Loans, Allowance for Loan Losses and Credit Quality

9 Months Ended

Sep. 30, 2011

Loans, Allowance for Loan Losses and Credit Quality [Abstract]

LOANS, ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY

NOTE 4 — LOANS, ALLOWANCE FOR LOAN LOSSES AND CREDIT QUALITY

     The following table summarizes changes in the allowance for loan losses by loan category and bifurcates the amount of allowance allocated to each loan category based on collective impairment analysis and loans evaluated individually for impairment:

As of September 30, 2011
				(Dollars in Thousands)
	Commercial and			Commercial Real			Commercial			Small			Residential Real			Consumer			Consumer
	Industrial			Estate			Construction			Business			Estate			Home Equity			Other			Total
Allowance for Loan Losses:
Beginning Balance	$	10,423		$	21,939		$	2,145		$	3,740		$	2,915		$	3,369		$	1,724		$	46,255
Charge-offs		(2,455	)		(1,386	)		(769	)		(970	)		(490	)		(912	)		(1,261	)		(8,243	)
Recoveries		348			98			500			72			—			30			536			1,584
Provision		3,286			2,334			15			(845	)		756			1,629			507			7,682
Ending Balance	$	11,602		$	22,985		$	1,891		$	1,997		$	3,181		$	4,116		$	1,506		$	47,278
Ending Balance: individually evaluated for impairment	$	558		$	306		$	—		$	299		$	1,258		$	24		$	240		$	2,685
Ending Balance: collectively evaluated for impairment	$	11,044		$	22,679		$	1,891		$	1,698		$	1,923		$	4,092		$	1,266		$	44,593
Financing Receivables:
Ending Balance: total loans by group	$	567,552		$	1,815,063		$	119,309		$	77,230		$	447,906		$	648,475		$	47,590		$	3,723,125	(1)
Ending Balance: individually evaluated for impairment	$	2,956		$	32,611		$	551		$	3,025		$	12,699		$	474		$	2,146		$	54,462
Ending Balance: collectively evaluated for impairment	$	564,596		$	1,782,452		$	118,758		$	74,205		$	435,207		$	648,001		$	45,444		$	3,668,663

As of December 31, 2010
				(Dollars in Thousands)
	Commercial and			Commercial Real			Commercial			Small			Residential Real			Consumer			Consumer
	Industrial			Estate			Construction			Business			Estate			Home Equity			Other			Total
Allowance for Loan Losses:
Beginning Balance	$	7,545		$	19,451		$	2,457		$	3,372		$	2,840		$	3,945		$	2,751		$	42,361
Charge-offs		(5,170	)		(3,448	)		(1,716	)		(2,279	)		(557	)		(939	)		(2,078	)		(16,187	)
Recoveries		361			1			—			217			59			131			657			1,426
Provision		7,687			5,935			1,404			2,430			573			232			394			18,655
Ending Balance	$	10,423		$	21,939		$	2,145		$	3,740		$	2,915		$	3,369		$	1,724		$	46,255
Ending Balance: individually evaluated for impairment	$	511		$	411		$	151		$	221		$	991		$	17		$	245		$	2,547
Ending Balance: collectively evaluated for impairment	$	9,912		$	21,528		$	1,994		$	3,519		$	1,924		$	3,352		$	1,479		$	43,708
Financing Receivables:
Ending Balance: total loans by group	$	502,952		$	1,717,118		$	129,421		$	80,026		$	478,111		$	579,278		$	68,773		$	3,555,679	(1)
Ending Balance: individually evaluated for impairment	$	3,823		$	26,665		$	1,999		$	2,494		$	9,963		$	428		$	2,014		$	47,386
Ending Balance: collectively evaluated for impairment	$	499,129		$	1,690,453		$	127,422		$	77,532		$	468,148		$	578,850		$	66,759		$	3,508,293

(1) The amount of deferred fees included in the ending balance was $2.8 million at September 30, 2011 and December 31, 2010, respectively.

     For the purpose of estimating the allowance for loan losses, management segregates the loan portfolio into the portfolio segments detailed in the above tables. Each of these loan categories possesses unique risk characteristics that are considered when determining the appropriate level of allowance for each segment. Some of the risk characteristics unique to each loan category include:

Commercial Portfolio:

Commercial & Industrial — Loans in this category consist of revolving and term loan obligations extended to business and corporate enterprises for the purpose of financing working capital and/or capital investment. Collateral generally consists of pledges of business assets including, but not limited to: accounts receivable, inventory, plant & equipment, or real estate, if applicable. Repayment sources consist of: primarily, operating cash flow, and secondarily, liquidation of assets.

Real Estate — Commercial — Loans in this category consist of mortgage loans to finance investment in real property such as multi-family residential, commercial/retail, office, industrial, hotels, educational and healthcare facilities and other specific use properties. Loans are typically written with amortizing payment structures. Collateral values are determined based upon third party appraisals and evaluations. Loan to value ratios at origination are governed by established policy and regulatory guidelines. Repayment sources consist of: primarily, cash flow from operating leases and rents, and secondarily, liquidation of assets.

Commercial Real Estate — Construction — Loans in this category consist of short-term construction loans, revolving and non-revolving credit lines and construction/permanent loans to finance the acquisition, development and construction or rehabilitation of real property. Project types include: residential 1-4 family condominium and multi-family homes, commercial/retail, office, industrial, hotels, educational and healthcare facilities and other specific use properties. Loans may be written with non-amortizing or hybrid payment structures depending upon the type of project. Collateral values are determined based upon third party appraisals and evaluations. Loan to value ratios at origination are governed by established policy and regulatory guidelines. Repayment sources vary depending upon the type of project and may consist of: sale or lease of units, operating cash flows or liquidation of other assets.

Small Business — Loans in this category consist of revolving, term loan and mortgage obligations extended to sole proprietors and small businesses for purposes of financing working capital and/or capital investment. Collateral generally consists of pledges of business assets including, but not limited to: accounts receivable, inventory, plant & equipment, or real estate (if applicable). Repayment sources consist of: primarily, operating cash flows, and secondarily, liquidation of assets.

     For the commercial portfolio it is the Bank’s policy to obtain personal guaranties for payment from individuals holding material ownership interests of the borrowing entities.

Consumer Portfolio:

Consumer Real Estate — Residential — Residential mortgage loans held in the Bank’s portfolio are made to borrowers who demonstrate the ability to make scheduled payments with full consideration to underwriting factors such as current and expected income, employment status, current assets, other financial resources, credit history and the value of the collateral. Collateral consists of mortgage liens on 1-4 family residential properties. The Company does not originate sub-prime loans.

Consumer — Home Equity — Home equity loans and lines are made to qualified individuals for legitimate purposes secured by senior or junior mortgage liens on owner-occupied 1-4 family homes, condominiums or vacation homes or on non-owner occupied 1-4 family homes with more restrictive loan to value requirements. Borrower qualifications include favorable credit history combined with supportive income requirements and combined loan to value ratios within established policy guidelines.

Consumer — Other — Other consumer loan products including personal lines of credit and amortizing loans made to qualified individuals for various purposes such as education, auto loans, debt consolidation, personal expenses or overdraft protection. Borrower qualifications include favorable credit history combined with supportive income and collateral requirements within established policy guidelines. Consumer — Other loans may be secured or unsecured. Auto loans collateral consists of liens on motor vehicles.

Credit Quality

     The Company continually monitors the asset quality of the loan portfolio using all available information. Based on this information, loans demonstrating certain payment issues or other weaknesses may be categorized as delinquent, impaired, nonperforming and/or put on nonaccrual status. Additionally, in the course of resolving such loans, the Company may choose to restructure the contractual terms of certain loans to match the borrower’s ability to repay the loan based on their current financial condition. If a restructured loan meets certain criteria, it may be categorized as a troubled debt restructuring (“TDR”). The Company reviews numerous credit quality indicators when assessing the risk in its loan portfolio.

     For the commercial and industrial, commercial real estate, commercial construction and small business portfolios, the Company utilizes a 10-point commercial risk-rating system, which assigns a risk-grade to each borrower based on a number of quantitative and qualitative factors associated with a commercial loan transaction. Factors considered include industry and market conditions, position within the industry, earnings trends, operating cash flow, asset/liability values, debt capacity, guarantor strength, management and controls, financial reporting, collateral, and other considerations. The risk-ratings categories are defined as follows:

1- 6 Rating — Pass

Risk-rating grades “1” through “6” comprise those loans ranging from ‘Substantially Risk Free’ which indicates borrowers are of unquestioned credit standing and the pinnacle of credit quality, well established companies with a very strong financial condition, and loans fully secured by cash collateral, through ‘Acceptable Risk’, which indicates borrowers may exhibit declining earnings, strained cash flow, increasing leverage and/or weakening market fundamentals that indicate above average or below average asset quality, margins and market share. Collateral coverage is protective.

7 Rating — Potential Weakness

Borrowers exhibit potential credit weaknesses or downward trends deserving management’s close attention. If not checked or corrected, these trends will weaken the Bank’s asset and position. While potentially weak, these borrowers are currently marginally acceptable; no loss of principal or interest is envisioned.

8 Rating — Definite Weakness — Loss Unlikely

Borrowers exhibit well defined weaknesses that jeopardize the orderly liquidation of debt. Loan may be inadequately protected by the current net worth and paying capacity of the obligor or by the collateral pledged, if any. Normal repayment from the borrower is in jeopardy, although no loss of principal is envisioned. However, there is a distinct possibility that a partial loss of interest and/or principal will occur if the deficiencies are not corrected. Collateral coverage may be inadequate to cover the principal obligation.

9 Rating — Partial Loss Probable

Borrowers exhibit well defined weaknesses that jeopardize the orderly liquidation of debt with the added provision that the weaknesses make collection of the debt in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Serious problems exist to the point where partial loss of principal is likely.

10 Rating — Definite Loss

Borrowers deemed incapable of repayment. Loans to such borrowers are considered uncollectible and of such little value that continuation as active assets of the Bank is not warranted.

     The credit quality of the commercial loan portfolio is actively monitored and any changes in credit quality are reflected in risk-rating changes. Risk-ratings are assigned or reviewed for all new loans, when advancing significant additions to existing relationships (over $50,000), at least quarterly for all actively managed loans, and any time a significant event occurs, including at renewal of the loan.

     The Company utilizes a comprehensive strategy for monitoring commercial credit quality. Borrowers are required to provide updated financial information at least annually which is carefully evaluated for any changes in credit quality. Larger loan relationships are subject to a full annual credit review by an experienced credit analysis group. Additionally, the Company retains an independent loan review firm to evaluate the credit quality of the commercial loan portfolio. The independent loan review process achieves significant penetration into the commercial loan portfolio and reports the results of these reviews to the Audit Committee of the Board of Directors on a quarterly basis.

     The following table details the internal risk-rating categories for the Company’s commercial and industrial, commercial real estate, commercial construction and small business portfolios:

			September 30, 2011
	Risk		Commercial		Commercial		Commercial
Category	Rating		and Industrial		Real Estate		Construction		Small Business		Total
	(Dollars in Thousands)
Pass		1-6	$	521,319	$	1,605,283	$	107,524	$	69,108	$	2,303,234
Potential Weakness		7		25,585		111,349		5,546		4,336		146,816
Definite Weakness — Loss Unlikely		8		19,020		97,083		6,239		3,640		125,982
Partial Loss Probable		9		1,628		1,348		—		146		3,122
Definite Loss		10		—		—		—		—		—
TOTAL			$	567,552	$	1,815,063	$	119,309	$	77,230	$	2,579,154

			December 31, 2010
	Risk		Commercial		Commercial		Commercial
Category	Rating		and Industrial		Real Estate		Construction		Small Business		Total
	(Dollars in Thousands)
Pass		1-6	$	445,116	$	1,496,822	$	110,549	$	70,987	$	2,123,474
Potential Weakness		7		30,250		99,400		6,311		5,252		141,213
Definite Weakness — Loss Unlikely		8		25,864		117,850		12,561		3,533		159,808
Partial Loss Probable		9		1,722		3,046		—		254		5,022
Definite Loss		10		—		—		—		—		—
TOTAL			$	502,952	$	1,717,118	$	129,421	$	80,026	$	2,429,517

     For the Company’s residential real estate, residential construction, home equity and other consumer portfolios, the quality of the loan is best indicated by the repayment performance of an individual borrower. However, the Company does supplement performance data with current Fair Isaac Corporation (“FICO”) and Loan to Value (“LTV”) estimates. Current FICO data is purchased and appended to all consumer loans on a quarterly basis. In addition, automated valuation services and broker opinions of value are used to supplement original value data for the residential and home equity portfolios, periodically, typically twice per annum. The following table shows the weighted average FICO scores and the weighted average combined LTV ratio for the periods indicated below:

	As of
	September 30,			December 31,
	2011			2010
Residential Portfolio
FICO Score (re-scored) (1)		734			738
Combined LTV (re-valued) (2)		66.0	%		64.0	%
Home Equity Portfolio
FICO Score (re-scored) (1)		761			760
Combined LTV (re-valued) (2)		55.0	%		55.0	%

(1)	The average FICO scores above for September 30, 2011 are based upon rescores available from August 2011, and actual score data for loans booked between September 1 and September 30, 2011. The average FICO scores above for December 31, 2010 are based upon re-scores available from November 2010 and actual score data for loans booked between December 1 and December 31, 2010
(2)	The combined LTV ratios for September 30, 2011 are based upon updated automated valuations as of May 31, 2011. The combined LTV ratios at December 31, 2010 are based upon updated automated valuations as of November 30, 2010.

     The Bank’s philosophy toward managing its loan portfolios is predicated upon careful monitoring, which stresses early detection and response to delinquent and default situations. Delinquent loans are managed by a team of seasoned collection specialists and the Bank seeks to make arrangements to resolve any delinquent or default situation over the shortest possible time frame. As a general rule, loans more than 90 days past due with respect to principal or interest are classified as nonaccrual loans. As permitted by banking regulations, certain consumer loans past due 90 days or more may continue to accrue interest. The Company also may use discretion regarding other loans over 90 days delinquent if the loan is well secured and in process of collection. Set forth is information regarding the Company’s nonperforming loans at the period shown.

     The following table shows nonaccrual loans at the dates indicated:

	September 30,		December 31,
	2011		2010
	(Dollars In Thousands)
Loans accounted for on a nonaccrual basis (1)
Commercial and Industrial	$	1,836	$	3,123
Commercial Real Estate		10,121		7,837
Commercial Construction		552		1,999
Small Business		1,032		887
Residential Real Estate		10,420		6,728
Home Equity		2,009		1,752
Consumer — Other		327		505
TOTAL NONACCRUAL LOANS	$	26,297	$	22,831

(1) Included in these amounts w ere $8.5 million and $4.0 million nonaccruing TDRs at September 30, 2011 and December 31, 2010, respectively.

     The following table shows the age analysis of past due financing receivables as of the dates indicated:

September 30, 2011
																					Recorded
	30-59 days				60-89 days				90 days or more				Total Past Due						Total		Investment
	Number		Principal		Number		Principal		Number		Principal		Number		Principal				Financing		>90 Days
	of Loans		Balance		of Loans		Balance		of Loans		Balance		of Loans		Balance		Current		Receivables		and Accruing
	(Dollars in Thousands)
Commercial and Industrial		12	$	775		1	$	85		19	$	1,129		32	$	1,989	$	565,563	$	567,552	$	—
Commercial Real Estate		19		6,268		4		1,123		29		5,452		52		12,843		1,802,220		1,815,063		—
Commercial Construction		1		133		—		—		3		551		4		684		118,625		119,309		—
Small Business		18		335		8		146		24		174		50		655		76,575		77,230		—
Residential Real Estate		8		1,596		9		3,226		32		5,511		49		10,333		431,267		441,600		—
Residential Construction		—		—		—		—		—		—		—		—		6,306		6,306		—
Home Equity		30		1,808		10		425		19		1,329		59		3,562		644,913		648,475		—
Consumer -Other		269		1,947		51		609		72		447		392		3,003		44,587		47,590		328
TOTAL		357	$	12,862		83	$	5,614		198	$	14,593		638	$	33,069	$	3,690,056	$	3,723,125	$	328
December 31, 2010
																					Recorded
	30-59 days				60-89 days				90 days or more				Total Past Due						Total		Investment
	Number		Principal		Number		Principal		Number		Principal		Number		Principal				Financing		>90 Days
	of Loans		Balance		of Loans		Balance		of Loans		Balance		of Loans		Balance		Current		Receivables		and Accruing
											(Dollars in Thousands)
Commercial and Industrial		16	$	1,383		8	$	910		18	$	2,207		42	$	4,500	$	498,452	$	502,952	$	—
Commercial Real Estate		13		2,809		7		4,820		29		6,260		49		13,889		1,703,229		1,717,118		—
Commercial Construction		—		—		—		—		9		1,999		9		1,999		127,422		129,421		—
Small Business		23		1,071		11		302		19		420		53		1,793		78,233		80,026		—
Residential Real Estate		14		4,793		6		865		21		4,050		41		9,708		464,228		473,936		—
Residential Construction		—		—		—		—		—		—		—		—		4,175		4,175		—
Home Equity		31		1,737		8		878		12		1,095		51		3,710		575,568		579,278		4
Consumer -Other		402		2,986		89		478		85		564		576		4,028		64,745		68,773		273
TOTAL		499	$	14,779		129	$	8,253		193	$	16,595		821	$	39,627	$	3,516,052	$	3,555,679	$	277

     In the course of resolving nonperforming loans, the Bank may choose to restructure the contractual terms of certain loans. The Bank attempts to work-out an alternative payment schedule with the borrower in order to avoid foreclosure actions. Any loans that are modified are reviewed by the Bank to identify if a TDR has occurred, which is when, for economic or legal reasons related to a borrower’s financial difficulties, the Bank grants a concession to the borrower that it would not otherwise consider. Terms may be modified to fit the ability of the borrower to repay in line with its current financial status and the restructuring of the loan may include the transfer of assets from the borrower to satisfy the debt, a modification of loan terms, or a combination of the two.

     The following table shows the Company’s total TDRs and other pertinent information as of the dates indicated:

	As of September 30, 2011		As of December 31, 2010
	(Dollars in Thousands)		(Dollars in Thousands)
TDRs on Accrual Status	$	35,633	$	26,091
TDRs on Nonaccrual		8,520		3,982
TOTAL TDR’S	$	44,153	$	30,073
Amount of specific reserves included in the allowance for loan loss associated with TDRs:	$	1,921	$	1,658
Additional commitments to lend to a borrower who has been a party to a TDR:	$	1,668	$	1,240

     The Bank’s policy is to have any restructured loan which is on nonaccrual status prior to being modified remain on nonaccrual status for six months, subsequent to being modified, before management considers its return to accrual status. If the restructured loan is on accrual status prior to being modified, it is reviewed to determine if the modified loan should remain on accrual status. Additionally, loans classified as TDRs are adjusted accordingly to reflect the changes in value of the recorded investment in the loan, if any, resulting from the granting of a concession.

     The following table shows the modifications which occurred during the periods indicated and the change in the recorded investment subsequent to the modifications occurring:

	Three Months Ended,						Three Months Ended,
	September 30, 2011						September 30, 2010
			Pre-Modification		Post-Modification				Pre-Modification		Post-Modification
			Outstanding Recorded		Outstanding Recorded				Outstanding Recorded		Outstanding Recorded
	Number of Contracts		Investment		Investment (1)		Number of Contracts		Investment		Investment
			(Dollars in Thousands)						(Dollars in Thousands)
Troubled Debt Restructurings
Commercial & Industrial		1	$	200	$	200		9	$	118	$	118
Commercial Real Estate		2		872		872		5		4,506		4,506
Small Business		14		480		480		14		460		460
Residential Real Estate (2)		2		203		203		8		2,436		2,514
Consumer — Home Equity		—		—		—		1		68		68
Consumer — Other		26		302		302		12		159		159
SUBTOTAL		45	$	2,057	$	2,057		49	$	7,747	$	7,825

	Nine Months Ended,						Nine Months Ended,
	September 30, 2011						September 30, 2010
			Pre-Modification		Post-Modification				Pre-Modification		Post-Modification
			Outstanding Recorded		Outstanding Recorded				Outstanding Recorded		Outstanding Recorded
	Number of Contracts		Investment		Investment		Number of Contracts		Investment		Investment
			(Dollars in Thousands)						(Dollars in Thousands)
Troubled Debt Restructurings
Commercial & Industrial		5	$	410	$	410		10	$	952	$	952
Commercial Real Estate		8		6,151		6,151		11		11,522		11,522
Small Business		34		1,267		1,267		47		1,518		1,518
Residential Real Estate (1)		11		3,082		3,130		14		4,780		4,886
Consumer — Home Equity		3		127		127		4		296		296
Consumer — Other		71		816		816		71		863		863
SUBTOTAL		132	$	11,853	$	11,901		157	$	19,931	$	20,037

(1)	The post-modification balances represent the balance of the loan on the date of modifications. These amounts may show an increase when modifications include a capitalization of interest.
(2)	Residential real estate includes residential construction.

     The following table shows the Company’s post-modification balance of TDRs listed by type of modification as of the periods indicated:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2011		2010		2011		2010
	(Dollars in Thousands)				(Dollars in Thousands)
Extended Maturity	$	481	$	687	$	3,978	$	9,403
Adjusted Interest Rate		622		5		647		52
Combination Rate & Maturity		954		7,133		7,276		10,582
TOTAL	$	2,057	$	7,825	$	11,901	$	20,037

     The following table shows the loans that have been modified during the past twelve months which have subsequently defaulted during the periods indicated. The Company considers a loan to have defaulted when it reaches 90 days past due.

	For the Three Months Ended September 30,
	2011				2010
	Number		Recorded		Number		Recorded
	of Contracts		Investment		of Contracts		Investment
	(Dollars in Thousands)				(Dollars in Thousands)
Troubled Debt Restructurings
That Subsequently Defaulted (1)
Commercial & Industrial		—	$	—		—	$	—
Commercial Real Estate		—		—		—		—
Small Business		2		66		2		22
Residential Real Estate (2)		1		378		2		951
Consumer — Home Equity		—		—		—		—
Consumer — Other		2		11		2		11
SUBTOTAL		5	$	455		6	$	984

	For the Nine Months Ended September 30,
	2011				2010
	Number		Recorded		Number		Recorded
	of Contracts		Investment		of Contracts		Investment
	(Dollars in Thousands)				(Dollars in Thousands)
Troubled Debt Restructurings
That Subsequently Defaulted
Commercial & Industrial		—	$	—		—	$	—
Commercial Real Estate		—		—		—		—
Small Business		2		66		2		22
Residential Real Estate (2)		1		378		2		951
Consumer — Home Equity		—		—		—		—
Consumer — Other		2		11		2		11
SUBTOTAL		5	$	455		6	$	984

(1)	This table does not reflect any TDRs which were charged off during the periods indicated. The amount of TDRs that were modified in the past twelve months that were charged off were $358,000 for the three and nine months ended September 30, 2011 and $20,000 and $29,000 for the three and nine months ended September 30, 2010.
(2)	Residential real estate includes residential construction.

     All TDR loans are considered impaired and therefore are subject to a specific review for impairment. The impairment analysis appropriately discounts the present value of the anticipated cash flows by the loan’s contractual rate of interest in effect prior to the loan’s modification. The amount of impairment, if any, is recorded as a specific loss allocation to each individual loan in the allowance for loan losses. Commercial loans (commercial and industrial, commercial construction, commercial real estate and small business loans) and residential loans that have been classified as TDRs and which subsequently default are reviewed to determine if the loan should be deemed collateral dependent. In such an instance, any shortfall between the value of the collateral and the book value of the loan is determined by measuring the recorded investment in the loan against the fair value of the collateral less costs to sell. The Company charges off the amount of any confirmed loan loss in the period when the loans, or portion of loans, are deemed uncollectible. Smaller balance consumer TDR loans are reviewed to determine when a charge-off is appropriate.

     A loan is considered impaired when, based on current information and events, it is probable that the Bank will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed.

     The table below sets forth information regarding the Company’s impaired loans as of the dates indicated:

							For the Three Months Ended				For the Nine Months Ended
	As of September 30, 2011						September 30, 2011				September 30, 2011
			Unpaid				Average		Interest		Average		Interest
	Recorded		Principal		Related		Recorded		Income		Recorded		Income
	Investment		Balance		Allowance		Investment		Recognized		Investment		Recognized
	(Dollars in Thousands)
With no Related Allowance Recorded:
Commercial & Industrial	$	2,182	$	2,783	$	—	$	2,236	$	46	$	2,527	$	143
Commercial Real Estate		19,317		19,644		—		19,391		345		19,600		1,020
Commercial Construction		551		551		—		551		11		560		32
Small Business		1,621		1,674		—		1,641		28		1,627		82
Residential Real Estate (1)		1		1		—		2		—		5		—
Consumer — Home Equity		22		22		—		22		—		22		1
Consumer — Other		44		84		—		90		2		113		5
Subtotal		23,738		24,759		—		23,933		432		24,454		1,283
With an Allowance Recorded:
Commercial & Industrial	$	774	$	777	$	558	$	756	$	12	$	926	$	41
Commercial Real Estate		13,294		13,637		306		13,247		183		13,304		569
Commercial Construction		—		—		—		—		—		—		—
Small Business		1,404		1,430		299		1,401		21		1,505		67
Residential Real Estate (1)		12,698		13,316		1,258		12,721		132		12,744		378
Consumer — Home Equity		452		492		24		457		8		480		22
Consumer — Other		2,102		2,116		240		2,043		20		1,919		56
Subtotal		30,724		31,768		2,685		30,625		376		30,878		1,133
TOTAL	$	54,462	$	56,527	$	2,685	$	54,558	$	808	$	55,332	$	2,416

							For the Three Months Ended				For the Nine Months Ended
	As of September 30, 2010						September 30, 2010				September 30, 2010
			Unpaid				Average		Interest		Average		Interest
	Recorded		Principal		Related		Recorded		Income		Recorded		Income
	Investment		Balance		Allowance		Investment		Recognized		Investment		Recognized
	(Dollars in Thousands)
With no Related Allowance Recorded:
Commercial & Industrial	$	2,904	$	3,756	$	—	$	2,996	$	58	$	2,944	$	169
Commercial Real Estate		15,785		16,367		—		16,024		275		16,367		834
Commercial Construction		—		—		—		—		—		—		—
Small Business		719		835		—		747		15		821		43
Residential Real Estate (1)		205		205		—		205		—		206		10
Consumer — Home Equity		—		—		—		—		—		—		—
Consumer — Other		—		—		—		—		—		—		—
Subtotal		19,613		21,163		—		19,972		348		20,338		1,056
With an Allowance Recorded:
Commercial & Industrial	$	1,631	$	2,399	$	864	$	1,641	$	31	$	2,181	$	91
Commercial Real Estate		7,247		7,502		444		7,256		104		7,543		346
Commercial Construction		—		—		—		—		—		—		—
Small Business		1,880		2,010		307		1,994		31		1,942		90
Residential Real Estate (1)		9,106		9,469		855		9,075		130		9,186		267
Consumer — Home Equity		409		415		14		410		6		411		14
Consumer — Other		1,554		1,572		188		1,521		16		1,253		42
Subtotal		21,827		23,367		2,672		21,897		318		22,516		850
TOTAL	$	41,440	$	44,530	$	2,672	$	41,869	$	666	$	42,854	$	1,906

(1) Includes residential construction loans.