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Note 3 - Loans/Leases Receivable

6 Months Ended

Jun. 30, 2012

NOTE 3 – LOANS/LEASES RECEIVABLE

The composition of the loan/lease portfolio as of June 30, 2012 and December 31, 2011 is presented as follows:

	As of June 30, 2012			As of December 31, 2011

Commercial and industrial loans	$	350,780,417		$	350,794,278
Commercial real estate loans
Owner-occupied commercial real estate		188,948,747			167,790,621
Commercial construction, land development, and other land		46,663,733			60,384,738
Other non owner-occupied commercial real estate		340,674,818			349,628,491
		576,287,298			577,803,850

Direct financing leases *		98,567,582			93,212,362
Residential real estate loans **		107,450,497			98,107,051
Installment and other consumer loans		77,416,813			78,223,080
		1,210,502,607			1,198,140,621
Plus deferred loan/lease origination costs, net of fees		2,801,194			2,604,876
		1,213,303,801			1,200,745,497
Less allowance for estimated losses on loans/leases		(18,724,535	)		(18,789,262	)
	$	1,194,579,266		$	1,181,956,235


* Direct financing leases:
Net minimum lease payments to be received	$	112,122,885		$	106,389,988
Estimated unguaranteed residual values of leased assets		1,144,745			1,043,326
Unearned lease/residual income		(14,700,048	)		(14,220,952	)
		98,567,582			93,212,362
Plus deferred lease origination costs, net of fees		3,519,830			3,217,011
		102,087,412			96,429,373
Less allowance for estimated losses on leases		(1,610,999	)		(1,339,496	)
	$	100,476,413		$	95,089,877

**Includes residential real estate loans held for sale totaling $4,349,967 and $3,832,760 as of June 30, 2012, and December 31, 2011, respectively.

Management performs an evaluation of the estimated unguaranteed residual values of leased assets on an annual basis, at a minimum. The evaluation consists of discussions with reputable and current vendors and management’s expertise and understanding of the current states of particular industries to determine informal valuations of the equipment. As necessary and where available, management will utilize valuations by independent appraisers. The large majority of leases with residual values contain a lease options rider which requires the lessee to pay the residual value directly, finance the payment of the residual value, or extend the lease term to pay the residual value. In these cases, the residual value is protected and the risk of loss is minimal.

For the three and six months ended June 30, 2012 and 2011, there were no losses on residual values. At June 30, 2012, the Company had 38 leases remaining with residual values totaling $1,144,745 that were not protected with a lease end options rider. At December 31, 2011, the Company had 39 leases remaining with residual values totaling $1,043,326 that were not protected with a lease end options rider. Management has performed specific evaluations of these residual values and determined that the valuations are appropriate.

The aging of the loan/lease portfolio by classes of loans/leases as of June 30, 2012 is presented as follows:

Classes of Loans/Leases	Current			30-59 Days Past Due			60-89 Days Past Due			Accruing Past Due 90 Days or More			Nonaccrual Loans/Leases			Total

Commercial and Industrial	$	347,348,642		$	834,831		$	17,821		$	965,673		$	1,613,450		$	350,780,417
Commercial Real Estate
Owner-Occupied Commercial Real Estate		187,712,914			548,615			-			-			687,218			188,948,747
Commercial Construction, Land Development, and Other Land		42,799,962			-			1,076,387			-			2,787,384			46,663,733
Other Non Owner-Occupied Commercial Real Estate		326,648,116			2,178,037			3,258,985			137,611			8,452,069			340,674,818
Direct Financing Leases		96,813,835			796,205			270,034			-			687,508			98,567,582
Residential Real Estate		106,016,069			-			411,031			-			1,023,397			107,450,497
Installment and Other Consumer		75,469,221			231,520			671,731			48,607			995,734			77,416,813
	$	1,182,808,759		$	4,589,208		$	5,705,989		$	1,151,891		$	16,246,760		$	1,210,502,607

As a percentage of total loan/lease portfolio		97.71	%		0.38	%		0.47	%		0.10	%		1.34	%		100.00	%

The aging of the loan/lease portfolio by classes of loans/leases as of December 31, 2011 is presented as follows:

Classes of Loans/Leases	Current			30-59 Days Past Due			60-89 Days Past Due			Accruing Past Due 90 Days or More			Nonaccrual Loans/Leases			Total

Commercial and Industrial	$	347,417,683		$	226,394		$	239,991		$	120,000		$	2,790,210		$	350,794,278
Commercial Real Estate
Owner-Occupied Commercial Real Estate		166,632,318			146,847			-			-			1,011,456			167,790,621
Commercial Construction, Land Development, and Other Land		55,741,827			211,878			486,802			968,919			2,975,312			60,384,738
Other Non Owner-Occupied Commercial Real Estate		336,080,128			522,323			3,732,935			-			9,293,105			349,628,491
Direct Financing Leases		91,273,406			826,187			396,344			-			716,425			93,212,362
Residential Real Estate		95,456,433			1,127,465			389,678			-			1,133,475			98,107,051
Installment and Other Consumer		76,376,399			737,543			12,122			22,160			1,074,856			78,223,080
	$	1,168,978,194		$	3,798,637		$	5,257,872		$	1,111,079		$	18,994,839		$	1,198,140,621

As a percentage of total loan/lease portfolio		97.57	%		0.32	%		0.44	%		0.09	%		1.59	%		100.00	%

Nonperforming loans/leases by classes of loans/leases as of June 30, 2012 is presented as follows:

Classes of Loans/Leases	Accruing Past Due 90 Days or More		Nonaccrual Loans/Leases *		Troubled Debt Restructurings - Accruing		Total Nonperforming Loans/Leases		Percentage of Total Nonperforming Loans/Leases

Commercial and Industrial	$	965,673	$	1,613,450	$	185,591	$	2,764,714		10.13	%
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		687,218		-		687,218		2.52	%
Commercial Construction, Land Development, and Other Land		-		2,787,384		337,500		3,124,884		11.45	%
Other Non Owner-Occupied Commercial Real Estate		137,611		8,452,069		9,167,020		17,756,700		65.05	%
Direct Financing Leases		-		687,508		-		687,508		2.52	%
Residential Real Estate		-		1,023,397		167,739		1,191,136		4.36	%
Installment and Other Consumer		48,607		995,734		39,553		1,083,894		3.97	%
	$	1,151,891	$	16,246,760	$	9,897,403	$	27,296,054		100.00	%

*Nonaccrual loans/leases includes $6,122,952 of troubled debt restructurings, including $156,595 in commercial and industrial loans, $5,628,957 in commercial real estate loans, $64,726 in direct financing leases, and $272,674 in installment loans.

Nonperforming loans/leases by classes of loans/leases as of December 31, 2011 is presented as follows:

Classes of Loans/Leases	Accruing Past Due 90 Days or More		Nonaccrual Loans/Leases **		Troubled Debt Restructurings - Accruing		Total Nonperforming Loans/Leases		Percentage of Total Nonperforming Loans/Leases

Commercial and Industrial	$	120,000	$	2,790,210	$	187,407	$	3,097,617		9.68	%
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		1,011,456		-		1,011,456		3.16	%
Commercial Construction, Land Development, and Other Land		968,919		2,975,312		6,076,143		10,020,374		31.30	%
Other Non Owner-Occupied Commercial Real Estate		-		9,293,105		5,049,795		14,342,900		44.81	%
Direct Financing Leases		-		716,425		590,238		1,306,663		4.08	%
Residential Real Estate		-		1,133,475		-		1,133,475		3.54	%
Installment and Other Consumer		22,160		1,074,856		-		1,097,016		3.43	%
	$	1,111,079	$	18,994,839	$	11,903,583	$	32,009,501		100.00	%

**Nonaccrual loans/leases includes $8,622,874 of troubled debt restructurings, including $198,697 in commercial and industrial loans, $8,074,777 in commercial real estate loans, $64,726 in direct financing leases, and $284,674 in installment loans.

Changes in the allowance for estimated losses on loans/leases by portfolio segment for the three and six months ended June 30, 2012 and 2011, respectively, are presented as follows:

	Three Months Ended June 30, 2012

	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate		Installment and Other Consumer			Total

Balance, beginning	$	4,585,467		$	10,855,442		$	1,366,528		$	963,157	$	1,236,050		$	19,006,644
Provisions charged to expense		(683,718	)		1,275,510			258,469			23,557		174,651			1,048,469
Loans/leases charged off		(79,334	)		(1,427,987	)		(27,543	)		-		(199,935	)		(1,734,799	)
Recoveries on loans/leases previously charged off		358,377			7,026			13,545			-		25,273			404,221
Balance, ending	$	4,180,792		$	10,709,991		$	1,610,999		$	986,714	$	1,236,039		$	18,724,535

	Three Months Ended June 30, 2011

	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases		Residential Real Estate		Installment and Other Consumer			Total

Balance, beginning	$	8,454,099		$	8,631,699		$	1,467,934	$	706,305	$	1,469,979		$	20,730,016
Provisions charged to expense		224,974			865,054			123,221		50,770		408,202			1,672,221
Loans/leases charged off		(1,593,901	)		(921,407	)		-		-		(176,397	)		(2,691,705	)
Recoveries on loans/leases previously charged off		39,272			27,293			154		-		25,381			92,100
Balance, ending	$	7,124,444		$	8,602,639		$	1,591,309	$	757,075	$	1,727,165		$	19,802,632

	Six Months Ended June 30, 2012

	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate			Installment and Other Consumer			Total

Balance, beginning	$	4,878,006		$	10,596,958		$	1,339,496		$	704,946		$	1,269,856		$	18,789,262
Provisions charged to expense		(774,618	)		1,533,374			573,915			286,525			209,719			1,828,915
Loans/leases charged off		(455,742	)		(1,427,987	)		(343,264	)		(4,757	)		(327,801	)		(2,559,551	)
Recoveries on loans/leases previously charged off		533,146			7,646			40,852			-			84,265			665,909
Balance, ending	$	4,180,792		$	10,709,991		$	1,610,999		$	986,714		$	1,236,039		$	18,724,535

	Six Months Ended June 30, 2011

	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate		Installment and Other Consumer			Total

Balance, beginning	$	7,548,922		$	9,087,315		$	1,530,572		$	748,028	$	1,449,819		$	20,364,656
Provisions charged to expense		1,216,493			392,902			303,885			9,047		817,558			2,739,885
Loans/leases charged off		(1,790,617	)		(921,537	)		(243,446	)		-		(617,032	)		(3,572,632	)
Recoveries on loans/leases previously charged off		149,646			43,959			298			-		76,820			270,723
Balance, ending	$	7,124,444		$	8,602,639		$	1,591,309		$	757,075	$	1,727,165		$	19,802,632

The allowance for estimated losses on loans/leases by impairment evaluation and by portfolio segment as of June 30, 2012 and December 31, 2011 is presented as follows:

	As of June 30, 2012
	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate			Installment and Other Consumer			Total

Allowance for loans/leases individually evaluated for impairment	$	265,046		$	3,175,726		$	90,000		$	117,877		$	2,313		$	3,650,962
Allowance for loans/leases collectively evaluated for impairment		3,915,746			7,534,265			1,520,999			868,837			1,233,726			15,073,573
	$	4,180,792		$	10,709,991		$	1,610,999		$	986,714		$	1,236,039		$	18,724,535


Loans/leases individually evaluated for impairment	$	1,011,904		$	21,305,295		$	687,508		$	1,191,136		$	965,678		$	25,161,521
Loans/leases collectively evaluated for impairment		349,768,513			554,982,003			97,880,074			106,259,361			76,451,135			1,185,341,086
	$	350,780,417		$	576,287,298		$	98,567,582		$	107,450,497		$	77,416,813		$	1,210,502,607


Allowance as a percentage of loans/leases individually evaluated for impairment		26.19	%		14.91	%		13.09	%		9.90	%		0.24	%		14.51	%
Allowance as a percentage of loans/leases collectively evaluated for impairment		1.12	%		1.36	%		1.55	%		0.82	%		1.61	%		1.27	%
		1.19	%		1.86	%		1.63	%		0.92	%		1.60	%		1.54	%

	As of December 31, 2011
	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate			Installment and Other Consumer			Total

Allowance for loans/leases individually evaluated for impairment	$	903,187		$	4,297,738		$	66,675		$	55,884		$	22,819		$	5,346,303
Allowance for loans/leases collectively evaluated for impairment		3,974,819			6,299,220			1,272,821			649,062			1,247,037			13,442,959
	$	4,878,006		$	10,596,958		$	1,339,496		$	704,946		$	1,269,856		$	18,789,262

Loans/leases individually evaluated for impairment	$	2,152,855		$	24,281,365		$	1,306,663		$	1,133,474		$	984,806		$	29,859,163
Loans/leases collectively evaluated for impairment		348,641,423			553,522,485			91,905,699			96,973,577			77,238,274			1,168,281,458
	$	350,794,278		$	577,803,850		$	93,212,362		$	98,107,051		$	78,223,080		$	1,198,140,621

Allowance as a percentage of loans/leases individually evaluated for impairment		41.95	%		17.70	%		5.10	%		4.93	%		2.32	%		17.91	%
Allowance as a percentage of loans/leases collectively evaluated for impairment		1.14	%		1.14	%		1.38	%		0.67	%		1.61	%		1.15	%
		1.39	%		1.83	%		1.44	%		0.72	%		1.62	%		1.56	%

Information for impaired loans/leases is presented in the tables below. The recorded investment represents customer balances net of any partial charge-offs recognized on the loan/lease. The unpaid principal balance represents the recorded balance outstanding on the loan/lease prior to any partial charge-offs.

Information for impaired loans/leases by classes of financing receivable as of and for the six months ended June 30, 2012 is as follows:

Classes of Loans/Leases	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized		Interest Income Recognized for Cash Payments Received

Impaired Loans/Leases with No Specific Allowance Recorded:
Commercial and Industrial	$	679,015	$	1,410,800	$	-	$	1,230,600	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		555,729		555,729		-		711,463		-		-
Commercial Construction, Land Development, and Other Land		1,427,018		2,009,619		-		5,041,106		3,851		3,851
Other Non Owner-Occupied Commercial Real Estate		4,700,668		5,500,668		-		6,864,499		894		894
Direct Financing Leases		569,233		569,233		-		804,542		-		-
Residential Real Estate		733,354		733,354		-		784,598		3,346		3,346
Installment and Other Consumer		963,365		982,097		-		972,903		124		124
	$	9,628,382	$	11,761,500	$	-	$	16,409,711	$	8,215	$	8,215

Impaired Loans/Leases with Specific Allowance Recorded:
Commercial and Industrial	$	332,889	$	332,889	$	265,046	$	281,764	$	3,951	$	3,951
Commercial Real Estate
Owner-Occupied Commercial Real Estate		66,660		66,660		1,276		66,660		-		-
Commercial Construction, Land Development, and Other Land		2,352,865		2,376,100		1,018,457		2,328,678		-		-
Other Non Owner-Occupied Commercial Real Estate		12,202,355		12,202,355		2,155,993		8,771,552		150,664		150,664
Direct Financing Leases		118,275		118,275		90,000		100,425		-		-
Residential Real Estate		457,782		457,782		117,877		421,985		-		-
Installment and Other Consumer		2,313		2,313		2,313		1,332		-		-
	$	15,533,139	$	15,556,374	$	3,650,962	$	11,972,396	$	154,615	$	154,615

Total Impaired Loans/Leases:
Commercial and Industrial	$	1,011,904	$	1,743,689	$	265,046	$	1,512,364	$	3,951	$	3,951
Commercial Real Estate
Owner-Occupied Commercial Real Estate		622,389		622,389		1,276		778,123		-		-
Commercial Construction, Land Development, and Other Land		3,779,883		4,385,719		1,018,457		7,369,784		3,851		3,851
Other Non Owner-Occupied Commercial Real Estate		16,903,023		17,703,023		2,155,993		15,636,051		151,558		151,558
Direct Financing Leases		687,508		687,508		90,000		904,967		-		-
Residential Real Estate		1,191,136		1,191,136		117,877		1,206,583		3,346		3,346
Installment and Other Consumer		965,678		984,410		2,313		974,235		124		124
	$	25,161,521	$	27,317,874	$	3,650,962	$	28,382,107	$	162,830	$	162,830

Impaired loans/leases for which no allowance has been provided have adequate collateral, based on management’s current estimates.

Information for impaired loans/leases by classes of financing receivable for the three months ended June 30, 2012 and 2011 is as follows:

	Three Months Ended June 30, 2012						Three Months Ended June 30, 2011
Classes of Loans/Leases	Average Recorded Investment		Interest Income Recognized		Interest Income Recognized for Cash Payments Received		Average Recorded Investment		Interest Income Recognized		Interest Income Recognized for Cash Payments Received

Impaired Loans/Leases with No Specific Allowance Recorded:
Commercial and Industrial	$	870,085	$	-	$	-	$	1,455,378	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		668,313		-		-		1,737,998		-		-
Commercial Construction, Land Development, and Other Land		4,773,032		1,683		1,683		184,693		-		-
Other Non Owner-Occupied Commercial Real Estate		6,997,797		-		-		3,840,268		-		-
Direct Financing Leases		585,845		-		-		1,052,176		-		-
Residential Real Estate		734,485		1,673		1,673		958,303		-		-
Installment and Other Consumer		974,591		101		101		668,265		-		-
	$	15,604,148	$	3,457	$	3,457	$	9,897,081	$	-	$	-

Impaired Loans/Leases with Specific Allowance Recorded:
Commercial and Industrial	$	314,872	$	1,971	$	1,971	$	3,666,049	$	1,705	$	1,705
Commercial Real Estate
Owner-Occupied Commercial Real Estate		66,660		-		-		370,843		18,145		18,145
Commercial Construction, Land Development, and Other Land		2,348,194		-		-		4,688,045		-		-
Other Non Owner-Occupied Commercial Real Estate		8,354,604		83,113		83,113		7,130,672		-		-
Direct Financing Leases		118,275		-		-		746,288		-		-
Residential Real Estate		462,406		-		-		140,332		-		-
Installment and Other Consumer		1,998		-		-		233,087		-		-
	$	11,667,009	$	85,084	$	85,084	$	16,975,316	$	19,850	$	19,850

Total Impaired Loans/Leases:
Commercial and Industrial	$	1,184,957	$	1,971	$	1,971	$	5,121,427	$	1,705	$	1,705
Commercial Real Estate
Owner-Occupied Commercial Real Estate		734,973		-		-		2,108,841		18,145		18,145
Commercial Construction, Land Development, and Other Land		7,121,226		1,683		1,683		4,872,738		-		-
Other Non Owner-Occupied Commercial Real Estate		15,352,401		83,113		83,113		10,970,940		-		-
Direct Financing Leases		704,120		-		-		1,798,464		-		-
Residential Real Estate		1,196,891		1,673		1,673		1,098,635		-		-
Installment and Other Consumer		976,589		101		101		901,352		-		-
	$	27,271,157	$	88,541	$	88,541	$	26,872,397	$	19,850	$	19,850

Impaired loans/leases for which no allowance has been provided have adequate collateral, based on management’s current estimates.

Information for impaired loans/leases by classes of financing receivable as of December 31, 2011 is as follows:

Classes of Loans/Leases	Recorded Investment		Unpaid Principal Balance		Related Allowance

Impaired Loans/Leases with No Specific Allowance Recorded:
Commercial and Industrial	$	360,947	$	979,901	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		736,610		736,610		-
Commercial Construction, Land Development, and Other Land		-		-		-
Other Non Owner-Occupied Commercial Real Estate		3,936,826		3,986,820		-
Direct Financing Leases		1,094,178		1,094,178		-
Residential Real Estate		788,685		862,298		-
Installment and Other Consumer		593,987		593,987		-
	$	7,511,233	$	8,253,794	$	-

Impaired Loans/Leases with Specific Allowance Recorded:
Commercial and Industrial	$	1,791,908	$	1,791,908	$	903,187
Commercial Real Estate
Owner-Occupied Commercial Real Estate		217,059		217,059		47,911
Commercial Construction, Land Development, and Other Land		9,051,455		9,051,455		3,002,450
Other Non Owner-Occupied Commercial Real Estate		10,339,415		10,839,415		1,247,377
Direct Financing Leases		212,485		212,485		66,675
Residential Real Estate		344,789		344,789		55,884
Installment and Other Consumer		390,819		390,819		22,819
	$	22,347,930	$	22,847,930	$	5,346,303

Total Impaired Loans/Leases:
Commercial and Industrial	$	2,152,855	$	2,771,809	$	903,187
Commercial Real Estate
Owner-Occupied Commercial Real Estate		953,669		953,669		47,911
Commercial Construction, Land Development, and Other Land		9,051,455		9,051,455		3,002,450
Other Non Owner-Occupied Commercial Real Estate		14,276,241		14,826,235		1,247,377
Direct Financing Leases		1,306,663		1,306,663		66,675
Residential Real Estate		1,133,474		1,207,087		55,884
Installment and Other Consumer		984,806		984,806		22,819
	$	29,859,163	$	31,101,724	$	5,346,303

Impaired loans/leases for which no allowance has been provided have adequate collateral, based on management’s current estimates.

For each class of financing receivable, the following presents the recorded investment by credit quality indicator as of June 30, 2012 and December 31, 2011:

	As of June 30, 2012
			Commercial Real Estate
					Non Owner-Occupied
Internally Assigned Risk Rating	Commercial and Industrial		Owner-Occupied Commercial Real Estate		Commercial Construction, Land Development, and Other Land		Other Commercial Real Estate		Total

Pass (Ratings 1 through 5)	$	326,648,303	$	183,382,668	$	40,298,069	$	303,371,664	$	853,700,704
Special Mention (Rating 6)		8,239,440		3,609,328		442,149		9,046,514		21,337,431
Substandard (Rating 7)		15,892,674		1,956,751		5,923,515		28,256,640		52,029,580
Doubtful (Rating 8)		-		-		-		-		-
	$	350,780,417	$	188,948,747	$	46,663,733	$	340,674,818	$	927,067,715

	As of June 30, 2012
Delinquency Status *	Direct Financing Leases		Residential Real Estate		Installment and Other Consumer		Total

Performing	$	97,880,074	$	106,259,361	$	76,332,919	$	280,472,354
Nonperforming		687,508		1,191,136		1,083,894		2,962,538
	$	98,567,582	$	107,450,497	$	77,416,813	$	283,434,892

*Performing = loans/leases accruing and less than 90 days past due. Nonperforming = loans/leases on nonaccrual, accruing loans/leases that are greater than or equal to 90 days past due, and accruing troubled debt restructurings.

	As of December 31, 2011
			Commercial Real Estate
					Non Owner-Occupied
Internally Assigned Risk Rating	Commercial and Industrial		Owner-Occupied Commercial Real Estate		Commercial Construction, Land Development, and Other Land		Other Commercial Real Estate		Total

Pass (Ratings 1 through 5)	$	324,225,905	$	158,955,618	$	46,268,554	$	310,401,972	$	839,852,049
Special Mention (Rating 6)		8,814,497		2,700,496		764,586		13,754,798		26,034,377
Substandard (Rating 7)		17,753,876		6,134,507		13,351,598		25,471,721		62,711,702
Doubtful (Rating 8)		-		-		-		-		-
	$	350,794,278	$	167,790,621	$	60,384,738	$	349,628,491	$	928,598,128

	As of December 31, 2011
Delinquency Status *	Direct Financing Leases		Residential Real Estate		Installment and Other Consumer		Total

Performing	$	91,905,699	$	96,973,576	$	77,126,064	$	266,005,339
Nonperforming		1,306,663		1,133,475		1,097,016		3,537,154
	$	93,212,362	$	98,107,051	$	78,223,080	$	269,542,493

For commercial and industrial and commercial real estate loans, the Company’s credit quality indicator is internally assigned risk ratings. Each commercial loan is assigned a risk rating upon origination. The risk rating is reviewed every 15 months, at a minimum, and on an as needed basis depending on the specific circumstances of the loan.

For direct financing leases, residential real estate loans, and installment and other consumer loans, the Company’s credit quality indicator is performance determined by delinquency status. Delinquency status is updated daily by the Company’s loan system.

As of June 30, 2012 and December 31, 2011, troubled debt restructurings totaled $16,020,355 and $20,526,457, respectively.

For each class of financing receivable, the following presents the number and recorded investment of troubled debt restructurings, by type of concession, that were restructured during the three and six months ended June 30, 2012 and 2011.

	For the three months ended June 30, 2012								For the three months ended June 30, 2011
Classes of Loans/Leases	Number of Loans / Leases		Pre-Modification Recorded Investment		Post-Modification Recorded Investment		Specific Allowance		Number of Loans / Leases		Pre-Modification Recorded Investment		Post-Modification Recorded Investment		Specific Allowance

CONCESSION - Extension of maturity
Other Non Owner-Occupied Commercial Real Estate		-	$	-	$	-	$	-		1	$	2,851,134	$	2,851,134	$	-
TOTAL		-	$	-	$	-	$	-		1	$	2,851,134	$	2,851,134	$	-

	For the six months ended June 30, 2012								For the six months ended June 30, 2011
Classes of Loans/Leases	Number of Loans / Leases		Pre-Modification Recorded Investment		Post-Modification Recorded Investment		Specific Allowance		Number of Loans / Leases		Pre-Modification Recorded Investment		Post-Modification Recorded Investment		Specific Allowance

CONCESSION - Extension of maturity
Other Non Owner-Occupied Commercial Real Estate		-	$	-	$	-	$	-		1	$	2,851,134	$	2,851,134	$	-
		-	$	-	$	-	$	-		1	$	2,851,134	$	2,851,134	$	-

CONCESSION - Significant payment delay
Commercial and Industrial		-	$	-	$	-	$	-		4	$	1,175,819	$	1,175,819	$	-
Commercial Construction, Land Development, and Other Land		2		200,000		200,000		144,000		-		-		-		-
		2	$	200,000	$	200,000	$	144,000		4	$	1,175,819	$	1,175,819	$	-

CONCESSION - Interest rate adjusted below market
Commercial Construction, Land Development, and Other Land		1	$	337,500	$	337,500	$	-		-	$	-	$	-	$	-
Residential Real Estate		1		167,739		167,739		-		-		-		-		-
Installment and Other Consumer		1		16,043		16,043		-		-		-		-		-
		3	$	521,282	$	521,282	$	-		-	$	-	$	-	$	-

TOTAL		5	$	721,282	$	721,282	$	144,000		5	$	4,026,953	$	4,026,953	$	-

Of the troubled debt restructurings reported above, three with post-modification recorded investments totaling $3,051,134 were on nonaccrual as of June 30, 2012. None of the troubled debt restructurings reported above had partial charge-offs.

For the three and six months ended June 30, 2012, none of the Company’s troubled debt restructurings has redefaulted within 12 months subsequent to restructure where default is defined as delinquency of 90 days or more and/or placement on nonaccrual status.