10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

_______________________________________________________________

FORM 10-Q

__________________________________________________

(Mark One)

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

For the quarterly period ended March 31, 2016

OR

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

(215) 283-2900

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

_______________________________________________________________

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 (Section 232.405 of this chapter) 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 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 [   ]	Accelerated Filer [X ]
Non-Accelerated Filer [  ]	Smaller Reporting Company [   ]
(Do not check if a smaller reporting company)

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

Yes  o    No  ý

As of April 30, 2016, there were 11,769,390 shares of the registrant’s common stock outstanding.

	FOX CHASE BANCORP, INC.
	Table of Contents
		Page No.
Part I. Financial Information
Item 1.	Financial Statements	3
	Consolidated Statements of Condition at March 31, 2016 (Unaudited) and December 31, 2015	3
	Consolidated Statements of Operations for the Three Months Ended March 31, 2016 and 2015 (Unaudited)	4
	Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2016 and 2015 (Unaudited)	5
	Consolidated Statements of Changes in Equity for the Three Months Ended March 31, 2016 and 2015 (Unaudited)	6
	Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2016 and 2015 (Unaudited)	7
	Notes to the Unaudited Consolidated Financial Statements	8
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	36
Item 4.	Controls and Procedures	36
Part II. Other Information
Item 1.	Legal Proceedings	36
Item 1A.	Risk Factors	36
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.	Defaults Upon Senior Securities	38
Item 4.	Mine Safety Disclosures	38
Item 5.	Other Information	38
Item 6.	Exhibits	38
Signatures

2

PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

FOX CHASE BANCORP, INC.

Consolidated Statements of Condition

(In Thousands, Except Share Data)

		March 31, 2016			December 31, 2015
		(Unaudited)
ASSETS
	Cash and due from banks	$	3,737		$	3,413
	Interest-earning demand deposits in other banks	5,375			4,385
	Total cash and cash equivalents	9,112			7,798
	Investment securities available-for-sale	135,826			139,751
	Investment securities held-to-maturity (fair value of $146,655 at March 31, 2016 and $149,850 at December 31, 2015)	144,528			150,190
	Loans, net of allowance for loan losses of $10,570 at March 31, 2016 and $10,562 at December 31, 2015	776,669			767,683
	Federal Home Loan Bank stock, at cost	6,186			6,734
	Bank-owned life insurance	25,902			25,687
	Premises and equipment, net	8,895			9,030
	Assets acquired through foreclosure	2,615			2,623
	Real estate held for investment	1,620			1,620
	Accrued interest receivable	3,348			3,145
	Mortgage servicing rights, net	97			104
	Deferred tax asset, net	3,993			5,142
	Other assets	12,950			6,096
	Total Assets	$	1,131,741		$	1,125,603
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES
	Deposits	$	815,708		$	764,974
	Short-term borrowings	15,000			38,496
	Federal Home Loan Bank advances	90,000			110,000
	Other borrowed funds	30,000			30,000
	Advances from borrowers for taxes and insurance	1,350			1,422
	Accrued interest payable	302			319
	Accrued expenses and other liabilities	1,541			3,478
	Total Liabilities	953,901			948,689
STOCKHOLDERS’ EQUITY
	Preferred stock ($.01 par value; 1,000,000 shares authorized, none issued and outstanding at March 31, 2016 and December 31, 2015)	—			—
	Common stock ($.01 par value; 60,000,000 shares authorized, 11,767,590 shares outstanding at March 31, 2016 and December 31, 2015)	149			149
	Additional paid-in capital	141,833			142,189
	Treasury stock, at cost (3,141,201 shares at March 31, 2016 and December 31, 2015)	(44,468		)	(44,468		)
	Common stock acquired by benefit plans	(5,876		)	(6,717		)
	Retained earnings	85,542			86,241
	Accumulated other comprehensive income (loss), net	660			(480		)
	Total Stockholders’ Equity	177,840			176,914
	Total Liabilities and Stockholders’ Equity	$	1,131,741		$	1,125,603

3

FOX CHASE BANCORP, INC.

Consolidated Statements of Operations

(In Thousands, Except Per Share Data)

(Unaudited)

		Three Months Ended   March 31,
		2016			2015
INTEREST INCOME
	Interest and fees on loans	$	8,506		$	8,139
	Interest and dividends on investment securities	1,632			1,982
	Other interest income	9			3
	Total Interest Income	10,147			10,124
INTEREST EXPENSE
	Deposits	807			715
	Short-term borrowings	59			32
	Federal Home Loan Bank advances	557			539
	Other borrowed funds	180			166
	Total Interest Expense	1,603			1,452
	Net Interest Income	8,544			8,672
	Provision for loan losses	45			472
	Net Interest Income after Provision for Loan Losses	8,499			8,200
NONINTEREST INCOME
	Service charges and other fee income	362			384
	Income on bank-owned life insurance	215			120
	Equity in earnings of affiliate	(5		)	40
	Other	94			27
	Total Noninterest Income	666			571
NONINTEREST EXPENSE
	Salaries, benefits and other compensation	3,943			3,719
	Occupancy expense	430			477
	Furniture and equipment expense	77			83
	Data processing costs	408			573
	Professional fees	538			363
	Marketing expense	24			41
	FDIC premiums	134			119
	Assets acquired through foreclosure expense	30			30
	Other	301			360
	Total Noninterest Expense	5,885			5,765
	Income Before Income Taxes	3,280			3,006
	Income tax provision	1,031			727
	Net Income	$	2,249		$	2,279
Earnings per share:
	Basic	$	0.20		$	0.21
	Diluted	$	0.20		$	0.20

4

FOX CHASE BANCORP, INC.

Consolidated Statements of Comprehensive Income

(In Thousands, Unaudited)

		Three Months Ended   March 31,
		2016			2015
Net income		$	2,249		$	2,279
Other comprehensive income:
	Unrealized holding gains on investment securities	1,694			800
	Tax effect	(583		)	(276		)
	Net of tax amount	1,111			524
	Accretion of unrealized loss on securities reclassified to held-to-maturity	46			41
	Tax effect	(17		)	(15		)
	Net of tax amount	29			26
Other comprehensive income		1,140			550
Comprehensive income		$	3,389		$	2,829

5

FOX CHASE BANCORP, INC.

Consolidated Statements of Changes in Equity

Three Months Ended March 31, 2016 and 2015

(In Thousands Except Share Data, Unaudited)

	Common Stock		Additional Paid-in Capital			Treasury Stock			Common Stock Acquired by Benefit Plans			Retained Earnings			Accumulated Other Comprehensive Income, net			Total Equity
BALANCE - DECEMBER 31, 2014	$	147	$	139,177		$	(39,698	)	$	(8,056	)	$	84,225		$	116		$	175,911
Purchase of treasury stock (69,800 shares)	—		—			(1,137		)	—			—			—			(1,137		)
Stock based compensation expense	—		310			—			—			—			—			310
ESOP shares allocated to employees	—		113			—			156			—			—			269
Issuance of stock for vested equity awards	—		(333		)	—			254			79			—			—
Common stock issued for exercise of vested stock options	—		—			—			—			—			—			—
Excess tax benefit from exercise of stock options and vesting of restricted stock	—		(3		)	—			—			—			—			(3		)
Dividends paid ($0.26 per share)	—		—			—			—			(2,940		)	—			(2,940		)
Net income	—		—			—			—			2,279			—			2,279
Other comprehensive income	—		—			—			—			—			550			550
BALANCE - MARCH 31, 2015	$	147	$	139,264		$	(40,835	)	$	(7,646	)	$	83,643		$	666		$	175,239
	Common Stock		Additional Paid-in Capital			Treasury Stock			Common Stock Acquired by Benefit Plans			Retained Earnings			Accumulated Other Comprehensive (Loss) Income, net			Total Equity
BALANCE - DECEMBER 31, 2015	$	149	$	142,189		$	(44,468	)	$	(6,717	)	$	86,241		$	(480	)	$	176,914
Purchase of treasury stock	—		—			—			—			—			—			—
Stock based compensation expense	—		349			—			—			—			—			349
ESOP shares allocated to employees	—		158			—			156			—			—			314
Issuance of stock for vested equity awards	—		(913		)	—			685			228			—			—
Common stock issued for exercise of vested stock options	—		—			—			—			—			—			—
Excess tax benefit from exercise of stock options and vesting of restricted stock	—		50			—			—			—			—			50
Dividends paid ($0.28 per share)	—		—			—			—			(3,176		)	—			(3,176		)
Net income	—		—			—			—			2,249			—			2,249
Other comprehensive income	—		—			—			—			—			1,140			1,140
BALANCE - MARCH 31, 2016	$	149	$	141,833		$	(44,468	)	$	(5,876	)	$	85,542		$	660		$	177,840

6

FOX CHASE BANCORP, INC.

Consolidated Statements of Cash Flows

(In Thousands, Unaudited)

	Three Months Ended   March 31,
	2016			2015
Cash Flows From Operating Activities
Net income	$	2,249		$	2,279
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Provision for loan losses	45			472
Valuation adjustment for assets acquired through foreclosure	16			15
Depreciation	135			163
Net amortization of securities premiums and discounts	366			423
Deferred income tax benefit (expense)	550			(16		)
Stock compensation from benefit plans	663			579
Income on bank-owned life insurance	(215		)	(120		)
Excess tax (benefit) expense from exercise of stock options and vesting of restricted stock	(50		)	3
Decrease in mortgage servicing rights, net	7			5
(Increase) decrease in accrued interest receivable and other assets	(7,110		)	2,675
Decrease in accrued interest payable, accrued expenses and other liabilities	(1,954		)	(716		)
Net Cash (Used in) Provided by Operating Activities	(5,298		)	5,762
Cash Flows from Investing Activities
Investment securities - available-for-sale:
Purchases	—			(8,056		)
Proceeds from maturities, calls and principal repayments	5,536			7,967
Investment securities - held-to-maturity:
Purchases	—			(5,823		)
Proceeds from maturities, calls and principal repayments	5,527			5,817
Net increase in loans	(9,031		)	(9,651		)
Purchases of loans and loan participations	—			(20,968		)
Net decrease in Federal Home Loan Bank stock	548			1,000
Purchases of premises and equipment	—			(37		)
Additions to assets acquired through foreclosure	(8		)	(5		)
Net Cash Provided by (Used in) Investing Activities	2,572			(29,756		)
Cash Flows from Financing Activities
Net increase in deposits	50,734			91,120
Decrease in advances from borrowers for taxes and insurance	(72		)	(192		)
Principal payments on Federal Home Loan Bank advances	(20,000		)	(10,000		)
Net decrease in short-term borrowings	(23,496		)	(50,000		)
Excess tax benefit (expense) from exercise of stock options and vesting of restricted stock	50			(3		)
Purchase of treasury stock	—			(1,137		)
Cash dividends paid	(3,176		)	(2,940		)
Net Cash Provided by Financing Activities	4,040			26,848
Net Increase in Cash and Cash Equivalents	1,314			2,854
Cash and Cash Equivalents – Beginning	7,798			17,213
Cash and Cash Equivalents – Ending	$	9,112		$	20,067
Supplemental Disclosure of Cash Flow Information
Interest paid	$	1,620		$	1,495
Income taxes paid	$	1		$	—
Transfers of loans to assets acquired through foreclosure	$	—		$	—
Net charge-offs	$	37		$	24

7

FOX CHASE BANCORP, INC

Notes to the Unaudited Consolidated Financial Statements

NOTE 1 - PRINCIPLES OF CONSOLIDATION AND PRESENTATION

Fox Chase Bancorp, Inc. (the "Bancorp" or "Fox Chase") is a Maryland corporation. The Bancorp’s primary business is holding the common stock of Fox Chase Bank (the "Bank") and making two loans to the Fox Chase Bank Employee Stock Ownership Plan (the "ESOP").  The Bancorp is authorized to pursue other business activities permissible by laws and regulations for bank holding companies.

The Bancorp is a bank holding company and is regulated by the Board of Governors of the Federal Reserve System. The Bank is a Pennsylvania state-chartered savings bank and is regulated by the Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation (the "FDIC").

The Bancorp and the Bank (collectively referred to as the "Company" or the "Corporation") provide a wide variety of financial products and services to individuals and businesses through the Bank’s ten branches in Philadelphia, Richboro, Willow Grove, Warminster, Lahaska, Hatboro, 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 Bank also owns 46.15% of Philadelphia Mortgage Advisors ("PMA"), a mortgage banker with offices in Plymouth Meeting and Doylestown, Pennsylvania and Ocean City, New Jersey.

The Company is subject to the regulations of certain federal and state 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 it to further changes with respect to asset valuations, 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. 

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 sole purpose is to facilitate the Bank’s investment in PMA. 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 disclose 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. 

These interim financial statements do not contain all necessary disclosures required by GAAP for complete financial statements and therefore should be read in conjunction with the audited financial statements and the notes thereto included in Fox Chase Bancorp, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission on March 4, 2016.  These financial statements include all normal and recurring adjustments which management believes were necessary in order to conform to GAAP.  The results for the three months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016 or any other period.

8

NOTE 1 - PRINCIPLES OF CONSOLIDATION AND PRESENTATION (CONTINUED)

Per Share Information

Basic earnings per share excludes 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.  Average 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.

The following table presents the reconciliation of the numerators and denominators of the basic and diluted earnings per share computations. 

	Three Months Ended   March 31,
	2016			2015
	(Unaudited)
Net income	$	2,249,000		$	2,279,000
Weighted-average common shares outstanding (1)	11,767,590			11,768,571
Average common stock acquired by stock benefit plans:
ESOP shares unallocated	(415,800		)	(480,852		)
Shares purchased by trust	(195,115		)	(260,153		)
Weighted-average common shares used to calculate basic earnings per share	11,156,675			11,027,566
Dilutive effect of:
Restricted stock awards	43,279			46,597
Stock option awards	114,434			193,503
Weighted-average common shares used to calculate diluted earnings per share	11,314,388			11,267,666
Earnings per share - basic	$	0.20		$	0.21
Earnings per share - diluted	$	0.20		$	0.20
Outstanding common stock equivalents which are anti-dilutive	71,668			508,610
(1) Excludes treasury stock.

NOTE 2 - BUSINESS COMBINATIONS

Proposed Merger with Univest Corporation of Pennsylvania

On December 8, 2015, Univest Corporation of Pennsylvania ("Univest") and Fox Chase entered into a merger agreement (the "Merger Agreement") that provides that the Company will merge with and into Univest, with Univest remaining as the surviving entity. Following the merger, Fox Chase Bank will merge with and into Univest Bank and Trust Co., with Univest Bank and Trust Co. remaining as the surviving entity.

At the effective time of the Merger, Fox Chase shareholders will be entitled to elect to receive, for each share of Fox Chase common stock, subject to the election and adjustment procedures described in the joint proxy statement/prospectus, either 0.9731 shares of Univest common stock or $21.00 in cash; provided, however, that 60% of the total number of outstanding shares of Fox Chase common stock will be converted into Univest common stock, and the remaining outstanding shares of Fox Chase common stock will be converted into cash. As a result, if more Fox Chase shareholders elect to receive either Univest common stock or cash than is available as merger consideration under the merger agreement, those Fox Chase shareholders electing the over-subscribed form of consideration may have the over-subscribed consideration proportionately reduced and substituted with consideration in the alternative form.

9

NOTE 2 - BUSINESS COMBINATIONS (CONTINUED)

Subject to the satisfaction or waiver of the closing conditions contained in the merger agreement, including the approval of the merger agreement by the Company’s and Univest's shareholders and the receipt of required regulatory approvals, Univest and the Company expect that the merger will be completed during the third quarter of 2016. However, it is possible that factors outside the control of both companies, including whether or when the required regulatory approvals will be received, could result in the merger being completed at a different time or not at all.

NOTE 3 - INVESTMENT SECURITIES

The amortized cost and fair value of securities available-for-sale and held-to-maturity as of March 31, 2016 and December 31, 2015 are summarized as follows: 

	March 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands, Unaudited)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	301	$	5	$	—		$	306
Corporate securities	17,608		107		—			17,715
Agency residential mortgage related securities	115,592		2,258		(45		)	117,805
Total available-for-sale securities	$	133,501	$	2,370	$	(45	)	$	135,826
Held-to-Maturity Securities:
Corporate securities	$	1,776	$	34	$	—		$	1,810
Private label residential mortgage related securities	2,452		11		—			2,463
Agency residential mortgage related securities	140,300		2,182		(100		)	142,382
Total held-to-maturity securities	$	144,528	$	2,227	$	(100	)	$	146,655
	December 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	301	$	—	$	(2	)	$	299
Corporate securities	17,625		9		(93		)	17,541
Agency residential mortgage related securities	121,195		1,597		(881		)	121,911
Total available-for-sale securities	$	139,121	$	1,606	$	(976	)	$	139,751
Held-to-Maturity Securities:
Corporate securities	$	1,776	$	—	$	(11	)	$	1,765
Private label residential mortgage related securities	2,522		—		(25		)	2,497
Agency residential mortgage related securities	145,892		663		(967		)	145,588
Total held-to-maturity securities	$	150,190	$	663	$	(1,003	)	$	149,850

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

10

NOTE 3 - INVESTMENT 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 March 31, 2016 and December 31, 2015.

	March 31, 2016
	Less than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(In thousands, Unaudited)
Available-for-Sale Securities:
Agency residential mortgage related securities	$	2,587	$	(4	)	$	17,179	$	(41	)	$	19,766	$	(45	)
Total available-for-sale securities	$	2,587	$	(4	)	$	17,179	$	(41	)	$	19,766	$	(45	)
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	1,324	$	—		$	9,438	$	(100	)	$	10,762	$	(100	)
Total held-to-maturity securities	$	1,324	$	—		$	9,438	$	(100	)	$	10,762	$	(100	)
Total temporarily impaired securities	$	3,911	$	(4	)	$	26,617	$	(141	)	$	30,528	$	(145	)
	December 31, 2015
	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	$	299	$	(2	)	$	—	$	—		$	299	$	(2	)
Corporate securities	15,015		(93		)	—		—			15,015		(93		)
Agency residential mortgage related securities	79,995		(716		)	7,927		(165		)	87,922		(881		)
Total available-for-sale securities	$	95,309	$	(811	)	$	7,927	$	(165	)	$	103,236	$	(976	)
Held-to-Maturity Securities:
Corporate securities	$	1,766	$	(11	)	$	—	$	—		$	1,766	$	(11	)
Private label residential mortgage related securities	2,497		(25		)	—		—			2,497		(25		)
Agency residential mortgage related securities	80,741		(709		)	9,768		(258		)	90,509		(967		)
Total held-to-maturity securities	$	85,004	$	(745	)	$	9,768	$	(258	)	$	94,772	$	(1,003	)
Total temporarily impaired securities	$	180,313	$	(1,556	)	$	17,695	$	(423	)	$	198,008	$	(1,979	)

During the three month periods ended March 31, 2016 and 2015, no securities were sold. There were no net investment securities gains or losses in the consolidated statement of operations for the three month periods ended March 31, 2016 or 2015.

The Company evaluates a variety of factors when concluding whether a security is other-than-temporarily impaired.  These factors include, but are not limited to, the type and purpose of the security, the underlying rating of the issuer, the presence of credit enhancements, the length of time a security has been in a loss position and the severity of the loss.

11

NOTE 3 - INVESTMENT SECURITIES (CONTINUED)

At March 31, 2016, gross unrealized losses totaled $145,000.  Fifteen agency residential mortgage related securities, with a fair value of $26.6 million, had an unrealized loss position of $141,000 for twelve months or longer as of March 31, 2016.  Additionally, four agency residential mortgage related securities, with a fair value of $3.9 million and an unrealized loss position of $4,000, had unrealized loss positions for less than twelve months as of March 31, 2016. The fair value of these nineteen securities primarily fluctuates with changes in market conditions for the underlying securities and changes in the interest rate environment. The Company does not intend to sell the securities in an unrealized loss position and it is not more likely than not that it will be required to sell these securities before a recovery of fair value, which may be maturity.  Upon review of the attributes of the individual securities, the Company concluded these securities were not other-than-temporarily impaired.

At March 31, 2016, the amortized cost of held-to-maturity investments consisted of the following (in thousands):

	Original Cost		Unrealized Loss at Transfer			Post-transfer Accretion			Amortized Cost
Securities transferred from available-for-sale	$	80,730	$	(1,625	)	$	(312	)	$	78,793
Other held-to-maturity securities	65,735		—			—			65,735
Total	$	146,465	$	(1,625	)	$	(312	)	$	144,528

The amortized cost and estimated fair value of investment securities available-for-sale and held-to-maturity at March 31, 2016 and December 31, 2015 by contractual maturity are as follows:

	Available-for-Sale				Held-to-Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In thousands)
March 31, 2016(Unaudited)
Due in one year or less	$	2,508	$	2,515	$	—	$	—
Due after one year through five years	15,401		15,506		1,776		1,810
Due after five years through ten years	—		—		—		—
Due after ten years	—		—		—		—
Total mortgage related securities	115,592		117,805		142,752		144,845
	$	133,501	$	135,826	$	144,528	$	146,655
December 31, 2015
Due in one year or less	$	2,517	$	2,526	$	—	$	—
Due after one year through five years	15,409		15,314		1,776		1,765
Due after five years through ten years	—		—		—		—
Due after ten years	—		—		—		—
Total mortgage related securities	121,195		121,911		148,414		148,085
	$	139,121	$	139,751	$	150,190	$	149,850

Securities with a fair value of $65.6 million and $48.7 million at March 31, 2016 and December 31, 2015, respectively, were pledged to secure public deposits.

Securities with a fair value of $156.0 million and $161.7 million at March 31, 2016 and December 31, 2015, respectively, were used to secure FHLB advances, short-term borrowings, other borrowed funds and related unused borrowing capacities.  See Note 7.

Securities with a fair value of $1.6 million and $900,000 at March 31, 2016 and December 31, 2015, respectively, were used to secure derivative transactions. See Note 5.

12

NOTE 4 - LOANS

The composition of net loans at March 31, 2016 and December 31, 2015 is provided below:

	March 31, 2016			December 31, 2015
	(In thousands)
	(Unaudited)
Real estate loans:
One- to four-family	$	86,393		$	90,339
Multi-family and commercial	449,581			442,612
Construction	43,130			35,794
	579,104			568,745
Consumer loans	13,906			14,711
Commercial and industrial loans	194,570			195,078
Total loans	787,580			778,534
Deferred loan origination fees, net	(341		)	(289		)
Allowance for loan losses	(10,570		)	(10,562		)
Net loans	$	776,669		$	767,683

The following tables present changes in the allowance for loan losses by loan segment for the three months ended March 31, 2016 and the three months ended March 31, 2015.

	Three Months Ended March 31, 2016
	One- to Four-Family			Multi-family and Commercial		Construction		Consumer			Commercial and Industrial		Unallocated			Total
	(In thousands, Unaudited)
Balance, beginning	$	362		$	6,464	$	580	$	134		$	2,672	$	350		$	10,562
(Credit) provision for loan losses	(23		)	28		70		(12		)	108		(126		)	45
Loans charged off	—			—		—		(54		)	—		—			(54		)
Recoveries	—			7		—		10			—		—			17
Balance, ending	$	339		$	6,499	$	650	$	78		$	2,780	$	224		$	10,570
	Three Months Ended March 31, 2015
	One- to Four-Family			Multi-family and Commercial		Construction		Consumer			Commercial and Industrial		Unallocated			Total
	(In thousands, Unaudited)
Balance, beginning	$	405		$	5,990	$	1,038	$	184		$	2,753	$	360		$	10,730
Provision (credit) for loan losses	26			111		22		(47		)	349		11			472
Loans charged off	(44		)	—		—		—			—		—			(44		)
Recoveries	—			3		—		17			—		—			20
Balance, ending	$	387		$	6,104	$	1,060	$	154		$	3,102	$	371		$	11,178

13

NOTE 4 - LOANS (CONTINUED)

The following tables provide details of loans, and associated allowance for loan losses, which are individually or collectively evaluated for impairment as of March 31, 2016 and December 31, 2015.

	As of March 31, 2016
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Unallocated		Total
	(In thousands, Unaudited)
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	$	—	$	533	$	135	$	—	$	53	$	—	$	721
Balance, ending: collectively evaluated for impairment	339		5,966		515		78		2,727		224		9,849
Total	$	339	$	6,499	$	650	$	78	$	2,780	$	224	$	10,570
Total Loans:
Balance, ending: individually evaluated for impairment	$	1,635	$	7,076	$	3,829	$	177	$	702	$	—	$	13,419
Balance, ending: collectively evaluated for impairment	84,758		442,505		39,301		13,729		193,868		—		774,161
Total	$	86,393	$	449,581	$	43,130	$	13,906	$	194,570	$	—	$	787,580
	As of December 31, 2015
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Unallocated		Total
	(In thousands)
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	$	3	$	539	$	135	$	56	$	54	$	—	$	787
Balance, ending: collectively evaluated for impairment	359		5,925		445		78		2,618		350		9,775
Total	$	362	$	6,464	$	580	$	134	$	2,672	$	350	$	10,562
Total Loans:
Balance, ending: individually evaluated for impairment	$	1,460	$	7,111	$	3,866	$	171	$	718	$	—	$	13,326
Balance, ending: collectively evaluated for impairment	88,879		435,501		31,928		14,540		194,360		—		765,208
Total	$	90,339	$	442,612	$	35,794	$	14,711	$	195,078	$	—	$	778,534

14

NOTE 4 - LOANS (CONTINUED)

The following tables set forth the breakdown of impaired loans by loan segment as of March 31, 2016 and December 31, 2015.

March 31, 2016
	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		Impaired Loans with Allowance		Impaired Loans without Allowance
	(In thousands, Unaudited)
Real estate loans:
One- to four-family	$	759	$	876	$	—	$	1,635	$	—	$	1,635
Multi-family and commercial	1,066		1,685		4,325		7,076		6,305		771
Construction	—		3,829		—		3,829		3,829		—
Consumer loans	79		98		—		177		—		177
Commercial and industrial	702		—		—		702		702		—
Total	$	2,606	$	6,488	$	4,325	$	13,419	$	10,836	$	2,583
December 31, 2015
	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	$	583	$	877	$	—	$	1,460	$	117	$	1,343
Multi-family and commercial	1,074		1,685		4,352		7,111		6,340		771
Construction	—		3,866		—		3,866		3,866		—
Consumer loans	159		12		—		171		57		114
Commercial and industrial	718		—		—		718		718		—
Total	$	2,534	$	6,440	$	4,352	$	13,326	$	11,098	$	2,228

There were no loans past due 90 days or more and still accruing interest at March 31, 2016 or December 31, 2015.

For the three months ended March 31, 2016 and 2015, the average recorded investment in impaired loans was $13.6 million and $12.4 million, respectively.  The interest income recognized on these impaired loans was $163,000 and $141,000 for the three months ended March 31, 2016 and 2015, respectively.

At both December 31, 2015 and March 31, 2016, two troubled debt restructurings ("TDRs") totaling $1.1 million are excluded from the accruing TDR column above as they are included in nonaccrual loans.  Of this amount, $1.0 million relates to one multi-family and commercial real estate loan and $93,000 relates to one residential loan.

15

NOTE 4 - LOANS (CONTINUED)

The following tables set forth the allowance for loan loss for impaired loans and general allowance by loan segment as of March 31, 2016 and December 31, 2015.

March 31, 2016	Allowance for Loan Losses
	Impaired Loans
	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans
									General		Total
	(In thousands, Unaudited)
Real estate loans:
One- to four-family	$	—	$	—	$	—	$	—	$	339	$	339
Multi-family and commercial	118		46		369		533		5,966		6,499
Construction	—		135		—		135		515		650
Consumer loans	—		—		—		—		78		78
Commercial and industrial	53		—		—		53		2,727		2,780
Unallocated	—		—		—		—		224		224
Total allowance for loan losses	$	171	$	181	$	369	$	721	$	9,849	$	10,570
December 31, 2015	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	$	3	$	—	$	—	$	3	$	359	$	362
Multi-family and commercial	119		46		374		539		5,925		6,464
Construction	—		135		—		135		445		580
Consumer loans	56		—		—		56		78		134
Commercial and industrial	54		—		—		54		2,618		2,672
Unallocated	—		—		—		—		350		350
Total allowance for loan losses	$	232	$	181	$	374	$	787	$	9,775	$	10,562

16

NOTE 4 - LOANS (CONTINUED)

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

The following table sets forth a summary of the TDR activity for the three month periods ended March 31, 2016 and 2015.

	Three Months Ended March 31, 2016
	Restructured Current Period
	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Type of Modification
	(Dollars in thousands, Unaudited)
Real estate loans:
One- to four-family	—	$	—	$	—
Multi-family and commercial	—	—		—
Construction	—	—		—
Consumer loans	1	86		86		Delayed repayment
Commercial and industrial	—	—		—
Total	1	$	86	$	86
	Three Months Ended March 31, 2015
	Restructured Current Period
	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Type of Modification
	(Dollars in thousands, Unaudited)
Real estate loans:
One- to four-family	—	$	—	$	—
Multi-family and commercial	1	914		914		Delayed repayment
Construction	—	—		—
Consumer loans	—	—		—
Commercial and industrial	—	—		—
Total	1	$	914	$	914

During the three months ended March 31, 2016 and 2015, no TDRs defaulted that were restructured in the prior twelve months.

At March 31, 2016 and December 31, 2015, the recorded investment of residential and consumer mortgage loans secured by residential real estate properties, for which formal foreclosure proceedings are in process, totaled $277,000 and $364,000, respectively.  At March 31, 2016 and December 31, 2015, there were three foreclosed residential real estate properties, which were carried at $106,000 and $122,000, respectively.

17

NOTE 4 - LOANS (CONTINUED)

The following table sets forth past due loans by segment as of March 31, 2016 and December 31, 2015.

	March 31, 2016				December 31, 2015
	30-59 Days Past Due		60-89 Days Past Due		30-59 Days Past Due		60-89 Days Past Due
	(In thousands)
	(Unaudited)
One- to four-family real estate	$	286	$	—	$	865	$	685
Multi-family and commercial real estate	—		—		—		—
Construction	—		—		—		—
Consumer	126		70		156		—
Commercial and industrial	—		—		—		—
Total	$	412	$	70	$	1,021	$	685

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 well 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 March 31, 2016 and December 31, 2015. 

	March 31, 2016
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Total
	(In thousands, Unaudited)
Pass and Pass watch	$	85,634	$	433,186	$	39,301	$	13,827	$	190,528	$	762,476
Special mention	—		14,376		—		—		2,295		16,671
Substandard	759		2,019		3,829		79		1,747		8,433
Doubtful	—		—		—		—		—		—
Total loans	$	86,393	$	449,581	$	43,130	$	13,906	$	194,570	$	787,580
	December 31, 2015
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Total
	(In thousands)
Pass and Pass watch	$	89,756	$	427,393	$	31,927	$	14,552	$	191,496	$	755,124
Special mention	—		13,958		—		—		1,799		15,757
Substandard	583		1,261		3,867		159		1,783		7,653
Doubtful	—		—		—		—		—		—
Total loans	$	90,339	$	442,612	$	35,794	$	14,711	$	195,078	$	778,534

18

NOTE 5 - DERIVATIVES AND HEDGING

Interest Rate Swaps

On November 3, 2006, the Company entered into an interest rate swap with a current notional amount of $691,000, 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 1-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 $97,000 and $92,000 at March 31, 2016 and December 31, 2015, respectively.  The interest rate swap is carried at fair value in accordance with FASB ASC 815 "Derivatives and Hedging."  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 into an interest rate swap with a current notional amount of $1.5 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 1-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 $92,000 and $56,000 at March 31, 2016 and December 31, 2015, respectively.  The difference between changes in the fair values of the 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 $1,000 and $3,000 for the three months ended March 31, 2016 and March 31, 2015, respectively.

Credit Derivatives

We have entered 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 ours 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 March 31, 2016, 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 $12.1 million, and remaining maturities ranging from three to seven years.  At December 31, 2015, there were four variable-rate to fixed-rate interest swap transactions between the third-party financial institution and our customers with a notional amount of $12.2 million, and remaining maturities ranging from four to seven years.  The fair value of the swaps to the customers was a liability of $360,000 and $53,000 as of March 31, 2016 and December 31, 2015, respectively, and all swaps were in paying positions to the third-party financial institution at March 31, 2016.  As of March 31, 2016 and December 31, 2015, the fair value of the Company’s interest rate swap credit derivatives was a liability of $8,000 and $6,000, respectively.  During the three months ended March 31, 2016 and 2015, the Company recognized (expense) income of ($2,000) and $3,000, respectively, from interest rate swap credit derivatives.

At March 31, 2016 and December 31, 2015, there were no foreign currency swap transactions between the third-party financial institution and our customers.  During the three months ended March 31, 2016 and 2015, the Company recognized income of $0 and $2,000, respectively, 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.

19

NOTE 6 - DEPOSITS

Deposits and their respective weighted average interest rate at March 31, 2016 and December 31, 2015 consist of the following: 

	March 31, 2016				December 31, 2015
	Weighted Average Interest Rate		Amount		Weighted Average Interest Rate		Amount
	(Dollars in thousands)
	(Unaudited)
Noninterest-bearing demand accounts	—	%	$	225,083	—	%	$	170,327
NOW accounts	0.20		98,019		0.20		97,838
Money market accounts	0.26		105,184		0.28		93,325
Savings and club accounts	0.45		145,110		0.45		142,966
Brokered deposits	0.91		52,378		0.76		78,481
Certificates of deposit	0.86		189,934		0.88		182,037
	0.40	%	$	815,708	0.43	%	$	764,974

NOTE 7 - BORROWINGS

FHLB Advances

Pursuant to collateral agreements with the FHLB of Pittsburgh, advances are secured by qualifying first mortgage loans, qualifying fixed-income securities, FHLB stock and an interest-bearing demand deposit account with the FHLB. 

Maturity Date	Amount		Coupon Rate		Call Date	Rate if Called
	(In thousands, Unaudited)
September 2016	$	5,000	0.75	%	Not Applicable	Not Applicable
September 2016	10,000		1.04		Not Applicable	Not Applicable
June 2017	5,000		0.94		Not Applicable	Not Applicable
July 2017	10,000		0.92		Not Applicable	Not Applicable
November 2017	15,000		3.62		May 2016	3-month LIBOR + 0.10%
November 2017	15,000		3.87		May 2016	3-month LIBOR + 0.10%
December 2017	20,000		2.83		June 2016	3-month LIBOR + 0.11%
July 2018	10,000		1.32		Not Applicable	Not Applicable
	$	90,000	2.34	%

For the borrowings which have a "Call Date" disclosed in the above table, if the borrowing is called, the Bank has the option to either pay off the borrowing without penalty or the borrowings' fixed rate resets to a variable 3-month 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.

The Bank had a maximum borrowing capacity with the FHLB of Pittsburgh of approximately $496.1 million at March 31, 2016.  As of March 31, 2016, the Bank had qualifying collateral pledged against its advances consisting of loans in the amount of $632.0 million and securities in the amount of $63.7 million. Additionally, as of March 31, 2016, the Bank had a maximum borrowing capacity of $57.6 million with the Federal Reserve Bank of Philadelphia through the Discount Window. This borrowing capacity was generated by pledged securities with a fair value of $58.4 million.

As a member of the FHLB of Pittsburgh, the Bank is required to acquire and hold shares of FHLB of Pittsburgh capital stock. The FHLB stock holding requirement is based on a percentage of the Bank's borrowings and a percentage of the Bank's "eligible assets" as defined by the FHLB. Percentages of borrowings and "eligible assets" used to determine the stock holding requirement are set by the FHLB from a defined range. Maximum percentages are 6.00% of its advances plus 1.00% of the Bank’s "eligible assets." Minimum percentages are 2.00% of its advances plus 0.05% of "eligible assets."  Current percentages are 4.00% of advances plus 0.10% of "eligible assets."  As of March 31, 2016, the Company had a minimum stock obligation of $2.2 million and a maximum stock obligation of $11.6 million.  The Company held $6.2 million in FHLB stock at that date.

20

NOTE 7 - BORROWINGS (CONTINUED)

Other Borrowed Funds

Other borrowed funds obtained from other commercial banks under security repurchase agreements totaled $30.0 million at March 31, 2016.  These borrowings contractually mature with dates ranging from October 2018 through November 2020. As disclosed in the table below, one of the borrowings may be called by the lender based on the underlying agreement.  Accordingly, the contractual maturity below may differ from actual maturity.

				Next Call Date	Subsequent Call Frequency
Maturity Date	Amount		Coupon Rate
	(In thousands, Unaudited)
October 2018	$	5,000	3.15%	April 2016	Quarterly
December 2018	5,000		1-month LIBOR + 2.03%	Not Applicable	Not Applicable
September 2019	10,000		1-month LIBOR + 1.89%	Not Applicable	Not Applicable
September 2020	5,000		1-month LIBOR + 1.56%	Not Applicable	Not Applicable
November 2020	5,000		1-month LIBOR + 1.58%	Not Applicable	Not Applicable
	$	30,000

Mortgage backed securities with a fair value of $33.9 million at March 31, 2016 were used to secure these other borrowed funds. Changes in the fair value of pledged collateral may require the Company to pledge additional securities.

Short-term Borrowings

Short-term borrowings consist of overnight borrowings plus term borrowings with an original maturity of less than one year. Short-term borrowings are obtained from commercial banks, participants in the Federal Funds market and the FHLB. As of March 31, 2016, the Company had $15.0 million of overnight borrowings with a weighted average rate of 0.52% .  As of December 31, 2015, the Company had $38.5 million of overnight borrowings with a weighted average rate of 0.43%.

NOTE 8 - STOCK BASED COMPENSATION

During the three months ended March 31, 2016, the Company recorded $349,000 of stock based compensation expense comprised of stock option expense of $115,000 and restricted stock expense of $234,000. This compares to $310,000 of stock based compensation expense for the three months ended March 31, 2015 comprised of stock option expense of $112,000 and restricted stock expense of $198,000.

The following is a summary of the Bancorp’s stock option activity and related information for the three months ended March 31, 2016.

	Number of Stock Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
	(Unaudited)
Outstanding at December 31, 2015	715,554	$	14.45	6.1 years	$	4,182,000
Granted	—	—
Exercised	—	—
Forfeited/Cancelled	—	—
Outstanding at March 31, 2016	715,554	$	14.45	5.9 years	$	3,488,000
Exercisable at March 31, 2016	428,292	$	13.40	4.8 years	$	2,537,000

21

NOTE 8 - STOCK BASED COMPENSATION (CONTINUED)

The following is a summary of the Bancorp’s unvested options as of March 31, 2016 and the changes therein during the three months then ended. 

	Number of Stock Options		Weighted Average Grant Date Fair Value
	(Unaudited)
Unvested at December 31, 2015	366,362		$	3.68
Granted	—		—
Vested	(79,100	)	3.88
Forfeited / Cancelled	—		—
Unvested at March 31, 2016	287,262		$	3.63

Expected future expense relating to the 287,262 non-vested options outstanding as of March 31, 2016 is $900,000 over a weighted average period of 2.6 years. 

The following is a summary of the status of the Bancorp’s restricted stock as of March 31, 2016 and changes therein during the three months then ended.

	Number of Restricted Shares		Weighted Average Grant Date Fair Value
	(Unaudited)
Unvested at December 31, 2015	177,073		$	16.04
Granted	18,608		17.00
Vested	(54,397	)	16.79
Forfeited / Cancelled	—		—
Unvested at March 31, 2016	141,284		$	15.87

Expected future compensation expense relating to the 141,284 restricted shares at March 31, 2016 is $1.9 million over a weighted average period of 2.4 years. 

Performance-based restricted shares granted in 2013, as discussed in the following paragraph, vest over a five-year period based on continued service with the Bank and the achievement of performance metrics. The performance metrics to be evaluated during the performance period are (1) return on assets, actual and growth rate, compared to a predetermined peer group and (2) earnings per share growth rate compared to peer group ("performance criteria"). Each performance metric has a 50% weight. On the third anniversary of the grant date ("measurement date"), the Company's level of performance relative to the performance criteria are evaluated and the number of shares that will vest at that time and over the following two years will be determined. The number of shares eligible to vest is variable and can range from 0% to 150% of the shares identified on the grant date (the "target shares"). Of the shares that will vest, 50% of the shares vest on the measurement date and 25% vest on each of the fourth and fifth anniversaries of the date of grant.

During March 2013, the Company granted performance-based restricted stock to certain executive officers of the Company, of which 39,250 shares remained outstanding at the measurement date. During March 2016, the Company awarded an additional 18,608 shares of performance-based restricted stock, which represented additional shares owed to participants under the March 2013 grant as the Company exceeded the performance targets under the 2013 award. This represented a total grant of 147.4% of the "target shares." The 57,858 shares had a grant date fair value of $17.00.

During 2015, the Company granted 8,840 shares of performance-based restricted stock to certain executive officers of the Company. Performance-based restricted shares granted in 2015 utilize similar performance criteria and measurement date as outlined above for the 2012 and 2013 performance based grants. However, the 2015 awards vest 50% at measurement date and 50% on the fourth anniversary of the date of the grant. For the purposes of the above table, the Company is assuming 100% of the "target shares" will be awarded. However, more or less shares may actually be awarded based on the performance of the Company at the applicable measurement date, which is March 13, 2018.

22

NOTE 9 - 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 quarter 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 reporting date.

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 derived 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 March 31, 2016 and December 31, 2015:

Cash and Cash Equivalents

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

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

Fair values for investment 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. 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 record fair value adjustments to impaired 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. The methods utilized to estimate the fair value of loans do not necessarily represent an exit price.

FHLB Stock

It is not practical to determine the fair value of FHLB stock due to restriction placed on its transferability.

Mortgage Servicing Rights

The fair value of the mortgage servicing rights ("MSRs") was determined using a 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.

Accrued Interest Receivable and Accrued Interest Payable

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

23

NOTE 9 - 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, FHLB Advances and Other Borrowed Funds

Fair values of short-term borrowings, FHLB 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.

The estimated fair values of the Company’s financial instruments at March 31, 2016 and December 31, 2015 were as follows: 

		March 31, 2016				December 31, 2015
	Fair Value Hierarchy Level	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
		(In thousands)
Financial assets:		(Unaudited)
Cash and cash equivalents	Level 1	$	9,112	$	9,112	$	7,798	$	7,798
Investment securities available-for-sale	Level 2	135,826		135,826		139,751		139,751
Investment securities held-to-maturity	Level 2	144,528		146,655		150,190		149,850
Loans receivable, net	Level 3	776,669		779,947		767,683		768,516
FHLB stock	NA	6,186		NA		6,734		NA
Accrued interest receivable	Level 2, 3	3,348		3,348		3,145		3,145
Mortgage servicing rights	Level 3	97		97		104		104
Financial liabilities:
Savings and club accounts	Level 2	145,110		145,110		142,966		142,966
Demand, NOW and money market deposits	Level 2	428,286		428,286		361,490		361,490
Brokered deposits	Level 2	52,378		52,377		78,481		78,219
Certificates of deposit	Level 2	189,934		189,921		182,037		181,422
Short-term borrowings	Level 2	15,000		15,000		38,496		38,496
FHLB advances	Level 2	90,000		92,012		110,000		111,985
Other borrowed funds	Level 2	30,000		31,604		30,000		31,692
Accrued interest payable	Level 2	302		302		319		319
Derivative contracts	Level 2, 3	197		197		154		154

The following financial instruments were classified as Level 3 and carried at fair value on a recurring basis as of the dates indicated below:

• Two commercial loans, since lending credit risk is not an observable input for these loans (see interest rate swap discussion in Note 5).  The unrealized gain on the two loans was $177,000 at March 31, 2016 compared to $137,000 at December 31, 2015.

• Credit derivatives are valued based on creditworthiness of the underlying borrower which is a significant unobservable input.  The liability resulting from credit derivatives was $8,000 and $6,000 at March 31, 2016 and December 31, 2015, respectively.

24

NOTE 9 - FAIR VALUE (CONTINUED)

The following measures were made on a recurring basis as of March 31, 2016 and December 31, 2015.

				Fair Value Measurements at Reporting Date Using
				Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs			Significant Other Unobservable Inputs
	As of
Description	March 31, 2016			(Level 1)		(Level 2)			(Level 3)
	(In thousands, Unaudited)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	306		$	—	$	306		$	—
Corporate securities	17,715			—		17,715			—
Agency residential mortgage related securities	117,805			—		117,805			—
Loans (1)	2,324			—		—			2,324
Derivative contracts (1)	(197		)	—		(189		)	(8		)
				Fair Value Measurements at Reporting Date Using
				Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs			Significant Other Unobservable Inputs
	As of
Description	December 31, 2015			(Level 1)		(Level 2)			(Level 3)
	(In thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	299		$	—	$	299		$	—
Corporate securities	17,541			—		17,541			—
Agency residential mortgage related securities	121,911			—		121,911			—
Loans (1)	2,315			—		—			2,315
Derivative contracts (1)	(154		)	—		(148		)	(6		)

(1)          Such financial instruments are recorded at fair value as further described in Note 5.

The following measures were made on a non-recurring basis as of March 31, 2016 and December 31, 2015:

Loans, which were partially charged off at March 31, 2016 and December 31, 2015.  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.

MSRs, the fair value of which was determined using a 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, for which we used Level 3 inputs, which consist of appraisals, agreements of sale or letters of intent.

25

NOTE 9 - FAIR VALUE (CONTINUED)

			Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Other Unobservable Inputs
	Balance		(Level 1)		(Level 2)		(Level 3)
March 31, 2016(Unaudited)			(In thousands)
Loans	$	1,113	$	—	$	—	$	1,113
Mortgage servicing rights	97		—		—		97
Other real estate owned	2,615		—		—		2,615
Total	$	3,825	$	—	$	—	$	3,825
December 31, 2015
Loans	$	1,239	$	—	$	—	$	1,239
Mortgage servicing rights	104		—		—		104
Other real estate owned	2,623		—		—		2,623
Total	$	3,966	$	—	$	—	$	3,966

The following tables include a roll forward of the financial instruments which fair value is determined on a recurring basis using Significant Other Unobservable Inputs (Level 3) for the periods from December 31, 2015 to March 31, 2016 and December 31, 2014 to March 31, 2015. 

Three Months Ended March 31, 2016
	Derivative Contracts			Loans			Total
Beginning balance, December 31, 2015	$	(6	)	$	2,315		$	2,309
Purchases/additions	—			—			—
Sales	—			—			—
Payments received	—			(31		)	(31		)
Premium amortization, net	—			—			—
(Decrease) increase in value	(2		)	40			38
Ending balance, March 31, 2016	$	(8	)	$	2,324		$	2,316
Three Months Ended March 31, 2015
	Derivative Contracts			Loans			Total
Beginning balance, December 31, 2014	$	(12	)	$	2,451		$	2,439
Purchases/additions	(1		)	—			(1		)
Sales	—			—			—
Payments received	—			(30		)	(30		)
Premium amortization, net	—			—			—
Increase in value	5			20			25
Ending balance, March 31, 2015	$	(8	)	$	2,441		$	2,433

There were no transfers made between levels during the three months ended March 31, 2016 or 2015.

26

NOTE 10 – NEW ACCOUNTING PRONOUNCEMENTS

Accounting Standards Update (ASU) No. 2016-01 Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. This new guidance requires all equity investments to be measured at fair value with changes in the fair value recognized through net income (other than those accounted for under equity method of accounting or those that result in consolidation of the investee). The amendments in this update also require an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. For the Company, this guidance is effective for fiscal years and interim periods beginning after December 31, 2017. The Company is currently evaluating this guidance to determine the impact on its consolidated financial statements.

ASU No. 2016-02 - Leases (Topic 842). This new guidance requires lessees to recognize assets and liabilities related to certain operating leases on the balance sheet. The new guidance also requires additional disclosures by lessees and contains targeted changes to accounting by lessors. For the Company, this guidance is effective for fiscal years and interim periods beginning after December 31, 2018 and interim periods within those fiscal years. The Company is currently evaluating this guidance to determine the impact on its consolidated financial statements.

ASU No. 2016-06 - Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments (a consensus of the Emerging Issues Task Force). This new guidance requires embedded derivatives to be separated from the host contract and accounted for separately as derivatives if certain criteria are met, including the “clearly and closely related” criterion. The amendments in this Update clarify the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. An entity performing the assessment under the amendments is required to assess the embedded call (put) options solely in accordance with the four-step decision sequence. For the Company, this guidance is effective for fiscal years and interim periods beginning after December 31, 2016 and interim periods within those fiscal years. The Company is currently evaluating this guidance to determine the impact on its consolidated financial statements.

ASU No. 2016-09 - Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. This new guidance eliminates the APIC pool for excess tax benefits and requires that all excess tax benefits and tax deficiencies be recognized as an income tax benefit or expense in the income statement. All excess tax benefits and deficiencies are to be recognized in the period they are deducted on the income tax return. They shall not be anticipated when determining the annual estimated effective tax rate. Instead, they are discrete items in the reporting period in which they occur. With regards to forfeitures, entities can elect to continue to apply current U.S. GAAP or to reverse compensation cost of forfeited awards when they occur. With regards to tax withholdings and award classification, entities can withhold up to the maximum individual statutory tax rate in the applicable jurisdiction and classify the entire award as equity. For the Company, this guidance is effective for fiscal years and interim periods beginning after December 31, 2016 and interim periods within those fiscal years. The Company is currently evaluating this guidance to determine the impact on its consolidated financial statements.

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This quarterly report contains forward-looking statements that are based on assumptions and may describe future plans, strategies and expectations of the Company.  These forward-looking statements are generally identified by use of the words "believe," "expect," "intend," "anticipate," "estimate," "project" or similar expressions.  The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain.  This includes statements regarding the planned merger of Fox Chase Bancorp, Inc. ("Fox Chase") with and into Univest Corporation of Pennsylvania (“Univest”), with Univest surviving the merger as the surviving corporation (the “Merger"). Factors which could have a material adverse effect on the operations of the Company and its subsidiaries include, but are not limited to: the inability to obtain requisite approvals and/or meet the other closing conditions required to close the Merger in a timely manner, 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 the Company's market area, changes in real estate market values in the Company'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 the sections titled "Risk Factors" in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission on March 4, 2016, and its other Securities and Exchange Commission reports.

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, the Company does not undertake, and specifically

27

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 Form 10-Q to the "Company," "we," "us" and "our" refer to Fox Chase Bancorp, Inc. and its subsidiary.

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. 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 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.

We consider accounting policies involving significant judgments and assumptions by management that have, or could have, a material impact on the carrying value of certain assets or on income to be critical accounting policies.  We consider the following to be our critical accounting policies. 

• Allowance for Loan Losses

• Deferred Income Taxes

• Valuation and Other-Than-Temporary Impairment of Investment Securities

• Valuation of Assets Acquired Through Foreclosure

A discussion of these critical accounting policies is located in the section titled "Management's Discussion and Analysis of Financial Condition and Results of Operation—Critical Accounting Policies" in the Company's Annual Report on 10-K. There have been no material changes in the Company’s critical accounting policies, judgments and estimates, including assumptions or estimation techniques utilized, as described in the Company's most recent Annual Report on Form 10-K. 

Comparison of Financial Condition at March 31, 2016 and December 31, 2015

Total assets were $1.1 billion at March 31, 2016 and December 31, 2015.  Net loans were $776.7 million at March 31, 2016, an increase of $9.0 million, or 1.2%, from $767.7 million at December 31, 2015.  Total commercial loans increased $13.8 million, or 2.0%, primarily comprised of increases of $7.3 million in construction loans and $7.0 million in multi-family and commercial real estate loans, offset by a $508,000decrease in commercial and industrial loans. The increase in construction loans was primarily driven by originations during the quarter ended March 31, 2016, as the Company continues to offer financing for retail, multi-family and residential projects. The increase in multi-family and commercial real estate loans was driven by originations and fundings exceeding amortization and paydowns. During the three months ended March 31, 2016, one- to four-family residential mortgage loans decreased $3.9 million and consumer loans decreased $805,000 due to normal amortization exceeding originations, as the Company does not currently emphasize these types of lending.

Investment securities available-for-sale decreased $3.9 million from $139.8 million at December 31, 2015 to $135.8 million at March 31, 2016 due to paydowns during the three months ended March 31, 2016. Investment securities held-to-maturity decreased $5.7 million to $144.5 million at March 31, 2016 compared to $150.2 million at December 31, 2015 due to paydowns during the three months ended March 31, 2016. There were no purchases of investment securities during the three months ended March 31, 2016.

Deposits increased $50.7 million, or 6.6%, from $765.0 million at December 31, 2015 to $815.7 million at March 31, 2016.  During the three months ended March 31, 2016, noninterest-bearing demand accounts increased $54.8 million, money market accounts increased $11.9 million, non-brokered certificates of deposit increased $7.9 million, savings and club accounts increased $2.1 million and NOW accounts increased $181,000. Offsetting these increases was a decrease in brokered deposits of $26.1 million. The increase in noninterest-bearing demand accounts was primarily due to a short-term deposit from a commercial customer relationship. The increase in money market accounts and non-brokered certificates of deposit were primarily due to deposits obtained from certain municipal and commercial customers. The decrease in brokered deposits reflects the Company's decision to not replace maturities with new issuances.

Short-term borrowings decreased $23.5 million, or 61.0%, from $38.5 million at December 31, 2015 to $15.0 million at March 31, 2016. Federal Home Loan Bank advances decreased $20.0 million, or 18.2%, from $110.0 million at December 31, 2015 to $90.0 million at March 31, 2016 due to the Company's decision to not replace such term borrowings.  

28

Stockholders’ equity increased $926,000 to $177.8 million at March 31, 2016 compared to $176.9 million at December 31, 2015 primarily due to net income of $2.2 million, stock based compensation activity of $713,000 and other comprehensive income of $1.1 million, offset by dividends paid of $3.2 million during the three months ended March 31, 2016.

Comparison of Operating Results for the Three Months Ended March 31, 2016 and 2015

General. Net income decreased $30,000, or 1.3%, to $2.2 million for the three months ended March 31, 2016, compared to $2.3 million for the three months ended March 31, 2015.  The decrease in net income was due to a decrease in net interest income of $128,000 and increases in noninterest expense of $120,000 and income tax provision of $304,000, offset by a decrease in the provision for loan losses of $427,000 and an increase in noninterest income of $95,000. During the three months ended March 31, 2016, the Company incurred $346,000 ($320,000 after-tax) of professional fees related to the previously announced merger with Univest.

During the three months ended March 31, 2015, the Company incurred $230,000 in costs associated with the change in our outsourced data processing systems, of which $165,000 is included in data processing costs and $65,000 is included in professional fees. The Company also received a special dividend totaling $254,000 from the FHLB and reversed a $182,000 valuation allowance on certain deferred state tax assets. The total impact of these items was an after-tax increase in net income of $199,000 during the three months ended March 31, 2015.

Net Interest Income.  Net interest income decreased $128,000, or 1.5%, to $8.5 million for the three months ended March 31, 2016 compared to $8.7 million for the same period in 2015, due to an increase in total interest expense of $151,000, offset by an increase in total interest income of $23,000.

The increase in total interest expense was primarily due to a $33.3 millionincrease in the average balance of interest-bearing liabilities from $736.6 million to $769.9 million and an increase in the cost of interest-bearing liabilities from 0.80% to 0.84%.  The increase in the average balance of interest-bearing liabilities was primarily driven by a $45.4 million increase in interest-bearing deposits offset by a $12.0 milliondecrease in the average balance of borrowings. The increase in the average cost of interest-bearing liabilities was due to an increase in the cost of borrowings from 1.57% to 1.80% and an increase in the average cost of interest-bearing deposits from 0.53% to 0.55%.  The increase in the average cost of borrowings was primarily due to the maturity of certain term borrowings and FHLB advances, which had lower rates, as well as the 25 basis point increase in the Federal Funds rate in December 2015, which increased the cost of variable rate short-term borrowings and other borrowed funds. The slight increase in the average cost of interest-bearing deposits reflects the current interest rate environment, competition for deposits and the maturity of certificates of deposit with lower rates than current pricing.

The increase in total interest income was primarily due to a $19.9 millionincrease in the average balance of interest-earning assets offset by a decrease in yield on interest-earning assets from 3.88% to 3.80%. The increase in the average balance of interest-earning assets was primarily due to a $39.3 millionincrease in total loans offset by a decrease in investment securities of $18.5 million. The yield on total loans decreased from 4.44% to 4.37% primarily due to lower yields on commercial loan originations, partially offset by the impact of the 25 basis point increase in the Federal Funds rate in December 2015. The yield on investment securities decreased from 2.55% to 2.23% primarily due to a special dividend of $254,000 from the FHLB during the first quarter of 2015.

29

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. Net loan origination fees and costs 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. 

	Three Months Ended March 31,
	2016							2015
	Average Balance			Interest and Dividends		Yield/ Cost		Average Balance			Interest and Dividends		Yield/ Cost
Assets:	(Dollars in thousands)
Interest-earning assets:
Interest-earning demand deposits	$	10,417		$	9	0.34	%	$	11,550		$	3	0.10	%
Investment securities
Available-for-sale	144,788			857		2.37	%	140,485			1,092		3.11	%
Held-to-maturity	147,765			775		2.10	%	170,564			890		2.09	%
Total investment securities	292,553			1,632		2.23	%	311,049			1,982		2.55	%
Loans:
Residential loans	88,751			1,024		4.62	%	107,302			1,251		4.66	%
Commercial loans	678,099			7,315		4.34	%	615,474			6,669		4.39	%
Consumer loans	14,499			167		4.60	%	19,229			219		4.57	%
Total Loans	781,349			8,506		4.37	%	742,005			8,139		4.44	%
Allowance for loan losses	(10,563		)					(10,777		)
Net loans	770,786			8,506				731,228			8,139
Total interest-earning assets	1,073,756			10,147		3.80	%	1,053,827			10,124		3.88	%
Noninterest-earning assets	53,961							42,702
Total assets	$	1,127,717						$	1,096,529
Liabilities and equity:
Interest-bearing liabilities:
NOW and money market deposit accounts	$	194,028		$	111	0.23	%	$	164,508		$	90	0.22	%
Savings accounts	143,641			161		0.45	%	130,354			120		0.37	%
Brokered deposits	68,651			136		0.80	%	64,266			125		0.79	%
Certificates of deposit	185,519			399		0.87	%	187,337			380		0.82	%
Total interest-bearing deposits	591,839			807		0.55	%	546,465			715		0.53	%
Short-term borrowings	41,615			59		0.57	%	41,097			32		0.32	%
FHLB advances	106,483			557		2.10	%	119,032			539		1.84	%
Other borrowed funds	30,000			180		2.41	%	30,000			166		2.24	%
Total borrowings	178,098			796		1.80	%	190,129			737		1.57	%
Total interest-bearing liabilities	769,937			1,603		0.84	%	736,594			1,452		0.80	%
Noninterest-bearing deposits	175,527							176,389
Other noninterest-bearing liabilities	4,645							7,442
Total liabilities	950,109							920,425
Stockholders’ equity	177,444							175,552
Accumulated comprehensive income	164							552
Total stockholders' equity	177,608							176,104
Total liabilities and stockholders’ equity	$	1,127,717						$	1,096,529
Net interest income				$	8,544						$	8,672
Interest rate spread						2.96	%						3.08	%
Net interest margin						3.16	%						3.29	%
Average interest-earning assets to average interest-bearing liabilities						139.46	%						143.07	%

30

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. 

	Three Months Ended March 31, 2016
	Compared to
	Three Months Ended March 31, 2015
	Increase (Decrease)
	Due to
	Rate			Volume			Net
Interest Income:	(In thousands)
Interest-earning demand deposits	$	—		$	6		$	6
Investment securities
Available-for-sale	(269		)	34			(235		)
Held-to-maturity	5			(120		)	(115		)
Total investment securities	(264		)	(86		)	(350		)
Loans
Residential loans	(10		)	(217		)	(227		)
Commercial loans	(33		)	679			646
Consumer loans	1			(53		)	(52		)
Total loans	(42		)	409			367
Total interest-earning assets	(306		)	329			23
Interest Expense:
NOW and money market deposits	5			16			21
Savings accounts	29			12			41
Brokered deposits	3			8			11
Certificates of deposit	23			(4		)	19
Total interest-bearing deposits	60			32			92
Short-term borrowings	26			1			27
FHLB advances	75			(57		)	18
Other borrowed funds	14			—			14
Total borrowings	115			(56		)	59
Total interest-bearing liabilities	175			(24		)	151
Net change in net interest income	$	(481	)	$	353		$	(128	)

31

Provision for Loan Losses. The Company recorded a provision for loan losses of $45,000 for the three month period ended March 31, 2016 compared to a provision for loan losses of $472,000 for the three month period ended March 31, 2015.

The following table provides information with respect to our nonperforming assets and impaired loans at the dates indicated. 

	March 31, 2016			December 31, 2015
	(Dollars in thousands)
Nonaccruing Loans:
One- to four-family real estate	$	759		$	583
Multi-family and commercial real estate	1,066			1,074
Construction	—			—
Consumer	79			159
Commercial and industrial	702			718
Total	2,606			2,534
Accruing Loans Past Due 90 Days or More:
Total	$	—		$	—
Nonperforming Loans	2,606			2,534
Assets Acquired Through Foreclosure	2,615			2,623
Total Nonperforming Assets	$	5,221		$	5,157
Total nonperforming loans to total loans	0.33		%	0.33		%
Total nonperforming assets to total assets	0.46			0.46
Impaired Loans:
Nonaccruing loans	$	2,606		$	2,534
Accruing troubled debt restructurings	6,488			6,440
Other impaired loans	4,325			4,352
Total impaired loans	$	13,419		$	13,326

At March 31, 2016, nonperforming assets were comprised of the following: 

• Two multi-family and commercial real estate loans, the largest of which is secured by rental properties located in the greater Philadelphia Area.

• One commercial and industrial loan relationship secured by the assets of a professional services firm in the greater Philadelphia area.

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

• Two consumer loan relationships, which are secured by second or third lien mortgage positions. 

• Assets acquired through foreclosure consisting of five properties with a total carrying value of $2.6 million.

32

Noninterest Income.  The following table summarizes noninterest income for the three months ended March 31, 2016 and 2015. 

	Three Months Ended March 31,					$			%
	2016			2015		Change			Change
	(Dollars in thousands)
Service charges and other fee income	$	362		$	384	$	(22	)	(5.7	)%
Income on bank-owned life insurance	215			120		95			79.2
Equity in earnings of affiliate	(5		)	40		(45		)	(112.5	)
Other	94			27		67			248.1
Total Noninterest Income	$	666		$	571	$	95		16.6	%

Noninterest income increased $95,000 from $571,000 for the three months ended March 31, 2015 to $666,000 for the same period in 2016. Income on bank-owned life insurance increased $95,000 due to the purchase of policies totaling $10.0 million during the quarter ended September 30, 2015. Other noninterest income increased $67,000 primarily due to increased merchant services revenue. Equity in earnings of affiliates decreased $45,000 due to decreased income on the Bank’s investment in PMA due to lower mortgage loan volume for the 2016 period.

Noninterest Expense.  The following table summarizes noninterest expense for the three months ended March 31, 2016 and 2015. 

	Three Months Ended March 31,				$			%
	2016		2015		Change			Change
	(Dollars in thousands)
Salaries, benefits and other compensation	$	3,943	$	3,719	$	224		6.0	%
Occupancy expense	430		477		(47		)	(9.9	)
Furniture and equipment expense	77		83		(6		)	(7.2	)
Data processing costs	408		573		(165		)	(28.8	)
Professional fees	538		363		175			48.2
Marketing expense	24		41		(17		)	(41.5	)
FDIC premiums	134		119		15			12.6
Assets acquired through foreclosure expense	30		30		—			—
Other	301		360		(59		)	(16.4	)
Total Noninterest Expense	$	5,885	$	5,765	$	120		2.1	%

Noninterest expense increased $120,000 from $5.8 million for the three months ended March 31, 2015 to $5.9 million for the same period in 2016. Salaries, benefits and other compensation expense increased $224,000 primarily as a result of annual merit increases, increased staffing costs and increased benefits costs. Professional fees increased $175,000 primarily due to $346,000 in costs related to the previously announced merger with Univest, offset by decreased loan workout costs and one-time costs incurred during 2015 in conjunction with the change of our outsourced data processing systems. Data processing costs decreased $165,000 primarily due to one-time costs incurred during 2015 for this initiative.

Income Taxes. The income tax provision for the three months ended March 31, 2016 was $1.0 million, compared to $727,000 for the three months ended March 31, 2015.  The Company’s effective income tax rate was 31.4% for the three months ended March 31, 2016, compared to 24.2% for the three months ended March 31, 2015.  The increase in effective tax rate for the three months ended March 31, 2016 reflects non-deductible merger-related expenses of $269,000. Additionally, during the three months ended March 31, 2015, the Company reversed a $182,000 valuation allowance on certain state deferred tax assets, as management determined it is more likely than not the deferred tax assets will be realized. The effective tax rate for the three months ended March 31, 2015, excluding this discrete event, was 30.3%.

Liquidity and Capital Management

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, loan repayments and sales, security repayments, maturities and sales, and funds available from the FHLB, Federal Reserve Bank and commercial banks.  While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit flows and loans and securities sales and prepayments are greatly influenced by general interest rates, economic conditions and competition.

33

The following table presents certain of our contractual obligations as of March 31, 2016.

			Payments Due by Period
			Less Than One Year		One to Three Years		Three to Five Years		More Than Five Years
Contractual Obligations	Total
	(In thousands)
March 31, 2016
Operating lease obligations (1)	$	290	$	290	$	—	$	—	$	—
FHLB advances and other borrowings (2)	140,877		32,783		87,681		20,413		—
Other long-term obligations (3)	8,431		1,573		2,745		2,377		1,736
Total	$	149,598	$	34,646	$	90,426	$	22,790	$	1,736

(1)Represents lease obligations for operations center and equipment. This includes obligations under the operating lease for our Blue Bell location, which expires on November 30, 2016.

(2)Includes principal and projected interest payments.

(3)Represents obligations to the Company’s third-party data processing provider and other vendors.

We regularly adjust our investments in liquid assets and our short-term borrowing position based upon our assessment of: (1) expected loan demand; (2) expected deposit flows; (3) cash flows on our loans and investments; (4) yields available on interest-earning deposits and securities; and (5) 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.  At March 31, 2016, cash and cash equivalents totaled $9.1 million.  Securities classified as available-for-sale, which provide additional sources of liquidity, totaled $135.8 million at March 31, 2016.  In addition, at March 31, 2016, we had the ability to borrow a total of approximately $496.1 million from the FHLB, of which we had $95.0 million outstanding.  As of March 31, 2016, the Bank also had a maximum borrowing capacity of $57.6 million with the Federal Reserve Bank of Philadelphia, through the Discount Window.  Additionally, as of March 31, 2016, the Bank had federal funds lines of credit with other commercial banks.

At March 31, 2016, we had $198.3 million in commitments outstanding, which consisted of $4.5 million in home equity and consumer loan commitments, $178.3 million in commercial loan commitments, $15.0 million in standby letters of credit and $440,000 in commercial letters of credit.

Certificates of deposit due within one year of March 31, 2016 totaled $131.9 million, including $36.2 million of brokered deposits, representing 54.5% of certificates of deposit at March 31, 2016, an increase from 52.1% at December 31, 2015.  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.  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 March 31,2017. 

Our primary investing activities are the origination of loans and the purchase and sale of securities.  Our primary financing activities consist of activity in deposit accounts and borrowed funds.  Deposit flows are affected by the overall levels of interest rates, the interest rates and products offered by us and our local competitors and other factors.  We generally manage the pricing of our deposits to be competitive and to increase core deposit relationships.  Occasionally, we offer promotional rates on certain deposit products to attract deposits.

The Bancorp is a separate entity apart from the Bank and must provide for its own liquidity.  As of March 31, 2016, the Bancorp had $16.3 million in cash and cash equivalents compared to $20.2 million as of December 31, 2015. In addition to its operating expenses, the Bancorp may utilize its cash to pay dividends or to repurchase common stock, subject to applicable restrictions.  The Bancorp paid cash dividends totaling $0.28 per outstanding share of common stock. No shares of common stock were purchased during the three months ended March 31, 2016.

34

The Bancorp can receive dividends from the Bank.  Payment of such dividends to the Bancorp by the Bank is limited under applicable law. Dividends may be declared and paid only out of accumulated net earnings and may be paid in cash or property other than its own shares. Dividends may not be declared or paid unless stockholders' equity is at least equal to contributed capital. During the three months ended March 31, 2016, the Bank did not pay a dividend to the Bancorp.

Capital Management.  The Bancorp and Bank are subject to various regulatory capital requirements administered by their respective regulators, 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. In December 2010, the Basel Committee on Banking Supervision, an international forum for cooperation on banking supervisory matters, announced the "Basel III" capital standards, which substantially revised the existing capital requirements for banking organizations. In July 2013, the Federal Deposit Insurance Corporation and Federal Reserve adopted a final rule for the Basel III capital framework. The requirements in the rule began to phase in on January 1, 2015 for the Company and will be fully phased in by January 1, 2019. The rule imposes higher risk-based capital and leverage requirements than those currently in place. Specifically, the rule imposes the following minimum capital requirements: (1) a new common equity Tier 1 capital ratio of 4.5%; (2) a Tier 1 capital ratio of 6% (increased from 4%); (3) a total capital ratio of 8% (unchanged from prior rules); and (4) a Tier 1 leverage ratio of 4% for all institutions (unchanged from prior rules). In addition to establishing the minimum regulatory capital requirements, the regulations limit capital distributions and certain discretionary bonus payments to management if the institution does not hold a “capital conservation buffer” consisting of 2.5% of risk-weighted assets above the amount necessary to meet its minimum common equity Tier 1 capital, tier 1 capital and total capital requirements. The capital conservation buffer requirement is being phased in beginning January 1, 2016 at 0.625% of risk-weighted assets and increasing each year until fully implemented at 2.5% on January 1, 2019. At March 31, 2016, the Bancorp and Bank exceeded all applicable regulatory capital requirements under this new rule and are considered "well capitalized" under regulatory guidelines.

The following table presents the Bancorp's and the Bank’s capital ratios and the minimum capital requirements to be considered "well capitalized" under applicable regulatory guidelines as of March 31, 2016 and December 31, 2015.

	Ratio		Minimum to be Well Capitalized
March 31, 2016
Common Equity Tier 1 Capital Ratio (to risk-weighted assets)
Bancorp	19.07	%	6.5	%
Bank	16.66		6.5
Tier 1 Capital Ratio (to risk-weighted assets)
Bancorp	19.07		8.0
Bank	16.66		8.0
Total Capital Ratio (to risk-weighted assets)
Bancorp	20.03		10.0
Bank	17.63		10.0
Tier 1 Leverage Ratio (to adjusted average assets)
Bancorp	15.73		5.0
Bank	13.74		5.0
December 31, 2015
Common Equity Tier 1 Capital Ratio (to risk-weighted assets)
Bancorp	19.50	%	6.5	%
Bank	16.69		6.5
Tier 1 Capital Ratio (to risk-weighted assets)
Bancorp	19.50		8.0
Bank	16.69		8.0
Total Capital Ratio (to risk-weighted assets)
Bancorp	20.48		10.0
Bank	17.68		10.0
Tier 1 Leverage Ratio (to adjusted average assets)
Bancorp	15.85		5.0
Bank	13.52		5.0

35

Total stockholders’ equity to total assets was 15.7% at March 31, 2016 and December 31, 2015.  As a result of the mutual-to-stock conversion completed in June 2010, the Company continues to have significant capital.  The Company’s financial condition and results of operations have been enhanced by the capital from the offering, resulting in increased net interest-earning assets.  However, the large increase in equity resulting from the capital raised in the conversion has and will continue to have an adverse impact on our return on equity until such funds can be deployed into higher-yielding assets.  The Company may rely on capital management tools such as cash dividends and share repurchases as well as improving operating income to increase its return on equity.

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 the three-month period ended March 31, 2016, we did not engage in any off-balance sheet transactions reasonably likely to have a material effect on our financial condition, results of operations or cash flows.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

At March 31, 2016, there was not any material change to the market risk disclosure contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015.

Item 4.  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 the purpose of 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.  In addition, no change in the Company’s internal control over financial reporting occurred during the quarter ended March 31, 2016 that has materially affected, or is reasonably likely to materially effect, Company’s internal control over financial reporting.

1

PART II.  OTHER INFORMATION

Item 1.  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 other than as described below.

Item 1A.  Risk Factors

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2015, which could materially affect our business, financial condition or future results. As of March 31, 2016, except as detailed below, the risk factors of the Company have not changed materially from those reported in the Company’s Annual Report on Form 10-K. The risks described in our Annual Report on Form 10-K are not the only risks that we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

Litigation relating to the merger could require us to incur significant costs and suffer management distraction, as well as delay and/or enjoin the merger.

Fox Chase received two letters from attorneys representing a purported shareholder demanding that the Fox Chase board remedy alleged breaches of fiduciary duties in connection with the merger and alleged failures to make all required material disclosures necessary for Fox Chase shareholders to make a fully informed voting decision on the merger. The letters assert that the proposed transaction

36

undervalues Fox Chase and that Fox Chase’s directors breached their fiduciary duties by allegedly refusing to adequately shop the company and maximize shareholder value, and that the registration statement initially filed on February 26, 2016 fails to make all material disclosures and contains misleading statements about the merger. The letters demand that Fox Chase’s board, among other things: (i) undertake all appropriate methods to maximize shareholder value and remove alleged conflicts of interest; (ii) remedy alleged disclosure violations that do not allow Fox Chase shareholders to make a fully informed voting decision; (iii) revise the merger agreement to eliminate certain deal protection devices; and (iv) refrain from completing the merger.

On February 19, 2016, the Fox Chase board of directors established a special committee of independent directors to review and investigate the allegations in the demand letters, and to make recommendations to the board regarding what actions Fox Chase should take as a result of the demand letters. The committee has retained an independent law firm as its legal counsel.

On or about March 17, 2016, the purported Fox Chase shareholder identified in the letters filed a purported class action and derivative complaint in the Court of Common Pleas of Montgomery County, Pennsylvania captioned Michael Rubin v. Roger H. Ballou, et al, No. 2016-05079-0. The lawsuit names as defendants each current member of Fox Chase’s board of directors and Univest, and also names Fox Chase as a nominal defendant. The lawsuit alleges that the Fox Chase directors breached their fiduciary duties by agreeing to the transaction, that the directors and executive officers have conflicts of interest related to the transaction, that the registration filed on February 26, 2016 failed to disclose material information relating to the transaction, and that Univest aided and abetted the alleged breaches of fiduciary duty. The complaint seeks injunctive relief to prevent consummation of the transaction, rescission of any terms of the transaction to the extent already implemented, and monetary damages resulting from the alleged wrongful misconduct of the defendants. In response to the lawsuit, Fox Chase and each of its directors has filed Preliminary Objections to the complaint and a Motion to Stay the proceedings with the Court of Common Pleas of Montgomery County, Pennsylvania. The Motion to Stay was granted on May 5, 2016.

A negative outcome in this matter could have a material adverse effect on Fox Chase if it results in preliminary or permanent injunctive relief or rescission of the merger agreement. Such actions may also create additional uncertainty relating to the merger, and responding to such demands and defending such actions may be costly and distracting to management. Fox Chase is not currently able to predict the outcome of any lawsuit arising out of or relating to the proposed transaction. If additional letters are received or complaints are filed, absent new or different allegations that are material, Fox Chase will not necessarily announce such additional matters.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

(a) Not applicable.

(b) Not applicable.

(c) The following table provides certain information with regard to shares repurchased by the Company in the first quarter of 2016.

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)
January 1, 2016 through January 31, 2016	—	$	—	—	817,172
February 1, 2016 through February 29, 2016	—	$	—	—	817,172
March 1, 2016 through March 31, 2016	—	$	—	—	817,172
Total	—	$	—	—

(1) In prior years, the Company announced repurchase programs under which it would repurchase, in the aggregate, up to 25% of the then-outstanding shares of the Company’s common stock from time to time, depending on market conditions.  On July 29, 2015, the Board of Directors approved an additional stock repurchase plan (the “July 2015 Plan”) under which it would repurchase up to 5% of the then-outstanding shares of the Company’s common stock (578,377 shares). The Company does not intend to repurchase shares of its common stock during the pendency of its merger with Univest. Under these plans, through March 31, 2016, the Company has repurchased 3.1 million shares at a cost of $44.5 million.

37

Item 3.  Defaults upon Senior Securities

Not applicable.

Item 4.  Mine Safety Disclosures

Not applicable.

Item 5.  Other Information

Not applicable.

Item 6.  Exhibits

3.1		Articles of Incorporation of Fox Chase Bancorp, Inc. (1)
3.2		Bylaws of Fox Chase Bancorp, Inc. (1)
4.0		Stock Certificate of Fox Chase Bancorp, Inc. (1)
31.1		Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
31.2		Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
32.0		Section 1350 Certification of Chief Executive Officer and Chief Financial Officer
101.0		The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2016, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Statements of Condition, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Equity, (v) the Consolidated Statements of Cash Flows and (vi) the Notes to the Unaudited Consolidated Financial Statements.
(1)	Incorporated by reference to this document from the exhibits to the Company’s Registration Statement on Form S-1 as initially filed with the Securities and Exchange Commission on March 12, 2010.

38

SIGNATURES

Pursuant to the requirements 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.
Dated:	May 10, 2016	By:	/s/ Thomas M. Petro
			Thomas M. Petro
			President and Chief Executive Officer
			(principal executive officer)
Dated:	May 10, 2016	By:	/s/ Roger S. Deacon
			Roger S. Deacon
			Chief Financial Officer
			(principal financial officer)

39

EX-31.1

Exhibit 31.1

Certification

I, Thomas M. Petro, certify that:
1.	I have reviewed this Quarterly Report on Form 10-Q of Fox Chase Bancorp, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and in preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (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(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	May 10, 2016	/s/ Thomas M. Petro
		Thomas M. Petro
		President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification

I, Roger S. Deacon, certify that:
1.	I have reviewed this Quarterly Report on Form 10-Q of Fox Chase Bancorp, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and in preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (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(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
	(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	May 10, 2016	/s/ Roger S. Deacon
		Roger S. Deacon
		Chief Financial Officer

EX-32.0

Exhibit 32.0

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Fox Chase Bancorp, Inc. (the “Company”) on Form 10-Q for the quarterly period ended March 31, 2016, as filed with the Securities and Exchange Commission (the “Report”), I hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 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, as amended; and

2.The information contained in the Report fairly presents, in all material respects, the consolidated financial condition and results of operations of the Company as of and for the period covered by the Report.

By:	/s/ Thomas M. Petro
	Thomas M. Petro
	President and Chief Executive Officer
	May 10, 2016
By:	/s/ Roger S. Deacon
	Roger S. Deacon
	Chief Financial Officer
	May 10, 2016

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2016	Apr. 30, 2016
Document and Entity Information
Entity Registrant Name	Fox Chase Bancorp Inc
Entity Central Index Key	0001485176
Document Type	10-Q
Document Period End Date	Mar. 31, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q1
Entity Common Stock, Shares Outstanding		11,769,390

XML

Consolidated Statements of Condition - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
ASSETS
Cash and due from banks	$ 3,737	$ 3,413
Interest-earning demand deposits in other banks	5,375	4,385
Total cash and cash equivalents	9,112	7,798
Investment securities available-for-sale	135,826	139,751
Investment securities held-to-maturity (fair value of $146,655 at March 31, 2016 and $149,850 at December 31, 2015)	144,528	150,190
Loans, net of allowance for loan losses of $10,570 at March 31, 2016 and $10,562 at December 31, 2015	776,669	767,683
Federal Home Loan Bank stock, at cost	6,186	6,734
Bank-owned life insurance	25,902	25,687
Premises and equipment, net	8,895	9,030
Assets acquired through foreclosure	2,615	2,623
Real estate held for investment	1,620	1,620
Accrued interest receivable	3,348	3,145
Mortgage servicing rights, net	97	104
Deferred tax asset, net	3,993	5,142
Other assets	12,950	6,096
Total Assets	1,131,741	1,125,603
LIABILITIES
Deposits	815,708	764,974
Short-term borrowings	15,000	38,496
Federal Home Loan Bank advances	90,000	110,000
Other borrowed funds	30,000	30,000
Advances from borrowers for taxes and insurance	1,350	1,422
Accrued interest payable	302	319
Accrued expenses and other liabilities	1,541	3,478
Total Liabilities	953,901	948,689
STOCKHOLDERS’ EQUITY
Preferred stock ($.01 par value; 1,000,000 shares authorized, none issued and outstanding at March 31, 2016 and December 31, 2015)	0	0
Common stock ($.01 par value; 60,000,000 shares authorized, 11,767,590 shares outstanding at March 31, 2016 and December 31, 2015)	149	149
Additional paid-in capital	141,833	142,189
Treasury stock, at cost (3,141,201 shares at March 31, 2016 and December 31, 2015)	(44,468)	(44,468)
Common stock acquired by benefit plans	(5,876)	(6,717)
Retained earnings	85,542	86,241
Accumulated other comprehensive income (loss), net	660	(480)
Total Stockholders’ Equity	177,840	176,914
Total Liabilities and Stockholders’ Equity	$ 1,131,741	$ 1,125,603

XML

Consolidated Statements of Condition (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Investment securities held to maturity, fair value	$ 146,655	$ 149,850
Loans, allowance for loan losses	$ 10,570	$ 10,562
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	11,767,590	11,767,590
Common stock, shares outstanding	11,767,590	11,767,590
Treasury stock, shares	3,141,201	3,141,201

XML

Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
INTEREST INCOME
Interest and fees on loans	$ 8,506	$ 8,139
Interest and dividends on investment securities	1,632	1,982
Other interest income	9	3
Total Interest Income	10,147	10,124
INTEREST EXPENSE
Deposits	807	715
Short-term borrowings	59	32
Federal Home Loan Bank advances	557	539
Other borrowed funds	180	166
Total Interest Expense	1,603	1,452
Net Interest Income	8,544	8,672
Provision for loan losses	45	472
Net Interest Income after Provision for Loan Losses	8,499	8,200
NONINTEREST INCOME
Service charges and other fee income	362	384
Income on bank-owned life insurance	215	120
Equity in earnings of affiliate	(5)	40
Other	94	27
Total Noninterest Income	666	571
NONINTEREST EXPENSE
Salaries, benefits and other compensation	3,943	3,719
Occupancy expense	430	477
Furniture and equipment expense	77	83
Data processing costs	408	573
Professional fees	538	363
Marketing expense	24	41
FDIC premiums	134	119
Assets acquired through foreclosure expense	30	30
Other	301	360
Total Noninterest Expense	5,885	5,765
Income Before Income Taxes	3,280	3,006
Income tax provision	1,031	727
Net Income	$ 2,249	$ 2,279
Earnings per share:
Basic (in dollars per share)	$ 0.20	$ 0.21
Diluted (in dollars per share)	$ 0.20	$ 0.20

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Statement of Comprehensive Income [Abstract]
Net income	$ 2,249	$ 2,279
Other comprehensive income:
Unrealized holding gains on investment securities	1,694	800
Tax effect	(583)	(276)
Net of tax amount	1,111	524
Accretion of unrealized loss on securities reclassified to held-to-maturity	46	41
Tax effect	(17)	(15)
Net of tax amount	29	26
Other comprehensive income	1,140	550
Comprehensive income	$ 3,389	$ 2,829

XML

Consolidated Statements of Changes in Equity - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Treasury Stock	Common Stock Acquired by Benefit Plans	Retained Earnings	Accumulated Other Comprehensive Income, net
BALANCE at Dec. 31, 2014	$ 175,911	$ 147	$ 139,177	$ (39,698)	$ (8,056)	$ 84,225	$ 116
Increase (Decrease) in Stockholders' Equity
Purchase of treasury stock	(1,137)			(1,137)
Stock based compensation expense	310		310
ESOP shares allocated to employees	269		113		156
Issuance of stock for vested equity awards	0		(333)		254	79
Common stock issued for exercise of vested stock options	0	0	0
Excess tax benefit from exercise of stock options and vesting of restricted stock			(3)
Adjustments to Additional Paid in Capital, Income Tax Deficiency from Share-based Compensation	(3)
Dividends paid	(2,940)					(2,940)
Net income	2,279					2,279
Other comprehensive income (loss)	550						550
BALANCE at Mar. 31, 2015	175,239	147	139,264	(40,835)	(7,646)	83,643	666
BALANCE at Dec. 31, 2015	176,914	149	142,189	(44,468)	(6,717)	86,241	(480)
Increase (Decrease) in Stockholders' Equity
Purchase of treasury stock	0			0
Stock based compensation expense	349		349
ESOP shares allocated to employees	314		158		156
Issuance of stock for vested equity awards	0		(913)		685	228
Common stock issued for exercise of vested stock options	0		0
Excess tax benefit from exercise of stock options and vesting of restricted stock	50		50
Dividends paid	(3,176)					(3,176)
Net income	2,249					2,249
Other comprehensive income (loss)	1,140						1,140
BALANCE at Mar. 31, 2016	$ 177,840	$ 149	$ 141,833	$ (44,468)	$ (5,876)	$ 85,542	$ 660

XML

Consolidated Statements of Changes in Equity (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Statement of Stockholders' Equity [Abstract]
Treasury stock, shares	0	69,800
Dividends paid (in dollars per share)	$ 0.28	$ 0.26

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Statement of Cash Flows [Abstract]
Net income	$ 2,249	$ 2,279
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Provision for loan losses	45	472
Valuation adjustment for assets acquired through foreclosure	16	15
Depreciation	135	163
Net amortization of securities premiums and discounts	366	423
Deferred income tax benefit (expense)	550	(16)
Stock compensation from benefit plans	663	579
Income on bank-owned life insurance	(215)	(120)
Excess tax (benefit) expense from exercise of stock options and vesting of restricted stock	(50)	3
Decrease in mortgage servicing rights, net	7	5
(Increase) decrease in accrued interest receivable and other assets	(7,110)	2,675
Decrease in accrued interest payable, accrued expenses and other liabilities	(1,954)	(716)
Net Cash (Used in) Provided by Operating Activities	(5,298)	5,762
Investment securities - available-for-sale:
Purchases	0	(8,056)
Proceeds from maturities, calls and principal repayments	5,536	7,967
Investment securities - held-to-maturity:
Purchases	0	(5,823)
Proceeds from maturities, calls and principal repayments	5,527	5,817
Net increase in loans	(9,031)	(9,651)
Purchases of loans and loan participations	0	(20,968)
Net decrease in Federal Home Loan Bank stock	548	1,000
Purchases of premises and equipment	0	(37)
Additions to assets acquired through foreclosure	(8)	(5)
Net Cash Provided by (Used in) Investing Activities	2,572	(29,756)
Cash Flows from Financing Activities
Net increase in deposits	50,734	91,120
Decrease in advances from borrowers for taxes and insurance	(72)	(192)
Principal payments on Federal Home Loan Bank advances	(20,000)	(10,000)
Net decrease in short-term borrowings	(23,496)	(50,000)
Excess tax benefit (expense) from exercise of stock options and vesting of restricted stock	50	(3)
Purchase of treasury stock	0	(1,137)
Cash dividends paid	(3,176)	(2,940)
Net Cash Provided by Financing Activities	4,040	26,848
Net Decrease in Cash and Cash Equivalents	1,314	2,854
Cash and Cash Equivalents – Beginning	7,798	17,213
Cash and Cash Equivalents – Ending	9,112	20,067
Supplemental Disclosure of Cash Flow Information
Interest paid	1,620	1,495
Income taxes paid	1	0
Transfers of loans to assets acquired through foreclosure	0	0
Net charge-offs	$ 37	$ 24

XML

PRINCIPLES OF CONSOLIDATION AND PRESENTATION

3 Months Ended

Mar. 31, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

PRINCIPLES OF CONSOLIDATION AND PRESENTATION

PRINCIPLES OF CONSOLIDATION AND PRESENTATION

Fox Chase Bancorp, Inc. (the "Bancorp" or "Fox Chase") is a Maryland corporation. The Bancorp’s primary business is holding the common stock of Fox Chase Bank (the "Bank") and making two loans to the Fox Chase Bank Employee Stock Ownership Plan (the "ESOP").  The Bancorp is authorized to pursue other business activities permissible by laws and regulations for bank holding companies.

The Bancorp is a bank holding company and is regulated by the Board of Governors of the Federal Reserve System. The Bank is a Pennsylvania state-chartered savings bank and is regulated by the Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation (the "FDIC").

The Bancorp and the Bank (collectively referred to as the "Company" or the "Corporation") provide a wide variety of financial products and services to individuals and businesses through the Bank’s ten branches in Philadelphia, Richboro, Willow Grove, Warminster, Lahaska, Hatboro, 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 Bank also owns 46.15% of Philadelphia Mortgage Advisors ("PMA"), a mortgage banker with offices in Plymouth Meeting and Doylestown, Pennsylvania and Ocean City, New Jersey.

The Company is subject to the regulations of certain federal and state 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 it to further changes with respect to asset valuations, 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. 

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 sole purpose is to facilitate the Bank’s investment in PMA. 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 disclose 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. 

These interim financial statements do not contain all necessary disclosures required by GAAP for complete financial statements and therefore should be read in conjunction with the audited financial statements and the notes thereto included in Fox Chase Bancorp, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the Securities and Exchange Commission on March 4, 2016.  These financial statements include all normal and recurring adjustments which management believes were necessary in order to conform to GAAP.  The results for the three months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016 or any other period.

NOTE 1 - PRINCIPLES OF CONSOLIDATION AND PRESENTATION (CONTINUED)

Per Share Information

Basic earnings per share excludes 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.  Average 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.

The following table presents the reconciliation of the numerators and denominators of the basic and diluted earnings per share computations. 

	Three Months Ended   March 31,
	2016			2015
	(Unaudited)
Net income	$	2,249,000		$	2,279,000
Weighted-average common shares outstanding (1)	11,767,590			11,768,571
Average common stock acquired by stock benefit plans:
ESOP shares unallocated	(415,800		)	(480,852		)
Shares purchased by trust	(195,115		)	(260,153		)
Weighted-average common shares used to calculate basic earnings per share	11,156,675			11,027,566
Dilutive effect of:
Restricted stock awards	43,279			46,597
Stock option awards	114,434			193,503
Weighted-average common shares used to calculate diluted earnings per share	11,314,388			11,267,666
Earnings per share - basic	$	0.20		$	0.21
Earnings per share - diluted	$	0.20		$	0.20
Outstanding common stock equivalents which are anti-dilutive	71,668			508,610
(1) Excludes treasury stock.

XML

BUSINESS COMBINATIONS

3 Months Ended

Mar. 31, 2016

Business Combinations [Abstract]

BUSINESS COMBINATIONS

BUSINESS COMBINATIONS

Proposed Merger with Univest Corporation of Pennsylvania

On December 8, 2015, Univest Corporation of Pennsylvania ("Univest") and Fox Chase entered into a merger agreement (the "Merger Agreement") that provides that the Company will merge with and into Univest, with Univest remaining as the surviving entity. Following the merger, Fox Chase Bank will merge with and into Univest Bank and Trust Co., with Univest Bank and Trust Co. remaining as the surviving entity.

At the effective time of the Merger, Fox Chase shareholders will be entitled to elect to receive, for each share of Fox Chase common stock, subject to the election and adjustment procedures described in the joint proxy statement/prospectus, either 0.9731 shares of Univest common stock or $21.00 in cash; provided, however, that 60% of the total number of outstanding shares of Fox Chase common stock will be converted into Univest common stock, and the remaining outstanding shares of Fox Chase common stock will be converted into cash. As a result, if more Fox Chase shareholders elect to receive either Univest common stock or cash than is available as merger consideration under the merger agreement, those Fox Chase shareholders electing the over-subscribed form of consideration may have the over-subscribed consideration proportionately reduced and substituted with consideration in the alternative form.

NOTE 2 - BUSINESS COMBINATIONS (CONTINUED)

Subject to the satisfaction or waiver of the closing conditions contained in the merger agreement, including the approval of the merger agreement by the Company’s and Univest's shareholders and the receipt of required regulatory approvals, Univest and the Company expect that the merger will be completed during the third quarter of 2016. However, it is possible that factors outside the control of both companies, including whether or when the required regulatory approvals will be received, could result in the merger being completed at a different time or not at all.

XML

INVESTMENT AND MORTGAGE RELATED SECURITIES

3 Months Ended

Mar. 31, 2016

Investments, Debt and Equity Securities [Abstract]

INVESTMENT AND MORTGAGE RELATED SECURITIES

INVESTMENT SECURITIES

The amortized cost and fair value of securities available-for-sale and held-to-maturity as of March 31, 2016 and December 31, 2015 are summarized as follows: 

	March 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands, Unaudited)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	301	$	5	$	—		$	306
Corporate securities	17,608		107		—			17,715
Agency residential mortgage related securities	115,592		2,258		(45		)	117,805
Total available-for-sale securities	$	133,501	$	2,370	$	(45	)	$	135,826
Held-to-Maturity Securities:
Corporate securities	$	1,776	$	34	$	—		$	1,810
Private label residential mortgage related securities	2,452		11		—			2,463
Agency residential mortgage related securities	140,300		2,182		(100		)	142,382
Total held-to-maturity securities	$	144,528	$	2,227	$	(100	)	$	146,655
	December 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	301	$	—	$	(2	)	$	299
Corporate securities	17,625		9		(93		)	17,541
Agency residential mortgage related securities	121,195		1,597		(881		)	121,911
Total available-for-sale securities	$	139,121	$	1,606	$	(976	)	$	139,751
Held-to-Maturity Securities:
Corporate securities	$	1,776	$	—	$	(11	)	$	1,765
Private label residential mortgage related securities	2,522		—		(25		)	2,497
Agency residential mortgage related securities	145,892		663		(967		)	145,588
Total held-to-maturity securities	$	150,190	$	663	$	(1,003	)	$	149,850

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

NOTE 3 - INVESTMENT 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 March 31, 2016 and December 31, 2015.

	March 31, 2016
	Less than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(In thousands, Unaudited)
Available-for-Sale Securities:
Agency residential mortgage related securities	$	2,587	$	(4	)	$	17,179	$	(41	)	$	19,766	$	(45	)
Total available-for-sale securities	$	2,587	$	(4	)	$	17,179	$	(41	)	$	19,766	$	(45	)
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	1,324	$	—		$	9,438	$	(100	)	$	10,762	$	(100	)
Total held-to-maturity securities	$	1,324	$	—		$	9,438	$	(100	)	$	10,762	$	(100	)
Total temporarily impaired securities	$	3,911	$	(4	)	$	26,617	$	(141	)	$	30,528	$	(145	)
	December 31, 2015
	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	$	299	$	(2	)	$	—	$	—		$	299	$	(2	)
Corporate securities	15,015		(93		)	—		—			15,015		(93		)
Agency residential mortgage related securities	79,995		(716		)	7,927		(165		)	87,922		(881		)
Total available-for-sale securities	$	95,309	$	(811	)	$	7,927	$	(165	)	$	103,236	$	(976	)
Held-to-Maturity Securities:
Corporate securities	$	1,766	$	(11	)	$	—	$	—		$	1,766	$	(11	)
Private label residential mortgage related securities	2,497		(25		)	—		—			2,497		(25		)
Agency residential mortgage related securities	80,741		(709		)	9,768		(258		)	90,509		(967		)
Total held-to-maturity securities	$	85,004	$	(745	)	$	9,768	$	(258	)	$	94,772	$	(1,003	)
Total temporarily impaired securities	$	180,313	$	(1,556	)	$	17,695	$	(423	)	$	198,008	$	(1,979	)

During the three month periods ended March 31, 2016 and 2015, no securities were sold. There were no net investment securities gains or losses in the consolidated statement of operations for the three month periods ended March 31, 2016 or 2015.

The Company evaluates a variety of factors when concluding whether a security is other-than-temporarily impaired.  These factors include, but are not limited to, the type and purpose of the security, the underlying rating of the issuer, the presence of credit enhancements, the length of time a security has been in a loss position and the severity of the loss.

NOTE 3 - INVESTMENT SECURITIES (CONTINUED)

At March 31, 2016, gross unrealized losses totaled $145,000.  Fifteen agency residential mortgage related securities, with a fair value of $26.6 million, had an unrealized loss position of $141,000 for twelve months or longer as of March 31, 2016.  Additionally, four agency residential mortgage related securities, with a fair value of $3.9 million and an unrealized loss position of $4,000, had unrealized loss positions for less than twelve months as of March 31, 2016. The fair value of these nineteen securities primarily fluctuates with changes in market conditions for the underlying securities and changes in the interest rate environment. The Company does not intend to sell the securities in an unrealized loss position and it is not more likely than not that it will be required to sell these securities before a recovery of fair value, which may be maturity.  Upon review of the attributes of the individual securities, the Company concluded these securities were not other-than-temporarily impaired.

At March 31, 2016, the amortized cost of held-to-maturity investments consisted of the following (in thousands):

	Original Cost		Unrealized Loss at Transfer			Post-transfer Accretion			Amortized Cost
Securities transferred from available-for-sale	$	80,730	$	(1,625	)	$	(312	)	$	78,793
Other held-to-maturity securities	65,735		—			—			65,735
Total	$	146,465	$	(1,625	)	$	(312	)	$	144,528

The amortized cost and estimated fair value of investment securities available-for-sale and held-to-maturity at March 31, 2016 and December 31, 2015 by contractual maturity are as follows:

	Available-for-Sale				Held-to-Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In thousands)
March 31, 2016(Unaudited)
Due in one year or less	$	2,508	$	2,515	$	—	$	—
Due after one year through five years	15,401		15,506		1,776		1,810
Due after five years through ten years	—		—		—		—
Due after ten years	—		—		—		—
Total mortgage related securities	115,592		117,805		142,752		144,845
	$	133,501	$	135,826	$	144,528	$	146,655
December 31, 2015
Due in one year or less	$	2,517	$	2,526	$	—	$	—
Due after one year through five years	15,409		15,314		1,776		1,765
Due after five years through ten years	—		—		—		—
Due after ten years	—		—		—		—
Total mortgage related securities	121,195		121,911		148,414		148,085
	$	139,121	$	139,751	$	150,190	$	149,850

Securities with a fair value of $65.6 million and $48.7 million at March 31, 2016 and December 31, 2015, respectively, were pledged to secure public deposits.

Securities with a fair value of $156.0 million and $161.7 million at March 31, 2016 and December 31, 2015, respectively, were used to secure FHLB advances, short-term borrowings, other borrowed funds and related unused borrowing capacities.  See Note 7.

Securities with a fair value of $1.6 million and $900,000 at March 31, 2016 and December 31, 2015, respectively, were used to secure derivative transactions. See Note 5.

XML

LOANS

3 Months Ended

Mar. 31, 2016

Receivables [Abstract]

LOANS

LOANS

The composition of net loans at March 31, 2016 and December 31, 2015 is provided below:

	March 31, 2016			December 31, 2015
	(In thousands)
	(Unaudited)
Real estate loans:
One- to four-family	$	86,393		$	90,339
Multi-family and commercial	449,581			442,612
Construction	43,130			35,794
	579,104			568,745
Consumer loans	13,906			14,711
Commercial and industrial loans	194,570			195,078
Total loans	787,580			778,534
Deferred loan origination fees, net	(341		)	(289		)
Allowance for loan losses	(10,570		)	(10,562		)
Net loans	$	776,669		$	767,683

The following tables present changes in the allowance for loan losses by loan segment for the three months ended March 31, 2016 and the three months ended March 31, 2015.

	Three Months Ended March 31, 2016
	One- to Four-Family			Multi-family and Commercial		Construction		Consumer			Commercial and Industrial		Unallocated			Total
	(In thousands, Unaudited)
Balance, beginning	$	362		$	6,464	$	580	$	134		$	2,672	$	350		$	10,562
(Credit) provision for loan losses	(23		)	28		70		(12		)	108		(126		)	45
Loans charged off	—			—		—		(54		)	—		—			(54		)
Recoveries	—			7		—		10			—		—			17
Balance, ending	$	339		$	6,499	$	650	$	78		$	2,780	$	224		$	10,570
	Three Months Ended March 31, 2015
	One- to Four-Family			Multi-family and Commercial		Construction		Consumer			Commercial and Industrial		Unallocated			Total
	(In thousands, Unaudited)
Balance, beginning	$	405		$	5,990	$	1,038	$	184		$	2,753	$	360		$	10,730
Provision (credit) for loan losses	26			111		22		(47		)	349		11			472
Loans charged off	(44		)	—		—		—			—		—			(44		)
Recoveries	—			3		—		17			—		—			20
Balance, ending	$	387		$	6,104	$	1,060	$	154		$	3,102	$	371		$	11,178

NOTE 4 - LOANS (CONTINUED)

The following tables provide details of loans, and associated allowance for loan losses, which are individually or collectively evaluated for impairment as of March 31, 2016 and December 31, 2015.

	As of March 31, 2016
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Unallocated		Total
	(In thousands, Unaudited)
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	$	—	$	533	$	135	$	—	$	53	$	—	$	721
Balance, ending: collectively evaluated for impairment	339		5,966		515		78		2,727		224		9,849
Total	$	339	$	6,499	$	650	$	78	$	2,780	$	224	$	10,570
Total Loans:
Balance, ending: individually evaluated for impairment	$	1,635	$	7,076	$	3,829	$	177	$	702	$	—	$	13,419
Balance, ending: collectively evaluated for impairment	84,758		442,505		39,301		13,729		193,868		—		774,161
Total	$	86,393	$	449,581	$	43,130	$	13,906	$	194,570	$	—	$	787,580
	As of December 31, 2015
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Unallocated		Total
	(In thousands)
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	$	3	$	539	$	135	$	56	$	54	$	—	$	787
Balance, ending: collectively evaluated for impairment	359		5,925		445		78		2,618		350		9,775
Total	$	362	$	6,464	$	580	$	134	$	2,672	$	350	$	10,562
Total Loans:
Balance, ending: individually evaluated for impairment	$	1,460	$	7,111	$	3,866	$	171	$	718	$	—	$	13,326
Balance, ending: collectively evaluated for impairment	88,879		435,501		31,928		14,540		194,360		—		765,208
Total	$	90,339	$	442,612	$	35,794	$	14,711	$	195,078	$	—	$	778,534

NOTE 4 - LOANS (CONTINUED)

The following tables set forth the breakdown of impaired loans by loan segment as of March 31, 2016 and December 31, 2015.

March 31, 2016
	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		Impaired Loans with Allowance		Impaired Loans without Allowance
	(In thousands, Unaudited)
Real estate loans:
One- to four-family	$	759	$	876	$	—	$	1,635	$	—	$	1,635
Multi-family and commercial	1,066		1,685		4,325		7,076		6,305		771
Construction	—		3,829		—		3,829		3,829		—
Consumer loans	79		98		—		177		—		177
Commercial and industrial	702		—		—		702		702		—
Total	$	2,606	$	6,488	$	4,325	$	13,419	$	10,836	$	2,583
December 31, 2015
	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	$	583	$	877	$	—	$	1,460	$	117	$	1,343
Multi-family and commercial	1,074		1,685		4,352		7,111		6,340		771
Construction	—		3,866		—		3,866		3,866		—
Consumer loans	159		12		—		171		57		114
Commercial and industrial	718		—		—		718		718		—
Total	$	2,534	$	6,440	$	4,352	$	13,326	$	11,098	$	2,228

There were no loans past due 90 days or more and still accruing interest at March 31, 2016 or December 31, 2015.

For the three months ended March 31, 2016 and 2015, the average recorded investment in impaired loans was $13.6 million and $12.4 million, respectively.  The interest income recognized on these impaired loans was $163,000 and $141,000 for the three months ended March 31, 2016 and 2015, respectively.

At both December 31, 2015 and March 31, 2016, two troubled debt restructurings ("TDRs") totaling $1.1 million are excluded from the accruing TDR column above as they are included in nonaccrual loans.  Of this amount, $1.0 million relates to one multi-family and commercial real estate loan and $93,000 relates to one residential loan.

NOTE 4 - LOANS (CONTINUED)

The following tables set forth the allowance for loan loss for impaired loans and general allowance by loan segment as of March 31, 2016 and December 31, 2015.

March 31, 2016	Allowance for Loan Losses
	Impaired Loans
	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans
									General		Total
	(In thousands, Unaudited)
Real estate loans:
One- to four-family	$	—	$	—	$	—	$	—	$	339	$	339
Multi-family and commercial	118		46		369		533		5,966		6,499
Construction	—		135		—		135		515		650
Consumer loans	—		—		—		—		78		78
Commercial and industrial	53		—		—		53		2,727		2,780
Unallocated	—		—		—		—		224		224
Total allowance for loan losses	$	171	$	181	$	369	$	721	$	9,849	$	10,570
December 31, 2015	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	$	3	$	—	$	—	$	3	$	359	$	362
Multi-family and commercial	119		46		374		539		5,925		6,464
Construction	—		135		—		135		445		580
Consumer loans	56		—		—		56		78		134
Commercial and industrial	54		—		—		54		2,618		2,672
Unallocated	—		—		—		—		350		350
Total allowance for loan losses	$	232	$	181	$	374	$	787	$	9,775	$	10,562

NOTE 4 - LOANS (CONTINUED)

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

The following table sets forth a summary of the TDR activity for the three month periods ended March 31, 2016 and 2015.

	Three Months Ended March 31, 2016
	Restructured Current Period
	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Type of Modification
	(Dollars in thousands, Unaudited)
Real estate loans:
One- to four-family	—	$	—	$	—
Multi-family and commercial	—	—		—
Construction	—	—		—
Consumer loans	1	86		86		Delayed repayment
Commercial and industrial	—	—		—
Total	1	$	86	$	86
	Three Months Ended March 31, 2015
	Restructured Current Period
	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Type of Modification
	(Dollars in thousands, Unaudited)
Real estate loans:
One- to four-family	—	$	—	$	—
Multi-family and commercial	1	914		914		Delayed repayment
Construction	—	—		—
Consumer loans	—	—		—
Commercial and industrial	—	—		—
Total	1	$	914	$	914

During the three months ended March 31, 2016 and 2015, no TDRs defaulted that were restructured in the prior twelve months.

At March 31, 2016 and December 31, 2015, the recorded investment of residential and consumer mortgage loans secured by residential real estate properties, for which formal foreclosure proceedings are in process, totaled $277,000 and $364,000, respectively.  At March 31, 2016 and December 31, 2015, there were three foreclosed residential real estate properties, which were carried at $106,000 and $122,000, respectively.

NOTE 4 - LOANS (CONTINUED)

The following table sets forth past due loans by segment as of March 31, 2016 and December 31, 2015.

	March 31, 2016				December 31, 2015
	30-59 Days Past Due		60-89 Days Past Due		30-59 Days Past Due		60-89 Days Past Due
	(In thousands)
	(Unaudited)
One- to four-family real estate	$	286	$	—	$	865	$	685
Multi-family and commercial real estate	—		—		—		—
Construction	—		—		—		—
Consumer	126		70		156		—
Commercial and industrial	—		—		—		—
Total	$	412	$	70	$	1,021	$	685

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 well 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 March 31, 2016 and December 31, 2015. 

	March 31, 2016
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Total
	(In thousands, Unaudited)
Pass and Pass watch	$	85,634	$	433,186	$	39,301	$	13,827	$	190,528	$	762,476
Special mention	—		14,376		—		—		2,295		16,671
Substandard	759		2,019		3,829		79		1,747		8,433
Doubtful	—		—		—		—		—		—
Total loans	$	86,393	$	449,581	$	43,130	$	13,906	$	194,570	$	787,580
	December 31, 2015
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Total
	(In thousands)
Pass and Pass watch	$	89,756	$	427,393	$	31,927	$	14,552	$	191,496	$	755,124
Special mention	—		13,958		—		—		1,799		15,757
Substandard	583		1,261		3,867		159		1,783		7,653
Doubtful	—		—		—		—		—		—
Total loans	$	90,339	$	442,612	$	35,794	$	14,711	$	195,078	$	778,534

XML

DERIVATIVES AND HEDGING

3 Months Ended

Mar. 31, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVES AND HEDGING

DERIVATIVES AND HEDGING

Interest Rate Swaps

On November 3, 2006, the Company entered into an interest rate swap with a current notional amount of $691,000, 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 1-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 $97,000 and $92,000 at March 31, 2016 and December 31, 2015, respectively.  The interest rate swap is carried at fair value in accordance with FASB ASC 815 "Derivatives and Hedging."  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 into an interest rate swap with a current notional amount of $1.5 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 1-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 $92,000 and $56,000 at March 31, 2016 and December 31, 2015, respectively.  The difference between changes in the fair values of the 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 $1,000 and $3,000 for the three months ended March 31, 2016 and March 31, 2015, respectively.

Credit Derivatives

We have entered 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 ours 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 March 31, 2016, 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 $12.1 million, and remaining maturities ranging from three to seven years.  At December 31, 2015, there were four variable-rate to fixed-rate interest swap transactions between the third-party financial institution and our customers with a notional amount of $12.2 million, and remaining maturities ranging from four to seven years.  The fair value of the swaps to the customers was a liability of $360,000 and $53,000 as of March 31, 2016 and December 31, 2015, respectively, and all swaps were in paying positions to the third-party financial institution at March 31, 2016.  As of March 31, 2016 and December 31, 2015, the fair value of the Company’s interest rate swap credit derivatives was a liability of $8,000 and $6,000, respectively.  During the three months ended March 31, 2016 and 2015, the Company recognized (expense) income of ($2,000) and $3,000, respectively, from interest rate swap credit derivatives.

At March 31, 2016 and December 31, 2015, there were no foreign currency swap transactions between the third-party financial institution and our customers.  During the three months ended March 31, 2016 and 2015, the Company recognized income of $0 and $2,000, respectively, 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.

XML

DEPOSITS

3 Months Ended

Mar. 31, 2016

Banking and Thrift [Abstract]

DEPOSITS

DEPOSITS

Deposits and their respective weighted average interest rate at March 31, 2016 and December 31, 2015 consist of the following: 

	March 31, 2016				December 31, 2015
	Weighted Average Interest Rate		Amount		Weighted Average Interest Rate		Amount
	(Dollars in thousands)
	(Unaudited)
Noninterest-bearing demand accounts	—	%	$	225,083	—	%	$	170,327
NOW accounts	0.20		98,019		0.20		97,838
Money market accounts	0.26		105,184		0.28		93,325
Savings and club accounts	0.45		145,110		0.45		142,966
Brokered deposits	0.91		52,378		0.76		78,481
Certificates of deposit	0.86		189,934		0.88		182,037
	0.40	%	$	815,708	0.43	%	$	764,974

XML

BORROWINGS

3 Months Ended

Mar. 31, 2016

BORROWINGS

BORROWINGS

BORROWINGS

FHLB Advances

Pursuant to collateral agreements with the FHLB of Pittsburgh, advances are secured by qualifying first mortgage loans, qualifying fixed-income securities, FHLB stock and an interest-bearing demand deposit account with the FHLB. 

Maturity Date	Amount		Coupon Rate		Call Date	Rate if Called
	(In thousands, Unaudited)
September 2016	$	5,000	0.75	%	Not Applicable	Not Applicable
September 2016	10,000		1.04		Not Applicable	Not Applicable
June 2017	5,000		0.94		Not Applicable	Not Applicable
July 2017	10,000		0.92		Not Applicable	Not Applicable
November 2017	15,000		3.62		May 2016	3-month LIBOR + 0.10%
November 2017	15,000		3.87		May 2016	3-month LIBOR + 0.10%
December 2017	20,000		2.83		June 2016	3-month LIBOR + 0.11%
July 2018	10,000		1.32		Not Applicable	Not Applicable
	$	90,000	2.34	%

For the borrowings which have a "Call Date" disclosed in the above table, if the borrowing is called, the Bank has the option to either pay off the borrowing without penalty or the borrowings' fixed rate resets to a variable 3-month 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.

The Bank had a maximum borrowing capacity with the FHLB of Pittsburgh of approximately $496.1 million at March 31, 2016.  As of March 31, 2016, the Bank had qualifying collateral pledged against its advances consisting of loans in the amount of $632.0 million and securities in the amount of $63.7 million. Additionally, as of March 31, 2016, the Bank had a maximum borrowing capacity of $57.6 million with the Federal Reserve Bank of Philadelphia through the Discount Window. This borrowing capacity was generated by pledged securities with a fair value of $58.4 million.

As a member of the FHLB of Pittsburgh, the Bank is required to acquire and hold shares of FHLB of Pittsburgh capital stock. The FHLB stock holding requirement is based on a percentage of the Bank's borrowings and a percentage of the Bank's "eligible assets" as defined by the FHLB. Percentages of borrowings and "eligible assets" used to determine the stock holding requirement are set by the FHLB from a defined range. Maximum percentages are 6.00% of its advances plus 1.00% of the Bank’s "eligible assets." Minimum percentages are 2.00% of its advances plus 0.05% of "eligible assets."  Current percentages are 4.00% of advances plus 0.10% of "eligible assets."  As of March 31, 2016, the Company had a minimum stock obligation of $2.2 million and a maximum stock obligation of $11.6 million.  The Company held $6.2 million in FHLB stock at that date.

NOTE 7 - BORROWINGS (CONTINUED)

Other Borrowed Funds

Other borrowed funds obtained from other commercial banks under security repurchase agreements totaled $30.0 million at March 31, 2016.  These borrowings contractually mature with dates ranging from October 2018 through November 2020. As disclosed in the table below, one of the borrowings may be called by the lender based on the underlying agreement.  Accordingly, the contractual maturity below may differ from actual maturity.

				Next Call Date	Subsequent Call Frequency
Maturity Date	Amount		Coupon Rate
	(In thousands, Unaudited)
October 2018	$	5,000	3.15%	April 2016	Quarterly
December 2018	5,000		1-month LIBOR + 2.03%	Not Applicable	Not Applicable
September 2019	10,000		1-month LIBOR + 1.89%	Not Applicable	Not Applicable
September 2020	5,000		1-month LIBOR + 1.56%	Not Applicable	Not Applicable
November 2020	5,000		1-month LIBOR + 1.58%	Not Applicable	Not Applicable
	$	30,000

Mortgage backed securities with a fair value of $33.9 million at March 31, 2016 were used to secure these other borrowed funds. Changes in the fair value of pledged collateral may require the Company to pledge additional securities.

Short-term Borrowings

Short-term borrowings consist of overnight borrowings plus term borrowings with an original maturity of less than one year. Short-term borrowings are obtained from commercial banks, participants in the Federal Funds market and the FHLB. As of March 31, 2016, the Company had $15.0 million of overnight borrowings with a weighted average rate of 0.52% .  As of December 31, 2015, the Company had $38.5 million of overnight borrowings with a weighted average rate of 0.43%.

XML

STOCK BASED COMPENSATION

3 Months Ended

Mar. 31, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

STOCK BASED COMPENSATION

STOCK BASED COMPENSATION

During the three months ended March 31, 2016, the Company recorded $349,000 of stock based compensation expense comprised of stock option expense of $115,000 and restricted stock expense of $234,000. This compares to $310,000 of stock based compensation expense for the three months ended March 31, 2015 comprised of stock option expense of $112,000 and restricted stock expense of $198,000.

The following is a summary of the Bancorp’s stock option activity and related information for the three months ended March 31, 2016.

	Number of Stock Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
	(Unaudited)
Outstanding at December 31, 2015	715,554	$	14.45	6.1 years	$	4,182,000
Granted	—	—
Exercised	—	—
Forfeited/Cancelled	—	—
Outstanding at March 31, 2016	715,554	$	14.45	5.9 years	$	3,488,000
Exercisable at March 31, 2016	428,292	$	13.40	4.8 years	$	2,537,000

NOTE 8 - STOCK BASED COMPENSATION (CONTINUED)

The following is a summary of the Bancorp’s unvested options as of March 31, 2016 and the changes therein during the three months then ended. 

	Number of Stock Options		Weighted Average Grant Date Fair Value
	(Unaudited)
Unvested at December 31, 2015	366,362		$	3.68
Granted	—		—
Vested	(79,100	)	3.88
Forfeited / Cancelled	—		—
Unvested at March 31, 2016	287,262		$	3.63

Expected future expense relating to the 287,262 non-vested options outstanding as of March 31, 2016 is $900,000 over a weighted average period of 2.6 years. 

The following is a summary of the status of the Bancorp’s restricted stock as of March 31, 2016 and changes therein during the three months then ended.

	Number of Restricted Shares		Weighted Average Grant Date Fair Value
	(Unaudited)
Unvested at December 31, 2015	177,073		$	16.04
Granted	18,608		17.00
Vested	(54,397	)	16.79
Forfeited / Cancelled	—		—
Unvested at March 31, 2016	141,284		$	15.87

Expected future compensation expense relating to the 141,284 restricted shares at March 31, 2016 is $1.9 million over a weighted average period of 2.4 years. 

Performance-based restricted shares granted in 2013, as discussed in the following paragraph, vest over a five-year period based on continued service with the Bank and the achievement of performance metrics. The performance metrics to be evaluated during the performance period are (1) return on assets, actual and growth rate, compared to a predetermined peer group and (2) earnings per share growth rate compared to peer group ("performance criteria"). Each performance metric has a 50% weight. On the third anniversary of the grant date ("measurement date"), the Company's level of performance relative to the performance criteria are evaluated and the number of shares that will vest at that time and over the following two years will be determined. The number of shares eligible to vest is variable and can range from 0% to 150% of the shares identified on the grant date (the "target shares"). Of the shares that will vest, 50% of the shares vest on the measurement date and 25% vest on each of the fourth and fifth anniversaries of the date of grant.

During March 2013, the Company granted performance-based restricted stock to certain executive officers of the Company, of which 39,250 shares remained outstanding at the measurement date. During March 2016, the Company awarded an additional 18,608 shares of performance-based restricted stock, which represented additional shares owed to participants under the March 2013 grant as the Company exceeded the performance targets under the 2013 award. This represented a total grant of 147.4% of the "target shares." The 57,858 shares had a grant date fair value of $17.00.

During 2015, the Company granted 8,840 shares of performance-based restricted stock to certain executive officers of the Company. Performance-based restricted shares granted in 2015 utilize similar performance criteria and measurement date as outlined above for the 2012 and 2013 performance based grants. However, the 2015 awards vest 50% at measurement date and 50% on the fourth anniversary of the date of the grant. For the purposes of the above table, the Company is assuming 100% of the "target shares" will be awarded. However, more or less shares may actually be awarded based on the performance of the Company at the applicable measurement date, which is March 13, 2018.

XML

FAIR VALUE

3 Months Ended

Mar. 31, 2016

Fair Value Disclosures [Abstract]

FAIR VALUE

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 quarter 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 reporting date.

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 derived 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 March 31, 2016 and December 31, 2015:

Cash and Cash Equivalents

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

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

Fair values for investment 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. 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 record fair value adjustments to impaired 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. The methods utilized to estimate the fair value of loans do not necessarily represent an exit price.

FHLB Stock

It is not practical to determine the fair value of FHLB stock due to restriction placed on its transferability.

Mortgage Servicing Rights

The fair value of the mortgage servicing rights ("MSRs") was determined using a 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.

Accrued Interest Receivable and Accrued Interest Payable

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

NOTE 9 - 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, FHLB Advances and Other Borrowed Funds

Fair values of short-term borrowings, FHLB 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.

The estimated fair values of the Company’s financial instruments at March 31, 2016 and December 31, 2015 were as follows: 

		March 31, 2016				December 31, 2015
	Fair Value Hierarchy Level	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
		(In thousands)
Financial assets:		(Unaudited)
Cash and cash equivalents	Level 1	$	9,112	$	9,112	$	7,798	$	7,798
Investment securities available-for-sale	Level 2	135,826		135,826		139,751		139,751
Investment securities held-to-maturity	Level 2	144,528		146,655		150,190		149,850
Loans receivable, net	Level 3	776,669		779,947		767,683		768,516
FHLB stock	NA	6,186		NA		6,734		NA
Accrued interest receivable	Level 2, 3	3,348		3,348		3,145		3,145
Mortgage servicing rights	Level 3	97		97		104		104
Financial liabilities:
Savings and club accounts	Level 2	145,110		145,110		142,966		142,966
Demand, NOW and money market deposits	Level 2	428,286		428,286		361,490		361,490
Brokered deposits	Level 2	52,378		52,377		78,481		78,219
Certificates of deposit	Level 2	189,934		189,921		182,037		181,422
Short-term borrowings	Level 2	15,000		15,000		38,496		38,496
FHLB advances	Level 2	90,000		92,012		110,000		111,985
Other borrowed funds	Level 2	30,000		31,604		30,000		31,692
Accrued interest payable	Level 2	302		302		319		319
Derivative contracts	Level 2, 3	197		197		154		154

The following financial instruments were classified as Level 3 and carried at fair value on a recurring basis as of the dates indicated below:

• Two commercial loans, since lending credit risk is not an observable input for these loans (see interest rate swap discussion in Note 5).  The unrealized gain on the two loans was $177,000 at March 31, 2016 compared to $137,000 at December 31, 2015.

• Credit derivatives are valued based on creditworthiness of the underlying borrower which is a significant unobservable input.  The liability resulting from credit derivatives was $8,000 and $6,000 at March 31, 2016 and December 31, 2015, respectively.

NOTE 9 - FAIR VALUE (CONTINUED)

The following measures were made on a recurring basis as of March 31, 2016 and December 31, 2015.

				Fair Value Measurements at Reporting Date Using
				Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs			Significant Other Unobservable Inputs
	As of
Description	March 31, 2016			(Level 1)		(Level 2)			(Level 3)
	(In thousands, Unaudited)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	306		$	—	$	306		$	—
Corporate securities	17,715			—		17,715			—
Agency residential mortgage related securities	117,805			—		117,805			—
Loans (1)	2,324			—		—			2,324
Derivative contracts (1)	(197		)	—		(189		)	(8		)
				Fair Value Measurements at Reporting Date Using
				Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs			Significant Other Unobservable Inputs
	As of
Description	December 31, 2015			(Level 1)		(Level 2)			(Level 3)
	(In thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	299		$	—	$	299		$	—
Corporate securities	17,541			—		17,541			—
Agency residential mortgage related securities	121,911			—		121,911			—
Loans (1)	2,315			—		—			2,315
Derivative contracts (1)	(154		)	—		(148		)	(6		)

(1)          Such financial instruments are recorded at fair value as further described in Note 5.

The following measures were made on a non-recurring basis as of March 31, 2016 and December 31, 2015:

Loans, which were partially charged off at March 31, 2016 and December 31, 2015.  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.

MSRs, the fair value of which was determined using a 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, for which we used Level 3 inputs, which consist of appraisals, agreements of sale or letters of intent.

NOTE 9 - FAIR VALUE (CONTINUED)

			Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Other Unobservable Inputs
	Balance		(Level 1)		(Level 2)		(Level 3)
March 31, 2016(Unaudited)			(In thousands)
Loans	$	1,113	$	—	$	—	$	1,113
Mortgage servicing rights	97		—		—		97
Other real estate owned	2,615		—		—		2,615
Total	$	3,825	$	—	$	—	$	3,825
December 31, 2015
Loans	$	1,239	$	—	$	—	$	1,239
Mortgage servicing rights	104		—		—		104
Other real estate owned	2,623		—		—		2,623
Total	$	3,966	$	—	$	—	$	3,966

The following tables include a roll forward of the financial instruments which fair value is determined on a recurring basis using Significant Other Unobservable Inputs (Level 3) for the periods from December 31, 2015 to March 31, 2016 and December 31, 2014 to March 31, 2015. 

Three Months Ended March 31, 2016
	Derivative Contracts			Loans			Total
Beginning balance, December 31, 2015	$	(6	)	$	2,315		$	2,309
Purchases/additions	—			—			—
Sales	—			—			—
Payments received	—			(31		)	(31		)
Premium amortization, net	—			—			—
(Decrease) increase in value	(2		)	40			38
Ending balance, March 31, 2016	$	(8	)	$	2,324		$	2,316
Three Months Ended March 31, 2015
	Derivative Contracts			Loans			Total
Beginning balance, December 31, 2014	$	(12	)	$	2,451		$	2,439
Purchases/additions	(1		)	—			(1		)
Sales	—			—			—
Payments received	—			(30		)	(30		)
Premium amortization, net	—			—			—
Increase in value	5			20			25
Ending balance, March 31, 2015	$	(8	)	$	2,441		$	2,433

There were no transfers made between levels during the three months ended March 31, 2016 or 2015.

XML

NEW ACCOUNTING PRONOUNCEMENTS

3 Months Ended

Mar. 31, 2016

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

NEW ACCOUNTING PRONOUNCEMENTS

NEW ACCOUNTING PRONOUNCEMENTS

Accounting Standards Update (ASU) No. 2016-01 Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. This new guidance requires all equity investments to be measured at fair value with changes in the fair value recognized through net income (other than those accounted for under equity method of accounting or those that result in consolidation of the investee). The amendments in this update also require an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. For the Company, this guidance is effective for fiscal years and interim periods beginning after December 31, 2017. The Company is currently evaluating this guidance to determine the impact on its consolidated financial statements.

ASU No. 2016-02 - Leases (Topic 842). This new guidance requires lessees to recognize assets and liabilities related to certain operating leases on the balance sheet. The new guidance also requires additional disclosures by lessees and contains targeted changes to accounting by lessors. For the Company, this guidance is effective for fiscal years and interim periods beginning after December 31, 2018 and interim periods within those fiscal years. The Company is currently evaluating this guidance to determine the impact on its consolidated financial statements.

ASU No. 2016-06 - Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments (a consensus of the Emerging Issues Task Force). This new guidance requires embedded derivatives to be separated from the host contract and accounted for separately as derivatives if certain criteria are met, including the “clearly and closely related” criterion. The amendments in this Update clarify the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. An entity performing the assessment under the amendments is required to assess the embedded call (put) options solely in accordance with the four-step decision sequence. For the Company, this guidance is effective for fiscal years and interim periods beginning after December 31, 2016 and interim periods within those fiscal years. The Company is currently evaluating this guidance to determine the impact on its consolidated financial statements.

ASU No. 2016-09 - Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. This new guidance eliminates the APIC pool for excess tax benefits and requires that all excess tax benefits and tax deficiencies be recognized as an income tax benefit or expense in the income statement. All excess tax benefits and deficiencies are to be recognized in the period they are deducted on the income tax return. They shall not be anticipated when determining the annual estimated effective tax rate. Instead, they are discrete items in the reporting period in which they occur. With regards to forfeitures, entities can elect to continue to apply current U.S. GAAP or to reverse compensation cost of forfeited awards when they occur. With regards to tax withholdings and award classification, entities can withhold up to the maximum individual statutory tax rate in the applicable jurisdiction and classify the entire award as equity. For the Company, this guidance is effective for fiscal years and interim periods beginning after December 31, 2016 and interim periods within those fiscal years. The Company is currently evaluating this guidance to determine the impact on its consolidated financial statements.

XML

PRINCIPLES OF CONSOLIDATION AND PRESENTATION (Tables)

3 Months Ended

Mar. 31, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of the reconciliation of the numerators and denominators of the basic and diluted earnings per share computations

The following table presents the reconciliation of the numerators and denominators of the basic and diluted earnings per share computations. 

	Three Months Ended   March 31,
	2016			2015
	(Unaudited)
Net income	$	2,249,000		$	2,279,000
Weighted-average common shares outstanding (1)	11,767,590			11,768,571
Average common stock acquired by stock benefit plans:
ESOP shares unallocated	(415,800		)	(480,852		)
Shares purchased by trust	(195,115		)	(260,153		)
Weighted-average common shares used to calculate basic earnings per share	11,156,675			11,027,566
Dilutive effect of:
Restricted stock awards	43,279			46,597
Stock option awards	114,434			193,503
Weighted-average common shares used to calculate diluted earnings per share	11,314,388			11,267,666
Earnings per share - basic	$	0.20		$	0.21
Earnings per share - diluted	$	0.20		$	0.20
Outstanding common stock equivalents which are anti-dilutive	71,668			508,610
(1) Excludes treasury stock.

XML

INVESTMENT AND MORTGAGE RELATED SECURITIES (Tables)

3 Months Ended

Mar. 31, 2016

Investments, Debt and Equity Securities [Abstract]

Schedule of amortized cost and fair value of securities available-for-sale and held-to-maturity

The amortized cost and fair value of securities available-for-sale and held-to-maturity as of March 31, 2016 and December 31, 2015 are summarized as follows: 

	March 31, 2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands, Unaudited)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	301	$	5	$	—		$	306
Corporate securities	17,608		107		—			17,715
Agency residential mortgage related securities	115,592		2,258		(45		)	117,805
Total available-for-sale securities	$	133,501	$	2,370	$	(45	)	$	135,826
Held-to-Maturity Securities:
Corporate securities	$	1,776	$	34	$	—		$	1,810
Private label residential mortgage related securities	2,452		11		—			2,463
Agency residential mortgage related securities	140,300		2,182		(100		)	142,382
Total held-to-maturity securities	$	144,528	$	2,227	$	(100	)	$	146,655
	December 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	301	$	—	$	(2	)	$	299
Corporate securities	17,625		9		(93		)	17,541
Agency residential mortgage related securities	121,195		1,597		(881		)	121,911
Total available-for-sale securities	$	139,121	$	1,606	$	(976	)	$	139,751
Held-to-Maturity Securities:
Corporate securities	$	1,776	$	—	$	(11	)	$	1,765
Private label residential mortgage related securities	2,522		—		(25		)	2,497
Agency residential mortgage related securities	145,892		663		(967		)	145,588
Total held-to-maturity securities	$	150,190	$	663	$	(1,003	)	$	149,850

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

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 March 31, 2016 and December 31, 2015.

	March 31, 2016
	Less than 12 Months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(In thousands, Unaudited)
Available-for-Sale Securities:
Agency residential mortgage related securities	$	2,587	$	(4	)	$	17,179	$	(41	)	$	19,766	$	(45	)
Total available-for-sale securities	$	2,587	$	(4	)	$	17,179	$	(41	)	$	19,766	$	(45	)
Held-to-Maturity Securities:
Agency residential mortgage related securities	$	1,324	$	—		$	9,438	$	(100	)	$	10,762	$	(100	)
Total held-to-maturity securities	$	1,324	$	—		$	9,438	$	(100	)	$	10,762	$	(100	)
Total temporarily impaired securities	$	3,911	$	(4	)	$	26,617	$	(141	)	$	30,528	$	(145	)
	December 31, 2015
	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	$	299	$	(2	)	$	—	$	—		$	299	$	(2	)
Corporate securities	15,015		(93		)	—		—			15,015		(93		)
Agency residential mortgage related securities	79,995		(716		)	7,927		(165		)	87,922		(881		)
Total available-for-sale securities	$	95,309	$	(811	)	$	7,927	$	(165	)	$	103,236	$	(976	)
Held-to-Maturity Securities:
Corporate securities	$	1,766	$	(11	)	$	—	$	—		$	1,766	$	(11	)
Private label residential mortgage related securities	2,497		(25		)	—		—			2,497		(25		)
Agency residential mortgage related securities	80,741		(709		)	9,768		(258		)	90,509		(967		)
Total held-to-maturity securities	$	85,004	$	(745	)	$	9,768	$	(258	)	$	94,772	$	(1,003	)
Total temporarily impaired securities	$	180,313	$	(1,556	)	$	17,695	$	(423	)	$	198,008	$	(1,979	)

Schedule of amortized cost of held-to-maturity investments

At March 31, 2016, the amortized cost of held-to-maturity investments consisted of the following (in thousands):

	Original Cost		Unrealized Loss at Transfer			Post-transfer Accretion			Amortized Cost
Securities transferred from available-for-sale	$	80,730	$	(1,625	)	$	(312	)	$	78,793
Other held-to-maturity securities	65,735		—			—			65,735
Total	$	146,465	$	(1,625	)	$	(312	)	$	144,528

Schedule of amortized cost and estimated fair value of investment securities available-for-sale and held-to-maturity by contractual maturity

The amortized cost and estimated fair value of investment securities available-for-sale and held-to-maturity at March 31, 2016 and December 31, 2015 by contractual maturity are as follows:

	Available-for-Sale				Held-to-Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In thousands)
March 31, 2016(Unaudited)
Due in one year or less	$	2,508	$	2,515	$	—	$	—
Due after one year through five years	15,401		15,506		1,776		1,810
Due after five years through ten years	—		—		—		—
Due after ten years	—		—		—		—
Total mortgage related securities	115,592		117,805		142,752		144,845
	$	133,501	$	135,826	$	144,528	$	146,655
December 31, 2015
Due in one year or less	$	2,517	$	2,526	$	—	$	—
Due after one year through five years	15,409		15,314		1,776		1,765
Due after five years through ten years	—		—		—		—
Due after ten years	—		—		—		—
Total mortgage related securities	121,195		121,911		148,414		148,085
	$	139,121	$	139,751	$	150,190	$	149,850

XML

LOANS (Tables)

3 Months Ended

Mar. 31, 2016

Receivables [Abstract]

Schedule of composition of net loans

The composition of net loans at March 31, 2016 and December 31, 2015 is provided below:

	March 31, 2016			December 31, 2015
	(In thousands)
	(Unaudited)
Real estate loans:
One- to four-family	$	86,393		$	90,339
Multi-family and commercial	449,581			442,612
Construction	43,130			35,794
	579,104			568,745
Consumer loans	13,906			14,711
Commercial and industrial loans	194,570			195,078
Total loans	787,580			778,534
Deferred loan origination fees, net	(341		)	(289		)
Allowance for loan losses	(10,570		)	(10,562		)
Net loans	$	776,669		$	767,683

Schedule of changes in allowance for loan losses by loan segment

The following tables present changes in the allowance for loan losses by loan segment for the three months ended March 31, 2016 and the three months ended March 31, 2015.

	Three Months Ended March 31, 2016
	One- to Four-Family			Multi-family and Commercial		Construction		Consumer			Commercial and Industrial		Unallocated			Total
	(In thousands, Unaudited)
Balance, beginning	$	362		$	6,464	$	580	$	134		$	2,672	$	350		$	10,562
(Credit) provision for loan losses	(23		)	28		70		(12		)	108		(126		)	45
Loans charged off	—			—		—		(54		)	—		—			(54		)
Recoveries	—			7		—		10			—		—			17
Balance, ending	$	339		$	6,499	$	650	$	78		$	2,780	$	224		$	10,570
	Three Months Ended March 31, 2015
	One- to Four-Family			Multi-family and Commercial		Construction		Consumer			Commercial and Industrial		Unallocated			Total
	(In thousands, Unaudited)
Balance, beginning	$	405		$	5,990	$	1,038	$	184		$	2,753	$	360		$	10,730
Provision (credit) for loan losses	26			111		22		(47		)	349		11			472
Loans charged off	(44		)	—		—		—			—		—			(44		)
Recoveries	—			3		—		17			—		—			20
Balance, ending	$	387		$	6,104	$	1,060	$	154		$	3,102	$	371		$	11,178

Loans and allowance for loan losses individually or collectively evaluated for impairment

The following tables provide details of loans, and associated allowance for loan losses, which are individually or collectively evaluated for impairment as of March 31, 2016 and December 31, 2015.

	As of March 31, 2016
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Unallocated		Total
	(In thousands, Unaudited)
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	$	—	$	533	$	135	$	—	$	53	$	—	$	721
Balance, ending: collectively evaluated for impairment	339		5,966		515		78		2,727		224		9,849
Total	$	339	$	6,499	$	650	$	78	$	2,780	$	224	$	10,570
Total Loans:
Balance, ending: individually evaluated for impairment	$	1,635	$	7,076	$	3,829	$	177	$	702	$	—	$	13,419
Balance, ending: collectively evaluated for impairment	84,758		442,505		39,301		13,729		193,868		—		774,161
Total	$	86,393	$	449,581	$	43,130	$	13,906	$	194,570	$	—	$	787,580
	As of December 31, 2015
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Unallocated		Total
	(In thousands)
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	$	3	$	539	$	135	$	56	$	54	$	—	$	787
Balance, ending: collectively evaluated for impairment	359		5,925		445		78		2,618		350		9,775
Total	$	362	$	6,464	$	580	$	134	$	2,672	$	350	$	10,562
Total Loans:
Balance, ending: individually evaluated for impairment	$	1,460	$	7,111	$	3,866	$	171	$	718	$	—	$	13,326
Balance, ending: collectively evaluated for impairment	88,879		435,501		31,928		14,540		194,360		—		765,208
Total	$	90,339	$	442,612	$	35,794	$	14,711	$	195,078	$	—	$	778,534

Schedule of breakdown of impaired loans by loan segment

The following tables set forth the breakdown of impaired loans by loan segment as of March 31, 2016 and December 31, 2015.

March 31, 2016
	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans		Impaired Loans with Allowance		Impaired Loans without Allowance
	(In thousands, Unaudited)
Real estate loans:
One- to four-family	$	759	$	876	$	—	$	1,635	$	—	$	1,635
Multi-family and commercial	1,066		1,685		4,325		7,076		6,305		771
Construction	—		3,829		—		3,829		3,829		—
Consumer loans	79		98		—		177		—		177
Commercial and industrial	702		—		—		702		702		—
Total	$	2,606	$	6,488	$	4,325	$	13,419	$	10,836	$	2,583
December 31, 2015
	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	$	583	$	877	$	—	$	1,460	$	117	$	1,343
Multi-family and commercial	1,074		1,685		4,352		7,111		6,340		771
Construction	—		3,866		—		3,866		3,866		—
Consumer loans	159		12		—		171		57		114
Commercial and industrial	718		—		—		718		718		—
Total	$	2,534	$	6,440	$	4,352	$	13,326	$	11,098	$	2,228

Schedule of allowance for loan loss for impaired loans and general allowance by loan segment

The following tables set forth the allowance for loan loss for impaired loans and general allowance by loan segment as of March 31, 2016 and December 31, 2015.

March 31, 2016	Allowance for Loan Losses
	Impaired Loans
	Nonaccrual Loans		Accruing TDRs		Other Impaired Loans		Total Impaired Loans
									General		Total
	(In thousands, Unaudited)
Real estate loans:
One- to four-family	$	—	$	—	$	—	$	—	$	339	$	339
Multi-family and commercial	118		46		369		533		5,966		6,499
Construction	—		135		—		135		515		650
Consumer loans	—		—		—		—		78		78
Commercial and industrial	53		—		—		53		2,727		2,780
Unallocated	—		—		—		—		224		224
Total allowance for loan losses	$	171	$	181	$	369	$	721	$	9,849	$	10,570
December 31, 2015	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	$	3	$	—	$	—	$	3	$	359	$	362
Multi-family and commercial	119		46		374		539		5,925		6,464
Construction	—		135		—		135		445		580
Consumer loans	56		—		—		56		78		134
Commercial and industrial	54		—		—		54		2,618		2,672
Unallocated	—		—		—		—		350		350
Total allowance for loan losses	$	232	$	181	$	374	$	787	$	9,775	$	10,562

Summary of TDR activity for the periods

The following table sets forth a summary of the TDR activity for the three month periods ended March 31, 2016 and 2015.

	Three Months Ended March 31, 2016
	Restructured Current Period
	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Type of Modification
	(Dollars in thousands, Unaudited)
Real estate loans:
One- to four-family	—	$	—	$	—
Multi-family and commercial	—	—		—
Construction	—	—		—
Consumer loans	1	86		86		Delayed repayment
Commercial and industrial	—	—		—
Total	1	$	86	$	86
	Three Months Ended March 31, 2015
	Restructured Current Period
	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Type of Modification
	(Dollars in thousands, Unaudited)
Real estate loans:
One- to four-family	—	$	—	$	—
Multi-family and commercial	1	914		914		Delayed repayment
Construction	—	—		—
Consumer loans	—	—		—
Commercial and industrial	—	—		—
Total	1	$	914	$	914

Schedule of past due loans by segment

The following table sets forth past due loans by segment as of March 31, 2016 and December 31, 2015.

	March 31, 2016				December 31, 2015
	30-59 Days Past Due		60-89 Days Past Due		30-59 Days Past Due		60-89 Days Past Due
	(In thousands)
	(Unaudited)
One- to four-family real estate	$	286	$	—	$	865	$	685
Multi-family and commercial real estate	—		—		—		—
Construction	—		—		—		—
Consumer	126		70		156		—
Commercial and industrial	—		—		—		—
Total	$	412	$	70	$	1,021	$	685

Schedule of criticized and classified loans by segment

The following tables set forth criticized and classified loans by segment as of March 31, 2016 and December 31, 2015. 

	March 31, 2016
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Total
	(In thousands, Unaudited)
Pass and Pass watch	$	85,634	$	433,186	$	39,301	$	13,827	$	190,528	$	762,476
Special mention	—		14,376		—		—		2,295		16,671
Substandard	759		2,019		3,829		79		1,747		8,433
Doubtful	—		—		—		—		—		—
Total loans	$	86,393	$	449,581	$	43,130	$	13,906	$	194,570	$	787,580
	December 31, 2015
	One- to Four-Family		Multi-family and Commercial		Construction		Consumer		Commercial and Industrial		Total
	(In thousands)
Pass and Pass watch	$	89,756	$	427,393	$	31,927	$	14,552	$	191,496	$	755,124
Special mention	—		13,958		—		—		1,799		15,757
Substandard	583		1,261		3,867		159		1,783		7,653
Doubtful	—		—		—		—		—		—
Total loans	$	90,339	$	442,612	$	35,794	$	14,711	$	195,078	$	778,534

XML

DEPOSITS (Tables)

3 Months Ended

Mar. 31, 2016

Banking and Thrift [Abstract]

Schedule of components of weighted average interest rate and balance of deposits

Deposits and their respective weighted average interest rate at March 31, 2016 and December 31, 2015 consist of the following: 

	March 31, 2016				December 31, 2015
	Weighted Average Interest Rate		Amount		Weighted Average Interest Rate		Amount
	(Dollars in thousands)
	(Unaudited)
Noninterest-bearing demand accounts	—	%	$	225,083	—	%	$	170,327
NOW accounts	0.20		98,019		0.20		97,838
Money market accounts	0.26		105,184		0.28		93,325
Savings and club accounts	0.45		145,110		0.45		142,966
Brokered deposits	0.91		52,378		0.76		78,481
Certificates of deposit	0.86		189,934		0.88		182,037
	0.40	%	$	815,708	0.43	%	$	764,974

XML

BORROWINGS (Tables)

3 Months Ended

Mar. 31, 2016

BORROWINGS

Schedule of FHLB advances

Maturity Date	Amount		Coupon Rate		Call Date	Rate if Called
	(In thousands, Unaudited)
September 2016	$	5,000	0.75	%	Not Applicable	Not Applicable
September 2016	10,000		1.04		Not Applicable	Not Applicable
June 2017	5,000		0.94		Not Applicable	Not Applicable
July 2017	10,000		0.92		Not Applicable	Not Applicable
November 2017	15,000		3.62		May 2016	3-month LIBOR + 0.10%
November 2017	15,000		3.87		May 2016	3-month LIBOR + 0.10%
December 2017	20,000		2.83		June 2016	3-month LIBOR + 0.11%
July 2018	10,000		1.32		Not Applicable	Not Applicable
	$	90,000	2.34	%

Schedule of other long-term borrowings

				Next Call Date	Subsequent Call Frequency
Maturity Date	Amount		Coupon Rate
	(In thousands, Unaudited)
October 2018	$	5,000	3.15%	April 2016	Quarterly
December 2018	5,000		1-month LIBOR + 2.03%	Not Applicable	Not Applicable
September 2019	10,000		1-month LIBOR + 1.89%	Not Applicable	Not Applicable
September 2020	5,000		1-month LIBOR + 1.56%	Not Applicable	Not Applicable
November 2020	5,000		1-month LIBOR + 1.58%	Not Applicable	Not Applicable
	$	30,000

XML

STOCK BASED COMPENSATION (Tables)

3 Months Ended

Mar. 31, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Summary of stock option activity and related information

The following is a summary of the Bancorp’s stock option activity and related information for the three months ended March 31, 2016.

	Number of Stock Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
	(Unaudited)
Outstanding at December 31, 2015	715,554	$	14.45	6.1 years	$	4,182,000
Granted	—	—
Exercised	—	—
Forfeited/Cancelled	—	—
Outstanding at March 31, 2016	715,554	$	14.45	5.9 years	$	3,488,000
Exercisable at March 31, 2016	428,292	$	13.40	4.8 years	$	2,537,000

Schedule of assumptions to determine the fair value of the options

Summary of unvested options and changes during the period

The following is a summary of the Bancorp’s unvested options as of March 31, 2016 and the changes therein during the three months then ended. 

	Number of Stock Options		Weighted Average Grant Date Fair Value
	(Unaudited)
Unvested at December 31, 2015	366,362		$	3.68
Granted	—		—
Vested	(79,100	)	3.88
Forfeited / Cancelled	—		—
Unvested at March 31, 2016	287,262		$	3.63

Summary of the status of the Company's restricted stock activity and balances

The following is a summary of the status of the Bancorp’s restricted stock as of March 31, 2016 and changes therein during the three months then ended.

	Number of Restricted Shares		Weighted Average Grant Date Fair Value
	(Unaudited)
Unvested at December 31, 2015	177,073		$	16.04
Granted	18,608		17.00
Vested	(54,397	)	16.79
Forfeited / Cancelled	—		—
Unvested at March 31, 2016	141,284		$	15.87

XML

FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2016

Fair Value Disclosures [Abstract]

Fair value of financial instruments

The estimated fair values of the Company’s financial instruments at March 31, 2016 and December 31, 2015 were as follows: 

		March 31, 2016				December 31, 2015
	Fair Value Hierarchy Level	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
		(In thousands)
Financial assets:		(Unaudited)
Cash and cash equivalents	Level 1	$	9,112	$	9,112	$	7,798	$	7,798
Investment securities available-for-sale	Level 2	135,826		135,826		139,751		139,751
Investment securities held-to-maturity	Level 2	144,528		146,655		150,190		149,850
Loans receivable, net	Level 3	776,669		779,947		767,683		768,516
FHLB stock	NA	6,186		NA		6,734		NA
Accrued interest receivable	Level 2, 3	3,348		3,348		3,145		3,145
Mortgage servicing rights	Level 3	97		97		104		104
Financial liabilities:
Savings and club accounts	Level 2	145,110		145,110		142,966		142,966
Demand, NOW and money market deposits	Level 2	428,286		428,286		361,490		361,490
Brokered deposits	Level 2	52,378		52,377		78,481		78,219
Certificates of deposit	Level 2	189,934		189,921		182,037		181,422
Short-term borrowings	Level 2	15,000		15,000		38,496		38,496
FHLB advances	Level 2	90,000		92,012		110,000		111,985
Other borrowed funds	Level 2	30,000		31,604		30,000		31,692
Accrued interest payable	Level 2	302		302		319		319
Derivative contracts	Level 2, 3	197		197		154		154

Schedule of fair value measurements on a recurring basis

The following measures were made on a recurring basis as of March 31, 2016 and December 31, 2015.

				Fair Value Measurements at Reporting Date Using
				Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs			Significant Other Unobservable Inputs
	As of
Description	March 31, 2016			(Level 1)		(Level 2)			(Level 3)
	(In thousands, Unaudited)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	306		$	—	$	306		$	—
Corporate securities	17,715			—		17,715			—
Agency residential mortgage related securities	117,805			—		117,805			—
Loans (1)	2,324			—		—			2,324
Derivative contracts (1)	(197		)	—		(189		)	(8		)
				Fair Value Measurements at Reporting Date Using
				Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs			Significant Other Unobservable Inputs
	As of
Description	December 31, 2015			(Level 1)		(Level 2)			(Level 3)
	(In thousands)
Available-for-Sale Securities:
Obligations of U.S. government agencies	$	299		$	—	$	299		$	—
Corporate securities	17,541			—		17,541			—
Agency residential mortgage related securities	121,911			—		121,911			—
Loans (1)	2,315			—		—			2,315
Derivative contracts (1)	(154		)	—		(148		)	(6		)

(1)          Such financial instruments are recorded at fair value as further described in Note 5.

Schedule of fair value measurements on a non-recurring basis

			Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Other Unobservable Inputs
	Balance		(Level 1)		(Level 2)		(Level 3)
March 31, 2016(Unaudited)			(In thousands)
Loans	$	1,113	$	—	$	—	$	1,113
Mortgage servicing rights	97		—		—		97
Other real estate owned	2,615		—		—		2,615
Total	$	3,825	$	—	$	—	$	3,825
December 31, 2015
Loans	$	1,239	$	—	$	—	$	1,239
Mortgage servicing rights	104		—		—		104
Other real estate owned	2,623		—		—		2,623
Total	$	3,966	$	—	$	—	$	3,966

Rollforward of Level 3 Fair Value Financial Instruments

The following tables include a roll forward of the financial instruments which fair value is determined on a recurring basis using Significant Other Unobservable Inputs (Level 3) for the periods from December 31, 2015 to March 31, 2016 and December 31, 2014 to March 31, 2015. 

Three Months Ended March 31, 2016
	Derivative Contracts			Loans			Total
Beginning balance, December 31, 2015	$	(6	)	$	2,315		$	2,309
Purchases/additions	—			—			—
Sales	—			—			—
Payments received	—			(31		)	(31		)
Premium amortization, net	—			—			—
(Decrease) increase in value	(2		)	40			38
Ending balance, March 31, 2016	$	(8	)	$	2,324		$	2,316
Three Months Ended March 31, 2015
	Derivative Contracts			Loans			Total
Beginning balance, December 31, 2014	$	(12	)	$	2,451		$	2,439
Purchases/additions	(1		)	—			(1		)
Sales	—			—			—
Payments received	—			(30		)	(30		)
Premium amortization, net	—			—			—
Increase in value	5			20			25
Ending balance, March 31, 2015	$	(8	)	$	2,441		$	2,433

XML

PRINCIPLES OF CONSOLIDATION AND PRESENTATION (Details)	3 Months Ended
	Mar. 31, 2016 branch loan
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of loans to the ESOP by Bancorp | loan	2
Number of branches | branch	10
PMA
LOANS
Ownership (as a percent)	46.15%

XML

PRINCIPLES OF CONSOLIDATION AND PRESENTATION (Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Earnings per share:
Net income	$ 2,249	$ 2,279
Weighted-average common shares outstanding (in shares)	11,767,590	11,768,571
Average common stock acquired by stock benefit plans:
ESOP shares unallocated (shares)	(415,800)	(480,852)
Shares purchased by trust (shares)	(195,115)	(260,153)
Weighted-average common shares used to calculate basic earnings per share (in shares)	11,156,675	11,027,566
Dilutive effect of:
Restricted stock awards (shares)	43,279	46,597
Stock option awards (shares)	114,434	193,503
Weighted-average common shares used to calculate diluted earnings per share (in shares)	11,314,388	11,267,666
Earnings per share-basic (in dollars per share)	$ 0.20	$ 0.21
Earnings per share-diluted (in dollars per share)	$ 0.20	$ 0.20
Outstanding common stock equivalents which are anti-dilutive (in shares)	71,668	508,610

XML

BUSINESS COMBINATIONS (Details) - Univest Corporation of Pennsylvania [Member] - Scenario, Forecast [Member]	Sep. 30, 2016 $ / shares shares
Business Acquisition [Line Items]
Number of Shares Exchanged per Common Share | shares	0.9731
Business Acquisition, Share Price | $ / shares	$ 21.00
Business Combination, Percent of Total Shares That Will Be Converted Into Acquirer Shares	60.00%

XML

INVESTMENT AND MORTGAGE RELATED SECURITIES (Amortized Cost and Fair Value of Securities) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Available-for-Sale Securities:
Amortized Cost	$ 133,501	$ 139,121
Gross Unrealized Gains	2,370	1,606
Gross Unrealized Losses	(45)	(976)
Fair Value	135,826	139,751
Held-to-Maturity Securities:
Amortized Cost	144,528	150,190
Gross Unrealized Gains	2,227	663
Gross Unrealized Losses	(100)	(1,003)
Investment securities held to maturity, fair value	146,655	149,850
Obligations of U.S. government agencies
Available-for-Sale Securities:
Amortized Cost	301	301
Gross Unrealized Gains	5	0
Gross Unrealized Losses	0	(2)
Fair Value	306	299
Corporate securities
Available-for-Sale Securities:
Amortized Cost	17,608	17,625
Gross Unrealized Gains	107	9
Gross Unrealized Losses	0	(93)
Fair Value	17,715	17,541
Held-to-Maturity Securities:
Amortized Cost	1,776	1,776
Gross Unrealized Gains	34	0
Gross Unrealized Losses	0	(11)
Investment securities held to maturity, fair value	1,810	1,765
Private label residential mortgage related securities
Held-to-Maturity Securities:
Amortized Cost	2,452	2,522
Gross Unrealized Gains	11	0
Gross Unrealized Losses	0	(25)
Investment securities held to maturity, fair value	2,463	2,497
Agency residential mortgage related securities
Available-for-Sale Securities:
Amortized Cost	115,592	121,195
Gross Unrealized Gains	2,258	1,597
Gross Unrealized Losses	(45)	(881)
Fair Value	117,805	121,911
Held-to-Maturity Securities:
Amortized Cost	140,300	145,892
Gross Unrealized Gains	2,182	663
Gross Unrealized Losses	(100)	(967)
Investment securities held to maturity, fair value	$ 142,382	$ 145,588

XML

INVESTMENT AND MORTGAGE RELATED SECURITIES (Gross Unrealized Losses and Fair Value of Securities) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Available-for-sale securities:
Fair Value, Less than 12 Months	$ 2,587	$ 95,309
Unrealized Losses, Less than 12 Months	(4)	(811)
Fair Value, 12 Months or More	17,179	7,927
Unrealized Losses, 12 Months or More	(41)	(165)
Fair Value, Total	19,766	103,236
Unrealized Losses, Total	(45)	(976)
Held-to-maturity Securities:
Fair Value, Less than 12 Months	1,324	85,004
Unrealized Losses, Less than 12 Months	0	(745)
Fair Value, 12 Months or More	9,438	9,768
Unrealized Losses, 12 Months or more	(100)	(258)
Unrealized Losses, Total	(100)	(1,003)
Fair Value, Total	10,762	94,772
Temporarily Impaired Securities
Fair Value, Less than 12 Months	3,911	180,313
Unrealized Losses, Less than 12 Months	(4)	(1,556)
Fair Value, 12 Months or More	26,617	17,695
Unrealized Losses Plus OTTI in AOCI, 12 Months or More	(141)	(423)
Fair Value, Total	30,528	198,008
Unrealized Losses, Total	(145)	(1,979)
Obligations of U.S. government agencies
Available-for-sale securities:
Fair Value, Less than 12 Months	0	299
Unrealized Losses, Less than 12 Months	0	(2)
Fair Value, 12 Months or More	0	0
Unrealized Losses, 12 Months or More	0	0
Fair Value, Total	0	299
Unrealized Losses, Total	0	(2)
Corporate securities
Available-for-sale securities:
Fair Value, Less than 12 Months	0	15,015
Unrealized Losses, Less than 12 Months	0	(93)
Fair Value, 12 Months or More	0	0
Unrealized Losses, 12 Months or More	0	0
Fair Value, Total	0	15,015
Unrealized Losses, Total	0	(93)
Held-to-maturity Securities:
Fair Value, Less than 12 Months	0	1,766
Unrealized Losses, Less than 12 Months	0	(11)
Fair Value, 12 Months or More	0	0
Unrealized Losses, 12 Months or more	0	0
Unrealized Losses, Total	0	(11)
Fair Value, Total	0	1,766
Residential Mortgage Backed Securities [Member]
Held-to-maturity Securities:
Fair Value, Less than 12 Months	0	2,497
Unrealized Losses, Less than 12 Months	0	(25)
Fair Value, 12 Months or More	0	0
Unrealized Losses, 12 Months or more	0	0
Unrealized Losses, Total	0	(25)
Fair Value, Total	0	2,497
Agency residential mortgage related securities
Available-for-sale securities:
Fair Value, Less than 12 Months	2,587	79,995
Unrealized Losses, Less than 12 Months	(4)	(716)
Fair Value, 12 Months or More	17,179	7,927
Unrealized Losses, 12 Months or More	(41)	(165)
Fair Value, Total	19,766	87,922
Unrealized Losses, Total	(45)	(881)
Held-to-maturity Securities:
Fair Value, Less than 12 Months	1,324	80,741
Unrealized Losses, Less than 12 Months	0	(709)
Fair Value, 12 Months or More	9,438	9,768
Unrealized Losses, 12 Months or more	(100)	(258)
Unrealized Losses, Total	(100)	(967)
Fair Value, Total	10,762	$ 90,509
Temporarily Impaired Securities
Fair Value, 12 Months or More	26,600
Unrealized Losses Plus OTTI in AOCI, 12 Months or More	$ (141)

XML

INVESTMENT AND MORTGAGE RELATED SECURITIES (Narrative) (Details)	3 Months Ended
	Mar. 31, 2016 USD ($) security	Mar. 31, 2015 USD ($) security	Dec. 31, 2015 USD ($)
Investment Holdings [Line Items]
Number of securities sold | security	0	0
Net investment gains (losses)	$ 0	$ 0
Gross unrealized losses	145,000		$ 1,979,000
Unrealized loss, fair value	26,617,000		17,695,000
Unrealized loss position	$ 141,000		423,000
Number of agency residential mortgage related securities | security	19
Amortized cost	$ 133,501,000		139,121,000
Carrying value of securities pledged to secure public deposits and for other purposes as required or permitted by law	65,600,000		48,700,000
Mortgage backed securities pledged as collateral for other borrowed funds	156,000,000		161,700,000
Carrying value of investment securities used to secure derivative transactions	$ 1,600,000		900,000
Agency residential mortgage related securities
Investment Holdings [Line Items]
Number of mortgage related securities | security	15
Unrealized loss, fair value	$ 26,600,000
Unrealized loss position	$ 141,000
Number of mortgage related securities in a continuous unrealized loss position | security	4
Continuous unrealized loss position	$ 3,900,000
Unrealized loss position for less than twelve months	4,000
Amortized cost	115,592,000		121,195,000
Corporate securities
Investment Holdings [Line Items]
Amortized cost	17,608,000		17,625,000
Agency debenture
Investment Holdings [Line Items]
Amortized cost	$ 301,000		$ 301,000

XML

INVESTMENT AND MORTGAGE RELATED SECURITIES (Held-to-Maturity Investments) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Dec. 31, 2015
Investment Holdings [Line Items]
Held-to-maturity securities, amortized cost before other than temporary impairment	$ 144,528	$ 150,190
Held-to-maturity securities, amortized cost excluding transfer loss	146,465
Unrealized Loss at Transfer	(1,625)
Post-transfer Accretion	(312)
Transferred Securities from Available-for-Sale
Investment Holdings [Line Items]
Held-to-maturity securities, amortized cost before other than temporary impairment, transferred securities	80,730
Held-to-maturity securities, amortized cost before other than temporary impairment	78,793
Unrealized Loss at Transfer	(1,625)
Post-transfer Accretion	(312)
Held-to-Maturity, Excluding Transferred Securities
Investment Holdings [Line Items]
Held-to-maturity securities, amortized cost before other than temporary impairment	$ 65,735

XML

INVESTMENT AND MORTGAGE RELATED SECURITIES (Amortized Cost and Estimated Fair Value of Investment Securities) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Available for Sale, Amortized Cost
Due in one year or less	$ 2,508	$ 2,517
Due after one year through five years	15,401	15,409
Due after five years through ten years	0	0
Due after ten years	0	0
Total mortgage related securities	115,592	121,195
Amortized Cost	133,501	139,121
Available for Sale, Fair Value
Due in one year or less	2,515	2,526
Due after one year through five years	15,506	15,314
Due after five years through ten years	0	0
Due after ten years	0	0
Total mortgage related securities	117,805	121,911
Total Fair Value	135,826	139,751
Held to Maturity, Amortized Cost
Due in one year or less	0	0
Due after one year through five years	1,776	1,776
Due after five years through ten years	0	0
Due after ten years	0	0
Total mortgage related securities	142,752	148,414
Total Amortized Cost	144,528	150,190
Held to Maturity, Fair Value
Due in one year or less	0	0
Due after one year through five years	1,810	1,765
Due after five years through ten years	0	0
Due after ten years	0	0
Total mortgage related securities	144,845	148,085
Total Fair Value	$ 146,655	$ 149,850

XML

LOANS (Composition of Net Loans) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015	Mar. 31, 2015	Dec. 31, 2014
LOANS
Total loans	$ 787,580	$ 778,534
Deferred loan origination cost, net	(341)	(289)
Allowance for loan losses	(10,570)	(10,562)	$ (11,178)	$ (10,730)
Net loans	776,669	767,683
Real estate loans:
LOANS
Total loans	579,104	568,745
One- to four-family
LOANS
Total loans	86,393	90,339
Allowance for loan losses	(339)	(362)	(387)	(405)
Multi-family and commercial
LOANS
Total loans	449,581	442,612
Allowance for loan losses	(6,499)	(6,464)	(6,104)	(5,990)
Construction
LOANS
Total loans	43,130	35,794
Allowance for loan losses	(650)	(580)	(1,060)	(1,038)
Consumer loans
LOANS
Total loans	13,906	14,711
Allowance for loan losses	(78)	(134)	(154)	(184)
Commercial and industrial loans
LOANS
Total loans	194,570	195,078
Allowance for loan losses	$ (2,780)	$ (2,672)	$ (3,102)	$ (2,753)

XML

LOANS (Allowance for Loan Losses by Loan Segment) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Changes in allowance for loan losses
Balance, beginning	$ 10,562	$ 10,730
(Credit) provision for loan losses	45	472
Loans charged off	(54)	(44)
Recoveries	17	20
Balance, ending	10,570	11,178
One- to four-family
Changes in allowance for loan losses
Balance, beginning	362	405
(Credit) provision for loan losses	(23)	26
Loans charged off	0	(44)
Recoveries	0	0
Balance, ending	339	387
Multi-family and commercial
Changes in allowance for loan losses
Balance, beginning	6,464	5,990
(Credit) provision for loan losses	28	111
Loans charged off	0	0
Recoveries	7	3
Balance, ending	6,499	6,104
Construction
Changes in allowance for loan losses
Balance, beginning	580	1,038
(Credit) provision for loan losses	70	22
Loans charged off	0	0
Recoveries	0	0
Balance, ending	650	1,060
Consumer
Changes in allowance for loan losses
Balance, beginning	134	184
(Credit) provision for loan losses	(12)	(47)
Loans charged off	(54)	0
Recoveries	10	17
Balance, ending	78	154
Commercial and industrial
Changes in allowance for loan losses
Balance, beginning	2,672	2,753
(Credit) provision for loan losses	108	349
Loans charged off	0	0
Recoveries	0	0
Balance, ending	2,780	3,102
Unallocated
Changes in allowance for loan losses
Balance, beginning	350	360
(Credit) provision for loan losses	(126)	11
Loans charged off	0	0
Recoveries	0	0
Balance, ending	$ 224	$ 371

XML

LOANS (Loans and Allowance for Loan Losses, Individually or Collectively Evaluated for Impairment) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015	Mar. 31, 2015	Dec. 31, 2014
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	$ 721	$ 787
Balance, ending: collectively evaluated for impairment	9,849	9,775
Total	10,570	10,562	$ 11,178	$ 10,730
Total Loans:
Balance, ending: individually evaluated for impairment	13,419	13,326
Balance, ending: collectively evaluated for impairment	774,161	765,208
Total	787,580	778,534
One- to four-family
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	0	3
Balance, ending: collectively evaluated for impairment	339	359
Total	339	362	387	405
Total Loans:
Balance, ending: individually evaluated for impairment	1,635	1,460
Balance, ending: collectively evaluated for impairment	84,758	88,879
Total	86,393	90,339
Multi-family and commercial
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	533	539
Balance, ending: collectively evaluated for impairment	5,966	5,925
Total	6,499	6,464	6,104	5,990
Total Loans:
Balance, ending: individually evaluated for impairment	7,076	7,111
Balance, ending: collectively evaluated for impairment	442,505	435,501
Total	449,581	442,612
Construction
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	135	135
Balance, ending: collectively evaluated for impairment	515	445
Total	650	580	1,060	1,038
Total Loans:
Balance, ending: individually evaluated for impairment	3,829	3,866
Balance, ending: collectively evaluated for impairment	39,301	31,928
Total	43,130	35,794
Consumer
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	0	56
Balance, ending: collectively evaluated for impairment	78	78
Total	78	134	154	184
Total Loans:
Balance, ending: individually evaluated for impairment	177	171
Balance, ending: collectively evaluated for impairment	13,729	14,540
Total	13,906	14,711
Commercial and industrial
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	53	54
Balance, ending: collectively evaluated for impairment	2,727	2,618
Total	2,780	2,672	3,102	2,753
Total Loans:
Balance, ending: individually evaluated for impairment	702	718
Balance, ending: collectively evaluated for impairment	193,868	194,360
Total	194,570	195,078
Unallocated
Allowance for Loan Losses:
Balance, ending: individually evaluated for impairment	0	0
Balance, ending: collectively evaluated for impairment	224	350
Total	224	350	$ 371	$ 360
Total Loans:
Balance, ending: individually evaluated for impairment	0	0
Balance, ending: collectively evaluated for impairment	0	0
Total	$ 0	$ 0

XML

LOANS (Impaired Loans by Loan Segment) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Financing Receivable, Impaired [Line Items]
Nonaccrual Loans	$ 2,606	$ 2,534
Accruing TDRs	6,488	6,440
Other Impaired Loans	4,325	4,352
Total Impaired Loans	13,419	13,326
Impaired Loans with Allowance	10,836	11,098
Impaired Loans without Allowance	2,583	2,228
One- to four-family
Financing Receivable, Impaired [Line Items]
Nonaccrual Loans	759	583
Accruing TDRs	876	877
Other Impaired Loans	0	0
Total Impaired Loans	1,635	1,460
Impaired Loans with Allowance	0	117
Impaired Loans without Allowance	1,635	1,343
Multi-family and commercial
Financing Receivable, Impaired [Line Items]
Nonaccrual Loans	1,066	1,074
Accruing TDRs	1,685	1,685
Other Impaired Loans	4,325	4,352
Total Impaired Loans	7,076	7,111
Impaired Loans with Allowance	6,305	6,340
Impaired Loans without Allowance	771	771
Construction
Financing Receivable, Impaired [Line Items]
Nonaccrual Loans	0	0
Accruing TDRs	3,829	3,866
Other Impaired Loans	0	0
Total Impaired Loans	3,829	3,866
Impaired Loans with Allowance	3,829	3,866
Impaired Loans without Allowance	0	0
Consumer
Financing Receivable, Impaired [Line Items]
Nonaccrual Loans	79	159
Accruing TDRs	98	12
Other Impaired Loans	0	0
Total Impaired Loans	177	171
Impaired Loans with Allowance	0	57
Impaired Loans without Allowance	177	114
Commercial and industrial
Financing Receivable, Impaired [Line Items]
Nonaccrual Loans	702	718
Accruing TDRs	0	0
Other Impaired Loans	0	0
Total Impaired Loans	702	718
Impaired Loans with Allowance	702	718
Impaired Loans without Allowance	$ 0	$ 0

XML

LOANS (Narrative) (Details)	3 Months Ended
	Mar. 31, 2016 USD ($) loan classification weakness property	Mar. 31, 2015 USD ($) loan	Dec. 31, 2015 USD ($) loan property
Financing Receivable, Impaired [Line Items]
Loans past due 90 days or more and still accruing interest	$ 0		$ 0
Average recorded investment in impaired loans	13,600,000	$ 12,400,000
Interest income recognized on impaired loans	$ 163,000	$ 141,000
Number of troubled debt restructurings, included in nonaccrual status and total impaired loans | loan	2
Troubled debt restructurings excluded from accruing TDR	$ 1,100,000
Number of loans classified as TDRs | loan	0	0
Foreclosure proceedings in process	$ 277,000		$ 364,000
Number of foreclosed properties | property	3		3
Foreclosed residential real estate property	$ 106,000		$ 122,000
Number of primary classification for loans | classification	6
Number of classifications for problem loans | classification	3
Minimum number of defined weaknesses for substandard loans | weakness	1
Multi-family and commercial
Financing Receivable, Impaired [Line Items]
Troubled debt restructurings excluded from accruing TDR	$ 1,000,000
Number of contracts classified as nonaccrual | loan	1		1
One- to four-family
Financing Receivable, Impaired [Line Items]
Troubled debt restructurings excluded from accruing TDR	$ 93,000		$ 93,000
Number of contracts classified as nonaccrual | loan	1		1

XML

LOANS (Allowance for Loan Loss for Impaired Loans) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015	Mar. 31, 2015	Dec. 31, 2014
Allowance for loan losses
Nonaccrual Loans	$ 171	$ 232
Accruing TDRs	181	181
Other Impaired Loans	369	374
Total Impaired Loans	721	787
General	9,849	9,775
Total	10,570	10,562	$ 11,178	$ 10,730
One- to four-family
Allowance for loan losses
Nonaccrual Loans	0	3
Accruing TDRs	0	0
Other Impaired Loans	0	0
Total Impaired Loans	0	3
General	339	359
Total	339	362	387	405
Multi-family and commercial
Allowance for loan losses
Nonaccrual Loans	118	119
Accruing TDRs	46	46
Other Impaired Loans	369	374
Total Impaired Loans	533	539
General	5,966	5,925
Total	6,499	6,464	6,104	5,990
Construction
Allowance for loan losses
Nonaccrual Loans	0	0
Accruing TDRs	135	135
Other Impaired Loans	0	0
Total Impaired Loans	135	135
General	515	445
Total	650	580	1,060	1,038
Consumer
Allowance for loan losses
Nonaccrual Loans	0	56
Accruing TDRs	0	0
Other Impaired Loans	0	0
Total Impaired Loans	0	56
General	78	78
Total	78	134	154	184
Commercial and industrial
Allowance for loan losses
Nonaccrual Loans	53	54
Accruing TDRs	0	0
Other Impaired Loans	0	0
Total Impaired Loans	53	54
General	2,727	2,618
Total	2,780	2,672	3,102	2,753
Unallocated
Allowance for loan losses
Nonaccrual Loans	0	0
Accruing TDRs	0	0
Other Impaired Loans	0	0
Total Impaired Loans	0	0
General	224	350
Total	$ 224	$ 350	$ 371	$ 360

XML

LOANS (TDR Activity) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2016 USD ($) loan	Mar. 31, 2015 USD ($) loan
TDR activity
Number of Loans | loan	1	1
Pre-Modification Outstanding Recorded Investment	$ 86	$ 914
Post-Modification Outstanding Recorded Investment	$ 86	$ 914
One- to four-family
TDR activity
Number of Loans | loan	0	0
Pre-Modification Outstanding Recorded Investment	$ 0	$ 0
Post-Modification Outstanding Recorded Investment	$ 0	$ 0
Multi-family and commercial
TDR activity
Number of Loans | loan	0	1
Pre-Modification Outstanding Recorded Investment	$ 0	$ 914
Post-Modification Outstanding Recorded Investment	$ 0	$ 914
Construction
TDR activity
Number of Loans | loan	0	0
Pre-Modification Outstanding Recorded Investment	$ 0	$ 0
Post-Modification Outstanding Recorded Investment	$ 0	$ 0
Consumer loans
TDR activity
Number of Loans | loan	1	0
Pre-Modification Outstanding Recorded Investment	$ 86	$ 0
Post-Modification Outstanding Recorded Investment	$ 86	$ 0
Commercial and industrial
TDR activity
Number of Loans | loan	0	0
Pre-Modification Outstanding Recorded Investment	$ 0	$ 0
Post-Modification Outstanding Recorded Investment	$ 0	$ 0

XML

LOANS (Past Due Loans by Segment) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
30-59 Days Past Due
Past due loans
Past due loans	$ 412	$ 1,021
30-59 Days Past Due | One- to four-family
Past due loans
Past due loans	286	865
30-59 Days Past Due | Multi-family and commercial
Past due loans
Past due loans	0	0
30-59 Days Past Due | Construction
Past due loans
Past due loans	0	0
30-59 Days Past Due | Consumer
Past due loans
Past due loans	126	156
30-59 Days Past Due | Commercial and industrial
Past due loans
Past due loans	0	0
60-89 Days Past Due
Past due loans
Past due loans	70	685
60-89 Days Past Due | One- to four-family
Past due loans
Past due loans	0	685
60-89 Days Past Due | Multi-family and commercial
Past due loans
Past due loans	0	0
60-89 Days Past Due | Construction
Past due loans
Past due loans	0	0
60-89 Days Past Due | Consumer
Past due loans
Past due loans	70	0
60-89 Days Past Due | Commercial and industrial
Past due loans
Past due loans	$ 0	$ 0

XML

LOANS (Criticized and Classified Loans by Segment) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Criticized and classified loans by segment
Total criticized and classified loans	$ 787,580	$ 778,534
One- to four-family
Criticized and classified loans by segment
Total criticized and classified loans	86,393	90,339
Multi-family and commercial
Criticized and classified loans by segment
Total criticized and classified loans	449,581	442,612
Construction
Criticized and classified loans by segment
Total criticized and classified loans	43,130	35,794
Consumer
Criticized and classified loans by segment
Total criticized and classified loans	13,906	14,711
Commercial and industrial
Criticized and classified loans by segment
Total criticized and classified loans	194,570	195,078
Pass and Pass watch
Criticized and classified loans by segment
Total criticized and classified loans	762,476	755,124
Pass and Pass watch | One- to four-family
Criticized and classified loans by segment
Total criticized and classified loans	85,634	89,756
Pass and Pass watch | Multi-family and commercial
Criticized and classified loans by segment
Total criticized and classified loans	433,186	427,393
Pass and Pass watch | Construction
Criticized and classified loans by segment
Total criticized and classified loans	39,301	31,927
Pass and Pass watch | Consumer
Criticized and classified loans by segment
Total criticized and classified loans	13,827	14,552
Pass and Pass watch | Commercial and industrial
Criticized and classified loans by segment
Total criticized and classified loans	190,528	191,496
Special mention loans
Criticized and classified loans by segment
Total criticized and classified loans	16,671	15,757
Special mention loans | One- to four-family
Criticized and classified loans by segment
Total criticized and classified loans	0	0
Special mention loans | Multi-family and commercial
Criticized and classified loans by segment
Total criticized and classified loans	14,376	13,958
Special mention loans | Construction
Criticized and classified loans by segment
Total criticized and classified loans	0	0
Special mention loans | Consumer
Criticized and classified loans by segment
Total criticized and classified loans	0	0
Special mention loans | Commercial and industrial
Criticized and classified loans by segment
Total criticized and classified loans	2,295	1,799
Substandard loans
Criticized and classified loans by segment
Total criticized and classified loans	8,433	7,653
Substandard loans | One- to four-family
Criticized and classified loans by segment
Total criticized and classified loans	759	583
Substandard loans | Multi-family and commercial
Criticized and classified loans by segment
Total criticized and classified loans	2,019	1,261
Substandard loans | Construction
Criticized and classified loans by segment
Total criticized and classified loans	3,829	3,867
Substandard loans | Consumer
Criticized and classified loans by segment
Total criticized and classified loans	79	159
Substandard loans | Commercial and industrial
Criticized and classified loans by segment
Total criticized and classified loans	1,747	1,783
Doubtful loans
Criticized and classified loans by segment
Total criticized and classified loans	0	0
Doubtful loans | One- to four-family
Criticized and classified loans by segment
Total criticized and classified loans	0	0
Doubtful loans | Multi-family and commercial
Criticized and classified loans by segment
Total criticized and classified loans	0	0
Doubtful loans | Construction
Criticized and classified loans by segment
Total criticized and classified loans	0	0
Doubtful loans | Consumer
Criticized and classified loans by segment
Total criticized and classified loans	0	0
Doubtful loans | Commercial and industrial
Criticized and classified loans by segment
Total criticized and classified loans	$ 0	$ 0

XML

DERIVATIVES AND HEDGING (Details) $ in Thousands			3 Months Ended		12 Months Ended
	Oct. 12, 2011	Nov. 03, 2006	Mar. 31, 2016 USD ($) transaction	Mar. 31, 2015 USD ($)	Dec. 31, 2015 USD ($) transaction
Interest rate swap maturing in April 2022
Interest Rate Swaps
Notional amount			$ 691
Fixed rate loan term		15 years
Interest rate on loans receivable		7.43%
Interest rate derivative activities		1-month LIBOR
Margin added to derivative interest rate (as a percent)		2.24%
Fixed interest rate to be paid under hedge (as a percent)		7.43%
Fair value loss position on interest rate swap derivative			97		$ 92
Interest rate swap maturing in October 2021
Interest Rate Swaps
Notional amount			1,500
Fixed rate loan term	10 years
Interest rate on loans receivable	5.83%
Interest rate derivative activities	1-month LIBOR
Margin added to derivative interest rate (as a percent)	3.50%
Fixed interest rate to be paid under hedge (as a percent)	5.83%
Fair value loss position on interest rate swap derivative			92		$ 56
Gain (loss) on fair value hedge ineffectiveness			$ (1)	$ (3)
Credit Derivatives (Interest Rate Swap Underlyings)
Credit Derivatives
Number of derivative transactions | transaction			4		4
Notional amount of credit swap derivative (protection sold)			$ 12,100		$ 12,200
Remaining maturity period, minimum			3 years		4 years
Remaining maturity period, maximum			7 years		7 years
Fair value of swap asset (liability)			$ (360)		$ (53)
Derivative liability			(8)		$ (6)
Recognized income			$ (2)	3
Credit Derivatives (Foreign Currency Swap Underlyings)
Credit Derivatives
Number of derivative transactions | transaction			0
Recognized income			$ 0	$ 2

XML

DEPOSITS (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Weighted Average Interest Rate
NOW accounts	0.20%	0.20%
Money market accounts	0.26%	0.28%
Savings and club accounts	0.45%	0.45%
Brokered deposits	0.91%	0.76%
Certificates of deposit	0.86%	0.88%
Deposits	0.40%	0.43%
Amount
Noninterest-bearing demand accounts	$ 225,083	$ 170,327
NOW accounts	98,019	97,838
Money market accounts	105,184	93,325
Savings and club accounts	145,110	142,966
Brokered deposits	52,378	78,481
Certificates of deposit	189,934	182,037
Total deposits amount	$ 815,708	$ 764,974

XML

BORROWINGS (FHLB Advances) (Details) - USD ($)	3 Months Ended
	Mar. 31, 2016	Dec. 31, 2015
Borrowings
Federal Home Loan Bank advances	$ 90,000,000	$ 110,000,000
Fair value of investment securities pledged for borrowings	156,000,000	161,700,000
FHLB stock	6,186,000	$ 6,734,000
0.75% borrowing, due September 2016
Borrowings
Federal Home Loan Bank advances	5,000,000
1.04% borrowing, due September 2016
Borrowings
Federal Home Loan Bank advances	10,000,000
0.94% borrowing, due June 2017
Borrowings
Federal Home Loan Bank advances	5,000,000
0.92% borrowing, due July 2017
Borrowings
Federal Home Loan Bank advances	10,000,000
3.62% borrowing, due November 2017
Borrowings
Federal Home Loan Bank advances	$ 15,000,000
Reference rate, description	3-Month LIBOR
Interest rate added to reference rate (as a percent)	0.10%
3.87% borrowing, due November 2017
Borrowings
Federal Home Loan Bank advances	$ 15,000,000
Reference rate, description	3-Month LIBOR
Interest rate added to reference rate (as a percent)	0.10%
2.83% borrowing, due on December 2017
Borrowings
Federal Home Loan Bank advances	$ 20,000,000
Reference rate, description	3-Month LIBOR
Interest rate added to reference rate (as a percent)	0.11%
1.32% borrowing, due on July 2018
Borrowings
Federal Home Loan Bank advances	$ 10,000,000
Federal Home Loan Bank Advances
Borrowings
Maximum borrowing capacity	$ 496,100,000.0
Capital stock to be held as percentage of advances	4.00%
Capital stock to be held as percentage of eligible assets	0.10%
Federal Home Loan Bank Advances | Minimum
Borrowings
Capital stock to be held as percentage of advances	2.00%
Capital stock to be held as percentage of eligible assets	0.05%
Stock obligation	$ 2,200,000
Federal Home Loan Bank Advances | Maximum
Borrowings
Capital stock to be held as percentage of advances	6.00%
Capital stock to be held as percentage of eligible assets	1.00%
Stock obligation	$ 11,600,000
Federal Reserve Bank of Philadelphia
Borrowings
Maximum borrowing capacity	57,600,000
Fair value of investment securities pledged for borrowings	$ 58,400,000
FHLB advances
Borrowings
Interest rate (as a percent)	2.34%
Securities pledged as collateral	$ 632,000,000
FHLB advances | 0.75% borrowing, due September 2016
Borrowings
Interest rate (as a percent)	0.75%
FHLB advances | 1.04% borrowing, due September 2016
Borrowings
Interest rate (as a percent)	1.04%
FHLB advances | 0.94% borrowing, due June 2017
Borrowings
Interest rate (as a percent)	0.94%
FHLB advances | 0.92% borrowing, due July 2017
Borrowings
Interest rate (as a percent)	0.92%
FHLB advances | 3.62% borrowing, due November 2017
Borrowings
Interest rate (as a percent)	3.62%
FHLB advances | 3.87% borrowing, due November 2017
Borrowings
Interest rate (as a percent)	3.87%
FHLB advances | 2.83% borrowing, due on December 2017
Borrowings
Interest rate (as a percent)	2.83%
FHLB advances | 1.32% borrowing, due on July 2018
Borrowings
Interest rate (as a percent)	1.32%
Federal Home Loan Bank Advances
Borrowings
Fair value of investment securities pledged for borrowings	$ 63,700,000

XML

BORROWINGS (Other Borrowed Funds) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Dec. 31, 2015
Other Borrowed Funds
Amount of other borrowings	$ 30,000	$ 30,000
Mortgage backed securities pledged as collateral for other borrowed funds	156,000	$ 161,700
3.15% other borrowings, due October 2018
Other Borrowed Funds
Amount of other borrowings	$ 5,000
Interest rate (as a percent)	3.15%
Other Borrowings 1-month LIBOR plus 2.03 Percent Due December 2018 [Member] [Domain]
Other Borrowed Funds
Amount of other borrowings	$ 5,000
Reference rate, description	1-Month LIBOR
Interest rate added to reference rate (as a percent)	2.03%
Other Borrowings 1-month LIBOR plus 1.89 Percent DUe September 2019 [Member] [Domain]
Other Borrowed Funds
Amount of other borrowings	$ 10,000
Reference rate, description	1-Month LIBOR
Interest rate added to reference rate (as a percent)	1.89%
Other Borrowings 1-month LIBOR plus 1.56 Percent Due September 2020 [Domain]
Other Borrowed Funds
Amount of other borrowings	$ 5,000
Reference rate, description	1-Month LIBOR
Interest rate added to reference rate (as a percent)	1.56%
Other Borrowings 1-month LIBOR plus 1.58 Percent Due November 2020 [Domain]
Other Borrowed Funds
Amount of other borrowings	$ 5,000
Reference rate, description	1-Month LIBOR
Interest rate added to reference rate (as a percent)	1.58%
Other long-term borrowings
Other Borrowed Funds
Mortgage backed securities pledged as collateral for other borrowed funds	$ 33,900

XML

BORROWINGS (Short-term Borrowings) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Short-term Debt [Line Items]
Short-term borrowings	$ 15,000	$ 38,496
Overnight Borrowings
Short-term Debt [Line Items]
Blended weighted average interest rate (as a percent)	0.52%	0.43%

XML

STOCK BASED COMPENSATION (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
STOCK BASED COMPENSATION
Stock based compensation expense	$ 300	$ 310
Stock options
STOCK BASED COMPENSATION
Stock based compensation expense	$ 115	112
Number of Stock Options
Outstanding at the beginning of the period (in shares)	715,554
Granted (in shares)	0
Exercised (in shares)	0
Forfeited / Cancelled (in shares)	0
Outstanding at the end of the period (in shares)	715,554		715,554
Exercisable at the end of the period (in shares)	428,292
Weighted Average Exercise Price
Outstanding at the beginning of the period (in dollars per share)	$ 14.45
Granted (in dollars per share)	0.00
Exercised (in dollars per share)	0.00
Forfeited / Cancelled (in dollars per share)	0.00
Outstanding at the end of the period (in dollars per share)	14.45		$ 14.45
Exercisable at the end of the period (in dollars per share)	$ 13.40
Weighted Average Remaining Contractual Life
Outstanding at the beginning of the period	5 years 11 months		6 years 1 month
Outstanding at the end of the period	5 years 11 months		6 years 1 month
Exercisable at the end of the period	4 years 9 months
Aggregate Intrinsic Value
Outstanding at the beginning of the period	$ 4,182
Outstanding at the end of the period	3,488		$ 4,182
Exercisable at the end of the period	$ 2,537
Number of Stock Options, Unvested
Unvested at the beginning of the period (in shares)	366,362
Granted (in shares)	0
Vested (in shares)	(79,100)
Forfeited / Cancelled (in shares)	0
Unvested at the end of the period (in shares)	287,262		366,362
Weighted Average Grant Date Fair Value, Unvested
Unvested at the beginning of the period (in dollars per share)	$ 3.68
Granted (in dollars per share)	0.00
Vested (in dollars per share)	3.88
Forfeited / Cancelled (in dollars per share)	0.00
Unvested at the end of the period (in dollars per share)	$ 3.63		$ 3.68
Compensation cost not yet recognized
Expected future compensation expense, non-vested options	$ 900
Weighted average period	2 years 7 months
Restricted stock
STOCK BASED COMPENSATION
Stock based compensation expense	$ 234	$ 198
Compensation cost not yet recognized
Expected future compensation expense, restricted shares	$ 1,900
Weighted average period	2 years 5 months
Number of Restricted Shares
Unvested at the beginning of the period (in shares)	177,073
Granted (in shares)	18,608
Vested (in shares)	(54,397)
Forfeited / Cancelled (in shares)	0
Unvested at the end of the period (in shares)	141,284		177,073
Weighted Average Grant Date Fair Value
Unvested at the beginning of the period (in dollars per share)	$ 16.04
Granted (in dollars per share)	17.00
Vested (in dollars per share)	16.79
Forfeited / Cancelled (in dollars per share)	0.00
Unvested at the end of the period (in dollars per share)	15.87		$ 16.04
Performance based restricted stock
Weighted Average Grant Date Fair Value
Granted (in dollars per share)	$ 17.00
Award vesting period	5 years
Metric weight percentage	50.00%
Percent of target shares	147.00%
Performance based restricted stock | Minimum
Weighted Average Grant Date Fair Value
Award vesting rights, percentage	0.00%
Performance based restricted stock | Maximum
Weighted Average Grant Date Fair Value
Award vesting rights, percentage	150.00%
Performance based restricted stock | Executive Officer
Number of Restricted Shares
Granted (in shares)	39,250		8,840
Performance Shares including Variable Payout Adjustment [Member] | Executive Officer
Number of Restricted Shares
Granted (in shares)	57,858
Performance Shares Variable Payout Adjustment [Member] | Executive Officer
Number of Restricted Shares
Granted (in shares)	18,608
50% Vest at Year Three | Performance based restricted stock
Weighted Average Grant Date Fair Value
Award vesting rights, percentage	50.00%
25% Vest at Year Four | Performance based restricted stock
Weighted Average Grant Date Fair Value
Award vesting rights, percentage	25.00%
50% Vest at Measurement Date | Performance based restricted stock
Weighted Average Grant Date Fair Value
Award vesting rights, percentage	50.00%
50% Vest at Year Four | Performance based restricted stock
Weighted Average Grant Date Fair Value
Award vesting rights, percentage	50.00%
25% Vest At Year Five | Performance based restricted stock
Weighted Average Grant Date Fair Value
Award vesting rights, percentage	25.00%

XML

FAIR VALUE FAIR VALUE (Narrative) (Details)	3 Months Ended		12 Months Ended
	Mar. 31, 2016 USD ($) security loan adjustment external_pricing_service	Mar. 31, 2015 USD ($)	Dec. 31, 2015 USD ($) loan
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Number of external pricing service providers | external_pricing_service	1
Number of quotes per investment security obtained | security	1
Adjustments to the values obtained from the primary pricing service | adjustment	0
Liabilities transferred between the three levels of the fair value hierarchy	$ 0	$ 0
Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Number of loans | loan	2		2,000
Loans | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Unrealized gain on loans	$ 177,000		$ 137,000
Loans | Non-recurring basis | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fully charged off loans balance sheet value	0
Derivatives contracts | Recurring basis | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities	$ 8,000		$ 6,000

XML

FAIR VALUE (Estimated Fair Values of Financial Instruments) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015	Mar. 31, 2015	Dec. 31, 2014
Financial assets:
Cash and cash equivalents	$ 9,112	$ 7,798	$ 20,067	$ 17,213
Investment securities available-for-sale	135,826	139,751
Investment securities held-to-maturity	146,655	149,850
FHLB stock	6,186	6,734
Accrued interest receivable	3,348	3,145
Mortgage servicing rights	97	104
Financial liabilities:
Savings and club accounts	145,110	142,966
Carrying Amount
Financial assets:
FHLB stock	6,186	6,734
Carrying Amount | Level 1
Financial assets:
Cash and cash equivalents	9,112	7,798
Carrying Amount | Level 2
Financial assets:
Investment securities available-for-sale	135,826	139,751
Investment securities held-to-maturity	144,528	150,190
Financial liabilities:
Savings and club accounts	145,110	142,966
Demand, NOW and money market deposits	428,286	361,490
Brokered deposits	52,378	78,481
Certificates of deposit	189,934	182,037
Short-term borrowings	15,000	38,496
FHLB advances	90,000	110,000
Other borrowed funds	30,000	30,000
Accrued interest payable	302	319
Carrying Amount | Level 3
Financial assets:
Loans receivable, net	776,669	767,683
Mortgage servicing rights	97	104
Carrying Amount | Level 2, 3
Financial assets:
Accrued interest receivable	3,348	3,145
Financial liabilities:
Derivative contracts	197	154
Estimated Fair Value | Level 1
Financial assets:
Cash and cash equivalents	9,112	7,798
Estimated Fair Value | Level 2
Financial assets:
Investment securities available-for-sale	135,826	139,751
Investment securities held-to-maturity	146,655	149,850
Financial liabilities:
Savings and club accounts	145,110	142,966
Demand, NOW and money market deposits	428,286	361,490
Brokered deposits	52,377	78,219
Certificates of deposit	189,921	181,422
Short-term borrowings	15,000	38,496
FHLB advances	92,012	111,985
Other borrowed funds	31,604	31,692
Accrued interest payable	302	319
Estimated Fair Value | Level 3
Financial assets:
Loans receivable, net	779,947	768,516
Mortgage servicing rights	97	104
Estimated Fair Value | Level 2, 3
Financial assets:
Accrued interest receivable	3,348	3,145
Financial liabilities:
Derivative contracts	$ 197	$ 154

XML

FAIR VALUE (Recurring and Nonrecurring Basis) (Details) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	$ 135,826	$ 139,751
Mortgage servicing rights, net	97	104
Balance | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	135,826	139,751
Balance | Significant Other Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mortgage servicing rights, net	97	104
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Obligations of U.S. government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	0	0
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	0	0
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Agency residential mortgage related securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	0	0
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	0	0
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Derivatives contracts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative contracts	0	0
Recurring basis | Significant Other Observable Inputs (Level 2) | Obligations of U.S. government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	306	299
Recurring basis | Significant Other Observable Inputs (Level 2) | Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	17,715	17,541
Recurring basis | Significant Other Observable Inputs (Level 2) | Agency residential mortgage related securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	117,805	121,911
Recurring basis | Significant Other Observable Inputs (Level 2) | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	0	0
Recurring basis | Significant Other Observable Inputs (Level 2) | Derivatives contracts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative contracts	(189)	(148)
Recurring basis | Significant Other Unobservable Inputs (Level 3) | Obligations of U.S. government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	0	0
Recurring basis | Significant Other Unobservable Inputs (Level 3) | Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	0	0
Recurring basis | Significant Other Unobservable Inputs (Level 3) | Agency residential mortgage related securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	0	0
Recurring basis | Significant Other Unobservable Inputs (Level 3) | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	2,324	2,315
Recurring basis | Significant Other Unobservable Inputs (Level 3) | Derivatives contracts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative contracts	(8)	(6)
Recurring basis | Balance | Obligations of U.S. government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	306	299
Recurring basis | Balance | Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	17,715	17,541
Recurring basis | Balance | Agency residential mortgage related securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investment securities available-for-sale	117,805	121,911
Recurring basis | Balance | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	2,324	2,315
Recurring basis | Balance | Derivatives contracts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative contracts	(197)	(154)
Non-recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	0	0
Mortgage servicing rights, net	0	0
Non-recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	0	0
Non-recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	0	0
Non-recurring basis | Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	0	0
Mortgage servicing rights, net	0	0
Non-recurring basis | Significant Other Observable Inputs (Level 2) | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	0	0
Non-recurring basis | Significant Other Observable Inputs (Level 2) | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	0	0
Non-recurring basis | Significant Other Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	3,825	3,966
Mortgage servicing rights, net	97	104
Non-recurring basis | Significant Other Unobservable Inputs (Level 3) | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	1,113	1,239
Non-recurring basis | Significant Other Unobservable Inputs (Level 3) | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	2,615	2,623
Non-recurring basis | Balance
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	3,825	3,966
Mortgage servicing rights, net	97	104
Non-recurring basis | Balance | Loans
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	1,113	1,239
Non-recurring basis | Balance | Other real estate owned
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Loans	$ 2,615	$ 2,623

XML

FAIR VALUE (Level 3 Rollforward) (Details) - Significant Other Unobservable Inputs (Level 3) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015	Dec. 31, 2014
Roll forward of financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3)
Beginning balance	$ 2,309	$ 2,439
Purchases/additions	0	(1)
Sales	0	0
Payments (received) made	(31)	(30)
Premium amortization, net	0	0
(Decrease) increase in value	38	25
Ending balance	2,316	2,433
Derivatives contracts
Fair Value
Fair Value, Measurement with Unobservable Inputs Reconciliations, Recurring Basis, Liability Value	(8)	(8)	$ (6)	$ (12)
Roll forward of financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3)
Purchases/additions	0	(1)
Sales	0	0
Payments (received) made	0	0
Premium amortization, net	0	0
(Decrease) increase in value	(2)	5
Loans
Roll forward of financial instruments which fair value is determined using Significant Other Unobservable Inputs (Level 3)
Beginning balance	2,315	2,451
Purchases/additions	0	0
Sales	0	0
Payments (received) made	(31)	(30)
Premium amortization, net	0	0
(Decrease) increase in value	40	20
Ending balance	$ 2,324	$ 2,441