

Dec. 31, 2012

EMPLOYEE BENEFITS

EMPLOYEE BENEFITS

NOTE 9—EMPLOYEE BENEFITS

• 401(k) Plan

        The Bank has a 401(k) retirement plan covering all employees meeting certain eligibility requirements. Employees may contribute a percentage of their salary to the Plan each year, subject to limitations set by law. The Bank matches a portion of each employee contribution and also may make discretionary contributions, based on the Bank's performance. The Bank provides a matching contribution equivalent to 33% of the first 6% of the contribution made by an employee. The Bank's contributions to the plan on behalf of its employees resulted in an expenditure of $131,000, $121,000 and $110,000 for the years ended December 31, 2012, 2011 and 2010, respectively.

• Employee Stock Ownership Plan

        The ESOP is a tax-qualified plan designed to invest in the Bancorp's common stock that provides employees meeting certain eligibility requirements with the opportunity to receive a funded retirement benefit, based on the value of the Bancorp's common stock. The ESOP has purchased 963,767 shares of common stock and has total loans outstanding of $6.7 million as of December 31, 2012. The ESOP purchased shares in two separate transactions as described in the next paragraph.

        The ESOP initially purchased 615,267 shares of common stock in Old Fox Chase Bancorp's initial stock offering in 2006 at a price of $9.35 per share with the proceeds of a loan from Old Fox Chase Bancorp to the ESOP. The outstanding loan principal balance on the initial ESOP transaction at December 31, 2012 and 2011 was $3.7 million and $4.0 million, respectively. ESOP shares from this transaction that were unallocated at December 31, 2012 totaled 328,142 and had a fair market value of $5.5 million.

        The ESOP purchased an additional 348,500 shares of common stock in conjunction with the Bancorp's mutual-to-stock conversion completed on June 29, 2010 at a price of $10.00 per share with the proceeds of a second loan from the Bancorp to the ESOP. The outstanding loan principal balance at December 31, 2012 and 2011 was $3.0 million and $3.2 million, respectively. ESOP shares from this transaction that were unallocated at December 31, 2012 totaled 288,415 and had a fair market value of $4.8 million.

        Shares of the Bancorp's common stock pledged as collateral for the loan are released from the pledge for allocation to Plan participants as loan payments are made. The Bank releases 65,053 shares annually based upon the ratio that the current principal and interest payment bears to the current and remaining scheduled future principal and interest payments. Dividends declared on common stock held by the ESOP and not allocated to the account of a participant are used to repay the loan. Dividends declared on common stock held by the ESOP that are allocated to the account of a participant are paid to the participant once a year.

        As of December 31, 2012, there were no shares committed to employees, 347,210 shares allocated to employees and 616,557 unallocated shares to be released in future periods.

        Total ESOP compensation expense for the year ended December 31, 2012, 2011 and 2010 was $921,000, $840,000 and $522,000, respectively, representing the average fair market value of shares allocated during the year.

• Long-Term Incentive Plan

        The Bank maintains the Fox Chase Bank Executive Long-Term Incentive Plan (the "Incentive Plan"). All plan assets are invested in Bancorp common stock. The Incentive Plan became effective January 1, 2006. During 2012, 2011 and 2010, the Bank recorded compensation expense of $0, $0 and $89,000, respectively, for the Incentive Plan. All shares in the plan were fully vested on January 1, 2011.

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FAIR VALUE (Details 3) (Unobservable Inputs (Level 3), USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Roll forward of financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3)
Beginning balance	$ 11,905	$ 13,174
Purchases/ additions	3,974	1,600
Sales	(70)
Payments (received) made	(2,379)	(2,675)
Premium amortization, net	(12)	(16)
Increase/(decrease) in value	(713)	(178)
Ending balance	12,705	11,905
Private label residential mortgage related security
Roll forward of financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3)
Beginning balance	122	166
Sales	(70)
Payments (received) made	(7)	(34)
Increase/(decrease) in value	(45)	(10)
Ending balance		122
Private label commercial mortgage related securities
Roll forward of financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3)
Beginning balance	8,906	11,767
Payments (received) made	(2,668)	(2,570)
Premium amortization, net	(12)	(16)
Increase/(decrease) in value	(29)	(275)
Ending balance	6,197	8,906
Derivatives contracts
Roll forward of financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3)
Purchases/ additions	(39)
Increase/(decrease) in value	27
Ending balance	(12)
Financial assets acquired from debtors
Roll forward of financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3)
Purchases/ additions	4,013
Payments (received) made	393
Increase/(decrease) in value	(692)
Ending balance	3,714
Loans
Roll forward of financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3)
Beginning balance	2,877	1,241
Purchases/ additions		1,600
Payments (received) made	(97)	(71)
Increase/(decrease) in value	26	107
Ending balance	$ 2,806	$ 2,877

XML

CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
INTEREST INCOME
Interest and fees on loans	$ 33,878	$ 35,428	$ 36,320
Interest on mortgage related securities	7,606	9,775	11,874
Interest on investment securities available-for-sale
Taxable	308	488	471
Nontaxable	34	184	334
Other interest income	8	71	286
Total Interest Income	41,834	45,946	49,285
INTEREST EXPENSE
Deposits	6,347	8,672	15,203
Short-term borrowings	38	5
Federal Home Loan Bank advances	2,383	4,085	4,789
Other borrowed funds	1,349	1,733	1,733
Total Interest Expense	10,117	14,495	21,725
Net Interest Income	31,717	31,451	27,560
Provision for loan losses	3,478	5,734	6,213
Net Interest Income after Provision for Loan Losses	28,239	25,717	21,347
NONINTEREST INCOME
Service charges and other fee income	1,597	1,630	1,132
Net gain on sale of premises and equipment			6
Net gain on sale of loans	0
Net gain on sale of assets acquired through foreclosure	135	250	44
Impairment loss on real estate held for investment		(110)
Income on bank-owned life insurance	471	468	471
Equity in earnings of affiliates	690	245	166
Other	130	130	107
Total other-than-temporary impairment loss		(407)
Less: Portion of loss recognized in other comprehensive income (before taxes)		46
Net other-than-temporary impairment loss		(361)
Net gain on sale of investment securities	3,292	1,091	1,963
Net investment securities gains	3,292	730	1,963
Total Noninterest Income	6,315	3,343	3,889
NONINTEREST EXPENSE
Salaries, benefits and other compensation	13,540	12,761	12,128
Occupancy expense	1,702	1,845	1,822
Furniture and equipment expense	537	442	454
Data processing costs	1,797	1,719	1,662
Professional fees	1,706	1,720	1,374
Marketing expense	270	356	291
FDIC premiums	773	870	1,401
Assets acquired through foreclosure expense	2,143	762	543
Loss on extinguishment of debt	3,018
Other	1,688	1,594	1,697
Total Noninterest Expense	27,174	22,069	21,372
Income Before Income Taxes	7,380	6,991	3,864
Income tax provision	2,318	2,212	1,120
Net Income	$ 5,062	$ 4,779	$ 2,744
Earnings per share:
Basic (in dollars per share)	$ 0.44	$ 0.36	$ 0.20
Diluted (in dollars per share)	$ 0.43	$ 0.36	$ 0.20

XML

LOANS

12 Months Ended

Dec. 31, 2012

LOANS

LOANS

NOTE 3—LOANS

        The composition of net loans at December 31, 2012 and 2011 is provided below (in thousands):

	December 31, 2012			December 31, 2011
Real estate loans:
One- to four-family	$	158,828		$	198,669
Multi-family and commercial		368,948			313,060
Construction		22,591			18,243
		550,367			529,972
Consumer loans		30,585			44,667
Commercial and industrial loans		113,820			107,781
Total loans		694,772			682,420
Deferred loan origination cost, net		263			227
Allowance for loan losses		(11,170	)		(12,075	)
Net loans	$	683,865		$	670,572

        The Company had approximately $197.9 million and $210.4 million of loans in New Jersey at December 31, 2012 and 2011, respectively. Other than the loans in New Jersey, the majority of the Company's loans are in the geographic areas near the Company's branches in Southeastern Pennsylvania.

        The Company reclassified $8,000 and $21,000 of deposit accounts that were overdrawn to other consumer loans as of December 31, 2012 and 2011, respectively.

        The following table presents changes in the allowance for loan losses (in thousands):

	Years Ended December 31,
	2012			2011			2010
Balance, beginning	$	12,075		$	12,443		$	10,605
Provision for loan losses		3,478			5,734			6,213
Loans charged off		(4,527	)		(6,331	)		(4,402	)
Recoveries		144			229			27
Balance, ending	$	11,170		$	12,075		$	12,443

        The following tables present changes in the allowance for loan losses by loan segment for the years ended December 31, 2012 and 2011:

	For the Year Ended December 31, 2012
	One- to Four- Family			Multi-family and Commercial			Construction Loans			Consumer Loans			Commercial and Industrial Loans			Unallocated		Total
	(in thousands)
Balance, beginning	$	1,760		$	6,112		$	869		$	455		$	2,657		$	222	$	12,075
Provision for loan losses		286			1,064			252			1,659			(27	)		244		3,478
Loans charged off		(1,408	)		(887	)		(340	)		(1,892	)		—			—		(4,527	)
Recoveries		4			38			92			10			—			—		144
Balance, ending	$	642		$	6,327		$	873		$	232		$	2,630		$	466	$	11,170

	For the Year Ended December 31, 2011
	One- to Four- Family			Multi-family and Commercial			Construction Loans			Consumer Loans			Commercial and Industrial Loans			Unallocated		Total
	(in thousands)
Balance, beginning	$	1,990		$	4,624		$	3,260		$	665		$	1,707		$	197	$	12,443
Provision for loan losses		324			2,608			1,010			221			1,546			25		5,734
Loans charged off		(567	)		(1,290	)		(3,445	)		(433	)		(596	)		—		(6,331	)
Recoveries		13			170			44			2			—			—		229
Balance, ending	$	1,760		$	6,112		$	869		$	455		$	2,657		$	222	$	12,075

        The following tables set forth the breakdown of impaired loans by loan segment as of December 31, 2012 and 2011.

December 31, 2012

	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		Impaired Loans with Allowance		Impaired Loans without Allowance
	(in thousands)
Real estate loans:
One- to four-family	$	3,355	$	507	$	—	$	3,862	$	3,862	$	—
Multi-family and commercial		5,284		6,867		—		12,151		11,770		381
Construction		6,434		—		—		6,434		6,434		—
Consumer loans		2,051		14		—		2,065		203		1,862
Commercial and industrial		—		—		—		—		—
Total	$	17,124	$	7,388	$	—	$	24,512	$	22,269	$	2,243

December 31, 2011

	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		Impaired Loans with Allowance		Impaired Loans without Allowance
	(in thousands)
Real estate loans:
One- to four-family	$	6,885	$	307	$	—	$	7,192	$	7,192	$	—
Multi-family and commercial		3,814		6,836		—		10,650		9,570		1,080
Construction		6,372		—		—		6,372		6,372		—
Consumer loans		7		64		6,229		6,300		6,300		—
Commercial and industrial		—		—		—		—		—		—
Total	$	17,078	$	7,207	$	6,229	$	30,514	$	29,434	$	1,080

        For the years ended December 31, 2012, 2011 and 2010, the average recorded investment in impaired loans was $28.7 million, $32.0 million and $42.0 million, respectively. The interest income recognized on these impaired loans was $502,000, $825,000 and $399,000 for the years ended December 31, 2012, 2011 and 2010, respectively.

        At December 31, 2012, seven troubled debt restructurings ("TDRs"), totaling $6.9 million, are excluded from the accruing TDR column above as they are included in the nonaccrual loans. Of this amount, $6.4 million relates to two construction loans. The Company has commitments of $855,000 to lend additional funds related to these construction loans. Additionally, the Company had four residential loan TDRs totaling $435,000 and one consumer loan TDR totaling $8,000 which are included in the nonaccrual loans and total impaired loans. At December 31, 2011, two TDRs, totaling $5.2 million, were excluded from the accruing TDR column above as they are included in the nonaccrual loans. These TDRs relate to two construction loans.

        Loans on which the accrual of interest has been discontinued amounted to $17.1 million at December 31, 2012 and $17.1 million at December 31, 2011. If interest on such loans had been recorded in accordance with contractual terms, interest income would have increased by $1.5 million, $1.1 million and $1.5 million in 2012, 2011 and 2010, respectively. There was $0, $3.9 million and $0 of loans past due 90 days or more and still accruing interest at December 31, 2012, 2011 and 2010, respectively.

        The following tables set forth a summary of the TDR activity for the twelve months ended December 31, 2012 and 2011:

	As of and for the Twelve Months Ended December 31, 2012
	Restructured Current Period						TDRs that Defaulted in Current Period that were Restructured in the Prior Twelve Months
	Number of Loans		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Number of Loans		Post- Modification Outstanding Recorded Investment
	(Dollars in Thousands)
Real estate loans:
One- to four-family		4	$	582	$	582		3	$	254
Multi-family and commercial		2		604		604		—		—
Construction		—		—		—		—		—
Consumer loans		1		14		14		1		8
Commercial and industrial		—		—		—		—		—
Total		7	$	1,200	$	1,200		4	$	262

	As of and for the Twelve Months Ended December 31, 2011
	Restructured Current Period						TDRs that Defaulted in Current Period that were Restructured in the Prior Twelve Months
	Number of Loans		Pre- Modification Outstanding Recorded Investment		Post- Modification Outstanding Recorded Investment		Number of Loans		Post- Modification Outstanding Recorded Investment
	(Dollars in Thousands)
Real estate loans:
One- to four-family		2	$	307	$	307		—	$	—
Multi-family and commercial		1		4,673		4,673		—		—
Construction		—		—		—		1		3,115
Consumer loans		2		64		64		—		—
Commercial and industrial		—		—		—		1		600
Total		5	$	5,044	$	5,044		2	$	3,715

        The Company may, under certain circumstances, restructure loans as a concession to borrowers who have experienced financial difficulty. TDRs are included in impaired loans. TDRs typically result from the Company's loss mitigation activities which, among other activities, could include rate reductions, payment extension, and/or principal forgiveness.

        At December 31, 2012, the Company had fourteen TDRs, totaling $14.3 million, of which $13.1 million were the following seven TDRs at December 31, 2011:

• •

  Two construction loans totaling $6.4 million.

• •

  Two multi-family and commercial real estate loans totaling $6.3 million.

  •

  Two residential loans totaling $365,000.

  •

  One consumer loan totaling $8,000.

        The Company had seven new TDRs during the year ended December 31, 2012, which totaled $1.2 million at December 31, 2012, and were comprised of the following:

• •

  Two multi-family and commercial real estate loans, totaling $590,000. The first loan, totaling $504,000 was classified as a TDR as the Company agreed to reduce payments to interest only for a period of seven months. The second loan, totaling $86,000, was classified as a TDR as the Company agreed to delay principal repayments.

  •

  Four residential loans, totaling $577,000, as the Company agreed to modified terms with the borrowers, which included delayed repayment of principal and/or interest.

  •

  One consumer loan, totaling $14,000, as the Company agreed to modified terms with the borrowers, which included delayed repayment of principal and/or interest.

        At December 31, 2011, the Company had eight TDRs, totaling $12.4 million, of which $7.4 million were the following three TDRs at December 31, 2010:

• •

  Two construction loans totaling $5.6 million.

  •

  One multi-family and commercial real estate loan totaling $1.8 million.

        The Company had five new TDRs during the year ended December 31, 2011, which totaled $5.0 million at December 31, 2011, and were comprised of the following:

• •

  One multi-family and commercial real estate loan, totaling $4.7 million. The loan was classified as a TDR as the Company agreed to restructure the terms of the loan, which included reducing payments to interest only for a period of nine months and reducing the rate for the term of the interest only period.

  •

  Two residential loans, totaling $307,000, as the Company agreed to modified terms with the borrowers, which included delayed repayment of principal and/or interest.

  •

  Two consumer loans, totaling $64,000, as the Company agreed to modified terms with the borrowers, which included delayed repayment of principal and/or interest.

        The following tables set forth the allowance for loan loss for impaired loans and general allowance by loan segment as of December 31, 2012 and December 31, 2011:

December 31, 2012

	Allowance for Loan Losses
	Impaired Loans
	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		General		Total
	(in thousands)
Real estate loans:
One- to four-family	$	337	$	5	$	—	$	342	$	300	$	642
Multi-family and commercial		530		948		—		1,478		4,849		6,327
Construction		449		—		—		449		424		873
Consumer loans		10		1		—		11		221		232
Commercial and industrial		—		—		—		—		2,630		2,630
Unallocated		—		—		—		—		466		466
Total allowance for loan losses	$	1,326	$	954	$	—	$	2,280	$	8,890	$	11,170

December 31, 2011

	Allowance for Loan Losses
	Impaired Loans
	Nonaccrual Loans		Accruing TDR's		Other Impaired Loans		Total Impaired Loans		General		Total
	(in thousands)
Real estate loans:
One- to four-family	$	1,394	$	3	$	—	$	1,397	$	363	$	1,760
Multi-family and commercial		466		975		—		1,441		4,671		6,112
Construction		565		—		—		565		304		869
Consumer loans		7		7		156		170		285		455
Commercial and industrial		—		—		—		—		2,657		2,657
Unallocated		—		—		—		—		222		222
Total allowance for loan losses	$	2,432	$	985	$	156	$	3,573	$	8,502	$	12,075

        The following table sets forth past due loans by segment as of December 31, 2012 and 2011.

	At December 31,
	2012				2011
	30 - 59 Days Past Due		60 - 89 Days Past Due		30 - 59 Days Past Due		60 - 89 Days Past Due
	(In thousands)
One- to four-family real estate	$	18	$	284	$	370	$	252
Multi-family and commercial real estate		—		1,691		—		—
Construction		—		—		—		—
Consumer		23		51		1,097		169
Commercial and industrial		—		—		—		—
Total	$	41	$	2,026	$	1,467	$	421

        We use six primary classifications for loans: pass, pass watch, special mention, substandard, doubtful and loss, of which three classifications are for problem loans: substandard, doubtful and loss. "Substandard loans" must have one or more defined weaknesses and are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected. "Doubtful loans" have the weaknesses of substandard loans with the additional characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions and values questionable, and there is a high possibility of loss. A loan classified "loss" is considered uncollectible and of such little value that continuance as a loan of the institution is not warranted. We also maintain a "special mention" category, described as loans which do not currently expose us to a sufficient degree of risk to warrant classification but do possess credit deficiencies or potential weaknesses deserving our close attention. If we classify an asset as loss, it is recorded as a loan charged off in the current period.

        The following tables set forth criticized and classified loans by segment as of December 31, 2012 and 2011:

	At December 31, 2012
	One- to Four-Family Loans		Multi-family and Commercial		Construction Loans		Consumer Loans		Commercial and Industrial Loans		Total
	(In thousands)
Pass and Pass watch	$	155,473	$	347,150	$	16,157	$	28,534	$	110,032	$	657,346
Special mention loans		—		6,733		—		—		3,633		10,366
Substandard loans		3,355		15,065		6,434		2,051		155		27,060
Doubtful loans		—		—		—		—		—		—
Total loans	$	158,828	$	368,948	$	22,591	$	30,585	$	113,820	$	694,772

	At December 31, 2011
	One- to Four-Family Loans		Multi-family and Commercial		Construction Loans		Consumer Loans		Commercial and Industrial Loans		Total
	(In thousands)
Pass and Pass watch	$	191,784	$	285,515	$	11,871	$	38,431	$	102,101	$	629,702
Special mention loans		—		13,226		—		6,229		1,407		20,862
Substandard loans		6,885		14,319		6,372		7		4,273		31,856
Doubtful loans		—		—		—		—		—		—
Total loans	$	198,669	$	313,060	$	18,243	$	44,667	$	107,781	$	682,420

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INVESTMENT AND MORTGAGE RELATED SECURITIES

12 Months Ended

Dec. 31, 2012

INVESTMENT AND MORTGAGE RELATED SECURITIES

INVESTMENT AND MORTGAGE RELATED SECURITIES

NOTE 2—INVESTMENT AND MORTGAGE RELATED SECURITIES

        The amortized cost and fair value of securities available-for-sale and held-to-maturity as of December 31, 2012 and 2011 are summarized as follows:

	December 31, 2012
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			OTTI in AOCI		Fair Value
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	300	$	14	$	—		$	—	$	314
Corporate securities		12,207		91		(121	)		—		12,177
		12,507		105		(121	)		—		12,491
Private label commercial mortgage related securities		6,119		78		—			—		6,197
Agency residential mortgage related securities		270,461		7,023		(65	)		—		277,419
Total mortgage related securities		276,580		7,101		(65	)		—		283,616
Total available-for-sale securities	$	289,087	$	7,206	$	(186	)	$	—	$	296,107
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	28,369	$	1,082	$	—		$	—	$	29,451
Total mortgage related securities		28,369		1,082		—			—		29,451
Total held-to-maturity securities	$	28,369	$	1,082	$	—		$	—	$	29,451

	December 31, 2011
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			OTTI in AOCI			Fair Value
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	6,424	$	90	$	—		$	—		$	6,514
State and political subdivisions		1,865		8		—			—			1,873
Corporate securities		15,007		16		(304	)		—			14,719
		23,296		114		(304	)		—			23,106
Private label residential mortgage related security		164		4		—			(46	)		122
Private label commercial mortgage related securities		8,799		107		—			—			8,906
Agency residential mortgage related securities		206,285		10,357		(6	)		—			216,636
Total mortgage related securities		215,248		10,468		(6	)		(46	)		225,664
Total available-for-sale securities	$	238,544	$	10,582	$	(310	)	$	(46	)	$	248,770
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	41,074	$	684	$	—		$	—		$	41,758
Total mortgage related securities		41,074		684		—			—			41,758
Total held-to-maturity securities	$	41,074	$	684	$	—		$	—		$	41,758

        Obligations of U.S. government agencies represents debt issued by the Federal Home Loan Bank and are not backed by the full faith and credit of the United States government.

        The following tables show gross unrealized losses and fair value of securities, aggregated by security category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2012 and 2011:

	December 31, 2012
	Less than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	—	$	—		$	—	$	—		$	—	$	—
State and political subdivisions		—		—			—		—			—		—
Corporate securities		—		—			2,879		(121	)		2,879		(121	)
		—		—			2,879		(121	)		2,879		(121	)
Private label commercial mortgage related securities		—		—			—		—			—		—
Agency residential mortgage related securities		29,092		(65	)		—		—			29,092		(65	)
Total mortgage related securities		29,092		(65	)		—		—			29,092		(65	)
Total available-for-sale securities	$	29,092	$	(65	)	$	2,879	$	(121	)	$	31,971	$	(186	)
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	—	$	—		$	—	$	—		$	—	$	—
Total mortgage related securities		—		—			—		—			—		—
Total held-to-maturity securities	$	—	$	—		$	—	$	—		$	—	$	—
Total Temporarily Impaired Securities	$	29,092	$	(65	)	$	2,879	$	(121	)	$	31,971	$	(186	)

	December 31, 2011
	Less than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses Plus OTTI in AOCI			Fair Value		Unrealized Losses
	(In Thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	—	$	—		$	—	$	—		$	—	$	—
State and political subdivisions		—		—			—		—			—		—
Corporate securities		4,799		(182	)		2,878		(122	)		7,677		(304	)
		4,799		(182	)		2,878		(122	)		7,677		(304	)
Private label residential mortgage related security		—		—			122		(42	)		122		(42	)
Private label commercial mortgage related securities		—		—			—		—			—		—
Agency residential mortgage related securities		1,538		(6	)		—		—			1,538		(6	)
Total mortgage related securities		1,538		(6	)		122		(42	)		1,660		(48	)
Total available-for-sale securities	$	6,337	$	(188	)	$	3,000	$	(164	)	$	9,337	$	(352	)
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	—	$	—		$	—	$	—		$	—	$	—
Total mortgage related securities		—		—			—		—			—		—
Total held-to-maturity securities	$	—	$	—		$	—	$	—		$	—	$	—
Total Temporarily Impaired Securities	$	6,337	$	(188	)	$	3,000	$	(164	)	$	9,337	$	(352	)

        During the year ended December 31, 2012, the Company sold (1) mortgage related securities with an amortized cost of $82.3 million and recognized gross gains of $3.3 million, (2) a private label residential mortgage related security with an amortized cost of $157,000 and recognized a loss of $87,000 and (3) two obligations of U.S. government agencies with an amortized cost of $6.1 million and recognized a gain of $64,000.

        As of December 31, 2012, the Company held three private label CMBS with an amortized cost of $6.1 million. These securities had a net unrealized gain of $78,000 at December 31, 2012 and all individual securities were held at an unrealized gain. As of December 31, 2011, the Company held three private label CMBS with an amortized cost of $8.8 million. These securities had a net unrealized gain of $107,000 at December 31, 2011 and all individual securities were held at an unrealized gain. During 2011, one security paid off in full.

        The Company evaluates current characteristics of each of these private label securities such as fair value, delinquency and foreclosure levels, credit enhancement, projected losses, coverage and actual and projected cash flows, on a quarterly basis. It is possible that the underlying collateral of these securities will perform worse than current expectations, which may lead to adverse changes in cash flows on these securities and potential future other-than-temporary impairment losses. Events that may trigger material declines in fair values for these securities in the future would include but are not limited to deterioration of credit metrics, significantly higher levels of default and severity of loss on the underlying collateral, deteriorating credit enhancement and loss coverage ratios, or further illiquidity.

        At December 31, 2011, after other-than-temporary impairment charges, the Company held one private label residential mortgage related security which had an amortized cost of $164,000, a fair value of $122,000 with a remaining net unrealized loss, including other-than-temporary impairment in accumulated other comprehensive income, of $42,000. There was no other-than-temporary credit impairment recognized on this investment during the year ended December 31, 2010. During the year ended December 31, 2011, management determined that there was additional other-than-temporary impairment in the amount of $407,000, $361,000 of which was recognized on the statement of operations and $46,000 of which was recognized on the statement of condition in accumulated other comprehensive income (before taxes). This additional impairment was primarily due to a slowdown in principal payment speeds, an increase in default rates and an increase in estimated loss severity at default on the underlying residential mortgage collateral. The Company sold the private label residential mortgage related security during the three months ended June 30, 2012.

        Securities that have been impaired greater than twelve months as of December 31, 2012 consist of one corporate security with a fair value of $2.9 million with a rating of "Baa2", with an unrealized loss of $121,000. This unrealized loss is deemed to be temporary as the issuer continues to have an investment grade rating, all contractual payments have been made and the Company does not have the intention or requirement to sell this security prior to recovery of the amortized cost basis.

        Of the ten securities with a temporary impairment at December 31, 2012, nine have a rating of "AAA". The security with a rating of less than AAA is one corporate security with a fair value of $2.9 million and a rating of "Baa2".

        The following schedule provides a summary of the components of net gains on sale of investment securities in the Company's Consolidated Statement of Operations:

	Twelve Months Ended December 31, 2012:
	Gross Realized Gains		Gross Realized Losses			Other-than- Temporary Impairment Losses		Portion of OTTI in OCI		Net Gains (Losses)
	(in thousands)
Obligations of U.S. government agencies	$	64	$	—		$	—	$	—	$	64
State and political subdivisions		—		—			—		—		—
Corporate securities		—		—			—		—		—
		64		—			—		—		64
Private label residential mortgage related security		—		(87	)		—		—		(87	)
Private label commercial mortgage related securities		—		—			—		—		—
Agency residential mortgage related securities		3,315		—			—		—		3,315
Total mortgage related securities		3,315		(87	)		—		—		3,228
Total securities available-for-sale	$	3,379	$	(87	)	$	—	$	—	$	3,292

	Twelve Months Ended December 31, 2011:
	Gross Realized Gains		Gross Realized Losses		Other-than- Temporary Impairment Losses			Portion of OTTI in OCI		Net Gains (Losses)
	(in thousands)
Obligations of U.S. government agencies	$	—	$	—	$	—		$	—	$	—
State and political subdivisions		—		—		—			—		—
Corporate securities		—		—		—			—		—
		—		—		—			—		—
Private label residential mortgage related security		—		—		(407	)		46		(361	)
Private label commercial mortgage related securities		—		—		—			—		—
Agency residential mortgage related securities		1,091		—		—			—		1,091
Total mortgage related securities		1,091		—		(407	)		46		730
Total securities available-for-sale	$	1,091	$	—	$	(407	)	$	46	$	730

	Twelve Months Ended December 31, 2010:
	Gross Realized Gains		Gross Realized Losses		Other-than- Temporary Impairment Losses		Portion of OTTI in OCI		Net Gains (Losses)
	(in thousands)
Obligations of U.S. government agencies	$	—	$	—	$	—	$	—	$	—
State and political subdivisions		—		—		—		—		—
Corporate securities		—		—		—		—		—
		—		—		—		—		—
Private label residential mortgage related security		—		—		—		—		—
Private label commercial mortgage related securities		50		—		—		—		50
Agency residential mortgage related securities		1,913		—		—		—		1,913
Total mortgage related securities		1,963		—		—		—		1,963
Total securities available-for-sale	$	1,963	$	—	$	—	$	—	$	1,963

        The amortized cost and estimated fair value of investment securities available-for-sale and held-to-maturity at December 31, 2012 and 2011 by contractual maturity are as follows:

	Available for Sale				Held to Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In Thousands)
December 31, 2012
Due in one year or less	$	2,019	$	2,032	$	—	$	—
Due after one year through five years		10,488		10,459		—		—
Due after five years through ten years		—		—		—		—
Due after ten years		—		—		—		—
Total mortgage related securities		276,580		283,616		28,369		29,451
	$	289,087	$	296,107	$	28,369	$	29,451
December 31, 2011
Due in one year or less	$	8,022	$	8,013	$	—	$	—
Due after one year through five years		14,072		13,886		—		—
Due after five years through ten years		763		766		—		—
Due after ten years		439		441		—		—
Total mortgage related securities		215,248		225,664		41,074		41,758
	$	238,544	$	248,770	$	41,074	$	41,758

        Securities with a carrying value of $8.3 million and $8.1 million at December 31, 2012 and 2011, respectively, were pledged to secure public deposits and for other purposes as required or permitted by law.

        Securities with a carrying value of $46.6 million and $63.2 million at December 31, 2012 and 2011, respectively, were used to secure other borrowed funds. See Note 8.

XML

FAIR VALUE

12 Months Ended

Dec. 31, 2012

FAIR VALUE

FAIR VALUE

NOTE 14—FAIR VALUE

        Management uses its best judgment in estimating the fair value of the Company's financial instruments; however, there are inherent weaknesses in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates herein are not necessarily indicative of the amounts the Company could have realized in a sales transaction on the dates indicated. The estimated fair value amounts have been measured as of the respective year ends, and have not been reevaluated or updated for purposes of these consolidated financial statements subsequent to those respective dates. As such, the estimated fair values of these financial instruments subsequent to the respective reporting dates may be different than the amounts reported at each year end.

        The Company determines the fair value of financial instruments using three levels of input:

• Level 1—Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that are accessible at the measurement date.

  Level 2—Inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

  Level 3—Valuations are observed from unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

        The following information should not be interpreted as an estimate of the fair value of the entire Company since a fair value calculation is only provided for a limited portion of the Company's assets and liabilities. Due to a wide range of valuation techniques and the degree of subjectivity used in making the estimates, comparisons between the Company's disclosures and those of other companies may not be meaningful. The following methods and assumptions were used to estimate the fair values of the Company's financial instruments at December 31, 2012 and 2011:

Cash and Cash Equivalents

        The carrying amounts of cash and cash equivalents approximate their fair value.

Investment and Mortgage Related Securities—Available-for-Sale and Held-to-Maturity

        Fair values for investment securities and mortgage related securities are obtained from one external pricing service ("primary pricing service") as the provider of pricing on the investment portfolio on a quarterly basis. We generally obtain one quote per investment security. If quoted market prices are not available, fair values are based on quoted market prices of comparable securities. If quoted market prices are not available for comparable securities, fair value is based on quoted bids for the security or comparable securities. We review the estimates of fair value provided by the pricing service to determine if they are representative of fair value based upon our general knowledge of market conditions and relative changes in interest rates and the credit environment. The Company made no adjustments to the values obtained from the primary pricing service.

Loans Receivable, Net

        To determine the fair values of loans that are not impaired, we employ discounted cash flow analyses that use interest rates and terms similar to those currently being offered to borrowers. We do not record loans at fair value on a recurring basis. We record fair value adjustments to loans on a nonrecurring basis to reflect full and partial charge-offs due to impairment. For impaired loans, we use a variety of techniques to measure fair value, such as using the current appraised value of the collateral, agreements of sale, discounting the contractual cash flows, and analyzing market data that we may adjust due to specific characteristics of the loan or collateral. This technique does not contemplate an exit price.

Federal Home Loan Bank Stock

        The fair value of the Federal Home Loan Bank stock is assumed to equal its cost, since the stock is nonmarketable but redeemable at its par value.

Mortgage Servicing Rights

        The fair value of the MSRs for these periods was determined using a third-party valuation model that calculates the present value of estimated future servicing income. The model incorporates assumptions that market participants use in estimating future net servicing income, including estimates of prepayment speeds and discount rates.

Financial Assets Acquired from Debtors

        The fair value of life insurance policies was determined using valuations obtained from a third party valuation firm who utilized a discounted cash flow model to calculate the fair value of the policies. The significant assumptions used in the valuation were the life expectancies of the insured parties, future premium payments and discount rates.

Accrued Interest Receivable and Accrued Interest Payable

        The carrying amount of accrued interest receivable and accrued interest payable approximates fair value.

Deposit Liabilities

        Fair values for demand deposits (including NOW accounts), savings and club accounts and money market deposits are, by definition, equal to the amount payable on demand at the reporting date. Fair values of fixed-maturity certificates of deposit, including brokered deposits, are estimated using a discounted cash flow calculation that applies interest rates currently being offered on similar instruments with similar maturities.

Short-term Borrowings, Federal Home Loan Bank Advances and Other Borrowed Funds

        Fair value of short-term borrowings, Federal Home Loan Bank advances and other borrowed funds are estimated using discounted cash flow analyses, based on rates currently available to the Bank for advances with similar terms and remaining maturities.

Derivative Contracts

        The fair values of derivative contracts are based upon the estimated amount the Company would receive or pay to terminate the contracts or agreements, taking into account underlying interest rates, creditworthiness of underlying customers for credit derivatives and, when appropriate, the creditworthiness of the counterparties.

Off-Balance Sheet Financial Instruments

        Fair value of commitments to extend credit are estimated using the fees currently charged to enter into similar agreements, taking into account market interest rates, the remaining terms and present creditworthiness of the counterparties. These amounts are deemed to be insignificant.

        The estimated fair values of the Company's financial instruments at December 31, 2012 and 2011 were as follows (in thousands):

		December 31, 2012				December 31, 2011
	Fair Value Hierarchy Level	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Financial assets:
Cash and cash equivalents	Level 1	$	25,090	$	25,090	$	7,586	$	7,586
Available for sale securities:
Investment securities available-for-sale	Level 2		12,491		12,491		23,106		23,106
Private label residential mortgage related security	Level 3		—		—		122		122
Private label commercial mortgage related securities	Level 3		6,197		6,197		8,906		8,906
Agency residential mortgage related securities	Level 2		277,419		277,419		216,636		216,636
Held to maturity securities:
Agency mortgage related securities	Level 2		28,369		29,451		41,074		41,758
Loans receivable, net	Level 3		683,865		686,867		670,572		672,847
Federal Home Loan Bank stock	Level 3		8,097		8,097		8,074		8,074
Accrued interest receivable	Level 3		3,223		3,223		4,578		4,578
Mortgage servicing rights	Level 2		170		170		316		322
Financial assets acquired from debtors	Level 3		3,714		3,714		—		—
Financial liabilities:
Savings and club accounts	Level 2		99,046		99,046		80,740		80,740
Demand, NOW and money market deposits	Level 2		275,693		275,693		257,989		257,989
Brokered deposits	Level 2		50,637		50,715		10,162		10,129
Certificates of deposit	Level 2		262,033		264,694		327,703		330,941
Short-term borrowings	Level 2		70,500		70,500		8,500		8,500
Federal Home Loan Bank advances	Level 2		110,000		115,767		88,278		95,878
Other borrowed funds	Level 2		30,000		33,651		50,000		55,103
Accrued interest payable	Level 2		330		330		418		418
Derivative contracts	Level 2, 3		320		320		279		279

The following assets and liabilities were carried at fair value and classified as Level 3 as of December 31, 2012 and 2011:

• •

  Private label commercial mortgage related securities ("CMBS"), the fair value of which are difficult to determine because they are not actively traded in securities markets. The net unrealized gain in the private label CMBS portfolio was $78,000 and $107,000 at December 31, 2012 and December 31, 2011, respectively.

  •

  Two loans, since lending credit risk is not an observable input for these commercial loans (see Note 4). The unrealized gain on the two loans was $293,000 at December 31, 2012 compared to $268,000 at December 31, 2011.

  •

  Financial assets acquired from debtors include eight life insurance policies. The life expectancies of the insured parties, future premium payments and discount rates which are used to value these policies are significant unobservable inputs. Losses resulting from changes in fair value, totaling $692,000, for the year ended December 31, 2012, were recorded in assets acquired through foreclosure expense in the consolidated statements of operations. At December 31, 2011, the company did not hold any financial assets acquired from debtors.

  •

  Credit derivatives which are valued based on creditworthiness of the underlying borrower which is a significant unobservable input. The unrealized loss on the credit derivatives was $12,000 at December 31, 2012 compared to $0 at December 31, 2011.

  •

  A private label collateralized mortgage obligation ("CMO"), the fair value of which is more difficult to determine because they are not actively traded in securities markets. The net unrealized loss, including other-than-temporary impairment in accumulated other comprehensive income, in the private label CMO was $42,000 at December 31, 2011. This security was sold during 2012.

The following measures were made on a recurring basis as of December 31, 2012 and 2011:

				Fair Value Measurements at Reporting Date Using
Description	As of December 31, 2012			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Other Unobservable Inputs (Level 3)
	(In Thousands)
Available for Sale Securities:
Obligations of U.S. government agencies	$	314		$	—	$	314		$	—
State and political subdivisions		—			—		—			—
Corporate securities		12,177			—		12,177			—
Private label commercial mortgage related securities		6,197			—		—			6,197
Agency residential mortgage related securities		277,419			—		277,419			—
Loans(1)		2,806			—		—			2,806
Financial assets acquired from debtors		3,714			—		—			3,714
Derivative contracts(1)		(320	)		—		(308	)		(12	)
Total	$	302,307		$	—	$	289,602		$	12,705

				Fair Value Measurements at Reporting Date Using
Description	As of December 31, 2011			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Other Unobservable Inputs (Level 3)
	(In Thousands)
Available for Sale Securities:
Obligations of U.S. government agencies	$	6,514		$	—	$	6,514		$	—
State and political subdivisions		1,873			—		1,873			—
Corporate securities		14,719			—		14,719			—
Private label residential mortgage related security		122			—		—			122
Private label commercial mortgage related securities		8,906			—		—			8,906
Agency residential mortgage related securities		216,636			—		216,636			—
Loans(1)		2,877			—		—			2,877
Derivative contracts(1)		(279	)		—		(279	)		—
Total	$	251,368		$	—	$	239,463		$	11,905

(1)

Such financial instruments are recorded at fair value as further described in Note 4.

        The following measures were made on a non-recurring basis as of December 31, 2012 and 2011:

        Loans, which were partially charged off at December 31, 2012 and 2011. The loans' fair values are based on Level 3 inputs, which are either an appraised value or a sales agreement, less costs to sell. These amounts do not include fully charged-off loans, because we carry fully charged-off loans at zero on our balance sheet.

        MSR's, the fair value was determined using a third-party valuation model that calculates the present value of estimated future servicing income. The model incorporates assumptions that market participants use in estimating future net servicing income, including estimates of prepayment speeds and discount rates.

        Other real estate owned, we used Level 3 inputs, which consists of appraisals or agreements of sale. Other real estate owned is recorded on our balance sheet at fair value, net of costs to sell, when we obtain control of the property.

			Fair Value Measurements at Reporting Date Using
Description	Balance		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)
	(In Thousands)
As of December 31, 2012
Loans	$	2,951	$	—	$	—	$	2,951
Mortgage servicing rights		170		—		170		—
Other real estate owned		4,810		—		—		4,810
Total	$	7,931	$	—	$	170	$	7,761
As of December 31, 2011
Loans	$	2,490	$	—	$	—	$	2,490
Mortgage servicing rights		282		—		282		—
Other real estate owned		2,423		—		—		2,423
Total	$	5,195	$	—	$	282	$	4,913

        The following table includes a roll forward of the financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3), on a recurring basis, for the period of December 31, 2010 to December 31, 2012.

	Private Label Residential Mortgage Related Security			Private Label Commercial Mortgage Related Securities			Derivative Contracts			Financial Assets Acquired from Debtors			Loan			Total
	(In thousands)
Beginning balance, December 31, 2010	$	166		$	11,767		$	—		$	—		$	1,241		$	13,174
Purchases/additions		—			—			—			—			1,600			1,600
Sales		—			—			—			—			—			—
Payments received		(34	)		(2,570	)		—			—			(71	)		(2,675	)
Premium amortization, net		—			(16	)		—			—			—			(16	)
Increase/(decrease) in value		(10	)		(275	)		—			—			107			(178	)
Reclassification to Level 3		—			—			—			—			—			—
Ending balance, December 31, 2011	$	122		$	8,906		$	—		$	—		$	2,877		$	11,905
Purchases/additions		—			—			(39	)		4,013			—			3,974
Sales		(70	)		—			—			—			—			(70	)
Payments (received) made		(7	)		(2,668	)		—			393			(97	)		(2,379	)
Premium amortization, net		—			(12	)		—			—			—			(12	)
Increase/(decrease) in value		(45	)		(29	)		27			(692	)		26			(713	)
Reclassification to Level 3		—			—			—			—			—			—
Ending balance, December 31, 2012	$	—		$	6,197		$	(12	)	$	3,714		$	2,806		$	12,705

        There were no transfers made between levels during the years ended December 31, 2012 and 2011.

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STOCK BASED COMPENSATION

12 Months Ended

Dec. 31, 2012

STOCK BASED COMPENSATION

STOCK BASED COMPENSATION

NOTE 10—STOCK BASED COMPENSATION

        In 2007, stockholders approved the Fox Chase Bancorp, Inc. 2007 Equity Incentive Plan (the "2007 Plan"). The Plan provides that 769,083 shares of common stock may be issued in connection with the exercise of stock options and 307,633 shares of common stock may be issued as restricted stock. The Plan allows for the granting of non-statutory stock options ("NSOs"), incentive stock options and restricted stock. Options are granted at no less than the fair value of the Bancorp's common stock on the date of the grant. In 2007, Old Fox Chase Bancorp's Board of Directors approved the funding of a trust that purchased 307,395 shares of Bancorp's common stock to fund restricted stock awards under the Plan. The 307,395 shares were purchased by the trust at a weighted average cost of $12.18 per share.

        In August 2011, stockholders approved the Fox Chase Bancorp, Inc. 2011 Equity Incentive Plan (the "2011 Plan"). The 2011 Plan provides that 685,978 shares of common stock may be issued in connection with the exercise of stock options and 274,391 shares of common stock may be issued as restricted stock, including performance based restricted stock. In August 2011, the Board of Directors approved the funding of a trust that purchased 274,391 shares of Bancorp's common stock to fund restricted stock awards under the 2011 Plan. During the year ended December 31, 2011, 274,391 shares were purchased by the trust at a weighted average cost of $12.66 per share.

        During 2011, the Company granted 10,668 shares of performance based restricted stock to certain executive officers of the Company. During 2012, the Company granted 22,500 shares of performance based restricted stock to certain executive officers of the Company.

        During the years ended December 31, 2012, 2011 and 2010, the Company recorded $1.0 million, $1.0 million, and $929,000 of stock based compensation expense, respectively, comprised of stock option expense of $420,000, $436,000 and $400,000, respectively, and restricted stock expense of $621,000, $606,000 and $529,000, respectively.

        As a result of the mutual-to-stock conversion, all presented share information for periods prior to June 30, 2010 has been revised to reflect the 1.0692 exchange ratio.

        The following is a summary of Bancorp's stock option activity and related information for the 2007 Plan and 2011 Plan for the years ended December 31, 2012, 2011 and 2010:

	Number of Stock Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
Outstanding at December 31, 2009		677,381		$	11.03	7.9 years	$	105,000
Granted		39,500			9.67
Exercised		—			—
Forfeited / Cancelled		(24,703	)		10.45
Outstanding at December 31, 2010		692,178		$	10.97	7.1 years	$	608,000
Granted		135,494			12.49
Exercised		(15,037	)		10.69
Forfeited / Cancelled		(24,493	)		11.24
Outstanding at December 31, 2011		788,142		$	11.23	6.6 years	$	1,111,000
Granted		146,550			13.15
Exercised		(43,954	)		10.94
Forfeited / Cancelled		(13,069	)		11.10
Outstanding at December 31, 2012		877,669		$	11.57	6.3 years	$	4,461,000
Exercisable at December 31, 2012		567,008		$	11.26	5.1 years	$	3,055,000

        Management estimated the fair values of all option grants using the Black-Scholes option-pricing model. Through June 30, 2011, as limited historical information on the volatility of the Company's stock existed, management considered the average volatilities of comparable public companies over a period equal to the expected life of the options in determining the expected volatility rate. Beginning in the quarter ended September 30, 2011, management began to utilize the Company's actual volatility in determining the expected volatility rate. Management estimated the expected life of the options using the simplified method allowed under certain accounting standards. The risk-free rate was determined utilizing the Treasury yield for the expected life of the option contract.

        The fair value of the stock option grants was estimated with the following weighted average assumptions:

	2012	2011	2010
Expected Dividend Yield	1.82%	1.90% - 2.00%		1.90	%
Expected Volatility	32.0% - 32.5%	33.0% - 40.0%		35.00	%
Risk-Free Interest Rate	0.86% - 1.10%	1.21% - 2.51%		2.04	%
Expected Option Life in Years	6.50	6.50		6.50

        The following is a summary of the Company's unvested options as of December 31, 2012, 2011 and 2010 and changes therein during the years then ended:

	Number of Stock Options			Weighted Average Grant Date Fair Value
Unvested at December 31, 2009		455,806		$	2.91
Granted		39,500			2.97
Exercised		—			—
Vested		(133,561	)		2.97
Forfeited / Cancelled		(17,748	)		2.73
Unvested at December 31, 2010		343,997		$	2.90
Granted		135,494			3.60
Exercised		—			—
Vested		(135,464	)		2.98
Forfeited / Cancelled		(21,497	)		3.06
Unvested at December 31, 2011		322,530		$	3.15
Granted		146,550			3.57
Exercised		—			—
Vested		(145,350	)		3.10
Forfeited / Cancelled		(13,069	)		3.17
Unvested at December 31, 2012		310,661		$	3.36

        Expected future expense relating to the 310,661 unvested options outstanding as of December 31, 2012 is $871,000 over a weighted average period of 3.8 years.

        The following is a summary of the status of the Company's restricted stock as of December 31, 2012, 2011 and 2010 and changes therein during the years then ended:

	Number of Restricted Shares			Weighted Average Grant Date Fair Value
Unvested at December 31, 2009		148,813		$	11.16
Granted		15,640			9.67
Vested		(45,888	)		11.30
Forfeited / Cancelled		(1,134	)		10.87
Unvested at December 31, 2010		117,431		$	10.91
Granted		57,036			12.54
Vested		(48,620	)		11.19
Forfeited / Cancelled		(5,857	)		11.72
Unvested at December 31, 2011		119,990		$	11.54
Granted		69,950			13.14
Vested		(56,358	)		11.46
Forfeited / Cancelled		(3,025	)		12.08
Unvested at December 31, 2012		130,557		$	12.41

        Expected future compensation expense relating to the 130,557 restricted shares at December 31, 2012 is $1.4 million over a weighted average period of 3.9 years.

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PARENT COMPANY ONLY FINANCIAL STATEMENTS (Details 3) (USD $) In Thousands, unless otherwise specified	3 Months Ended										12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Jun. 30, 2010	Mar. 31, 2010	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Cash Flows From Operating Activities
Net income	$ 1,900	$ 1,436	$ 539	$ 1,187	$ 1,044	$ 1,232	$ 1,257	$ 1,246			$ 5,062	$ 4,779	$ 2,744
Adjustment to reconcile net income to net cash provided by operating activities:
Decrease in deferred tax asset											(90)	(343)	(9)
Excess tax benefit from exercise of stock options and vesting of restricted stock											(88)
Net Cash Provided by Operating Activities											17,595	15,469	16,252
Cash Flows from Investing Activities
Net Cash (Used in) Provided by Investing Activities											(62,866)	39,355	39,955
Cash Flows from Financing Activities
Purchase of treasury stock											(9,911)	(19,822)
Acquisition of common stock for equity incentive plan												(3,474)
Excess tax benefit from exercise of stock options and vesting of restricted stock											88
Common stock issued for exercise of stock options											480	162
Capital contribution to subsidiary									(41,000)	(7,500)			(48,500)
Purchase of common stock by ESOP													(3,485)
Merger of Fox Chase Mutual Holding Company													107
Proceeds from stock offering, net of offering expenses													81,169
Cash dividends paid											(2,382)	(1,067)
Net Cash Provided by (Used in) Financing Activities											62,775	(85,552)	(83,311)
Net Increase (Decrease) in Cash and Cash Equivalents											17,504	(30,728)	(27,104)
Cash and Cash Equivalents - Beginning				7,586				38,314		65,418	7,586	38,314	65,418
Cash and Cash Equivalents - Ending	25,090				7,586						25,090	7,586	38,314
Parent company
Cash Flows From Operating Activities
Net income											5,062	4,779	2,744
Adjustment to reconcile net income to net cash provided by operating activities:
Equity in undistributed loss of subsidiary											(5,393)	(4,969)	(2,894)
Decrease in deferred tax asset													89
Decrease in due from/to subsidiary, net											259	84	118
Excess tax benefit from exercise of stock options and vesting of restricted stock											(88)
Increase in other assets											(308)	(100)	(79)
Increase in other liabilities											130	1	5
Net Cash Provided by Operating Activities											(338)	(205)	(17)
Cash Flows from Investing Activities
Loan payment received on ESOP loans											516	487	364
Cash dividends received from subsidiary											21,281
Net Cash (Used in) Provided by Investing Activities											21,797	487	364
Cash Flows from Financing Activities
Purchase of treasury stock											(9,911)	(19,822)
Acquisition of common stock for equity incentive plan												(3,474)
Excess tax benefit from exercise of stock options and vesting of restricted stock											88
Receipt from subsidiary related to vesting of stock in equity incentive plan											646	544	519
Common stock issued for exercise of stock options											480	162
Capital contribution to subsidiary													(48,500)
Purchase of common stock by ESOP													(3,485)
Merger of Fox Chase Mutual Holding Company													107
Proceeds from stock offering, net of offering expenses													81,169
Cash dividends paid											(2,382)	(1,067)
Net Cash Provided by (Used in) Financing Activities											(11,079)	(23,657)	29,810
Net Increase (Decrease) in Cash and Cash Equivalents											10,380	(23,375)	30,157
Cash and Cash Equivalents - Beginning				19,227				42,602		12,445	19,227	42,602	12,445
Cash and Cash Equivalents - Ending	$ 29,607				$ 19,227						$ 29,607	$ 19,227	$ 42,602

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PREMISES AND EQUIPMENT

12 Months Ended

Dec. 31, 2012

PREMISES AND EQUIPMENT

PREMISES AND EQUIPMENT

NOTE 6—PREMISES AND EQUIPMENT

        The components of premises and equipment at December 31, 2012 and 2011 were as follows (in thousands):

	December 31,
	2012			2011
Land	$	3,207		$	3,207
Buildings		13,661			13,479
Leasehold improvements		201			190
Furniture, fixtures and equipment		4,827			5,125
		21,896			22,001
Less: accumulated depreciation		(11,453	)		(11,570	)
Premises and equipment, net	$	10,443		$	10,431

        As of December 31, 2012, the Company leased space for an operations center in Blue Bell, Pennsylvania, a branch location in Media, Pennsylvania and certain office equipment. The leases are accounted for as operating leases. The Blue Bell lease expires in January 2016 and, upon expiration, the Company has the option to extend the lease for an additional five year period at the then prevailing market rate. The following rental expenses were included in the Company's financial statements (in thousands):

	December 31,
	2012		2011		2010
	(In thousands)
Office rent	$	449	$	486	$	470
Equipment lease		2		2		6
	$	451	$	488	$	476

The following table shows the minimum future rental payments under non-cancelable leases for premises and equipment as of December 31, 2012 (in thousands):

Year
2013	$	399
2014		417
2015		428
2016		36
2017		—

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LOANS (Details 8) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012 item	Dec. 31, 2011
Criticized and classified loans by segment
Total criticized and classified loans	$ 694,772	$ 682,420
Number of primary classification for loans	6
Number of classifications for problem loans	3
Minimum number of defined weaknesses for substandard loans	1
One- to four-family
Criticized and classified loans by segment
Total criticized and classified loans	158,828	198,669
Multi-family and commercial
Criticized and classified loans by segment
Total criticized and classified loans	368,948	313,060
Construction
Criticized and classified loans by segment
Total criticized and classified loans	22,591	18,243
Consumer loans
Criticized and classified loans by segment
Total criticized and classified loans	30,585	44,667
Commercial and industrial
Criticized and classified loans by segment
Total criticized and classified loans	113,820	107,781
Pass and Pass watch
Criticized and classified loans by segment
Total criticized and classified loans	657,346	629,702
Pass and Pass watch | One- to four-family
Criticized and classified loans by segment
Total criticized and classified loans	155,473	191,784
Pass and Pass watch | Multi-family and commercial
Criticized and classified loans by segment
Total criticized and classified loans	347,150	285,515
Pass and Pass watch | Construction
Criticized and classified loans by segment
Total criticized and classified loans	16,157	11,871
Pass and Pass watch | Consumer loans
Criticized and classified loans by segment
Total criticized and classified loans	28,534	38,431
Pass and Pass watch | Commercial and industrial
Criticized and classified loans by segment
Total criticized and classified loans	110,032	102,101
Special mention loans
Criticized and classified loans by segment
Total criticized and classified loans	10,366	20,862
Special mention loans | Multi-family and commercial
Criticized and classified loans by segment
Total criticized and classified loans	6,733	13,226
Special mention loans | Consumer loans
Criticized and classified loans by segment
Total criticized and classified loans		6,229
Special mention loans | Commercial and industrial
Criticized and classified loans by segment
Total criticized and classified loans	3,633	1,407
Substandard loans
Criticized and classified loans by segment
Total criticized and classified loans	27,060	31,856
Substandard loans | One- to four-family
Criticized and classified loans by segment
Total criticized and classified loans	3,355	6,885
Substandard loans | Multi-family and commercial
Criticized and classified loans by segment
Total criticized and classified loans	15,065	14,319
Substandard loans | Construction
Criticized and classified loans by segment
Total criticized and classified loans	6,434	6,372
Substandard loans | Consumer loans
Criticized and classified loans by segment
Total criticized and classified loans	2,051	7
Substandard loans | Commercial and industrial
Criticized and classified loans by segment
Total criticized and classified loans	$ 155	$ 4,273

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DERIVATIVES AND HEDGING

12 Months Ended

Dec. 31, 2012

DERIVATIVES AND HEDGING

DERIVATIVES AND HEDGING

NOTE 4—DERIVATIVES AND HEDGING

Interest Rate Swaps

        On November 3, 2006, the Company entered an interest rate swap with a current notional amount of $950,000, which is used to hedge a 15-year fixed rate loan that is earning interest at 7.43%. The Company is receiving variable rate payments of one-month LIBOR plus 224 basis points and is paying fixed rate payments of 7.43%. The swap matures in April 2022 and had a fair value loss position of $203,000 and $214,000 at December 31, 2012 and 2011, respectively. The interest rate swap is carried at fair value in accordance with FASB ASC 815 "Derivatives and Hedging" and is included in other liabilities on the consolidated statements of condition. The loan is carried at fair value under the fair value option as permitted by FASB ASC 825 "Financial Instruments".

        On October 12, 2011, the Company entered an interest rate swap with a current notional amount of $1.6 million, which is used to hedge a 10-year fixed rate loan that is earning interest at 5.83%. The Company is receiving variable rate payments of one-month LIBOR plus 350 basis points and is paying fixed rate payments of 5.83%. The Company designated this relationship as a fair value hedge. The swap matures in October 2021 and had a fair value loss position of $105,000 and $65,000 at December 31, 2012 and December 31, 2011, respectively, which was included in other liabilities on the consolidated statements of condition. The difference between changes in the fair values of interest rate swap agreement and the hedged loan represents hedge ineffectiveness and is recorded in other non-interest income in the consolidated statements of operations. Hedge ineffectiveness resulted in expense of $4,000 for the year ended December 31, 2012 and expense of $5,000 for the year ended December 31, 2011.

Credit Derivatives

        We enter into agreements with a third-party financial institution whereby the financial institution enters into interest rate derivative contracts and foreign currency swap contracts with customers referred to them by us. By the terms of the agreements, the financial institution has recourse to the Company for any exposure created under each swap contract in the event the customer defaults on the swap agreement and the agreement is in a paying position to the third-party financial institution. These transactions represent credit derivatives and are a customary arrangement that allows financial institutions like us to provide access to interest rate and foreign currency swap transactions for our customers without creating the swap ourselves. The Company records the fair value of credit derivatives in other liabilities on the consolidated statement of condition. The Company recognizes changes in the fair value of credit derivatives, net of any fees received, as service charges and other fee income in the consolidated statements of operations.

        At December 31, 2012, there were four variable-rate to fixed-rate interest rate swap transactions between the third-party financial institution and our customers with a notional amount of $13.3 million, and remaining maturities ranging from 7 to 10 years. The fair value of the swaps to the customers was a liability of $213,000 as of December 31, 2012 and all swaps were in paying positions to the third-party financial institution. As of December 31, 2012, the fair value of the Company's interest rate swap credit derivatives was a liability of $12,000. During the year ended December 31, 2012, the Company recognized income of $67,000 from interest rate swap credit derivatives.

        At December 31, 2012, there were no foreign currency swap transactions between the third-party financial institution and our customers. During the year ended December 31, 2012, the Company recognized income of $35,000 from foreign currency swap credit derivatives.

        The maximum potential payments by the Company to the financial institution under these credit derivatives are not estimable as they are contingent on future interest rates and exchange rates, and the agreement does not provide for a limitation of the maximum potential payment amount.

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MORTGAGE SERVICING ACTIVITY

12 Months Ended

Dec. 31, 2012

MORTGAGE SERVICING ACTIVITY

MORTGAGE SERVICING ACTIVITY

NOTE 5—MORTGAGE SERVICING ACTIVITY

        Loans serviced for others are not included in the accompanying consolidated statements of condition. The unpaid principal balances of these loans were $36.6 million at December 31, 2012, $50.0 million at December 31, 2011, and $65.7 million at December 31, 2010. The Company received fees, net of amortization, from the servicing of loans of $(16,000), $25,000 and $11,000 during 2012, 2011 and 2010, respectively.

        The following summarizes mortgage-servicing rights activity for the years ended December 31, 2012, 2011 and 2010 (in thousands):

	Servicing Rights			Valuation Allowance			Net Carrying Value
Balance at December 31, 2009	$	768		$	(85	)	$	683
Additions		—			(46	)		(46	)
Amortization		(189	)		—			(189	)
Balance at December 31, 2010	$	579		$	(131	)	$	448
Additions		—			(8	)		(8	)
Amortization		(124	)		—			(124	)
Balance at December 31, 2011	$	455		$	(139	)	$	316
Additions		—			(16	)		(16	)
Amortization		(130	)		—			(130	)
Balance at December 31, 2012	$	325		$	(155	)	$	170

        The estimated amortization expense of amortizing mortgage servicing rights for each of the five succeeding fiscal years after December 31, 2012 is as follows (in thousands):

Year
2013	$	93
2014		67
2015		48
2016		34
2017		25
Thereafter		58
Total	$	325

        As of December 31, 2012 and 2011, the fair value of the mortgage servicing rights ("MSRs") was $170,000 and $322,000, respectively. The fair value at these dates was determined using a third-party valuation model that calculates the present value of estimated future servicing income. The model incorporates assumptions that market participants use in estimating future net servicing income, including estimates of prepayment speeds and discount rates. Mortgage loan prepayment speed is the annual rate at which borrowers are forecasted to repay their mortgage loan principal and is based on historical experience and current interest rates. The discount rate used to determine the present value of future net servicing income is the required rate of return the market would expect for an asset with similar risk. Both assumptions can, and generally will, change quarterly valuations as market conditions and interest rates change.

        The valuation allowance was increased by $16,000, $8,000 and $46,000, during the years ended December 31, 2012, 2011, and 2010 respectively, due to continued low interest rates and high level of prepayments. The amount of the valuation adjustment is recorded as an adjustment to service charges and other fee income in the Company's consolidated statement of operations.

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DEPOSITS

12 Months Ended

Dec. 31, 2012

DEPOSITS.

DEPOSITS

NOTE 7—DEPOSITS

        The weighted average interest rate and balance of deposits at December 31, 2012 and 2011 consisted of the following (dollars in thousands):

	December 31, 2012					December 31, 2011
	Weighted Average Interest Rate			Amount		Weighted Average Interest Rate			Amount
Noninterest-bearing demand accounts		—	%	$	108,176		—	%	$	84,374
NOW accounts		0.22			70,199		0.39			45,948
Money market accounts		0.19			97,318		0.38			127,667
Savings and club accounts		0.14			99,046		0.29			80,740
Brokered deposits		0.36			50,637		0.53			10,162
Certificates of deposit		1.59			262,033		2.03			327,703
		0.70	%	$	687,409		1.12	%	$	676,594

        The scheduled maturities of certificates of deposit and brokered deposits for periods subsequent to December 31, 2012 are as follows (in thousands):

	December 31,
Year	Certificates of Deposit		Brokered Deposits		Total
2013	$	144,692	$	45,529	$	190,221
2014		64,212		5,108		69,320
2015		29,182		—		29,182
2016		11,493		—		11,493
2017		4,823		—		4,823
Thereafter		7,631		—		7,631
	$	262,033	$	50,637	$	312,670

        A summary of interest expense on deposits for the years ended December 31, 2012, 2011 and 2010 is as follows (in thousands):

	2012		2011		2010
NOW accounts	$	234	$	143	$	210
Money market accounts		339		596		1,294
Savings and club accounts		253		148		45
Brokered deposits		194		13		—
Certificates of deposit		5,327		7,772		13,654
	$	6,347	$	8,672	$	15,203

        The aggregate amount of certificates of deposit with a minimum denomination of $100,000 was $62.5 million and $81.6 million at December 31, 2012 and 2011, respectively. Deposits in excess of $250,000 are not insured by the Federal Deposit Insurance Corporation (the "FDIC").

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PREMISES AND EQUIPMENT (Details 2) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
PREMISES AND EQUIPMENT
Optional extension period of operating lease	5 years
Operating leases
Rental expenses	$ 451	$ 488	$ 476
Minimum future rental payments under non-cancelable leases
2013	399
2014	417
2015	428
2016	36
Office rent
Operating leases
Rental expenses	449	486	470
Equipment lease
Operating leases
Rental expenses	$ 2	$ 2	$ 6

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QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) (USD $)	3 Months Ended								12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011 item	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011 item	Dec. 31, 2010
QUARTERLY FINANCIAL DATA (UNAUDITED)
Specific impairments					$ 2,200,000
Number of commercial loan					3					3
Adjustments to assets acquired through foreclosure	979,000
Gain on sale of mortgage related securities	952,000				1,100,000
Mortgage related securities sold	15,700,000				12,800,000
Interest income	9,950,000	10,531,000	10,411,000	10,942,000	11,102,000	11,606,000	11,607,000	11,631,000	41,834,000	45,946,000	49,285,000
Interest expense	2,117,000	2,298,000	2,740,000	2,962,000	3,114,000	3,545,000	3,827,000	4,009,000	10,117,000	14,495,000	21,725,000
Net Interest Income	7,833,000	8,233,000	7,671,000	7,980,000	7,988,000	8,061,000	7,780,000	7,622,000	31,717,000	31,451,000	27,560,000
Provision for loan losses	442,000	470,000	1,291,000	1,275,000	2,825,000	1,034,000	900,000	975,000	3,478,000	5,734,000	6,213,000
Net Interest Income after Provision for Loan Losses	7,391,000	7,763,000	6,380,000	6,705,000	5,163,000	7,027,000	6,880,000	6,647,000	28,239,000	25,717,000	21,347,000
Noninterest income	1,804,000	737,000	3,080,000	694,000	1,959,000	467,000	450,000	467,000	6,315,000	3,343,000	3,889,000
Noninterest expense	6,437,000	6,398,000	8,699,000	5,640,000	5,601,000	5,690,000	5,480,000	5,298,000	27,174,000	22,069,000	21,372,000
Income Before Income Taxes	2,758,000	2,102,000	761,000	1,759,000	1,521,000	1,804,000	1,850,000	1,816,000	7,380,000	6,991,000	3,864,000
Income tax provision	858,000	666,000	222,000	572,000	477,000	572,000	593,000	570,000	2,318,000	2,212,000	1,120,000
Net Income	$ 1,900,000	$ 1,436,000	$ 539,000	$ 1,187,000	$ 1,044,000	$ 1,232,000	$ 1,257,000	$ 1,246,000	$ 5,062,000	$ 4,779,000	$ 2,744,000
Per Common Share Data
Weighted average common share-basic	11,431,957	11,535,146	11,624,120	11,808,632	12,214,704	13,087,582	13,662,264	13,636,010	11,599,877	13,146,159	13,734,884
Weighted average common share-diluted	11,622,035	11,718,308	11,750,623	11,901,737	12,287,733	13,175,689	13,770,934	13,678,887	11,747,261	13,231,830	13,752,598
Net income per share-basic (in dollars per share)	$ 0.17	$ 0.12	$ 0.05	$ 0.10	$ 0.09	$ 0.09	$ 0.09	$ 0.09	$ 0.44	$ 0.36	$ 0.20
Net income per share-diluted (in dollars per share)	$ 0.16	$ 0.12	$ 0.05	$ 0.10	$ 0.09	$ 0.09	$ 0.09	$ 0.09	$ 0.43	$ 0.36	$ 0.20

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DEPOSITS (Details 2) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012
Maturity of deposits
2013	$ 190,221
2014	69,320
2015	29,182
2016	11,493
2017	4,823
Thereafter	7,631
Total	312,670
Certificates of deposit
Maturity of deposits
2013	144,692
2014	64,212
2015	29,182
2016	11,493
2017	4,823
Thereafter	7,631
Total	262,033
Brokered deposits
Maturity of deposits
2013	45,529
2014	5,108
Total	$ 50,637

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PREMISES AND EQUIPMENT (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
PREMISES AND EQUIPMENT
Premises and equipment, gross	$ 21,896	$ 22,001
Less: accumulated depreciation	(11,453)	(11,570)
Premises and equipment, net	10,443	10,431
Land
PREMISES AND EQUIPMENT
Premises and equipment, gross	3,207	3,207
Buildings
PREMISES AND EQUIPMENT
Premises and equipment, gross	13,661	13,479
Leasehold improvements
PREMISES AND EQUIPMENT
Premises and equipment, gross	201	190
Furniture, fixtures and equipment
PREMISES AND EQUIPMENT
Premises and equipment, gross	$ 4,827	$ 5,125

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DEPOSITS (Tables)

12 Months Ended

Dec. 31, 2012

DEPOSITS.

Schedule of components of weighted average interest rate and balance of deposits

The weighted average interest rate and balance of deposits at December 31, 2012 and 2011 consisted of the following (dollars in thousands):

	December 31, 2012					December 31, 2011
	Weighted Average Interest Rate			Amount		Weighted Average Interest Rate			Amount
Noninterest-bearing demand accounts		—	%	$	108,176		—	%	$	84,374
NOW accounts		0.22			70,199		0.39			45,948
Money market accounts		0.19			97,318		0.38			127,667
Savings and club accounts		0.14			99,046		0.29			80,740
Brokered deposits		0.36			50,637		0.53			10,162
Certificates of deposit		1.59			262,033		2.03			327,703
		0.70	%	$	687,409		1.12	%	$	676,594

Schedule of maturities of certificates of deposit and brokered deposits

The scheduled maturities of certificates of deposit and brokered deposits for periods subsequent to December 31, 2012 are as follows (in thousands):

	December 31,
Year	Certificates of Deposit		Brokered Deposits		Total
2013	$	144,692	$	45,529	$	190,221
2014		64,212		5,108		69,320
2015		29,182		—		29,182
2016		11,493		—		11,493
2017		4,823		—		4,823
Thereafter		7,631		—		7,631
	$	262,033	$	50,637	$	312,670

Summary of interest expense on deposits

A summary of interest expense on deposits for the years ended December 31, 2012, 2011 and 2010 is as follows (in thousands):

	2012		2011		2010
NOW accounts	$	234	$	143	$	210
Money market accounts		339		596		1,294
Savings and club accounts		253		148		45
Brokered deposits		194		13		—
Certificates of deposit		5,327		7,772		13,654
	$	6,347	$	8,672	$	15,203

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INVESTMENT AND MORTGAGE RELATED SECURITIES (Details 3) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
INVESTMENT AND MORTGAGE RELATED SECURITIES
Gross Realized Gains	$ 3,379	$ 1,091	$ 1,963
Gross Realized Losses	(87)
Other-than-Temporary Impairment Losses		(407)
Portion of OTTI in OCI		46
Net investment securities gains	3,292	730	1,963
Debt securities excluding mortgage related securities
INVESTMENT AND MORTGAGE RELATED SECURITIES
Gross Realized Gains	64
Net investment securities gains	64
Obligations of U.S. government agencies
INVESTMENT AND MORTGAGE RELATED SECURITIES
Gross Realized Gains	64
Net investment securities gains	64
Mortgage related securities
INVESTMENT AND MORTGAGE RELATED SECURITIES
Gross Realized Gains	3,315	1,091	1,963
Gross Realized Losses	(87)
Other-than-Temporary Impairment Losses		(407)
Portion of OTTI in OCI		46
Net investment securities gains	3,228	730	1,963
Private label residential mortgage related security
INVESTMENT AND MORTGAGE RELATED SECURITIES
Gross Realized Losses	(87)
Other-than-Temporary Impairment Losses		(407)
Portion of OTTI in OCI		46
Net investment securities gains	(87)	(361)
Private label commercial mortgage related securities
INVESTMENT AND MORTGAGE RELATED SECURITIES
Gross Realized Gains			50
Net investment securities gains			50
Agency residential mortgage related securities
INVESTMENT AND MORTGAGE RELATED SECURITIES
Gross Realized Gains	3,315	1,091	1,913
Net investment securities gains	$ 3,315	$ 1,091	$ 1,913

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COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2012

COMMITMENTS AND CONTINGENCIES.

COMMITMENTS AND CONTINGENCIES

NOTE 12—COMMITMENTS AND CONTINGENCIES

• Lending Operations

        The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized on the statements of financial condition.

        The Company's exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit is represented by the contractual amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments.

        A summary of the Company's financial instrument commitments at December 31, 2012 and 2011 is as follows (in thousands):

	December 31,
	2012		2011
Commitments to grant loans	$	23,644	$	74,372
Unfunded commitments under lines of credit		98,537		105,983
Standby letters of credit		14,348		12,010
Commercial letters of credit		848		—
	$	137,377	$	192,365

        Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The Company evaluates each customer's credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management's credit evaluation. Collateral held varies, but includes principally residential or commercial real estate, accounts receivable or inventory. Fixed rate commitments to grant loans were $2.6 million and $15.5 million as of December 31, 2012 and December 31, 2011, respectively. The interest rates on these fixed rate loans ranged from 4.75% to 6.00% as of December 31, 2012 and 5.25% to 6.00% as of December 31, 2011.

• Legal Proceedings

        The Company is periodically subject to various pending and threatened legal actions, which involve claims for monetary relief. Based upon information presently available to the Company, it is the Company's opinion that any legal and financial responsibility arising from such claims will not have a material adverse effect on the Company's results of operations.

• Service Contracts

        The Company has entered into contracts with third-party providers to manage the Company's network operations, data processing and other related services. The projected amount of the Company's future minimum payments contractually due after December 31, 2012 is as follows (in thousands):

Year	Amount
2013	$	1,952
2014		224
2015		96
2016		—
2017		—

During January 2013, the Company signed a new agreement with one of its third-party data processing providers, which extends the contract through December 2015 and modifies future contractual payments due to $1.7 million in 2013, $1.6 million in 2014 and $1.4 million in 2015.

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PARENT COMPANY ONLY FINANCIAL STATEMENTS

12 Months Ended

Dec. 31, 2012

PARENT COMPANY ONLY FINANCIAL STATEMENTS

PARENT COMPANY ONLY FINANCIAL STATEMENTS

NOTE 17—PARENT COMPANY ONLY FINANCIAL STATEMENTS

        The following condensed financial statements for Fox Chase Bancorp, Inc. (parent company only) reflect the investment in its wholly owned subsidiary, Fox Chase Bank, using the equity method of accounting.

CONDENSED BALANCE SHEET

	December 31,
	2012		2011
	(In Thousands)
ASSETS
Cash and due from banks	$	94	$	444
Interest-earning deposits with banks		29,513		18,783
Total cash and cash equivalents		29,607		19,227
Investment in subsidiary		144,781		161,353
Due from subsidiary, net		—		266
ESOP loans		6,659		7,175
Other assets		549		241
Total Assets		181,596		188,262
LIABILITIES AND STOCKHOLDERS' EQUITY
Due to subsidiary, net		19		—
Other liabilities		112		70
Total Liabilities		131		70
Stockholders' Equity		181,465		188,192
Total Liabilities and Stockholders' Equity	$	181,596	$	188,262

CONDENSED STATEMENTS OF OPERATIONS

	Years Ended December 31,
	2012			2011			2010
INCOME
Interest on deposits with banks	$	66		$	219		$	182
Interest on ESOP loans		432			463			432
Total Income		498			682			614
EXPENSES
Other expenses		1,000			970			841
Total Expenses		1,000			970			841
Loss before income tax benefit and equity in undistributed net earnings of subsidiary		(502	)		(288	)		(227	)
Income tax benefit		(171	)		(98	)		(77	)
Loss before equity in undistributed net earnings of subsidiary		(331	)		(190	)		(150	)
Equity in undistributed net earnings of subsidiary		5,393			4,969			2,894
Net Income	$	5,062		$	4,779		$	2,744

CONDENSED STATEMENTS OF CASH FLOWS

	Years Ended December 31,
	2012			2011			2010
Cash Flows From Operating Activities
Net income	$	5,062		$	4,779		$	2,744
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in undistributed loss of subsidiary		(5,393	)		(4,969	)		(2,894	)
Decrease in deferred tax asset		—			—			89
Decrease in due from/to subsidiary, net		259			84			118
Excess tax benefit from exercise of stock options and vesting of restricted stock		(88	)		—			—
Increase in other assets		(308	)		(100	)		(79	)
Increase in other liabilities		130			1			5
Net Cash Used in Operating Activities		(338	)		(205	)		(17	)
Cash Flows from Investing Activities
Loan payment received on ESOP loans		516			487			364
Cash dividends received from subsidiary		21,281			—			—
Net Cash Provided by Investing Activities		21,797			487			364
Cash Flows from Financing Activities
Purchase of treasury stock		(9,911	)		(19,822	)		—
Acquisition of common stock for equity incentive plan		—			(3,474	)		—
Excess tax benefit from exercise of stock options and vesting of restricted stock		88			—			—
Receipt from subsidiary related to vesting of stock in equity incentive plan		646			544			519
Common stock issued for exercise of stock options		480			162			—
Capital contribution to subsidiary		—			—			(48,500	)
Purchase of common stock by ESOP		—			—			(3,485	)
Merger of Fox Chase Mutual Holding Company		—			—			107
Proceeds from stock offering, net of offering expenses		—			—			81,169
Cash dividends paid		(2,382	)		(1,067	)		—
Net Cash Used in Financing Activities		(11,079	)		(23,657	)		29,810
Net Increase in Cash and Cash Equivalents		10,380			(23,375	)		30,157
Cash and Cash Equivalents—Beginning		19,227			42,602			12,445
Cash and Cash Equivalents—Ending	$	29,607		$	19,227		$	42,602

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INVESTMENT AND MORTGAGE RELATED SECURITIES (Details) (USD $)	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2012
Available-for-Sale Securities:
Amortized Cost	$ 238,544,000	$ 289,087,000
Gross Unrealized Gains	10,582,000	7,206,000
Gross Unrealized Losses	(310,000)	(186,000)
OTTI in AOCI	(46,000)
Total Fair Value	248,770,000	296,107,000
Held-to-maturity Securities:
Amortized Cost	41,074,000	28,369,000
Gross Unrealized Gains	684,000	1,082,000
Fair Value	41,758,000	29,451,000
Available-for-sale securities:
Fair Value, Less than 12 Months	6,337,000	29,092,000
Unrealized Losses, Less than 12 Months	(188,000)	(65,000)
Fair Value, 12 Months or More	3,000,000	2,879,000
Unrealized Losses Plus OTTI in AOCI, 12 Months or More	(164,000)	(121,000)
Fair Value, Total	9,337,000	31,971,000
Unrealized Losses, Total	(352,000)	(186,000)
Temporarily Impaired Securities
Fair Value, Less than 12 Months	6,337,000	29,092,000
Unrealized Losses, Less than 12 Months	(188,000)	(65,000)
Fair Value, 12 Months or More	3,000,000	2,879,000
Unrealized Losses Plus OTTI in AOCI, 12 Months or More	(164,000)	(121,000)
Fair Value, Total	9,337,000	31,971,000
Unrealized Losses, Total	(352,000)	(186,000)
Number of securities paid off in full	1
Debt securities excluding mortgage related securities
Available-for-Sale Securities:
Amortized Cost	23,296,000	12,507,000
Gross Unrealized Gains	114,000	105,000
Gross Unrealized Losses	(304,000)	(121,000)
Total Fair Value	23,106,000	12,491,000
Available-for-sale securities:
Fair Value, Less than 12 Months	4,799,000
Unrealized Losses, Less than 12 Months	(182,000)
Fair Value, 12 Months or More	2,878,000	2,879,000
Unrealized Losses Plus OTTI in AOCI, 12 Months or More	(122,000)	(121,000)
Fair Value, Total	7,677,000	2,879,000
Unrealized Losses, Total	(304,000)	(121,000)
Obligations of U.S. government agencies
Available-for-Sale Securities:
Amortized Cost	6,424,000	300,000
Gross Unrealized Gains	90,000	14,000
Total Fair Value	6,514,000	314,000
State and political subdivisions
Available-for-Sale Securities:
Amortized Cost	1,865,000
Gross Unrealized Gains	8,000
Total Fair Value	1,873,000
Corporate securities
Available-for-Sale Securities:
Amortized Cost	15,007,000	12,207,000
Gross Unrealized Gains	16,000	91,000
Gross Unrealized Losses	(304,000)	(121,000)
Total Fair Value	14,719,000	12,177,000
Available-for-sale securities:
Fair Value, Less than 12 Months	4,799,000
Unrealized Losses, Less than 12 Months	(182,000)
Fair Value, 12 Months or More	2,878,000	2,879,000
Unrealized Losses Plus OTTI in AOCI, 12 Months or More	(122,000)	(121,000)
Fair Value, Total	7,677,000	2,879,000
Unrealized Losses, Total	(304,000)	(121,000)
Mortgage related securities
Available-for-Sale Securities:
Amortized Cost	215,248,000	276,580,000
Gross Unrealized Gains	10,468,000	7,101,000
Gross Unrealized Losses	(6,000)	(65,000)
OTTI in AOCI	(46,000)
Total Fair Value	225,664,000	283,616,000
Held-to-maturity Securities:
Amortized Cost	41,074,000	28,369,000
Gross Unrealized Gains	684,000	1,082,000
Fair Value	41,758,000	29,451,000
Available-for-sale securities:
Fair Value, Less than 12 Months	1,538,000	29,092,000
Unrealized Losses, Less than 12 Months	(6,000)	(65,000)
Fair Value, 12 Months or More	122,000
Unrealized Losses Plus OTTI in AOCI, 12 Months or More	(42,000)
Fair Value, Total	1,660,000	29,092,000
Unrealized Losses, Total	(48,000)	(65,000)
Private label residential mortgage related security
Available-for-Sale Securities:
Amortized Cost	164,000
Gross Unrealized Gains	4,000
OTTI in AOCI	(46,000)
Total Fair Value	122,000
Available-for-sale securities:
Fair Value, 12 Months or More	122,000
Unrealized Losses Plus OTTI in AOCI, 12 Months or More	(42,000)
Fair Value, Total	122,000
Unrealized Losses, Total	(42,000)
Private label commercial mortgage related securities
Available-for-Sale Securities:
Amortized Cost	8,799,000	6,119,000
Gross Unrealized Gains	107,000	78,000
Total Fair Value	8,906,000	6,197,000
Agency residential mortgage related securities
Available-for-Sale Securities:
Amortized Cost	206,285,000	270,461,000
Gross Unrealized Gains	10,357,000	7,023,000
Gross Unrealized Losses	(6,000)	(65,000)
Total Fair Value	216,636,000	277,419,000
Held-to-maturity Securities:
Amortized Cost	41,074,000	28,369,000
Gross Unrealized Gains	684,000	1,082,000
Fair Value	41,758,000	29,451,000
Available-for-sale securities:
Fair Value, Less than 12 Months	1,538,000	29,092,000
Unrealized Losses, Less than 12 Months	(6,000)	(65,000)
Fair Value, Total	1,538,000	29,092,000
Unrealized Losses, Total	$ (6,000)	$ (65,000)

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PARENT COMPANY ONLY FINANCIAL STATEMENTS (Tables)

12 Months Ended

Dec. 31, 2012

PARENT COMPANY ONLY FINANCIAL STATEMENTS

Condensed balance sheet

	December 31,
	2012		2011
	(In Thousands)
ASSETS
Cash and due from banks	$	94	$	444
Interest-earning deposits with banks		29,513		18,783
Total cash and cash equivalents		29,607		19,227
Investment in subsidiary		144,781		161,353
Due from subsidiary, net		—		266
ESOP loans		6,659		7,175
Other assets		549		241
Total Assets		181,596		188,262
LIABILITIES AND STOCKHOLDERS' EQUITY
Due to subsidiary, net		19		—
Other liabilities		112		70
Total Liabilities		131		70
Stockholders' Equity		181,465		188,192
Total Liabilities and Stockholders' Equity	$	181,596	$	188,262

Condensed statements of operations

	Years Ended December 31,
	2012			2011			2010
INCOME
Interest on deposits with banks	$	66		$	219		$	182
Interest on ESOP loans		432			463			432
Total Income		498			682			614
EXPENSES
Other expenses		1,000			970			841
Total Expenses		1,000			970			841
Loss before income tax benefit and equity in undistributed net earnings of subsidiary		(502	)		(288	)		(227	)
Income tax benefit		(171	)		(98	)		(77	)
Loss before equity in undistributed net earnings of subsidiary		(331	)		(190	)		(150	)
Equity in undistributed net earnings of subsidiary		5,393			4,969			2,894
Net Income	$	5,062		$	4,779		$	2,744

Condensed statements of cash flows

	Years Ended December 31,
	2012			2011			2010
Cash Flows From Operating Activities
Net income	$	5,062		$	4,779		$	2,744
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in undistributed loss of subsidiary		(5,393	)		(4,969	)		(2,894	)
Decrease in deferred tax asset		—			—			89
Decrease in due from/to subsidiary, net		259			84			118
Excess tax benefit from exercise of stock options and vesting of restricted stock		(88	)		—			—
Increase in other assets		(308	)		(100	)		(79	)
Increase in other liabilities		130			1			5
Net Cash Used in Operating Activities		(338	)		(205	)		(17	)
Cash Flows from Investing Activities
Loan payment received on ESOP loans		516			487			364
Cash dividends received from subsidiary		21,281			—			—
Net Cash Provided by Investing Activities		21,797			487			364
Cash Flows from Financing Activities
Purchase of treasury stock		(9,911	)		(19,822	)		—
Acquisition of common stock for equity incentive plan		—			(3,474	)		—
Excess tax benefit from exercise of stock options and vesting of restricted stock		88			—			—
Receipt from subsidiary related to vesting of stock in equity incentive plan		646			544			519
Common stock issued for exercise of stock options		480			162			—
Capital contribution to subsidiary		—			—			(48,500	)
Purchase of common stock by ESOP		—			—			(3,485	)
Merger of Fox Chase Mutual Holding Company		—			—			107
Proceeds from stock offering, net of offering expenses		—			—			81,169
Cash dividends paid		(2,382	)		(1,067	)		—
Net Cash Used in Financing Activities		(11,079	)		(23,657	)		29,810
Net Increase in Cash and Cash Equivalents		10,380			(23,375	)		30,157
Cash and Cash Equivalents—Beginning		19,227			42,602			12,445
Cash and Cash Equivalents—Ending	$	29,607		$	19,227		$	42,602

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 5,062	$ 4,779	$ 2,744
Other comprehensive income (loss):
Unrealized holding gains arising during the period, net of tax of $7, $424, and $767 for the years ended December 31, 2012, 2011 and 2010, respectively	91	779	1,291
Non-credit related unrealized loss on other-than temporary impaired securities, net of tax of $0, $(16) and $0 for the years ended December 31, 2012, 2011 and 2010, respectively		(30)
Reclassification adjustments for net investment securities gains included in net income, net of tax of $1,208, $371 and $667 for the years ended December 31, 2012, 2011 and 2010, respectively	(2,171)	(720)	(1,296)
Reclassification adjustment for loss included in net income for other-than temporary impaired investment sold, net of tax of ($34) for the year ended December 31, 2012	53
Other comprehensive (loss) income	(2,027)	29	(5)
Comprehensive income	$ 3,035	$ 4,808	$ 2,739

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

• Business

        Fox Chase Bancorp, Inc. (the "Bancorp") is a Maryland corporation that was incorporated in March 2010 to be the successor corporation to old Fox Chase Bancorp, Inc. ("Old Fox Chase Bancorp"), the federal corporation and the former stock holding company for Fox Chase Bank (the "Bank"), upon completion of the mutual-to-stock conversion of Fox Chase MHC, the former mutual holding company for Fox Chase Bank.

        The mutual-to-stock conversion was completed on June 29, 2010. In connection with the conversion, Bancorp sold 8,712,500 shares of common stock at $10.00 per share in a public offering. Concurrent with the completion of the offering, shares of Old Fox Chase Bancorp's common stock owned by public stockholders were exchanged for 1.0692 shares of Bancorp common stock. Additionally, as part of the mutual-to-stock conversion, the Bank's Employee Stock Ownership Plan ("ESOP") acquired 348,500 shares, or 4.0% of Bancorp's issued shares, at $10.00 per share. Net proceeds from the conversion and offering, after the loan made to the ESOP, were approximately $77.8 million.

        Financial information presented in this Annual Report on Form 10-K is derived from the consolidated financial statements of Fox Chase Bancorp, Inc. and subsidiaries on and after June 29, 2010 and from the consolidated financial statements of Old Fox Chase Bancorp and subsidiaries prior to June 29, 2010.

        The Bancorp's primary business has been that of holding the common stock of the Bank and making two loans to the ESOP. The Bancorp is authorized to pursue other business activities permissible by laws and regulations for savings and loan holding companies.

        The Bancorp and the Bank (collectively referred to as the "Company") provide a wide variety of financial products and services to individuals and businesses through the Bank's eleven branches in Philadelphia, Richboro, Willow Grove, Warminster, Lahaska, Hatboro, Media and West Chester, Pennsylvania, and Ocean City, Marmora and Egg Harbor Township, New Jersey. The operations of the Company are managed as a single business segment. The Company competes with other financial institutions and other companies that provide financial services. The Bank also owns approximately 45% of Philadelphia Mortgage Advisors, a mortgage banker located in Plymouth Meeting, Pennsylvania and Ocean City, New Jersey.

        The Company is subject to regulations of certain federal banking agencies. These regulations can and do change significantly from period to period. The Company also undergoes periodic examinations by regulatory agencies which may subject them to further changes with respect to asset valuations and classifications, amounts of required loan loss allowances and operating restrictions resulting from the regulators' judgments based on information available to them at the time of their examinations. Pursuant to the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"), effective July 21, 2011, the regulation and supervision of federal savings institutions, such as the Bank, was transferred from the Office of Thrift Supervision to the Office of the Comptroller of the Currency, the agency that regulates national banks. As a result, the Office of the Comptroller of the Currency assumed primary responsibility for examining the Bank and implementing and enforcing many of the laws and regulations applicable to federal savings associations. In addition, pursuant to the provisions of the Dodd-Frank Act, effective July 21, 2011, savings and loan holding companies, such as the Bancorp, became regulated by the Board of Governors of the Federal Reserve System.

• Principles of Consolidation and Presentation

        The consolidated financial statements include the accounts of the Bancorp and the Bank. The Bank's operations include the accounts of its wholly owned subsidiaries, Fox Chase Financial, Inc., Fox Chase Service Corporation, 104 S. Oakland Ave., LLC and Davisville Associates, LLC. Fox Chase Financial Inc. is a Delaware-chartered investment holding company and its sole purpose is to manage and hold investment securities. Fox Chase Service Corporation is a Pennsylvania-chartered company and its purposes are to facilitate the Bank's investment in PMA and, for regulatory purposes, to hold commercial loans. At December 31, 2012, Fox Chase Service Corporation held $20.0 million in commercial loans. 104 S. Oakland Ave., LLC is a New Jersey-chartered limited liability company formed to secure, manage and hold foreclosed real estate. Davisville Associates, LLC is a Pennsylvania-chartered limited liability company formed to secure, manage and hold foreclosed real estate. All material inter-company transactions and balances have been eliminated in consolidation. Prior period amounts are reclassified, when necessary, to conform with the current year's presentation.

        The Company follows accounting principles and reporting practices that are in compliance with U.S. generally accepted accounting principles ("GAAP"). The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses, the valuation and realizability of deferred tax assets, the evaluation of other-than-temporary impairment and the valuation of investment securities and assets acquired through foreclosure.

• Risk and Uncertainties

        In the normal course of its business, the Company encounters two significant types of risk: economic risk and regulatory risk. There are three main components of economic risk: interest rate risk, credit risk and market risk. The Company is subject to interest rate risk to the degree that its interest-bearing liabilities mature or reprice at different speeds, or on a different basis, from its interest-earning assets. The Company's primary credit risk is the risk of defaults in the Company's loan portfolio that result from borrowers' inability or unwillingness to make contractually required payments. The Company's lending activities are concentrated in Southeastern Pennsylvania and Southern New Jersey. The ability of the Company's borrowers to repay amounts owed is dependent on several factors, including the economic conditions in the borrowers' geographic regions and the borrowers' financial conditions. The Company also has credit risk related to the risk of defaults in its investment securities portfolio. The ability of the Company to realize the full value of its investment securities upon sale or maturity depends on several factors, including the cash flows, credit enhancements and underlying structures of the individual investment securities. Market risk reflects changes in the value of the collateral underlying loans, the valuation of assets acquired through foreclosure, and the valuation of securities, mortgage servicing assets and other investments.

        The Company is subject to the regulations of various government agencies. These regulations may change significantly from period to period. The Company also undergoes periodic examinations by regulatory agencies that may subject them to further changes with respect to asset valuations and classifications, amounts required for the allowance for loan losses and operating restrictions resulting from the regulators' judgment based on information available to them at the time of their examination.

• Cash and Cash Equivalents

        For purposes of reporting cash flows, cash and cash equivalents include cash and due from banks, interest-earning demand deposits in other banks and money market funds. At times, such balances exceed the FDIC limits for insurance coverage.

        The Company accounts for cash accounts that are in a net overdraft position as a liability and reports changes in book overdraft positions in operating cash flows.

• Investment and Mortgage Related Securities

        The Company accounts for its investment securities in accordance with standards that require, among other things, that debt and equity securities are classified into three categories and accounted for as follows:

• •

  Debt securities with the positive intention to hold to maturity are classified as "held-to-maturity" and reported at amortized cost.

  •

  Debt and equity securities purchased with the intention of selling them in the near future are classified as "trading securities" and are reported at fair value, with unrealized gains and losses included in earnings. As of the balance sheet dates, the Company did not have any trading securities.

  •

  Debt and equity securities not classified in either of the above categories are classified as "available-for-sale securities" and reported at fair value, with unrealized gains and losses excluded from earnings and reported, net of tax, as increases or decreases in other comprehensive income, a separate component of stockholders' equity. Securities classified as available-for-sale are those securities that the Company intends to hold for an indefinite period of time but not necessarily to maturity. Any decision to sell a security classified as available-for-sale would be based on various factors, including movement in interest rates, changes in the maturity or mix of the Company's assets and liabilities, liquidity needs, regulatory capital considerations and other factors.

        Management determines the appropriate classification of debt securities at the time of purchase and re-evaluates such designation as of each balance sheet date.

        The Company records other-than-temporary impairment charges, through earnings, if they have the intent to sell, or will more likely than not be required to sell, an impaired debt security before a recovery of its amortized cost basis. In addition, the Company records other-than-temporary impairment charges through earnings for the amount of credit losses, regardless of the intent or requirement to sell. Credit loss is measured as the difference between the present value of an impaired debt security's cash flows and its amortized cost basis. Non-credit related write-downs to fair value are recorded as decreases to accumulated other comprehensive income as long as the Company has no intent or requirement to sell an impaired security before a recovery of amortized cost basis.

        Purchase premiums and discounts are recognized in interest income using the interest method over the expected life for mortgage related securities and the contractual life for all other securities. Because of volatility of the financial markets in which securities are traded, there is the risk that any future fair value could be significantly less than that recorded or disclosed in the accompanying financial statements. Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method.

• Loans, Loan Origination Fees and Uncollected Interest

        Loans are recorded at cost, net of unearned discounts, deferred fees and allowances. Discounts or premiums on purchased loans are amortized using the interest method over the remaining contractual life of the purchased loans, adjusted for actual prepayments. Loan origination fees and certain direct origination costs are deferred and amortized using the interest method over the contractual life as an adjustment to yield on the loans. Interest income is accrued on the unpaid principal balance. From time-to-time, the Company sells certain loans for liquidity purposes or to manage interest rate risk.

        The accrual of interest is generally discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about further collectability of principal or interest, even though the loan is currently performing. A loan that is more than 90 days past due may remain on accrual status if it is in the process of collection and is either guaranteed or well secured. When a loan is placed on nonaccrual status, unpaid interest income is reversed and the amortization of net deferred loan fees is suspended. Interest received on nonaccrual loans generally is either applied against principal or reported as interest income, according to management's judgment as to the ultimate collectability of principal. Generally, loans are restored to accrual status when the obligation is brought current, has performed in accordance with the contractual terms for a reasonable period of time and the ultimate collectability of the total contractual principal and interest is no longer in doubt.

• Allowance for Loan Losses

        The allowance for loan losses is adjusted through increases or reductions in the provisions for loan losses charged against or credited to income. Loans deemed to be uncollectible are charged against the allowance for loan losses, and subsequent recoveries, if any, are credited to the allowance.

        The allowance for loan losses is maintained at a level representing management's best estimate of known and inherent losses in the portfolio, based upon management's evaluation of the portfolio's collectability. Our methodology for assessing the appropriateness of the allowance for loan losses consists of an allowance on impaired loans and a general valuation allowance on the remainder of the portfolio. Although we determine the amount of each element of the allowance separately, the entire allowance for loan losses is available for losses on the entire portfolio.

        Loans are deemed impaired when, based on current information and events, it is probable that the Company will be unable to collect all proceeds due according to the contractual terms of the loan agreement or when a loan is classified as a troubled debt restructuring. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Impairment is measured on a loan by loan basis for commercial loans by either the present value of expected future cash flows discounted at the loan's original effective interest rate, the loan's obtainable market price or the fair value of the collateral less costs to sell if the loan is collateral dependent. The Company establishes an allowance for loan loss in the amount of the difference between fair value of the impaired loan and the loan's carrying amount.

        We establish a general allowance for loans that are not considered impaired to recognize the inherent losses associated with lending activities. This general valuation allowance is determined by segmenting the loan portfolio by loan segments (described below) and assigning percentages, known as loss factors, to each category. The percentages are adjusted for significant factors that, in management's judgment, affect the collectability of the portfolio as of the evaluation date. These significant factors include the size and composition of the loan portfolio, the Company's loss experience by particular segment, trends and absolute levels of nonperforming loans, trends and absolute levels of classified and criticized loans, trends and absolute levels in delinquent loans, trends in risk ratings, trends in industry charge-offs and changes in existing general economic and business conditions affecting our lending areas and the national economy. These loss factors are subject to ongoing evaluation to ensure their relevance in the current economic environment. We perform this systematic analysis of the allowance on a quarterly basis. These criteria are analyzed and the allowance is developed and maintained at the segment level.

        Additional risk is associated with the analysis of the allowance for loan losses as such evaluations are highly subjective, and future adjustments to the allowance may be necessary if conditions differ substantially from the assumptions used in making the evaluations. In addition, various regulatory agencies periodically review the Company's allowance for loan losses. Such agencies may require the Company to recognize adjustments to the allowance, based on their judgments at the time of their examination.

        The loan segments utilized by management to develop the allowance for loan losses are (1) one- to four-family real estate, (2) multi-family and commercial real estate, (3) construction, (4) consumer and (5) commercial and industrial loans.

        One- to four-family real estate lending risks generally include the borrower's ability to make repayment from his or her employment or other income, and if the borrower defaults, the ability to obtain repayment from sale of the underlying collateral securing the loan. Risk associated with one- to four-family lending would be higher during a period of increased unemployment or reduced real estate value.

        Multi-family and commercial real estate lending risks generally relate to the borrower's creditworthiness and the feasibility and cash flow potential of the underlying project. Payments on loans secured by income properties often depend on successful operation and management of the properties. As a result, repayment of such loans may be subject to adverse conditions in the real estate market or the economy.

        Construction lending is generally considered to have a higher degree of lending risk than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property's value at completion of construction, the estimated cost (including interest) of construction and the ability of the project to be sold or refinanced upon completion.

        Commercial and industrial loans are typically made on the basis of the borrower's ability to make repayment from the cash flows of the borrower's underlying business. As a result, the availability of funds for the repayment of commercial loans may depend substantially on the success of the business itself. Further, any collateral securing such loans may depreciate over time, may be difficult to appraise and may fluctuate in value.

        Consumer lending includes unsecured lending or loans secured by assets that depreciate rapidly. In such cases, repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment for the outstanding loan and the remaining deficiency often does not warrant further substantial collection efforts against the borrower. Consumer loan collections depend on the borrower's continuing financial stability. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit the amount that can be recovered on such loans.

• Troubled Debt Restructurings

        Loans whose terms are modified are classified as troubled debt restructurings if the Company grants such borrowers concessions and it is deemed that those borrowers are experiencing financial difficulty. Concessions granted under a troubled debt restructuring generally involve a reduction in interest rate, extension of a loan's stated maturity date, temporary deferral of payments or granting credit to a borrower who is unable to obtain credit from another financial institution. Accrual of interest continues upon modification if the borrower has demonstrated a history of making payment as contractually due and has provided evidence which supports the borrower's ability to make payments. The accrual of interest income on accruing troubled debt restructurings is generally discontinued when the contractual payment of principal or interest has become 90 days past due or management has serious doubts about continued collectability of principal or interest, even though the loan is currently performing. Troubled debt restructurings which are subsequently reported as non-accrual remain as such until they demonstrate consistent payment performance for a minimum period of six months. All loans classified as troubled debt restructurings are considered impaired.

• Bank-Owned Life Insurance

        The Company has invested in bank-owned life insurance ("BOLI"). BOLI involves the purchasing of life insurance by the Company on a chosen group of employees and directors. The Company is the owner and beneficiary of the policies. This life insurance investment is carried at the cash surrender value of the underlying policies. Income from the increase in cash surrender value of the policies is included in noninterest income in the consolidated statements of operations.

• Premises and Equipment

        Premises and equipment are carried at cost less accumulated depreciation. Depreciation is computed on the straight-line method over the assets' estimated useful lives or, for leasehold improvements, over the life of the related lease if less than the estimated useful life of the asset. The estimated useful life is generally 10-39 years for buildings and 3-7 years for furniture and equipment. When assets are retired, or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts. The cost of maintenance and repairs is charged to expense when incurred and renewals and improvements are capitalized. Rental concessions on leased properties are recognized over the life of the lease.

• Assets Acquired through Foreclosure

        Assets acquired through foreclosure consists of other real estate owned and financial assets acquired from debtors. These assets are obtained through foreclosure, by a deed-in-lieu of foreclosure, in-substance foreclosure or in exchange for satisfaction of debt.

        Other real estate owned is carried at the lower of cost or fair value, less estimated selling costs. Costs related to the development or improvement of an acquired property are capitalized. Holding costs and declines in carrying value after acquisition are recorded as assets acquired through foreclosure expense in the consolidated statements of operations.

        Financial assets acquired from debtors are carried at fair value under the fair value option in accordance with FASB ASC 825 "Financial Instruments". Increases or decreases in fair value after acquisition are recorded as assets acquired through foreclosure expense in the consolidated statements of operations.

• Real Estate Held for Investment

        Real estate held for investment is carried at cost and is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. As of December 31, 2012 and December 31, 2011, real estate held for investment represented undeveloped land located in Absecon, New Jersey. The property was acquired by the Company in 2003 to expand the Company's retail branch network in southern New Jersey. As of December 31, 2011, the property was carried at $1,620,000 based on an appraisal obtained during 2011, which resulted in an impairment loss of $110,000 during the year ended December 31, 2011. As of December 31, 2012, the property continued to be carried at $1,620,000.

        In accordance with regulatory guidelines, because this real estate held for investment was not sold or placed in service by June 2011 (eight years from acquisition); for regulatory reporting purposes, the full amount of this asset is recorded as a reduction of regulatory capital at December 31, 2012 and 2011.

• Mortgage Servicing Rights

        Upon the sale of a residential mortgage loan where the Company retains servicing rights, a mortgage servicing right is recorded. GAAP requires that mortgage servicing rights on these loans be amortized into income over the estimated life of the loans sold using the interest method. At each reporting period, such assets are subject to an impairment test. The impairment test stratifies servicing assets based on predominant risk characteristics of the underlying financial assets. The Company has stratified its mortgage servicing assets by date of sale, which approximates date of origination.

        In conjunction with the impairment test, the Company records a valuation allowance when the fair value of the stratified servicing asset is less than amortized cost. Subsequent changes in the valuation of the assets are recorded as either an increase or a reduction of the valuation allowance, however, if the fair value exceeds amortized cost, such excess will not be recognized.

• Transfers of Financial Assets

        Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before maturity.

• Income Taxes

        The Company accounts for income taxes under the asset/liability method. Deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company files a consolidated federal income tax return and its subsidiaries file individual state income tax returns.

        The Company recognizes a tax position if it is more likely than not that the tax position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. If the tax position meets the more-likely-than-not recognition threshold, the position is measured to determine the amount of the benefit to recognize and is measured at the largest amount of benefit that is greater than 50% likely of being realized upon settlement. The Company has no material tax exposure matters that were accrued as of December 31, 2012 or 2011. The Company's policy is to account for interest and penalties as components of income tax expense.

• Equity Method Investments

        Under the equity method, the Company recognizes its portion of net income of unconsolidated affiliates, net of eliminations, in equity in earnings of affiliates on the consolidated statements of operations. Equity method investments are included in other assets on the consolidated statements of condition.

• Marketing and Advertising

        The Company expenses marketing and advertising costs as incurred.

• Off-Balance Sheet Financial Instruments

        In the ordinary course of business, the Company has entered into off-balance sheet financial instruments consisting of commitments to extend credit. Such financial instruments are recorded in the balance sheet when they are funded. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet financial instruments.

• Fair Value of Financial Instruments

        Certain of the Company's financial instruments are carried at fair value. Generally, fair value is the price that a willing buyer and a willing seller would agree upon in an other than a distressed sale situation. Because of the uncertainties inherent in determining fair value, fair value estimates may not be precise. Many of the fair value estimates are based on highly subjective judgments and assumptions made about market information and economic conditions. See Note 14 for a detailed discussion of fair value measurements and methodology used to determine fair value.

• Employee Stock Ownership Plan

        The ESOP borrows funds from the Bancorp to purchase shares of common stock in the Bancorp. The funds borrowed by the ESOP from Old Fox Chase Bancorp to purchase shares of common stock in Old Fox Chase Bancorp's initial public offering in 2006 are being repaid from the Bank's contributions over a period of 15 years from 2006 to 2020. The funds borrowed by the ESOP from the Bancorp to purchase shares of common stock in the Bancorp's mutual-to-stock conversion in 2010 are being repaid from the Bank's contributions over a period of 14.5 years from 2010 to 2024. The Bancorp's common stock not yet allocated to participants is recorded as a reduction of stockholders' equity at cost. The Bancorp's loans to the ESOP and the ESOP's note payables are not reflected in the consolidated statements of condition. Compensation expense for the ESOP is based on the average market price of the Company's stock and is recognized as shares are committed to be released to participants. The notes receivable and related interest income are included in the parent company financial statements presented in Note 17.

        For purposes of computing basic and diluted earnings per share, ESOP shares that have been committed to be released are considered outstanding. ESOP shares that have not been committed to be released are not considered outstanding.

• Stock Based Compensation

        The Company grants equity awards to employees, consisting of stock options and restricted stock, under its Long-Term Incentive Plan, its 2007 Equity Incentive Plan and its 2011 Equity Incentive Plan. The Company classifies share-based compensation for employees and outside directors within "Salaries, benefits and other compensation" in the Consolidated Statements of Operations to correspond with the same line item as compensation paid. Additionally, the Company reports (1) the expense associated with the grants as an adjustment to operating cash flows and (2) any benefits of realized tax deductions in excess of previously recognized tax benefits on compensation expense as a financing cash flow. Excess tax benefits totaled $88,000 in 2012. There were no such excess tax benefits in 2011 and 2010.

        Stock options vest over a five-year service period and expire ten years after grant date. The Company recognizes compensation expense for the fair values of stock options using the straight-line method over the requisite service period for the entire award.

        Non-performance based restricted shares vest over a five-year service period. The Company recognizes compensation expense for the fair value of restricted shares on a straight-line basis over the requisite service period for the entire award.

        Performance based restricted shares vest over a five-year based on service and achievement of performance metrics. The performance metrics to be evaluated during the performance period are (1) return on assets compared to peer group and (2) earnings growth rate compared to peer group. On the third anniversary of the grant date, the Company's level of performance relative to the performance metrics are evaluated and, if such performance metrics have been achieved, an amount of shares that will vest at that time and over the following two years will be determined. Of the shares that will vest, 50% of the shares vest on the third anniversary of the date of grant and 25% vest on each of the fourth and fifth anniversaries of the date of grant.

• Per Share Information

        Basic earnings per share exclude dilution and is computed by dividing income available to common stockholders by the weighted-average common shares outstanding during the period. Diluted earnings per share takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted into common stock. Proceeds assumed to have been received on such exercises are assumed to be used to purchase shares of the Company's common stock at the average market price during the periods, as required by the treasury stock method of accounting. Unallocated shares in the ESOP and shares purchased to fund the Bancorp's Equity Incentive Plans are not included in either basic or diluted earnings per share. As a result of the mutual-to-stock conversion, all share information for periods prior to June 30, 2010 has been revised to reflect the 1.0692 exchange ratio.

        Earnings per share ("EPS"), basic and diluted, were $0.44 and $0.43, respectively for the year ended December 31, 2012. EPS, both basic and diluted, were $0.36 and $0.20 for the years ended December 31, 2011 and 2010, respectively.

        The following table presents the reconciliation of the numerators and denominators of the basic and diluted EPS computations.

	Year Ended December 31,
	2012			2011			2010
Net income	$	5,062,000		$	4,779,000		$	2,744,000
Weighted-average common shares outstanding(1)		12,624,068			14,112,359			14,548,812
Average common stock acquired by stock benefit plans:
Unvested shares—long-term incentive plan		—			—			(7,582	)
ESOP shares unallocated		(651,538	)		(716,530	)		(607,235	)
Shares purchased by trust		(372,653	)		(249,670	)		(199,111	)
Weighted-average common shares used to calculate basic earnings per share		11,599,877			13,146,159			13,734,884
Dilutive effect of:
Unvested shares—long-term incentive plans		—			—			7,582
Restricted stock awards		29,653			33,089			10,132
Stock option awards		117,731			52,582			—
Weighted-average common shares used to calculate diluted earnings per share		11,747,261			13,231,830			13,752,598
Earnings per share—basic	$	0.44		$	0.36		$	0.20
Earnings per share—diluted	$	0.43		$	0.36		$	0.20
Outstanding common stock equivalents having no dilutive effect		860,842			822,461			807,827

(1)

Excludes treasury stock.

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LOANS (Details 6) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Allowance for loan loss for impaired loans and general allowance by loan segment
Nonaccrual Loans, Allowance for Loan Losses	$ 1,326	$ 2,432
Accruing TDRs, Allowance for Loan Losses	954	985
Other Impaired Loans, Allowance for Loan Loss		156
Total Impaired Loans, Allowance for Loan Losses	2,280	3,573
General Allowance for Loan Losses	8,890	8,502
Total	11,170	12,075	12,443	10,605
One- to four-family
Allowance for loan loss for impaired loans and general allowance by loan segment
Nonaccrual Loans, Allowance for Loan Losses	337	1,394
Accruing TDRs, Allowance for Loan Losses	5	3
Total Impaired Loans, Allowance for Loan Losses	342	1,397
General Allowance for Loan Losses	300	363
Total	642	1,760	1,990
Multi-family and commercial
Allowance for loan loss for impaired loans and general allowance by loan segment
Nonaccrual Loans, Allowance for Loan Losses	530	466
Accruing TDRs, Allowance for Loan Losses	948	975
Total Impaired Loans, Allowance for Loan Losses	1,478	1,441
General Allowance for Loan Losses	4,849	4,671
Total	6,327	6,112	4,624
Construction
Allowance for loan loss for impaired loans and general allowance by loan segment
Nonaccrual Loans, Allowance for Loan Losses	449	565
Total Impaired Loans, Allowance for Loan Losses	449	565
General Allowance for Loan Losses	424	304
Total	873	869	3,260
Consumer loans
Allowance for loan loss for impaired loans and general allowance by loan segment
Nonaccrual Loans, Allowance for Loan Losses	10	7
Accruing TDRs, Allowance for Loan Losses	1	7
Other Impaired Loans, Allowance for Loan Loss		156
Total Impaired Loans, Allowance for Loan Losses	11	170
General Allowance for Loan Losses	221	285
Total	232	455	665
Commercial and industrial loans
Allowance for loan loss for impaired loans and general allowance by loan segment
General Allowance for Loan Losses	2,630	2,657
Total	2,630	2,657	1,707
Unallocated
Allowance for loan loss for impaired loans and general allowance by loan segment
General Allowance for Loan Losses	466	222
Total	$ 466	$ 222	$ 197

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PARENT COMPANY ONLY FINANCIAL STATEMENTS (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
ASSETS
Cash and due from banks	$ 162	$ 734
Interest-earning deposits with banks	24,928	6,852
Total cash and cash equivalents	25,090	7,586	38,314	65,418
Other assets	5,803	5,131
Total Assets	1,088,341	1,015,863
LIABILITIES AND STOCKHOLDERS' EQUITY
Total Liabilities	906,876	827,671
Stockholders' Equity	181,465	188,192	205,704	123,634
Total Liabilities and Stockholders' Equity	1,088,341	1,015,863
Parent company
ASSETS
Cash and due from banks	94	444
Interest-earning deposits with banks	29,513	18,783
Total cash and cash equivalents	29,607	19,227	42,602	12,445
Investment in subsidiary	144,781	161,353
Due from subsidiary, net		266
ESOP loans	6,659	7,175
Other assets	549	241
Total Assets	181,596	188,262
LIABILITIES AND STOCKHOLDERS' EQUITY
Due to subsidiary, net	19
Other liabilities	112	70
Total Liabilities	131	70
Stockholders' Equity	181,465	188,192
Total Liabilities and Stockholders' Equity	$ 181,596	$ 188,262

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BORROWINGS (Details 2) (USD $)	12 Months Ended		3 Months Ended	12 Months Ended		12 Months Ended				12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Jun. 30, 2012 FHLB of Pittsburgh	Dec. 31, 2012 FHLB of Pittsburgh	Dec. 31, 2012 FHLB of Pittsburgh Minimum	Dec. 31, 2012 FHLB of Pittsburgh Maximum	Dec. 31, 2012 Federal Reserve Bank of Philadelphia	Dec. 31, 2012 FHLB advances	Dec. 31, 2011 FHLB advances	Dec. 31, 2012 Other borrowed funds	Dec. 31, 2011 Other borrowed funds	Dec. 31, 2012 Short-term borrowings	Dec. 31, 2011 Short-term borrowings	Dec. 31, 2012 3.40% other borrowings, due September 2018	Dec. 31, 2012 3.20% other borrowings, due September 2018	Dec. 31, 2012 3.15% other borrowings, due October 2018	Dec. 31, 2012 3.27% other borrowings, due October 2018	Dec. 31, 2012 3.37% other borrowings, due November 2018
Other Borrowed Funds
Amount of other borrowings	$ 30,000,000	$ 50,000,000								$ 30,000,000		$ 70,500,000	$ 8,500,000	$ 10,000,000	$ 5,000,000	$ 5,000,000	$ 5,000,000	$ 5,000,000
Interest rate (as a percent)								1.80%	3.41%	3.30%	3.42%	0.30%	0.25%	3.40%	3.20%	3.15%	3.27%	3.37%
Termination of debt			36,300,000							20,000,000
Loss on extinguishment of debt	3,018,000		1,500,000							1,500,000
Securities pledged as collateral								161,900,000
Maximum borrowing capacity				367,000,000			53,800,000
Capital stock to be redeemed as percentage of member's total capital stock				5.00%
Capital stock to be held as percentage of advances				4.60%		6.00%
Capital stock to be held as percentage of eligible assets				0.35%		1.00%
Stock obligation				8,100,000	7,900,000	12,600,000
Mortgage backed securities pledged as collateral for other borrowed funds										$ 37,400,000

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QUARTERLY FINANCIAL DATA (UNAUDITED)

12 Months Ended

Dec. 31, 2012

QUARTERLY FINANCIAL DATA (UNAUDITED)

QUARTERLY FINANCIAL DATA (UNAUDITED)

NOTE 18—QUARTERLY FINANCIAL DATA (UNAUDITED)

        The following represents summarized quarterly financial data of Fox Chase Bancorp, Inc. and subsidiary, which, in the opinion of management, reflects all adjustments (comprising only normal recurring accruals) necessary for a fair presentation. The Company reported net income of $1.9 million for the quarter ended December 31, 2012 and net income of $1.0 million for the quarter ended December 31, 2011.

        The net income for the quarter ended December 31, 2012 included a provision for loan losses of $442,000, valuation adjustments of assets acquired through foreclosure of $979,000, and a gain of $952,000 on the sale of $15.7 million of mortgage related securities.

        The net income for the quarter ended December 31, 2011 included a provision for loan losses of $2.8 million, primarily related to specific impairments totaling $2.2 million on three commercial loans, all of which are located in Southern New Jersey, and a gain of $1.1 million on the sale of $12.8 million of mortgage related securities.

Three Months Ended	12/31/12		9/30/12		6/30/12		3/31/12		12/31/11		9/30/11		6/30/11		3/31/11
Interest income	$	9,950	$	10,531	$	10,411	$	10,942	$	11,102	$	11,606	$	11,607	$	11,631
Interest expense		2,117		2,298		2,740		2,962		3,114		3,545		3,827		4,009
Net interest income		7,833		8,233		7,671		7,980		7,988		8,061		7,780		7,622
Provision for loan losses		442		470		1,291		1,275		2,825		1,034		900		975
Net interest income after
provision for loan losses		7,391		7,763		6,380		6,705		5,163		7,027		6,880		6,647
Noninterest income		1,804		737		3,080		694		1,959		467		450		467
Noninterest expense		6,437		6,398		8,699		5,640		5,601		5,690		5,480		5,298
Income before taxes		2,758		2,102		761		1,759		1,521		1,804		1,850		1,816
Income tax provision		858		666		222		572		477		572		593		570
Net Income	$	1,900	$	1,436	$	539	$	1,187	$	1,044	$	1,232	$	1,257	$	1,246
Per Common Share Data
Weighted average common shares—basic		11,431,957		11,535,146		11,624,120		11,808,632		12,214,704		13,087,582		13,662,264		13,636,010
Weighted average common shares—diluted		11,622,035		11,718,308		11,750,623		11,901,737		12,287,733		13,175,689		13,770,934		13,678,887
Net income per share—basic	$	0.17	$	0.12	$	0.05	$	0.10	$	0.09	$	0.09	$	0.09	$	0.09
Net income per share—diluted	$	0.16	$	0.12	$	0.05	$	0.10	$	0.09	$	0.09	$	0.09	$	0.09

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COMMITMENTS AND CONTINGENCIES (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Financial instrument commitments
Financial instrument commitment	$ 137,377,000	$ 192,365,000
Commitments to grant loans
Financial instrument commitments
Financial instrument commitment	23,644,000	74,372,000
Fixed rate commitments to grant loans	2,600,000	15,500,000
Interest rate on fixed rate loans, minimum (as a percent)	4.75%	5.25%
Interest rate on fixed rate loans, maximum (as a percent)	6.00%	6.00%
Unfunded commitments under lines of credit
Financial instrument commitments
Financial instrument commitment	98,537,000	105,983,000
Standby letters of credit
Financial instrument commitments
Financial instrument commitment	14,348,000	12,010,000
Commercial letters of credit
Financial instrument commitments
Financial instrument commitment	$ 848,000

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COMMITMENTS AND CONTINGENCIES (Tables)

12 Months Ended

Dec. 31, 2012

COMMITMENTS AND CONTINGENCIES.

Summary of the Company's financial instrument commitments

A summary of the Company's financial instrument commitments at December 31, 2012 and 2011 is as follows (in thousands):

	December 31,
	2012		2011
Commitments to grant loans	$	23,644	$	74,372
Unfunded commitments under lines of credit		98,537		105,983
Standby letters of credit		14,348		12,010
Commercial letters of credit		848		—
	$	137,377	$	192,365

Schedule of projected amount of the Company's future minimum payments contractually due

The projected amount of the Company's future minimum payments contractually due after December 31, 2012 is as follows (in thousands):

Year	Amount
2013	$	1,952
2014		224
2015		96
2016		—
2017		—

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INCOME TAXES

12 Months Ended

Dec. 31, 2012

INCOME TAXES

INCOME TAXES

NOTE 11—INCOME TAXES

        The components of income tax expense (benefit) for the years ended December 31, 2012, 2011 and 2010 are as follows (in thousands):

	December 31,
	2012			2011			2010
Federal:
Current	$	2,408		$	2,555		$	1,129
Deferred		(140	)		(359	)		(13	)
		2,268			2,196			1,116
State:
Current		—			—			—
Deferred		50			16			4
		50			16			4
	$	2,318		$	2,212		$	1,120

        The provision for income taxes differs from the statutory rate of 34% due to the following (in thousands):

	December 31,
	2012			2011			2010
Federal income tax at statutory rate of 34%	$	2,509		$	2,377		$	1,314
Tax exempt interest, net		(62	)		(62	)		(113	)
Bank-owned life insurance		(160	)		(159	)		(160	)
ESOP compensation expense		101			73			6
Equity incentive plans		—			1			46
Other, net		13			13			23
Dividends received from equity method investments		(49	)		(13	)		—
Dividends paid on benefit plans		(67	)		(26	)		—
State taxes, net		304			126			436
Decrease in valuation allowance		(271	)		(118	)		(432	)
Total Provision	$	2,318		$	2,212		$	1,120
Effective tax rate		31.41	%		31.64	%		28.99	%

        The net deferred tax asset consisted of the following components as of December 31, 2012 and 2011 (in thousands):

	December 31,
	2012			2011
Deferred tax assets:
Allowance for loan losses, net	$	3,798		$	4,106
Provision for loss on assets acquired through foreclosure		966			402
Nonaccrual interest		569			502
Accrued compensation		151			151
Equity incentive plans		734			644
Accrued expenses		370			345
Deferred lease liability		51			10
Impairment loss on investments		—			176
State net operating loss carryforward		73			343
		6,712			6,679
Valuation allowance		(36	)		(307	)
		6,676			6,372
Deferred tax liability
Prepaid expense deduction		238			181
Mortgage servicing rights		58			107
Loan origination costs		39			58
Deferrable earnings on investments		439			227
Depreciation of premises and equipment		471			458
Unrealized gains on securities available-for-sale		2,478			3,659
		3,723			4,690
Net Deferred Tax Asset	$	2,953		$	1,682

        Based on the Company's history of earnings and its expectation of future taxable income, management anticipates that it is more likely than not that the above deferred tax assets will be realized, except for the $36,000 gross deferred tax assets related to Fox Chase Bank's state net operating loss carryforward.

        Retained earnings include $6.0 million at December 31, 2012, 2011 and 2010 for which no provision for federal income tax has been made. This amount represents deductions for bad debt reserves for tax purposes, which were only allowed to savings institutions that met certain criteria prescribed by the Internal Revenue Code of 1986, as amended. The Small Business Job Protection Act of 1996 (the "Act") eliminated the special bad debt deduction granted solely to thrifts. Under the terms of the Act, there would be no recapture of the pre-1988 (base year) reserves. However, these pre-1988 reserves would be subject to recapture under the rules of the Internal Revenue Code if the Company pays a cash dividend in excess of earnings and profits, or liquidates.

        Approximately $73,000 of gross deferred tax assets were related to state tax net operating losses at December 31, 2012. Of this amount, $36,000 is related to the Bank and has a full valuation allowance of $36,000 on this deferred tax asset due to an expectation of such net operating losses expiring before being utilized. The remaining $37,000 of gross deferred tax assets were related to state tax net operating losses on Fox Chase Service Corporation and have no valuation allowance as it is more likely than not that it will be fully utilized before it expires. The Company has $517,000 of state net operating losses remaining as of December 31, 2012 for the Bank, which will begin to expire December 31, 2013. The Company has $368,000 of state net operating losses remaining as of December 31, 2012 for Fox Chase Service Corporation, which will begin to expire December 31, 2029.

        As of December 31, 2012 and prior periods, the Company had no material unrecognized tax benefits or accrued interest and penalties. The Company's policy is to account for interest and penalties as a component of income tax expense. Federal and state tax years 2009 through 2011 were open for examination as of December 31, 2012.