10-Q

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

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

For the quarterly period ending September 30, 2012

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

For the transition period from ________ to________

Commission file number 0-22208

QCR HOLDINGS, INC.

(Exact name of Registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)      42-1397595 (I.R.S. Employer ID Number)

3551 7th Street, Moline, Illinois 61265

(Address of principal executive offices)

(309) 743-7761

(Registrant’s telephone number, including area code)

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

Yes [ X ] No  [    ]

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

Yes [ X ]  No [    ]

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

Large accelerated filer [   ]     Accelerated filer  [   ]     Non-accelerated filer  [   ]     Smaller reporting company [ X ]

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

Yes [    ] No [ X ]

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date: As of November 1, 2012, the Registrant had outstanding 4,878,317 shares of common stock, $1.00 par value per share.

QCR HOLDINGS, INC. AND SUBSIDIARIES

INDEX

			Page Number(s)
Part I	FINANCIAL INFORMATION
	Item 1.	Consolidated Financial Statements (Unaudited)
		Consolidated Balance Sheets	2
		As of September 30, 2012 and December 31, 2011
		Consolidated Statements of Income	3
		For the Three Months Ended September 30, 2012 and 2011
		Consolidated Statements of Income	4
		For the Nine Months Ended September 30, 2012 and 2011
		Consolidated Statements of Comprehensive Income	5
		For the Three and Nine Months Ended September 30, 2012 and 2011
		Consolidated Statement of Changes in Stockholders' Equity	6-7
		For the Nine Months Ended September 30, 2012 and 2011
		Consolidated Statements of Cash Flows	8
		For the Nine Months Ended September 30, 2012 and 2011
		Notes to the Consolidated Financial Statements	9-28
	Item 2.	Management's Discussion and Analysis of Financial Condition and	29-58
		Results of Operations
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	59-60
	Item 4.	Controls and Procedures	61
Part II	OTHER INFORMATION
	Item 1.	Legal Proceedings	62
	Item 1.A.	Risk Factors	62
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	62
	Item 3.	Defaults upon Senior Securities	62
	Item 4.	Mine Safety Disclosures	62
	Item 5.	Other Information	62
	Item 6.	Exhibits	63
Signatures			64

1

QCR HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

As of September 30, 2012 and December 31, 2011

	September 30, 2012			December 31, 2011
ASSETS
Cash and due from banks	$	40,564,561		$	53,136,710
Federal funds sold		5,725,000			20,785,000
Interest-bearing deposits at financial institutions		49,436,938			26,750,602
Securities held to maturity, at amortized cost		650,000			200,000
Securities available for sale, at fair value		590,701,449			565,029,291
Total securities		591,351,449			565,229,291
Loans receivable held for sale		6,285,131			3,832,760
Loans/leases receivable held for investment		1,238,007,078			1,196,912,737
Gross loans/leases receivable		1,244,292,209			1,200,745,497
Less allowance for estimated losses on loans/leases		(19,416,748	)		(18,789,262	)
Net loans/leases receivable		1,224,875,461			1,181,956,235
Premises and equipment, net		31,589,347			31,740,751
Goodwill		3,222,688			3,222,688
Bank-owned life insurance		43,208,268			42,011,281
Restricted investment securities		14,780,800			15,253,600
Other real estate owned, net		5,002,791			8,385,758
Other assets		14,188,769			18,138,138
Total assets	$	2,023,946,072		$	1,966,610,054
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
Noninterest-bearing	$	417,284,214		$	357,183,481
Interest-bearing		925,951,220			848,274,307
Total deposits		1,343,235,434			1,205,457,788
Short-term borrowings		140,888,698			213,536,450
Federal Home Loan Bank advances		196,350,000			204,750,000
Other borrowings		138,237,737			136,231,663
Junior subordinated debentures		36,085,000			36,085,000
Other liabilities		30,027,917			26,116,451
Total liabilities		1,884,824,786			1,822,177,352
STOCKHOLDERS' EQUITY
Preferred stock, $1 par value; shares authorized 250,000 September 2012 - 54,867 shares issued and outstanding December 2011 - 65,090 shares issued and outstanding		54,867			65,090
Common stock, $1 par value; shares authorized 20,000,000 September 2012 - 4,984,024 shares issued and 4,862,778 outstanding December 2011 - 4,879,435 shares issued and 4,758,189 outstanding		4,984,024			4,879,435
Additional paid-in capital		78,342,963			89,702,533
Retained earnings		51,077,870			44,585,902
Accumulated other comprehensive income		6,122,102			4,754,714
Noncontrolling interests		145,970			2,051,538
Less treasury stock, September 2012 and December 2011 - 121,246 common shares, at cost		(1,606,510	)		(1,606,510	)
Total stockholders' equity		139,121,286			144,432,702
Total liabilities and stockholders' equity	$	2,023,946,072		$	1,966,610,054

See Notes to Consolidated Financial Statements

2

QCR HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

Three Months Ended September 30,

	2012			2011
Interest and dividend income:
Loans/leases, including fees	$	15,804,330		$	16,215,725
Securities:
Taxable		2,781,889			2,877,574
Nontaxable		690,466			244,209
Interest-bearing deposits at financial institutions		75,818			97,714
Restricted investment securities		131,967			126,333
Federal funds sold		3,055			7,875
Total interest and dividend income		19,487,525			19,569,430
Interest expense:
Deposits		1,488,749			2,201,070
Short-term borrowings		60,500			65,502
Federal Home Loan Bank advances		1,809,888			1,931,259
Other borrowings		1,238,254			1,301,144
Junior subordinated debentures		260,616			241,751
Total interest expense		4,858,007			5,740,726
Net interest income		14,629,518			13,828,704
Provision for loan/lease losses		1,496,194			2,456,965
Net interest income after provision for loan/lease losses		13,133,324			11,371,739
Noninterest income:
Trust department fees		914,586			762,133
Investment advisory and management fees		575,711			549,515
Deposit service fees		847,343			893,685
Gains on sales of loans, net		684,546			408,364
Securities gains		-			443,614
Gains (losses) on other real estate owned, net		(745,799	)		42,262
Earnings on bank-owned life insurance		399,925			331,440
Credit card issuing fees, net of processing costs		140,542			178,636
Other		1,300,328			725,658
Total noninterest income		4,117,182			4,335,307
Noninterest expense:
Salaries and employee benefits		8,201,323			7,651,695
Occupancy and equipment expense		1,459,901			1,359,758
Professional and data processing fees		1,065,780			1,077,435
FDIC and other insurance		599,422			578,776
Loan/lease expense		273,166			839,993
Advertising and marketing		437,130			277,376
Postage and telephone		190,868			242,103
Stationery and supplies		139,592			122,582
Bank service charges		211,378			186,351
Other		452,957			437,080
Total noninterest expense		13,031,517			12,773,149
Net income before income taxes		4,218,989			2,933,897
Federal and state income tax expense		1,034,479			667,296
Net income	$	3,184,510		$	2,266,601
Less: Net income attributable to noncontrolling interests		127,177			103,446
Net income attributable to QCR Holdings, Inc.	$	3,057,333		$	2,163,155
Less: Preferred stock dividends		810,837			2,188,058
Net income attributable to QCR Holdings, Inc. common stockholders	$	2,246,496		$	(24,903	)
Earnings per common share attributable to QCR Holdings, Inc. common shareholders
Basic	$	0.45		$	(0.01	)
Diluted	$	0.44		$	(0.01	)
Weighted average common shares outstanding		4,978,699			4,866,692
Weighted average common and common equivalent shares outstanding		5,080,288			4,866,692
Cash dividends declared per common share	$	-		$	-

See Notes to Consolidated Financial Statements

3

QCR HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

Nine Months Ended September 30,

	2012			2011
Interest and dividend income:
Loans/leases, including fees	$	47,748,276		$	48,466,331
Securities:
Taxable		8,353,482			8,035,495
Nontaxable		1,624,577			743,368
Interest-bearing deposits at financial institutions		288,400			311,807
Restricted investment securities		378,067			427,818
Federal funds sold		3,055			97,919
Total interest and dividend income		58,395,857			58,082,738
Interest expense:
Deposits		4,834,006			6,948,265
Short-term borrowings		202,731			248,079
Federal Home Loan Bank advances		5,503,329			6,053,134
Other borrowings		3,719,730			3,870,062
Junior subordinated debentures		787,597			974,637
Total interest expense		15,047,393			18,094,177
Net interest income		43,348,464			39,988,561
Provision for loan/lease losses		3,325,109			5,196,850
Net interest income after provision for loan/lease losses		40,023,355			34,791,711
Noninterest income:
Trust department fees		2,650,552			2,607,668
Investment advisory and management fees		1,776,499			1,630,976
Deposit service fees		2,626,822			2,623,018
Gains on sales of loans, net		1,965,957			1,923,185
Securities gains		104,600			1,472,528
Losses on other real estate owned, net		(1,324,468	)		(90,492	)
Earnings on bank-owned life insurance		1,196,987			1,032,493
Credit card issuing fees, net of processing costs		409,730			397,132
Other		2,734,890			1,969,304
Total noninterest income		12,141,569			13,565,812
Noninterest expense:
Salaries and employee benefits		24,581,642			22,480,731
Occupancy and equipment expense		4,177,076			4,017,506
Professional and data processing fees		3,342,847			3,338,935
FDIC and other insurance		1,756,493			2,149,093
Loan/lease expense		755,066			1,772,290
Advertising and marketing		1,057,246			836,459
Postage and telephone		716,050			703,803
Stationery and supplies		417,769			380,754
Bank service charges		609,599			525,007
Prepayment fees on Federal Home Loan Bank advances		-			832,099
Other-than-temporary impairment losses on securities		62,400			118,847
Other		1,402,492			1,185,443
Total noninterest expense		38,878,680			38,340,967
Net income before income taxes		13,286,244			10,016,556
Federal and state income tax expense		3,425,506			2,745,257
Net income	$	9,860,738		$	7,271,299
Less: Net income attributable to noncontrolling interests		494,431			308,215
Net income attributable to QCR Holdings, Inc.	$	9,366,307		$	6,963,084
Less: Preferred stock dividends		2,685,248			4,256,171
Net income attributable to QCR Holdings, Inc. common stockholders		6,681,059		$	2,706,913
Earnings per common share attributable to QCR Holdings, Inc. common shareholders
Basic	$	1.37		$	0.56
Diluted	$	1.35		$	0.56
Weighted average common shares outstanding		4,871,626			4,795,382
Weighted average common and common equivalent shares outstanding		4,938,514			4,847,433
Cash dividends declared per common share	$	0.04		$	0.04

See Notes to Consolidated Financial Statements

4

QCR HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

Three and Nine Months Ended September 30,

	Three Months Ended September 30,
	2012		2011
Net income	$	3,184,510	$	2,266,601
Other comprehensive income:
Unrealized gains on securities available for sale:
Unrealized holding gains arising during the period before tax		2,660,251		4,340,017
Less reclassification adjustment for gains included in net income before tax		-		443,614
		2,660,251		3,896,403
Tax expense		1,016,673		1,492,108
Other comprehensive income, net of tax		1,643,578		2,404,295
Comprehensive income attributable to QCR Holdings, Inc.	$	4,828,088	$	4,670,896

	Nine Months Ended September 30,
	2012		2011
Net income	$	9,860,738	$	7,271,299
Other comprehensive income:
Unrealized gains on securities available for sale:
Unrealized holding gains arising during the period before tax		2,313,706		7,091,919
Less reclassification adjustment for gains included in net income before tax		104,600		1,472,528
		2,209,106		5,619,391
Tax expense		841,718		2,150,922
Other comprehensive income, net of tax		1,367,388		3,468,469
Comprehensive income attributable to QCR Holdings, Inc.	$	11,228,126	$	10,739,768

See Notes to Consolidated Financial Statements

5

QCR HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED)

Nine Months Ended September 30, 2012 and 2011

	Preferred Stock			Common Stock			Additional Paid-In Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Noncontrolling Interests			Treasury Stock			Total
Balance December 31, 2011	$	65,090		$	4,879,435		$	89,702,533		$	44,585,902		$	4,754,714		$	2,051,538		$	(1,606,510	)	$	144,432,702
Comprehensive income:
Net income		-			-			-			3,236,818			-			166,031			-			3,402,849
Other comprehensive loss, net of tax		-			-			-			-			(1,517,235	)		-			-			(1,517,235	)
Comprehensive income																							1,885,614
Preferred cash dividends declared		-			-			-			(938,625	)		-			-			-			(938,625	)
Proceeds from issuance of 7,767 shares of common stock as a result of stock purchased under the Employee Stock Purchase Plan		-			7,767			55,566			-			-			-			-			63,333
Proceeds from issuance of 276 shares of common stock as a result of stock options exercised		-			276			2,374			-			-			-			-			2,650
Exchange of 576 shares of common stock in connection with payroll taxes for restricted stock		-			(576	)		(2,103	)		-			-			-			-			(2,679	)
Stock compensation expense		-			-			326,245															326,245
Restricted stock awards		-			57,770			(57,770	)		-			-			-			-			-
Other adjustments to noncontrolling interests		-			-			-			-			-			(2,066	)		-			(2,066	)
Balance March 31, 2012	$	65,090		$	4,944,672		$	90,026,845		$	46,884,095		$	3,237,479		$	2,215,503		$	(1,606,510	)	$	145,767,174
Comprehensive income:
Net income		-			-			-			3,072,156			-			201,223			-			3,273,379
Other comprehensive income, net of tax		-			-			-			-			1,241,045			-			-			1,241,045
Comprehensive income																							4,514,424
Common cash dividends declared, $0.04 per share		-			-			-			(189,091	)		-			-			-			(189,091	)
Preferred cash dividends declared		-			-			-			(935,786	)		-			-			-			(935,786	)
Redemption of 10,223 shares of Series F Noncumulative Perpetual Preferred Stock		(10,223	)		-			(10,212,777	)		-			-			-			-			(10,223,000	)
Proceeds from issuance of 10,856 shares of common stock as a result of stock purchased under the Employee Stock Purchase Plan		-			10,856			78,055			-			-			-			-			88,911
Proceeds from issuance of 9,090 shares of common stock as a result of stock options exercised		-			9,090			79,902			-			-			-			-			88,992
Exchange of 611 shares of common stock in connection with stock options exercised		-			(611	)		(7,125	)		-			-			-			-			(7,736	)
Proceeds from exercise of warrants to purchase 4,300 shares of common stock issued in conjunction with the Series A Subordinated Notes		-			4,300			38,700			-			-			-			-			43,000
Stock compensation expense		-			-			177,269															177,269
Other adjustments to noncontrolling interests		-			-			-			-			-			(2,065	)		-			(2,065	)
Balance June 30, 2012	$	54,867		$	4,968,307		$	80,180,869		$	48,831,374		$	4,478,524		$	2,414,661		$	(1,606,510	)	$	139,322,092
Comprehensive income:
Net income		-			-			-			3,057,333			-			127,177			-			3,184,510
Other comprehensive income, net of tax		-			-			-			-			1,643,578			-			-			1,643,578
Comprehensive income																							4,828,088
Preferred cash dividends declared		-			-			-			(810,837	)		-			-			-			(810,837	)
Purchase of noncontrolling interest		-			-			(2,133,417	)		-			-			(2,393,802	)		-			(4,527,219	)
Proceeds from issuance of 7,642 shares of common stock as a result of stock purchased under the Employee Stock Purchase Plan		-			7,642			58,326			-			-			-			-			65,968
Proceeds from issuance of 7,075 shares of common stock as a result of stock options exercised		-			7,075			58,996			-			-			-			-			66,071
Proceeds from exercise of warrants to purchase 1,000 shares of common stock issued in conjunction with the Series A Subordinated Notes		-			1,000			9,000			-			-			-			-			10,000
Stock compensation expense		-			-			169,189															169,189
Other adjustments to noncontrolling interests		-			-			-			-			-			(2,066	)		-			(2,066	)
Balance September 30, 2012	$	54,867		$	4,984,024		$	78,342,963		$	51,077,870		$	6,122,102		$	145,970		$	(1,606,510	)	$	139,121,286

(continued)

6

QCR HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED) (continued)

Nine Months Ended September 30, 2012 and 2011

	Preferred Stock			Common Stock			Additional Paid-In Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Noncontrolling Interests			Treasury Stock			Total
Balance December 31, 2010	$	63,237		$	4,732,428		$	86,478,269		$	40,550,900		$	704,165		$	1,648,219		$	(1,606,510	)	$	132,570,708
Comprehensive income:
Net income		-			-			-			2,124,960			-			106,524			-			2,231,484
Other comprehensive loss, net of tax		-			-			-			-			(1,345,554	)		-			-			(1,345,554	)
Comprehensive income																							885,930
Preferred cash dividends declared		-			-			-			(915,462	)		-			-			-			(915,462	)
Discount accretion on cumulative preferred stock		-			-			116,909			(116,909	)		-			-			-			-
Proceeds from issuance of 9,081 shares of common stock as a result of stock purchased under the Employee Stock Purchase Plan		-			9,081			49,249			-			-			-			-			58,330
Proceeds from issuance of 24,300 shares of common stock as a result of stock options exercised		-			24,300			146,067			-			-			-			-			170,367
Exchange of 2,171 shares of common stock in connection with stock options exercised		-			(2,171	)		(14,070	)		-			-			-			-			(16,241	)
Stock compensation expense		-			-			206,569															206,569
Restricted stock awards		-			69,924			(69,924	)		-			-			-			-			-
Other adjustments to noncontrolling interests		-			-			-			-			-			(2,065	)		-			(2,065	)
Balance March 31, 2011	$	63,237		$	4,833,562		$	86,913,069		$	41,643,489		$	(641,389	)	$	1,752,678		$	(1,606,510	)	$	132,958,136
Comprehensive income:
Net income		-			-			-			2,674,969			-			98,245			-			2,773,214
Other comprehensive income, net of tax		-			-			-			-			2,409,728			-			-			2,409,728
Comprehensive income																							5,182,942
Common cash dividends declared, $0.04 per share		-			-			-			(185,863	)		-			-			-			(185,863	)
Preferred cash dividends declared and accrued		-			-			-			(915,462	)		-			-			-			(915,462	)
Discount accretion on cumulative preferred stock		-			-			120,280			(120,280	)		-			-			-			-
Proceeds from issuance of 11,355 shares of common stock as a result of stock purchased under the Employee Stock Purchase Plan		-			11,355			61,582			-			-			-			-			72,937
Proceeds from issuance of 10,967 shares of common stock as a result of stock options exercised		-			10,967			65,205			-			-			-			-			76,172
Exchange of 379 shares of common stock in connection with stock options exercised		-			(379	)		(3,033	)		-			-			-			-			(3,412	)
Stock compensation expense		-			-			141,370															141,370
Other adjustments to noncontrolling interests		-			-			-			-			-			(2,066	)		-			(2,066	)
Balance June 30, 2011	$	63,237		$	4,855,505		$	87,298,473		$	43,096,853		$	1,768,339		$	1,848,857		$	(1,606,510	)	$	137,324,754
Comprehensive income:
Net income		-			-			-			2,163,155			-			103,446			-			2,266,601
Other comprehensive income, net of tax		-			-			-			-			2,404,295			-			-			2,404,295
Comprehensive income																							4,670,896
Preferred cash dividends declared		-			-			-			(835,802	)		-			-			-			(835,802	)
Discount accretion on cumulative preferred stock		-			-			1,352,256			(1,352,256	)		-			-			-			-
Proceeds from the issuance of 40,090 shares of Series F Non-Cumulative Perpetual Preferred Stock		40,090			-			40,034,251			-			-			-			-			40,074,341
Redemption of 38,237 shares of Series D Cumulative Perpetual Preferred Stock		(38,237	)		-			(38,198,763	)		-			-			-			-			(38,237,000	)
Proceeds from issuance of 7,975 shares of common stock as a result of stock purchased under the Employee Stock Purchase Plan		-			7,975			43,251			-			-			-			-			51,226
Stock compensation expense		-			-			149,160															149,160
Restricted stock awards		-			5,000			(5,000	)														-
Other adjustments to noncontrolling interests		-			-			-			-			-			(28,702	)		-			(28,702	)
Balance September 30, 2011	$	65,090		$	4,868,480		$	90,673,628		$	43,071,950		$	4,172,634		$	1,923,601		$	(1,606,510	)	$	143,168,873

See Notes to Consolidated Financial Statements

7

QCR HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Nine Months Ended September 30,

	2012			2011
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	9,860,738		$	7,271,299
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		1,740,621			1,866,403
Provision for loan/lease losses		3,325,109			5,196,850
Amortization of offering costs on subordinated debentures		10,738			10,738
Stock-based compensation expense		672,703			547,087
Losses on other real estate owned, net		1,324,468			90,492
Amortization of premiums on securities, net		2,950,609			2,541,408
Securities gains		(104,600	)		(1,472,528	)
Other-than-temporary impairment losses on securities		62,400			118,847
Loans originated for sale		(90,563,711	)		(65,240,469	)
Proceeds on sales of loans		90,077,297			75,960,589
Gains on sales of loans, net		(1,965,957	)		(1,923,185	)
Prepayment fees on Federal Home Loan Bank advances		-			832,099
Increase in cash value of bank-owned life insurance		(1,196,987	)		(1,032,493	)
Decrease in other assets		3,090,716			707,321
Increase in other liabilities		1,467,552			955,174
Net cash provided by operating activities	$	20,751,696		$	26,429,632
CASH FLOWS FROM INVESTING ACTIVITIES
Net decrease in federal funds sold		15,060,000			56,170,000
Net (increase) decrease in interest-bearing deposits at financial institutions		(22,686,336	)		15,080,252
Proceeds from sales of other real estate owned		4,201,516			8,376,898
Activity in securities portfolio:
Purchases		(363,501,993	)		(458,081,700	)
Calls, maturities and redemptions		292,291,109			302,145,002
Paydowns		25,174,348			4,977,152
Sales		19,215,075			54,326,191
Activity in restricted investment securities:
Purchases		(3,466,800	)		(245,000	)
Redemptions		3,939,600			1,675,700
Purchases of bank-owned life insurance		-			(7,000,000	)
Net increase in loans/leases originated and held for investment		(45,934,981	)		(48,043,333	)
Purchase of premises and equipment		(1,589,217	)		(1,693,870	)
Net cash used in investing activities	$	(77,297,679	)	$	(72,312,708	)
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in deposit accounts		137,777,646			92,653,389
Net increase (decrease) in short-term borrowings		(72,647,752	)		2,431,992
Activity in Federal Home Loan Bank advances:
Advances		14,000,000			5,000,000
Calls and maturities		(22,400,000	)		(24,000,000	)
Prepayments		-			(15,832,099	)
Net increase (decrease) in other borrowings		2,006,074			(9,941,030	)
Payment of cash dividends on common and preferred stock		(3,278,112	)		(3,274,991	)
Redemption of 10,223 shares of Series F Noncumulative Perpetual Preferred Stock		(10,223,000	)		-
Proceeds from issuance of 40,090 shares of Series F Noncumulative Perpetual Preferred Stock		-			40,074,341
Redemption of Series D Cumulative Perpetual Preferred Stock		-			(38,237,000	)
Proceeds from issuance of common stock, net		418,510			409,379
Purchase of noncontrolling interest		(1,679,532	)		-
Net cash provided by financing activities	$	43,973,834		$	49,283,981
Net increase (decrease) in cash and due from banks		(12,572,149	)		3,400,905
Cash and due from banks, beginning		53,136,710			42,030,806
Cash and due from banks, ending	$	40,564,561		$	45,431,711
Supplemental disclosure of cash flow information, cash payments for:
Interest	$	15,225,564		$	18,521,222
Income/franchise taxes	$	916,000		$	1,196,948
Supplemental schedule of noncash investing activities:
Change in accumulated other comprehensive income, unrealized gains on securities available for sale, net	$	1,367,388		$	3,468,469
Transfers of loans to other real estate owned	$	2,143,017		$	8,220,271
Liability for purchase of noncontrolling interest	$	2,847,687		$	-

See Notes to Consolidated Financial Statements

8

Part I

Item 1

QCR HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

September 30, 2012

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation:  The interim unaudited consolidated financial statements contained herein should be read in conjunction with the audited consolidated financial statements and accompanying notes to the consolidated financial statements for the fiscal year ended December 31, 2011, including QCR Holdings, Inc.’s (the “Company”) Form 10-K filed with the Securities and Exchange Commission on March 8, 2012.  Accordingly, footnote disclosures, which would substantially duplicate the disclosures contained in the audited consolidated financial statements, have been omitted.

The financial information of the Company included herein has been prepared in accordance with U.S. generally accepted accounting principles for interim financial reporting and has been prepared pursuant to the rules and regulations for reporting on Form 10-Q and Rule 10-01 of Regulation S-X.  Such information reflects all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the periods presented.  Any differences appearing between the numbers presented in financial statements and management’s discussion and analysis are due to rounding.  The results of the interim period ended September 30, 2012, are not necessarily indicative of the results expected for the year ending December 31, 2012.

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries which include three state-chartered commercial banks:  Quad City Bank & Trust Company (“QCBT”), Cedar Rapids Bank & Trust Company (“CRBT”), and Rockford Bank & Trust Company (“RB&T”).  The Company also engages in direct financing lease contracts through its now wholly-owned equity investment by QCBT in m2 Lease Funds, LLC (“m2 Lease Funds”).  QCBT previously owned 80% of m2 Lease Funds.  In August 2012, QCBT entered into an amendment to the operating agreement of m2 Lease Funds and purchased the 20% noncontrolling interest.  See Note 8 for a more detailed discussion of this transaction.  The Company engages in real estate holdings through its 91% equity investment in Velie Plantation Holding Company, LLC (“VPHC”).  All material intercompany transactions and balances have been eliminated in consolidation.

Recent accounting developments:  In December 2011, the Financial Accounting Standards Board issued ASU 2011-11, Disclosures about Offsetting Assets and Liabilities.  ASU 2011-11 requires entities to disclose both gross information and net information about both instruments and transactions eligible for offset in the balance sheet, and instruments and transactions subject to an agreement similar to a master netting arrangement.  ASU 2011-11 is effective for annual periods beginning on or after January 1, 2013, and interim periods within those annual periods.  Adoption is not expected to have a significant impact on the Company’s consolidated financial statements.

Reclassifications:  Certain amounts in the prior year financial statements have been reclassified, with no effect on net income or stockholders’ equity, to conform with the current period presentation.

9

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

NOTE 2 – INVESTMENT SECURITIES

The amortized cost and fair value of investment securities as of September 30, 2012 and December 31, 2011 are summarized as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
September 30, 2012:
Securities held to maturity:
Other bonds	$	650,000	$	-	$	-		$	650,000
Securities available for sale:
U.S. govt. sponsored agency securities	$	340,538,125	$	2,712,996	$	(7,499	)	$	343,243,622
Residential mortgage-backed and related securities		151,264,044		4,450,612		(24,081	)		155,690,575
Municipal securities		87,579,277		2,478,687		(26,333	)		90,031,631
Trust preferred securities		86,200		44,200		-			130,400
Other securities		1,329,191		301,728		(25,698	)		1,605,221
	$	580,796,837	$	9,988,223	$	(83,611	)	$	590,701,449
December 31, 2011:
Securities held to maturity:
Other bonds	$	200,000	$	-	$	-		$	200,000
Securities available for sale:
U.S. govt. sponsored agency securities	$	426,581,913	$	2,428,994	$	(55,687	)	$	428,955,220
Residential mortgage-backed and related securities		105,373,614		3,488,350		(8,215	)		108,853,749
Municipal securities		23,937,118		1,752,246		-			25,689,364
Trust preferred securities		86,200		-		(5,400	)		80,800
Other securities		1,354,940		140,022		(44,804	)		1,450,158
	$	557,333,785	$	7,809,612	$	(114,106	)	$	565,029,291

The Company’s residential mortgage-backed and related securities portfolio consists entirely of government sponsored or government guaranteed securities.  The Company has not invested in commercial mortgage-backed securities or pooled trust preferred securities.

10

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

Gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of September 30, 2012 and December 31, 2011, are summarized as follows:

	Less than 12 Months					12 Months or More					Total
	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
September 30, 2012:
Securities available for sale:
U.S. govt. sponsored agency securities	$	10,988,570	$	(7,499	)	$	-	$	-		$	10,988,570	$	(7,499	)
Residential mortgage-backed and related securities		5,430,389		(24,081	)		-		-			5,430,389		(24,081	)
Municipal securities		3,455,797		(26,333	)		-		-			3,455,797		(26,333	)
Other securities		-		-			215,000		(25,698	)		215,000		(25,698	)
	$	19,874,756	$	(57,913	)	$	215,000	$	(25,698	)	$	20,089,756	$	(83,611	)
December 31, 2011:
Securities available for sale:
U.S. govt. sponsored agency securities	$	59,979,620	$	(55,687	)	$	-	$	-		$	59,979,620	$	(55,687	)
Residential mortgage-backed and related securities		4,906,398		(8,215	)		-		-			4,906,398		(8,215	)
Trust preferred securities		-		-			80,800		(5,400	)		80,800		(5,400	)
Other securities		251,957		(44,332	)		2,778		(472	)		254,735		(44,804	)
	$	65,137,975	$	(108,234	)	$	83,578	$	(5,872	)	$	65,221,553	$	(114,106	)

At September 30, 2012, the investment portfolio included 360 securities.  Of this number, 13 securities had current unrealized losses with aggregate depreciation of less than 1% from the amortized cost basis.  Of these 13, only one had unrealized losses for twelve months or more.  All of the debt securities in unrealized loss positions are considered acceptable credit risks.  Based upon an evaluation of the available evidence, including the recent changes in market rates, credit rating information and information obtained from regulatory filings, management believes the declines in fair value for these debt securities are temporary.  In addition, the Company does not intend to sell these securities and it is not more-likely-than-not that the Company will be required to sell these debt securities before their anticipated recovery.  At September 30, 2012 and December 31, 2011, equity securities represented less than 1% of the total portfolio.

The Company did not recognize other-than-temporary impairment on any debt securities for the three and nine months ended September 30, 2012 and 2011.

The Company did not recognize other-than-temporary impairment on any equity securities for the three months ended September 30, 2012 and 2011.

During the second quarter of 2012, the Company’s evaluation determined that one privately held equity security experienced a decline in fair value that was other-than-temporary.  As a result, the Company wrote down the value of this security and recognized a loss in the amount of $62,400.  The Company did not recognize other-than-temporary impairment on any of its equity securities during the first quarter of 2012.

During the second quarter of 2011, the Company’s evaluation determined that two privately held equity securities experienced declines in fair value that were other-than-temporary.  As a result, the Company wrote down the value of these securities and recognized losses in the amount of $118,847.  The Company did not recognize other-than-temporary impairment on any of its equity securities during the first quarter of 2011.

11

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

All sales of securities, as applicable, for the three and nine months ended September 30, 2012 and 2011, respectively, were from securities identified as available for sale.  Information on proceeds received, as well as pre-tax gross gains from sales of those securities is as follows:

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Proceeds from sales of securities	$	-	$	8,601,107	$	19,215,075	$	54,326,191
Pre-tax gross gains from sales of securities		-		443,614		104,600		1,472,528

The amortized cost and fair value of securities as of September 30, 2012 by contractual maturity are shown below.  A portion of the Company’s U.S. government sponsored agency securities contain call options which allow the issuer, at its discretion, to call the security at predetermined dates prior to the contractual maturity date.Expected maturities of residential mortgage-backed and related securities may differ from contractual maturities because the residential mortgages underlying the residential mortgage-backed and related securities may be called or prepaid without any penalties.  Therefore, these securities are not included in the maturity categories in the following table.  “Other securities” are excluded from the maturity categories as there is no fixed maturity date.

	Amortized Cost		Fair Value
Securities held to maturity:
Due in one year or less	$	100,000	$	100,000
Due after one year through five years		550,000		550,000
	$	650,000	$	650,000
Securities available for sale:
Due in one year or less	$	2,251,717	$	2,257,998
Due after one year through five years		40,236,390		40,681,663
Due after five years		385,715,495		390,465,992
	$	428,203,602	$	433,405,653
Residential mortgage-backed and related securities		151,264,044		155,690,575
Other securities		1,329,191		1,605,221
	$	580,796,837	$	590,701,449

12

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

NOTE 3 – LOANS/LEASES RECEIVABLE

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

	As of September 30, 2012			As of December 31, 2011
Commercial and industrial loans	$	355,003,888		$	350,794,278
Commercial real estate loans
Owner-occupied commercial real estate		199,788,124			167,790,621
Commercial construction, land development, and other land		49,191,909			60,384,738
Other non owner-occupied commercial real estate		345,923,717			349,628,491
		594,903,750			577,803,850
Direct financing leases *		102,038,868			93,212,362
Residential real estate loans **		112,492,219			98,107,051
Installment and other consumer loans		76,837,989			78,223,080
		1,241,276,714			1,198,140,621
Plus deferred loan/lease origination costs, net of fees		3,015,495			2,604,876
		1,244,292,209			1,200,745,497
Less allowance for estimated losses on loans/leases		(19,416,748	)		(18,789,262	)
	$	1,224,875,461		$	1,181,956,235
* Direct financing leases:
Net minimum lease payments to be received	$	115,931,555		$	106,389,988
Estimated unguaranteed residual values of leased assets		1,111,627			1,043,326
Unearned lease/residual income		(15,004,314	)		(14,220,952	)
		102,038,868			93,212,362
Plus deferred lease origination costs, net of fees		3,727,752			3,217,011
		105,766,620			96,429,373
Less allowance for estimated losses on leases		(1,884,985	)		(1,339,496	)
	$	103,881,635		$	95,089,877

**Includes residential real estate loans held for sale totaling $6,285,131 and $3,832,760 as of September 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.

13

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

For the three and nine months ended September 30, 2012 and 2011, there were no losses on residual values.  At September 30, 2012, the Company had 37 leases remaining with residual values totaling $1,111,627 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 September 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	$	352,308,795		$	872,105		$	15,252		$	149,750		$	1,657,986		$	355,003,888
Commercial Real Estate
Owner-Occupied Commercial Real Estate		198,070,105			-			1,046,835			-			671,184			199,788,124
Commercial Construction, Land Development, and Other Land		47,080,534			-			-			-			2,111,375			49,191,909
Other Non Owner-Occupied Commercial Real Estate		332,708,671			2,325,809			733,442			-			10,155,795			345,923,717
Direct Financing Leases		100,205,091			632,458			106,595			-			1,094,724			102,038,868
Residential Real Estate		111,142,654			-			-			-			1,349,565			112,492,219
Installment and Other Consumer		75,805,776			255,048			33,730			52,733			690,702			76,837,989
	$	1,217,321,626		$	4,085,420		$	1,935,854		$	202,483		$	17,731,331		$	1,241,276,714
As a percentage of total loan/lease portfolio		98.07	%		0.33	%		0.16	%		0.02	%		1.43	%		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	%

14

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

Nonperforming loans/leases by classes of loans/leases as of September 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	$	149,750	$	1,657,986	$	184,813	$	1,992,549		8.32	%
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		671,184		-		671,184		2.80	%
Commercial Construction, Land Development, and Other Land		-		2,111,375		337,500		2,448,875		10.23	%
Other Non Owner-Occupied Commercial Real Estate		-		10,155,795		5,303,365		15,459,160		64.57	%
Direct Financing Leases		-		1,094,724		-		1,094,724		4.57	%
Residential Real Estate		-		1,349,565		167,739		1,517,304		6.34	%
Installment and Other Consumer		52,733		690,702		16,043		759,478		3.17	%
	$	202,483	$	17,731,331	$	6,009,460	$	23,943,274		100.00	%

*Nonaccrual loans/leases includes $5,749,193 of troubled debt restructurings, including $141,886 in commercial and industrial loans,  $5,212,247 in commercial real estate loans, $64,726 in direct financing leases, and $330,334 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.

15

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

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

	Three Months Ended September 30, 2012
	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate			Installment and Other Consumer			Total
Balance, beginning	$	4,180,792		$	10,709,991		$	1,610,999		$	986,714		$	1,236,039		$	18,724,535
Provisions charged to expense		136,766			721,358			350,194			233,226			54,650			1,496,194
Loans/leases charged off		(214,036	)		(552,959	)		(111,326	)		(183,031	)		(88,378	)		(1,149,730	)
Recoveries on loans/leases previously charged off		69,959			175,467			35,118			-			65,205			345,749
Balance, ending	$	4,173,481		$	11,053,857		$	1,884,985		$	1,036,909		$	1,267,516		$	19,416,748

	Three Months Ended September 30, 2011
	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate		Installment and Other Consumer			Total
Balance, beginning	$	7,124,444		$	8,602,639		$	1,591,309		$	757,075	$	1,727,165		$	19,802,632
Provisions charged to expense		(211,491	)		2,645,457			159,965			92,032		(228,998	)		2,456,965
Loans/leases charged off		(1,465,577	)		(852,174	)		(701,658	)		-		(84,358	)		(3,103,767	)
Recoveries on loans/leases previously charged off		174,013			212,683			2,344			-		33,616			422,656
Balance, ending	$	5,621,389		$	10,608,605		$	1,051,960		$	849,107	$	1,447,425		$	19,578,486

	Nine Months Ended September 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		(637,852	)		2,254,732			924,109			519,751			264,369			3,325,109
Loans/leases charged off		(669,778	)		(1,980,946	)		(454,590	)		(187,788	)		(416,179	)		(3,709,281	)
Recoveries on loans/leases previously charged off		603,105			183,113			75,970			-			149,470			1,011,658
Balance, ending	$	4,173,481		$	11,053,857		$	1,884,985		$	1,036,909		$	1,267,516		$	19,416,748

	Nine Months Ended September 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		1,005,002			3,038,359			463,850			101,079		588,560			5,196,850
Loans/leases charged off		(3,256,194	)		(1,773,711	)		(945,104	)		-		(701,390	)		(6,676,399	)
Recoveries on loans/leases previously charged off		323,659			256,642			2,642			-		110,436			693,379
Balance, ending	$	5,621,389		$	10,608,605		$	1,051,960		$	849,107	$	1,447,425		$	19,578,486

16

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

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

	As of September 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	$	274,666		$	3,482,125		$	157,900		$	169,196		$	68,673		$	4,152,560
Allowance for loans/leases collectively evaluated for impairment		3,898,815			7,571,732			1,727,085			867,713			1,198,843			15,264,188
	$	4,173,481		$	11,053,857		$	1,884,985		$	1,036,909		$	1,267,516		$	19,416,748
Loans/leases individually evaluated for impairment	$	1,071,050		$	18,450,756		$	1,094,724		$	1,517,304		$	759,478		$	22,893,312
Loans/leases collectively evaluated for impairment		353,932,838			576,452,994			100,944,144			110,974,915			76,078,511			1,218,383,402
	$	355,003,888		$	594,903,750		$	102,038,868		$	112,492,219		$	76,837,989		$	1,241,276,714
Allowance as a percentage of loans/leases individually evaluated for impairment		25.64	%		18.87	%		14.42	%		11.15	%		9.04	%		18.14	%
Allowance as a percentage of loans/leases collectively evaluated for impairment		1.10	%		1.31	%		1.71	%		0.78	%		1.58	%		1.25	%
		1.18	%		1.86	%		1.85	%		0.92	%		1.65	%		1.56	%

	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	%

17

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

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 nine months ended September 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	$	845,703	$	1,635,373	$	-	$	787,146	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		542,721		542,721		-		657,327		-		-
Commercial Construction, Land Development, and Other Land		1,027,200		1,027,200		-		4,441,935		5,552		5,552
Other Non Owner-Occupied Commercial Real Estate		1,498,599		2,298,599		-		6,613,234		894		894
Direct Financing Leases		853,974		853,974		-		774,855		-		-
Residential Real Estate		948,653		1,131,684		-		861,102		5,037		5,037
Installment and Other Consumer		646,466		646,466		-		1,014,236		245		245
	$	6,363,316	$	8,136,017	$	-	$	15,149,835	$	11,728	$	11,728
Impaired Loans/Leases with Specific Allowance Recorded:
Commercial and Industrial	$	225,347	$	247,599	$	274,666	$	543,668	$	5,935	$	5,935
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		-		-		-		-		-
Commercial Construction, Land Development, and Other Land		2,031,823		2,055,057		1,373,340		1,598,548		-		-
Other Non Owner-Occupied Commercial Real Estate		13,350,413		13,603,372		2,108,785		9,859,148		237,408		237,408
Direct Financing Leases		240,750		240,750		157,900		177,551		-		-
Residential Real Estate		568,651		568,651		169,196		463,361		-		-
Installment and Other Consumer		113,012		113,012		68,673		68,286		-		-
	$	16,529,996	$	16,828,441	$	4,152,560	$	12,710,562	$	243,343	$	243,343
Total Impaired Loans/Leases:
Commercial and Industrial	$	1,071,050	$	1,882,972	$	274,666	$	1,330,814	$	5,935	$	5,935
Commercial Real Estate
Owner-Occupied Commercial Real Estate		542,721		542,721		-		657,327		-		-
Commercial Construction, Land Development, and Other Land		3,059,023		3,082,257		1,373,340		6,040,483		5,552		5,552
Other Non Owner-Occupied Commercial Real Estate		14,849,012		15,901,971		2,108,785		16,472,382		238,302		238,302
Direct Financing Leases		1,094,724		1,094,724		157,900		952,406		-		-
Residential Real Estate		1,517,304		1,700,335		169,196		1,324,463		5,037		5,037
Installment and Other Consumer		759,478		759,478		68,673		1,082,522		245		245
	$	22,893,312	$	24,964,458	$	4,152,560	$	27,860,397	$	255,071	$	255,071

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

18

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

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

	Three Months Ended September 30, 2012						Three Months Ended September 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	$	754,844	$	-	$	-	$	2,236,289	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		550,725		-		-		1,774,342		11,909		11,909
Commercial Construction, Land Development, and Other Land		1,323,689		1,701		1,701		286,339		-		-
Other Non Owner-Occupied Commercial Real Estate		5,798,404		-		-		1,730,764		-		-
Direct Financing Leases		680,817		-		-		668,944		-		-
Residential Real Estate		943,926		1,691		1,691		942,011		-		-
Installment and Other Consumer		1,063,519		121		121		710,560		-		-
	$	11,115,924	$	3,513	$	3,513	$	8,349,249	$	11,909	$	11,909
Impaired Loans/Leases with Specific Allowance Recorded:
Commercial and Industrial	$	223,917	$	1,984	$	1,984	$	1,534,968	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		-		-		360,894		-		-
Commercial Construction, Land Development, and Other Land		2,157,696		-		-		5,595,484		473		473
Other Non Owner-Occupied Commercial Real Estate		12,036,134		86,744		86,744		7,488,032		-		-
Direct Financing Leases		210,299		-		-		983,131		-		-
Residential Real Estate		524,031		-		-		200,625		-		-
Installment and Other Consumer		68,898		-		-		108,859		-		-
	$	15,220,975	$	88,728	$	88,728	$	16,271,993	$	473	$	473
Total Impaired Loans/Leases:
Commercial and Industrial	$	978,761	$	1,984	$	1,984	$	3,771,257	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		550,725		-		-		2,135,236		11,909		11,909
Commercial Construction, Land Development, and Other Land		3,481,385		1,701		1,701		5,881,823		473		473
Other Non Owner-Occupied Commercial Real Estate		17,834,538		86,744		86,744		9,218,796		-		-
Direct Financing Leases		891,116		-		-		1,652,075		-		-
Residential Real Estate		1,467,957		1,691		1,691		1,142,636		-		-
Installment and Other Consumer		1,132,417		121		121		819,419		-		-
	$	26,336,899	$	92,241	$	92,241	$	24,621,242	$	12,382	$	12,382

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

19

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

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.

20

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

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

	As of September 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)	$	331,637,518	$	193,587,897	$	42,177,159	$	311,918,867	$	879,321,441
Special Mention (Rating 6)		7,920,533		4,213,076		560,086		8,660,810		21,354,505
Substandard (Rating 7)		15,445,837		1,987,151		6,454,664		25,344,040		49,231,692
Doubtful (Rating 8)		-		-		-		-		-
	$	355,003,888	$	199,788,124	$	49,191,909	$	345,923,717	$	949,907,638

	As of September 30, 2012
Delinquency Status *	Direct Financing Leases		Residential Real Estate		Installment and Other Consumer		Total
Performing	$	100,944,144	$	110,974,915	$	76,078,511	$	287,997,570
Nonperforming		1,094,724		1,517,304		759,478		3,371,506
	$	102,038,868	$	112,492,219	$	76,837,989	$	291,369,076

*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

*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.

21

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

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 September 30, 2012 and December 31, 2011, troubled debt restructurings totaled $11,758,653 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 nine months ended September 30, 2012 and 2011.  The difference between the pre-modification recorded investment and the post-modification recorded investment would be any partial charge-offs at the time of the restructuring.

	For the three months ended September 30, 2012								For the three months ended September 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		4	$	1,184,289	$	1,184,289	$	325,923		-	$	-	$	-	$	-
		4	$	1,184,289	$	1,184,289	$	325,923		-	$	-	$	-	$	-
CONCESSION - Interest rate adjusted below market
Other Non Owner-Occupied Commercial Real Estate		2	$	1,542,784	$	1,289,825	$	55,187		-	$	-	$	-	$	-
		2	$	1,542,784	$	1,289,825	$	55,187		-	$	-	$	-	$	-
TOTAL		6	$	2,727,073	$	2,474,114	$	381,110		-	$	-	$	-	$	-

	For the nine months ended September 30, 2012								For the nine months ended September 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		4	$	1,184,289	$	1,184,289	$	325,923		1	$	2,851,134	$	2,851,134	$	-
		4	$	1,184,289	$	1,184,289	$	325,923		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		-		-		-		-		-
		2	$	200,000	$	200,000	$	-		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	$	-		-	$	-	$	-	$	-
Other Non Owner-Occupied Commercial Real Estate		2		1,542,784		1,289,825		55,187		-		-		-		-
Residential Real Estate		1		167,739		167,739		-		-		-		-		-
Installment and Other Consumer		1		16,043		16,043		-		-		-		-		-
		5	$	2,064,066	$	1,811,107	$	55,187		-	$	-	$	-	$	-
TOTAL		11	$	3,448,355	$	3,195,396	$	381,110		5	$	4,026,953	$	4,026,953	$	-

Of the troubled debt restructurings reported above, four with post-modification recorded investments totaling $4,337,321 were on nonaccrual as of September 30, 2012.

For the three and nine months ended September 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.

22

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

NOTE 4 - EARNINGS PER SHARE

The following information was used in the computation of earnings per share on a basic and diluted basis:

	Three months ended September 30,					Nine months ended September 30,
	2012		2011			2012		2011
Net income	$	3,184,510	$	2,266,601		$	9,860,738	$	7,271,299
Less:  Net income attributable to noncontrolling interests		127,177		103,446			494,431		308,215
Net income attributable to QCR Holdings, Inc.	$	3,057,333	$	2,163,155		$	9,366,307	$	6,963,084
Less:  Preferred stock dividends and discount accretion		810,837		2,188,058	*		2,685,248		4,256,171	*
Net income attributable to QCR Holdings, Inc. common stockholders	$	2,246,496	$	(24,903	)	$	6,681,059	$	2,706,913
Earnings per common share attributable to QCR Holdings, Inc. common stockholders
Basic	$	0.45	$	(0.01	)	$	1.37	$	0.56
Diluted	$	0.44	$	(0.01	)	$	1.35	$	0.56
Weighted average common shares outstanding		4,978,699		4,866,692			4,871,626		4,795,382
Weighted average common shares issuable upon exercise of stock options and under the employee stock purchase plan		101,589		-	**		66,888		52,051
Weighted average common and common equivalent shares outstanding		5,080,288		4,866,692	**		4,938,514		4,847,433

* For the three and nine months ended September 30, 2011, includes approximately $1.2 million of accelerated accretion of discount on the U.S. Department of the Treasury ("Treasury") Captial Purchase Program preferred shares repurchased during the third quarter of 2011.

** In accordance with U.S. GAAP, the common equivalent shares are not considered in the calculation of diluted earnings per share as the numerator is a loss.

NOTE 5 – BUSINESS SEGMENT INFORMATION

Selected financial and descriptive information is required to be disclosed for reportable operating segments, applying a “management perspective” as the basis for identifying reportable segments.  The management perspective is determined by the view that management takes of the segments within the Company when making operating decisions, allocating resources, and measuring performance.  The segments of the Company have been defined by the structure of the Company’s internal organization, focusing on the financial information that the Company’s operating decision-makers routinely use to make decisions about operating matters.

The Company’s primary segment, Commercial Banking, is geographically divided by markets into the secondary segments which are the three subsidiary banks wholly-owned by the Company:  QCBT, CRBT, and RB&T.  Each of these secondary segments offers similar products and services, but is managed separately due to different pricing, product demand, and consumer markets.  Each offers commercial, consumer, and mortgage loans and deposit services.

The Company’s Wealth Management segment represents the trust and asset management and investment management and advisory services offered at the Company’s three subsidiary banks in aggregate.  This segment generates income primarily from fees charged based on assets under administration for corporate and personal trusts, custodial services, and investments managed.  No assets of the subsidiary banks have been allocated to the Wealth Management segment.

23

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

The Company’s All Other segment includes the operations of all other consolidated subsidiaries and/or defined operating segments that fall below the segment reporting thresholds.  This segment includes the corporate operations of the parent company and the 91% owned real estate holding operations of VPHC.

Selected financial information on the Company’s business segments is presented as follows for the three and nine months ended September 30, 2012 and 2011.

	Commercial Banking
	Quad City Bank & Trust		Cedar Rapids Bank & Trust		Rockford Bank & Trust			Wealth Management		All Other			Intercompany Eliminations			Consolidated Total
Three Months Ended September 30, 2012
Total revenue	$	11,643,674	$	6,706,485	$	2,897,098		$	1,490,297	$	4,542,612		$	(3,675,459	)	$	23,604,707
Net interest income	$	8,602,967	$	4,027,693	$	2,368,483		$	-	$	(369,625	)	$	-		$	14,629,518
Net income attributable to QCR Holdings, Inc.	$	2,586,303	$	1,532,946	$	(313,019	)	$	108,950	$	3,077,515		$	(3,935,362	)	$	3,057,333
Total assets	$	1,134,296,418	$	587,057,961	$	299,947,837		$	-	$	196,448,244		$	(193,804,388	)	$	2,023,946,072
Provision for loan/lease losses	$	350,194	$	300,000	$	846,000		$	-	$	-		$	-		$	1,496,194
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688
Three Months Ended September 30, 2011
Total revenue	$	12,147,213	$	7,110,970	$	3,377,454		$	1,311,647	$	3,319,882		$	(3,362,429	)	$	23,904,737
Net interest income	$	7,944,108	$	3,873,339	$	2,355,471		$	-	$	(344,214	)	$	-		$	13,828,704
Net income attributable to QCR Holdings, Inc.	$	1,854,914	$	1,375,114	$	(243,710	)	$	257,611	$	2,192,761		$	(3,273,535	)	$	2,163,155
Total assets	$	1,056,656,935	$	565,822,310	$	287,574,174		$	-	$	193,059,135		$	(204,152,062	)	$	1,898,960,492
Provision for loan/lease losses	$	1,158,965	$	250,000	$	1,048,000		$	-	$	-		$	-		$	2,456,965
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688
Nine Months Ended September 30, 2012
Total revenue	$	36,196,909	$	19,829,521	$	9,665,950		$	4,427,051	$	13,533,609		$	(13,115,614	)	$	70,537,426
Net interest income	$	25,524,594	$	11,691,876	$	7,259,522		$	-	$	(1,127,528	)	$	-		$	43,348,464
Net income attributable to QCR Holdings, Inc.	$	7,603,033	$	4,214,081	$	482,950		$	425,356	$	9,484,700		$	(12,843,813	)	$	9,366,307
Total assets	$	1,134,296,418	$	587,057,961	$	299,947,837		$	-	$	196,448,244		$	(193,804,388	)	$	2,023,946,072
Provision for loan/lease losses	$	1,138,109	$	875,000	$	1,312,000		$	-	$	-		$	-		$	3,325,109
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688
Nine Months Ended September 30, 2011
Total revenue	$	35,990,157	$	21,482,485	$	10,046,334		$	4,238,644	$	10,776,476		$	(10,885,546	)	$	71,648,550
Net interest income	$	22,772,375	$	11,859,003	$	6,641,533		$	-	$	(1,284,350	)	$	-		$	39,988,561
Net income attributable to QCR Holdings, Inc.	$	5,777,707	$	3,964,627	$	45,697		$	741,263	$	7,054,192		$	(10,620,402	)	$	6,963,084
Total assets	$	1,056,656,935	$	565,822,310	$	287,574,174		$	-	$	193,059,135		$	(204,152,062	)	$	1,898,960,492
Provision for loan/lease losses	$	2,236,850	$	1,035,000	$	1,925,000		$	-	$	-		$	-		$	5,196,850
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688

24

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

NOTE 6 – FAIR VALUE

The measurement of fair value under U.S. GAAP uses a hierarchy intended to maximize the use of observable inputs and minimize the use of unobservable inputs.  This hierarchy includes three levels and is based upon the valuation techniques used to measure assets and liabilities.  The three levels are as follows:

1. Level 1 – Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in markets;

2. Level 2 – Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument; and

3. Level 3 – Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

There were no transfers of assets or liabilities between Levels 1, 2, and 3 of the fair value hierarchy for the three and nine months ended September 30, 2012 or 2011.

Assets measured at fair value on a recurring basis comprise the following at September 30, 2012 and December 31, 2011:

			Fair Value Measurements at Reporting Date Using
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
September 30, 2012:
Securities available for sale:
U.S. govt. sponsored agency securities	$	343,243,622	$	-	$	343,243,622	$	-
Residential mortgage-backed and related securities		155,690,575		-		155,690,575		-
Municipal securities		90,031,631		-		90,031,631		-
Trust preferred securities		130,400		-		130,400		-
Other securities		1,605,221		235,027		1,370,194		-
	$	590,701,449	$	235,027	$	590,466,422	$	-
December 31, 2011:
Securities available for sale:
U.S. govt. sponsored agency securities	$	428,955,220	$	-	$	428,955,220	$	-
Residential mortgage-backed and related securities		108,853,749		-		108,853,749		-
Municipal securities		25,689,364		-		25,689,364		-
Trust preferred securities		80,800		-		80,800		-
Other securities		1,450,158		191,506		1,258,652		-
	$	565,029,291	$	191,506	$	564,837,785	$	-

25

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

A small portion of the securities available for sale portfolio consists of common stock issued by various unrelated bank holding companies.  The fair values used by the Company are obtained from an independent pricing service and represent quoted market prices for the identical securities (Level 1 inputs).

The large majority of the securities available for sale portfolio consists of U.S. government sponsored agency securities for which the Company obtains fair values from an independent pricing service.  The fair values are determined by pricing models that consider observable market data, such as interest rate volatilities, LIBOR yield curve, credit spreads and prices from market makers and live trading systems (Level 2 inputs).

Certain financial assets are measured at fair value on a non-recurring basis; that is, the assets are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment).

Assets measured at fair value on a non-recurring basis comprise the following at September 30, 2012 and December 31, 2011:

			Fair Value Measurements at Reporting Date Using
	Fair Value		Level 1		Level 2		Level 3
September 30, 2012:
Impaired loans/leases	$	13,367,633	$	-	$	-	$	13,367,633
Other real estate owned		5,403,014		-		-		5,403,014
	$	18,770,647	$	-	$	-	$	18,770,647
December 31, 2011:
Impaired loans/leases	$	18,361,757	$	-	$	-	$	18,361,757
Other real estate owned		9,056,619		-		-		9,056,619
	$	27,418,376	$	-	$	-	$	27,418,376

Impaired loans/leases are evaluated and valued at the time the loan/lease is identified as impaired, at the lower of cost or fair value, and are classified as Level 3 in the fair value hierarchy.  Fair value is measured based on the value of the collateral securing these loans/leases.  Collateral may be real estate and/or business assets, including equipment, inventory and/or accounts receivable, and is determined based on appraisals by qualified licensed appraisers hired by the Company.  Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and client’s business.  

Other real estate owned in the table above consists of property acquired through foreclosures and settlements of loans.  Property acquired is carried at the lower of the principal amount of loans outstanding, or the estimated fair value of the property, less disposal costs, and is classified as Level 3 in the fair value hierarchy.

For the impaired loans/leases and other real estate owned, the Company records carrying value at fair value less disposal or selling costs.  The amounts reported in the tables above are fair values before the adjustment for disposal or selling costs.

There have been no changes in valuation techniques used for any assets measured at fair value during the three and nine months ended September 30, 2012 or 2011.

26

Part I

Item 1

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

The following table presents the carrying values and estimated fair values of financial assets and liabilities carried on the Company’s consolidated balance sheets, including those financial assets and liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis:

	As of September 30, 2012				As of December 31, 2011
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Cash and due from banks	$	40,564,561	$	40,564,561	$	53,136,710	$	53,136,710
Federal funds sold		5,725,000		5,725,000		20,785,000		20,785,000
Interest-bearing deposits at financial institutions		49,436,938		49,436,938		26,750,602		26,750,602
Investment securities:
Held to maturity		650,000		650,000		200,000		200,000
Available for sale		590,701,449		590,701,449		565,029,291		565,029,291
Loans/leases receivable, net		1,224,875,461		1,243,192,000		1,181,956,235		1,202,817,000
Accrued interest receivable		6,640,822		6,640,822		6,510,021		6,510,021
Deposits		1,343,235,434		1,346,256,000		1,205,457,788		1,209,197,000
Short-term borrowings		140,888,698		140,888,698		213,536,450		213,536,450
Federal Home Loan Bank advances		196,350,000		216,052,000		204,750,000		223,678,000
Other borrowings		138,237,737		154,663,000		136,231,663		151,813,000
Junior subordinated debentures		36,085,000		18,753,000		36,085,000		18,444,000
Accrued interest payable		1,373,671		1,373,671		1,551,842		1,551,842

The methodologies for estimating the fair value of financial assets and liabilities that are measured at fair value on a recurring or non-recurring basis are discussed above.  For certain financial assets and liabilities, carrying value approximates fair value due to the nature of the financial instrument.  These instruments include:  cash and due from banks, federal funds sold, interest-bearing deposits at financial institutions, accrued interest receivable and payable, demand and other non-maturity deposits, and short-term borrowings.  The Company used the following methods and assumptions in estimating the fair value of the following instruments:

Loans/leases receivable:  The fair values for variable rate loans equal their carrying values.  The fair values for all other types of loans/leases are estimated using discounted cash flow analyses, using interest rates currently being offered for loans/leases with similar terms to borrowers with similar credit quality.  The fair value of loans held for sale is based on quoted market prices of similar loans sold on the secondary market.  All of the above are classified as Level 2 in the fair value hierarchy as presented in the table below.

Deposits:  The fair values disclosed for demand and other non-maturity deposits equal their carrying amounts, which represent the amount payable on demand.  Fair values for time deposits are estimated using a discounted cash flow calculation that applies interest rates currently being offered on time deposits to a schedule of aggregate expected monthly maturities on time deposits, and are classified as Level 2 in the fair value hierarchy as presented in the table below.

Federal Home Loan Bank advances and junior subordinated debentures:  The fair value of these instruments is estimated using discounted cash flow analyses, based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements, and are classified as Level 2 in the fair value hierarchy as presented in the table below.

Other borrowings:  The fair value for the wholesale repurchase agreements and fixed rate other borrowings is estimated using rates currently available for debt with similar terms and remaining maturities.  The fair value for variable rate other borrowings is equal to its carrying value.  All of the above are classified as Level 2 in the fair value hierarchy as presented in the table below.

27

Part I

Item 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)-continued

Commitments to extend credit:  The fair value of these instruments is not material.

The following table presents the level in the fair value hierarchy for the estimated fair values of the Company’s financial instruments that are not already on the Consolidated Balance Sheet at fair value at September 30, 2012.

	Fair Value		Level 1		Level 2		Level 3
Loans/leases receivable, net *	$	1,229,824,367	$	-	$	1,229,824,367	$	-
Time deposits		361,397,000		-		361,397,000		-
Federal Home Loan Bank advances		216,052,000		-		216,052,000		-
Other borrowings		154,663,000		-		154,663,000		-
Junior subordinated debentures		18,753,000		-		18,753,000		-

*Excludes impaired loans/leases totaling $13,367,633 measured at fair value on a non-recurring basis and reported separately.

NOTE 7 – PARTIAL REDEMPTION OF SERIES F PREFERRED STOCK

On June 29, 2012, the Company redeemed 10,223 shares of Series F Preferred Stock from Treasury for an aggregate redemption amount of $10,223,000 plus unpaid dividends to the date of redemption of $124,948.  Previously, on September 15, 2011, the Company issued 40,090 shares of Series F Preferred Stock to Treasury for an aggregate purchase price of $40,090,000.  The sale of Series F Preferred Stock was the result of an investment by Treasury from the Small Business Lending Fund (“SBLF”), a $30 billion fund established under the Small Business Jobs Act of 2010, which was intended to encourage lending to small business by providing capital to qualified community banks with assets of less than $10 billion.

The remaining Series F Preferred Stock may be redeemed at any time at the option of the Company, subject to the approval of the Company’s primary federal banking regulator.  All redemptions must be in amounts equal to at least 25% of the number of originally issued shares, or 100% of the then-outstanding shares (if less than 25% of the originally issued shares).

NOTE 8 – ACQUISITION OF 20% NONCONTROLLING INTEREST IN M2 LEASE FUNDS

On August 27, 2012, the Company’s largest subsidiary bank, QCBT, entered into an amendment to the operating agreement of m2 Lease Funds and purchased the 20% noncontrolling interest in m2 Lease Funds.  QCBT previously owned an 80% equity interest in m2 Lease Funds.  The acquisition is structured in two payments with the initial payment of $1,653,755 made on September 11, 2012 and the final payment to be made in September 2015.  The initial payment represented a 50% premium over the book value of the 20% equity interest of $3,307,509 as of August 31, 2012, calculated in accordance with the operating agreement.  The final payment will consist of the book value of the 20% equity interest as of August 31, 2012 plus 20% of the earnings from m2 Lease Funds for the period September 2012 through August 2015.  As a result, for the portion of the final payment related to the book value of the 20% equity interest as of August 31, 2012, QCBT calculated the present value of the future payment using a discount rate of 5% and recorded the resulting liability of $2,847,687.  QCBT will accrete the discount using the effective yield method over three years.  For the portion of the final payment related to the 20% of earnings from m2 Lease Funds for the period September 2012 through August 2015, QCBT will record compensation cost and increase the liability on a monthly basis.  As a result of acquiring additional equity in a majority-owned company, the premium paid is reflected as a reduction of additional paid-in capital.  The total premium paid and resulting reduction of additional paid-in capital totaled $2,133,417 which consists of the 50% premium over the book value as defined by the operating agreement ($1,653,755) and the difference between the discounted book value and the equity in the 20% noncontrolling interest as of August 31, 2012 ($453,884).

28

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

GENERAL

QCR Holdings, Inc. is the parent company of QCBT, CRBT, and RB&T.

QCBT and CRBT are Iowa-chartered commercial banks, and RB&T is an Illinois-chartered commercial bank.  All are members of the Federal Reserve System with depository accounts insured to the maximum amount permitted by law by the Federal Deposit Insurance Corporation (“FDIC”).

· QCBT commenced operations in 1994 and provides full-service commercial and consumer banking, and trust and asset management services, to the Quad City area and adjacent communities through its five offices that are located in Bettendorf and Davenport, Iowa and Moline, Illinois.  QCBT also provides leasing services through its now wholly-owned subsidiary, m2 Lease Funds, located in Brookfield, Wisconsin.  In August 2012, QCBT entered into an amendment to the operating agreement of m2 Lease Funds and purchased the 20% noncontrolling interest in m2 Lease Funds.  In addition, QCBT owns 100% of Quad City Investment Advisors, LLC (formerly known as CMG Investment Advisors, LLC), which is an investment management and advisory company.

· CRBT commenced operations in 2001 and provides full-service commercial and consumer banking, and trust and asset management services, to Cedar Rapids, Iowa and adjacent communities through its main office located on First Avenue in downtown Cedar Rapids, Iowa and its branch facility located on Council Street in northern Cedar Rapids.  CRBT also provides residential real estate mortgage lending services through its 50%-owned joint venture, Cedar Rapids Mortgage Company.

· RB&T commenced operations in January 2005 and provides full-service commercial and consumer banking, and trust and asset management services, to Rockford, Illinois and adjacent communities through its main office located in downtown Rockford and its branch facility on Guilford Road at Alpine Road in Rockford.

The Company engages in real estate holdings through its 91% equity investment in Velie Plantation Holding Company, LLC, based in Moline, Illinois.

29

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

OVERVIEW

The Company recognized net income of $3.2 million for the quarter ended September 30, 2012, and net income attributable to QCR Holdings, Inc. of $3.1 million, which excludes the net income attributable to noncontrolling interests of $127 thousand.  After preferred stock dividends of $811 thousand, the Company reported net income attributable to common stockholders of $2.2 million, or diluted earnings per common share of $0.44.  By comparison, for the third quarter of 2011, the Company recognized net income of $2.3 million and net income attributable to QCR holdings, Inc. of $2.2 million, which excludes the net income attributable to noncontrolling interests of $103 thousand.  After preferred stock dividends and discount accretion of $2.2 million, the Company reported a net loss attributable to common stockholders of $25 thousand, or diluted loss per common share of ($0.01).  The 2011 preferred stock dividends included a one-time deemed dividend of $1.2 million as a result of the Company’s repurchase of all of the preferred shares issued to Treasury under the Troubled Asset Relief Program (“TARP”).

For the nine months ended September 30, 2012, the Company reported net income of $9.9 million, and net income attributable to QCR Holdings, Inc. of $9.4 million, which excludes the net income attributable to noncontrolling interests of $494 thousand.  After preferred stock dividends of $2.7 million, the Company reported net income attributable to common stockholders of $6.7 million, or diluted earnings per common share of $1.35.  For the same period in 2011, the Company recognized net income of $7.3 million and net income attributable to QCR Holdings, Inc. of $7.0 million, which excludes the net income attributable to noncontrolling interests of $308 thousand.  After preferred stock dividends and discount accretion of $4.3 million, the Company reported net income attributable to common stockholders of $2.7 million, or diluted earnings per common share of $0.56.

Following is a table that represents the various net income measurements for the three and nine months ended September 30, 2012 and 2011, respectively.

	For the three months ended					For the nine months ended
	September 30, 2012		September 30, 2011			September 30, 2012		September 30, 2011
Net income	$	3,184,510	$	2,266,601		$	9,860,738	$	7,271,299
Less:  Net income attributable to noncontrolling interests		127,177		103,446			494,431		308,215
Net income attributable to QCR Holdings, Inc.	$	3,057,333	$	2,163,155		$	9,366,307	$	6,963,084
Less: Preferred stock dividends and discount accretion		810,837		2,188,058			2,685,248		4,256,171
Net income attributable to QCR Holdings, Inc. common stockholders	$	2,246,496	$	(24,903	)	$	6,681,059	$	2,706,913
Diluted earnings per common share	$	0.44	$	(0.01	)	$	1.35	$	0.56
Weighted average common and common equivalent shares outstanding		5,080,288		4,866,692			4,938,514		4,847,433

Following is a table that represents the major income and expense categories.

	For the three months ended									For the nine months ended
	September 30, 2012			June 30, 2012			September 30, 2011			September 30, 2012			September 30, 2011
Net interest income	$	14,629,518		$	14,515,493		$	13,828,704		$	43,348,464		$	39,988,561
Provision for loan/lease losses		(1,496,194	)		(1,048,469	)		(2,456,965	)		(3,325,109	)		(5,196,850	)
Noninterest income		4,117,182			4,067,509			4,335,307			12,141,569			13,565,812
Noninterest expense		(13,031,517	)		(13,109,083	)		(12,773,149	)		(38,878,680	)		(38,340,967	)
Federal and state income tax		(1,034,479	)		(1,152,071	)		(667,296	)		(3,425,506	)		(2,745,257	)
Net income	$	3,184,510		$	3,273,379		$	2,266,601		$	9,860,738		$	7,271,299

30

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

NET INTEREST INCOME

Net interest income, on a tax equivalent basis, increased $1.1 million, or 8%, to $15.1 million for the quarter ended September 30, 2012, from $14.0 million for the same period of 2011.  The increase in net interest income was driven primarily by reduced interest expense.  This was the result of continued reductions in the cost of deposits as well as growth in noninterest bearing deposits, which funded the earning asset growth and allowed the level of interest-bearing funding to remain relatively flat.  Interest income grew slightly as growth in loans and securities more than offset the continued decline in yields.

A comparison of yields, spread and margin from the third quarter of 2012 to the third quarter of 2011 is as follows (on a tax equivalent basis):

· The average yield on interest-earning assets decreased 25 basis points.

· The average cost of interest-bearing liabilities decreased 27 basis points.

· The net interest spread improved 2 basis points from 2.82% to 2.84%.

· The net interest margin expanded 3 basis points from 3.13% to 3.16%.

Net interest income, on a tax equivalent basis, increased $3.9 million, or 10%, to $44.3 million for the first nine months of 2012, from $40.4 million for the same period of 2011.  The growth was primarily a function of reductions in the rates paid on all interest-bearing liabilities with most of the impact from declining cost of deposits.  Additionally, interest income grew as growth in loans and securities more than offset the decline in yields.

A comparison of yields, spread and margin from the first nine months of 2012 to the same period of 2011 is as follows (on a tax equivalent basis):

· The average yield on interest-earning assets decreased 22 basis points.

· The average cost of interest-bearing liabilities decreased 30 basis points.

· The net interest spread improved 8 basis points from 2.73% to 2.81%.

· The net interest margin expanded 8 basis points from 3.06% to 3.14%.

The Company’s management closely monitors and manages net interest margin.  From a profitability standpoint, an important challenge for the Company’s subsidiary banks and leasing company is the improvement of their net interest margins.  Management continually addresses this issue with pricing and other balance sheet management strategies.  Over the past two years, the Company’s management has emphasized improving its funding mix by reducing its reliance on wholesale funding, which tends to be at a higher cost than deposits. In addition, with loan growth continuing to be modest, the Company’s management has focused on growing and diversifying its securities portfolio.

31

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

The Company’s average balances, interest income/expense, and rates earned/paid on major balance sheet categories, as well as the components of change in net interest income, are presented in the following tables:

	For the three months ended September 30,
	2012								2011
	Average Balance			Interest Earned or Paid		Average Yield or Cost			Average Balance			Interest Earned or Paid		Average Yield or Cost
	(dollars in thousands)
ASSETS
Interest earning assets:
Federal funds sold	$	6,199		$	3		0.19	%	$	18,996		$	8		0.17	%
Interest-bearing deposits at financial institutions		33,446			76		0.90	%		26,124			98		1.49	%
Investment securities (1)		619,650			3,930		2.52	%		516,617			3,243		2.49	%
Restricted investment securities		15,419			132		3.41	%		15,305			126		3.27	%
Gross loans/leases receivable (2) (3) (4)		1,227,326			15,804		5.12	%		1,190,313			16,216		5.40	%
Total interest earning assets	$	1,902,040			19,945		4.17	%	$	1,767,355			19,691		4.42	%
Noninterest-earning assets:
Cash and due from banks	$	38,376							$	46,947
Premises and equipment		31,401								30,446
Less allowance for estimated losses on loans/leases		(18,922	)							(19,693	)
Other		77,314								79,293
Total assets	$	2,030,209							$	1,904,348
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities:
Interest-bearing deposits	$	557,216			625		0.45	%	$	537,887			1,006		0.74	%
Time deposits		357,734			864		0.96	%		363,181			1,195		1.31	%
Short-term borrowings		164,775			60		0.14	%		145,147			66		0.18	%
Federal Home Loan Bank advances		201,328			1,810		3.58	%		204,911			1,931		3.74	%
Junior subordinated debentures		36,085			261		2.88	%		36,085			242		2.66	%
Other borrowings (4)		138,105			1,238		3.57	%		140,774			1,301		3.67	%
Total interest-bearing liabilities	$	1,455,243			4,858		1.33	%	$	1,427,985			5,741		1.60	%
Noninterest-bearing demand deposits	$	406,597							$	311,044
Other noninterest-bearing liabilities		29,147								26,315
Total liabilities	$	1,890,987							$	1,765,344
Stockholders' equity		139,222								139,004
Total liabilities and stockholders' equity	$	2,030,209							$	1,904,348
Net interest income				$	15,087							$	13,950
Net interest spread							2.84	%							2.82	%
Net interest margin							3.16	%							3.13	%
Ratio of average interest-earning assets to average interest-bearing liabilities		130.70	%							123.77	%

(1)	Interest earned and yields on nontaxable investment securities are determined on a tax equivalent basis using a 34% tax rate for each period presented.
(2)	Loan/lease fees are not material and are included in interest income from loans/leases receivable in accordance with accounting and regulatory guidance.
(3)	Non-accrual loans/leases are included in the average balance for gross loans/leases receivable in accordance with accounting and regulatory guidance.
(4)	In accordance with ASC 860, effective January 1, 2010, the Company accounts for some participations sold, including sales of SBA-guaranteed portions of loans during the recourse period, as secured borrowings.  As such, these amounts are included in the average balance for gross loans/leases receivable and other borrowings.  For the three months ended September 30, 2012 and 2011, this totaled $0.0 million and $0.6 million, respectively.  During the second quarter of 2011, SBA removed the recourse provision for sales which allowed for sale accounting treatment at the time of sale; thus, the decline in average balance.

32

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

Analysis of Changes of Interest Income/Interest Expense

For the three months ended September 30, 2012

				Components of Change (1)
	Inc./(Dec.) from Prior Period			Rate			Volume
	2012 vs. 2011
	(dollars in thousands)
INTEREST INCOME
Federal funds sold	$	(5	)	$	7		$	(12	)
Interest-bearing deposits at financial institutions		(22	)		(141	)		119
Investment securities (2)		687			51			636
Restricted investment securities		6			5			1
Gross loans/leases receivable (3) (4) (5)		(412	)		(2,733	)		2,321
Total change in interest income	$	254		$	(2,811	)	$	3,065
INTEREST EXPENSE
Interest-bearing deposits	$	(381	)	$	(615	)	$	234
Time deposits		(331	)		(313	)		(18	)
Short-term borrowings		(6	)		(46	)		40
Federal Home Loan Bank advances		(121	)		(85	)		(36	)
Junior subordinated debentures		19			19			-
Other borrowings (5)		(63	)		(36	)		(27	)
Total change in interest expense	$	(883	)	$	(1,076	)	$	193
Total change in net interest income	$	1,137		$	(1,735	)	$	2,872

(1)	The column "Inc./(Dec.) from Prior Period" is segmented into the changes attributable to variations in volume and the changes attributable to changes in interest rates.  The variations attributable to simultaneous volume and rate changes have been proportionately alloctaed to rate and volume.
(2)	Interest earned and yields on nontaxable investment securities are determined on a tax equivalent basis using a 34% tax rate for each period presented.
(3)	Loan/lease fees are not material and are included in interest income from loans/leases receivable in accordance with accounting and regulatory guidance.
(4)	Non-accrual loans/leases are included in the average balance for gross loans/leases receivable in accordance with accounting and regulatory guidance.
(5)	In accordance with ASC 860, effective January 1, 2010, the Company accounts for some participations sold, including sales of SBA-guaranteed portions of loans during the recourse period, as secured borrowings.  As such, these amounts are included in the average balance for gross loans/leases receivable and other borrowings.  For the three months ended September 30, 2012 and 2011, this totaled $0.0 million and $0.6 million, respectively.  During the second quarter of 2011, SBA removed the recourse provision for sales which allowed sale accounting treatment at the time of sale; thus, the decline in average balance.

33

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

	For the nine months ended September 30,
	2012								2011
	Average Balance			Interest Earned or Paid		Average Yield or Cost			Average Balance			Interest Earned or Paid		Average Yield or Cost
	(dollars in thousands)
ASSETS
Interest earning assets:
Federal funds sold	$	2,066		$	3		0.19	%	$	58,959		$	98		0.22	%
Interest-bearing deposits at financial institutions		51,430			288		0.75	%		30,991			312		1.35	%
Investment securities (1)		603,756			10,890		2.41	%		489,184			9,146		2.50	%
Restricted investment securities		15,327			378		3.29	%		15,677			428		3.65	%
Gross loans/leases receivable (2) (3) (4)		1,212,323			47,748		5.26	%		1,171,331			48,466		5.53	%
Total interest earning assets		1,884,903			59,307		4.20	%	$	1,766,142			58,450		4.42	%
Noninterest-earning assets:
Cash and due from banks	$	39,764							$	43,077
Premises and equipment		31,533								30,696
Less allowance for estimated losses on loans/leases…		(19,005	)							(19,979	)
Other		76,330								72,884
Total assets	$	2,013,525							$	1,892,820
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing liabilities:
Interest-bearing deposits	$	543,723			2,090		0.51	%	$	530,425			3,013		0.76	%
Time deposits		352,606			2,744		1.04	%		364,712			3,935		1.44	%
Short-term borrowings		174,578			203		0.16	%		140,312			248		0.24	%
Federal Home Loan Bank advances		204,209			5,503		3.60	%		213,565			6,053		3.79	%
Junior subordinated debentures		36,085			787		2.91	%		36,085			975		3.61	%
Other borrowings (4)		136,884			3,720		3.63	%		143,617			3,870		3.60	%
Total interest-bearing liabilities		1,448,085			15,047		1.39	%	$	1,428,716			18,094		1.69	%
Noninterest-bearing demand deposits		396,031							$	301,829
Other noninterest-bearing liabilities		27,081								27,327
Total liabilities		1,871,196							$	1,757,872
Stockholders' equity		142,329								134,948
Total liabilities and stockholders' equity		2,013,525							$	1,892,820
Net interest income				$	44,260							$	40,356
Net interest spread							2.81	%							2.73	%
Net interest margin							3.14	%							3.06	%
Ratio of average interest-earning assets to average interest-bearing liabilities		130.17	%							123.62	%

(1)	Interest earned and yields on nontaxable investment securities are determined on a tax equivalent basis using a 34% tax rate for each period presented.
(2)	Loan/lease fees are not material and are included in interest income from loans/leases receivable in accordance with accounting and regulatory guidance.
(3)	Non-accrual loans/leases are included in the average balance for gross loans/leases receivable in accordance with accounting and regulatory guidance.
(4)	In accordance with ASC 860, effective January 1, 2010, the Company accounts for some participations sold, including sales of SBA-guaranteed portions of loans during the recourse period, as secured borrowings.  As such, these amounts are included in the average balance for gross loans/leases receivable and other borrowings.  For the nine months ended September 30, 2012 and 2011, this totaled $0.0 million and $3.4 million, respectively.  During the second quarter of 2011, SBA removed the recourse provision for sales which allowed for sale accounting treatment at the time of sale; thus, the decline in average balance.

34

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

Analysis of Changes of Interest Income/Interest Expense

For the nine months ended September 30, 2012

				Components of Change (1)
	Inc./(Dec.) from Prior Period			Rate			Volume
	2012 vs. 2011
	(dollars in thousands)
INTEREST INCOME
Federal funds sold	$	(95	)	$	(11	)	$	(84	)
Interest-bearing deposits at financial institutions		(24	)		(230	)		206
Investment securities (2)		1,744			(497	)		2,241
Restricted investment securities		(50	)		(40	)		(10	)
Gross loans/leases receivable (3) (4) (5)		(718	)		(2,987	)		2,269
Total change in interest income	$	857		$	(3,765	)	$	4,622
INTEREST EXPENSE
Interest-bearing deposits	$	(923	)	$	(1,044	)	$	121
Time deposits		(1,191	)		(1,064	)		(127	)
Short-term borrowings		(45	)		(121	)		76
Federal Home Loan Bank advances		(550	)		(286	)		(264	)
Junior subordinated debentures		(188	)		(188	)		-
Other borrowings (5)		(150	)		60			(210	)
Total change in interest expense	$	(3,047	)	$	(2,643	)	$	(404	)
Total change in net interest income	$	3,904		$	(1,122	)	$	5,026

(1)	The column "Inc./(Dec.) from Prior Period" is segmented into the changes attributable to variations in volume and the changes attributable to changes in interest rates.  The variations attributable to simultaneous volume and rate changes have been proportionately alloctaed to rate and volume.
(2)	Interest earned and yields on nontaxable investment securities are determined on a tax equivalent basis using a 34% tax rate for each period presented.
(3)	Loan/lease fees are not material and are included in interest income from loans/leases receivable in accordance with accounting and regulatory guidance.
(4)	Non-accrual loans/leases are included in the average balance for gross loans/leases receivable in accordance with accounting and regulatory guidance.
(5)	In accordance with ASC 860, effective January 1, 2010, the Company accounts for some participations sold, including sales of SBA-guaranteed portions of loans during the recourse period, as secured borrowings.  As such, these amounts are included in the average balance for gross loans/leases receivable and other borrowings.  For the nine months ended September 30, 2012 and 2011, this totaled $0.0 million and $3.4 million, respectively.  During the second quarter of 2011, SBA removed the recourse provision for sales which allowed sale accounting treatment at the time of sale; thus, the decline in average balance.

35

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

CRITICAL ACCOUNTING POLICIES

The Company’s financial statements are prepared in accordance with accounting principles generally accepted in the United States of America.  The financial information contained within these statements is, to a significant extent, financial information that is based on approximate measures of the financial effects of transactions and events that have already occurred.

Based on its consideration of accounting policies that involve the most complex and subjective decisions and assessments, management has identified its most critical accounting policy to be that related to the allowance for estimated losses on loans/leases.  The Company’s allowance for estimated losses on loans/leases methodology incorporates a variety of risk considerations, both quantitative and qualitative, in establishing an allowance for estimated losses on loans/leases that management believes is appropriate at each reporting date.  Quantitative factors include the Company’s historical loss experience, delinquency and charge-off trends, collateral values, changes in nonperforming loans/leases, and other factors.  Quantitative factors also incorporate known information about individual loans/leases, including borrowers’ sensitivity to interest rate movements.  Qualitative factors include the general economic environment in the Company’s markets, including economic conditions throughout the Midwest, and in particular, the state of certain industries.  Size and complexity of individual credits in relation to loan/lease structure, existing loan/lease policies and pace of portfolio growth are other qualitative factors that are considered in the methodology.  Management may report a materially different amount for the provision for loan/lease losses in the statement of operations to change the allowance for estimated losses on loans/leases if its assessment of the above factors were different.  This discussion and analysis should be read in conjunction with the Company’s financial statements and the accompanying notes presented elsewhere herein, as well as the portion in the section entitled “Financial Condition” of this Management’s Discussion and Analysis that discusses the allowance for estimated losses on loans/leases.  Although management believes the level of the allowance as of September 30, 2012 is adequate to absorb losses inherent in the loan/lease portfolio, a decline in local economic conditions, or other factors, could result in increasing losses that cannot be reasonably predicted at this time.

The Company’s assessment of other-than-temporary impairment of its available-for-sale securities portfolio is another critical accounting policy as a result of the level of judgment required by management.  Available-for-sale securities are evaluated to determine whether declines in fair value below their cost are other-than-temporary.  In estimating other-than-temporary impairment losses, management considers a number of factors including, but not limited to, (1) the length of time and extent to which the fair value has been less than amortized cost, (2) the financial condition and near-term prospects of the issuer, (3) the current market conditions, and (4) the intent of the Company to not sell the security prior to recovery and whether it is not more-likely-than-not that the Company will be required to sell the security prior to recovery.  The discussion regarding the Company’s assessment of other-than-temporary impairment should be read in conjunction with the Company’s financial statements and the accompanying notes presented elsewhere herein.

36

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

RESULTS OF OPERATIONS

INTEREST INCOME

Interest income declined slightly comparing the third quarter of 2012 to the third quarter of 2011.  The effect of declines in loan yields effectively offset the growth in loans/leases and securities.  Specifically, over the year, the average balance for loans/leases grew $37.0 million, or 3%, while yields declined 28 basis points.  As deposit growth continues to outpace loan growth, the Company has focused on growing and diversifying its securities portfolio, including increasing its portfolio of agency-sponsored mortgage-backed securities as well as municipal securities.  Of the latter, the large majority are located in or near our existing markets with strong underwriting conducted before investment.  Over the year, the average balance for securities grew $103.0 million, or 20%, and yields improved 3 basis points.  With the continuing historical low interest rate environment, management’s execution of its strategy to diversify the securities portfolio has contributed to this yield gain.

For the first nine months of 2012, interest income grew slightly compared to the first nine months of 2011.  Growth and diversification of the securities portfolio (average balances grew $114.6 million, or 23%) more than offset the effect of declining yields (decline of 9 basis points year over year).  The impact of loan/lease growth (average balances grew $41.0 million, or 4%) fell short of the effect of declining yields (decline of 27 basis points year over year) leading to a net decline in interest income on loans/leases.

Management understands the importance of quality, well-priced loan/lease growth and has worked hard to grow assets in a prudent and sustainable manner.

INTEREST EXPENSE

Interest expense for the third quarter of 2012 declined $883 thousand, or 15%, from the third quarter of 2011, and declined $3.0 million, or 17%, comparing the first nine months of 2012 to the same period of 2011.   The Company continued to grow noninterest bearing deposits, whichhas provided management increased flexibility to decrease pricing on its interest-bearing deposits.  The Company has been successful in decreasing the cost of borrowings, which has also contributed to the decline in interest expense.  Management has placed a strong focus on reducing the reliance on wholesale funding as it tends to be higher cost than deposits.  In recent years, the majority of maturing wholesale funds have not been replaced, or, to a lesser extent, have been replaced at significantly reduced cost.  In addition, management executed on three separate strategies during 2011 and 2012 which strongly contributed to the declining borrowing costs:

1. During the first quarter of 2011, QCBT utilized excess liquidity and prepaid $15.0 million of FHLB advances with a weighted average interest rate of 4.87% and a weighted average maturity of May 2012.

2. The Company modified $33.4 million ($20.4 million in first quarter of 2011 and $13.0 million in the fourth quarter of 2011) of fixed rate FHLB advances into new fixed rate FHLB advances at significantly reduced interest rates and extended maturities.

3. During the second quarter of 2012, the Company modified $25.0 million of fixed rate wholesale structured repurchase agreements (“structured repos”) into new fixed rate structured repos at significantly reduced interest rates and extended maturities.

Management continues to consider strategies to accelerate the reduction of the reliance on wholesale funding and continue the shift in mix to a funding base consisting of a higher percentage of core deposits.

37

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

PROVISION FOR LOAN/LEASE LOSSES

The provision for loan/lease losses is established based on a number of factors, including the Company’s historical loss experience, delinquencies and charge-off trends, the local and national economy and risk associated with the loans/leases in the portfolio as described in more detail in the “Critical Accounting Policies” section.

The Company’s provision for loan/lease losses totaled $1.5 million for the third quarter of 2012, a decline of $961 thousand from the third quarter of 2011.  For the first nine months of 2012, the Company’s provision totaled $3.3 million, which was a decline of $1.9 million from the first nine months of 2011.  The declines were the result of continued improvement in loan quality as evidenced by a declining trend in the level of classified and criticized loans (see table and further discussion in the “Financial Condition” section), as well as a declining trend in nonperforming loans/leases.  The latter fell $8.1 million, or 25%, since September 30, 2011.

In comparison to the second quarter of 2012, the Company’s provision for loan/lease losses of $1.5 million for the third quarter of 2012 reflected an increase of $448 thousand.  The Company experiencedloan/lease growth during the third quarter of 2012 which warranted an increased provision.  Specifically, loans/leases grew $31.0 million, or 3%, with the majority of this growth in commercial and commercial real estate.

With the provision of $1.5 million more than offsetting net charge-offs totaling $804 thousand, the Company’s allowance for estimated losses on loans/leases to total loans/leases increased slightly to 1.56% at September 30, 2012 from 1.54% at June 30, 2012.  A more detailed discussion of the Company’s allowance for estimated losses on loans/leases can be found in the “Financial Condition” section of this report.

38

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

NONINTEREST INCOME

The following tables set forth the various categories of noninterest income for the three and nine months ended September 30, 2012 and 2011.

	Three Months Ended
	September 30, 2012			September 30, 2011		$ Change			% Change
Trust department fees	$	914,586		$	762,133	$	152,453			20.0	%
Investment advisory and management fees		575,711			549,515		26,196			4.8
Deposit service fees		847,343			893,685		(46,342	)		(5.2	)
Gains on sales of loans, net		684,546			408,364		276,182			67.6
Securities gains		-			443,614		(443,614	)		(100.0	)
Gains (losses) on other real estate owned, net		(745,799	)		42,262		(788,061	)		(1,864.7	)
Earnings on bank-owned life insurance		399,925			331,440		68,485			20.7
Credit card fees, net of processing costs		140,542			178,636		(38,094	)		(21.3	)
Other		1,300,328			725,658		574,670			79.2
	$	4,117,182		$	4,335,307	$	(218,125	)		(5.0	) %

	Nine Months Ended
	September 30, 2012			September 30, 2011			$ Change			% Change
Trust department fees	$	2,650,552		$	2,607,668		$	42,884			1.6	%
Investment advisory and management fees		1,776,499			1,630,976			145,523			8.9
Deposit service fees		2,626,822			2,623,018			3,804			0.1
Gains on sales of loans, net		1,965,957			1,923,185			42,772			2.2
Securities gains		104,600			1,472,528			(1,367,928	)		(92.9	)
Losses on other real estate owned, net		(1,324,468	)		(90,492	)		(1,233,976	)		1,363.6
Earnings on bank-owned life insurance		1,196,987			1,032,493			164,494			15.9
Credit card fees, net of processing costs		409,730			397,132			12,598			3.2
Other		2,734,890			1,969,304			765,586			38.9
	$	12,141,569		$	13,565,812		$	(1,424,243	)		(10.5	) %

Trust department fees continue to be a significant contributor to noninterest income.  Trust department fees grew 20% from the third quarter of 2011 to the third quarter of 2012, and grew slightly by 2% for the first nine months of 2012 compared to the same period of 2011.  The majority of the trust department fees are determined based on the value of the investments within the managed trusts.  As markets have experienced volatility with the national economy’s recovery from recession, the Company’s fee income has experienced similar volatility and fluctuation.  In recent years, the Company has been successful in expanding its customer base, which has helped to offset some of the effect of volatility and drive the recent increases.

39

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

In recent years, the Company has placed a stronger emphasis on growing its investment advisory and management services.  Part of this initiative has been to restructure the Company’s Wealth Management Division to allow for more efficient delivery of products and services through selective additions of talent as well as the leverage of and collaboration among existing resources (including the aforementioned Trust Department).  Fee income for investment advisory and management services grew 5% comparing third quarter of 2012 to the same period of 2011, and grew 9% year over year.  Similar to trust department fees, these fees are largely determined based on the value of the investments managed.  Continued expansion of the customer base more than offset the impact of market volatility.

As management understands the importance of growing fee income, expanding market share in trust and investment advisory services will continue to be a primary strategic focus.

Although deposit service fees are down 5% from the third quarter of 2011 to the third quarter of 2012, deposit service fees have generally expanded over the past several years.  The Company has placed an emphasis on shifting the mix of deposits from brokered and retail time deposits to non-maturity demand deposits.  With this shift in mix, the Company has increased the number of demand deposit accounts, which tend to be lower in interest cost and higher in service fees.  The Company plans to continue this shift in mix and to further focus on growing deposit service fees.  Management periodically evaluates fee levels and fully understands the importance of this recurring source of fee income.

Gains on sales of loans, net, consists of sales of residential mortgages and the government guaranteed portions of small business loans.  Following is the breakdown of the gains recognized for these types of sales for the three and nine months ended September 30, 2012 and 2011.

	For the three months ended				For the nine months ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Gains on sales of residential mortgages	$	424,255	$	233,163	$	987,021	$	529,696
Gains on sales of government guaranteed portions of loans		260,291		175,201		978,936		1,393,489
	$	684,546	$	408,364	$	1,965,957	$	1,923,185

Growth in the sales of residential mortgages is the result of an increase in refinancing activity caused by the continued flattening of the yield curve driving mortgage rates downward and allowing opportunities for additional refinancing.  In addition, there appears to be a slow and steady recovery in the residential mortgage market with increased buying and selling activity.  Sales activity for government guaranteed portions of loans tends to fluctuate depending on the demand for small business loans that fit the criteria for the government guarantee.  Further, some of the transactions can be large and, as the gain is determined as a percentage of the guaranteed amount, the resulting gain on sale can be large.  Lastly, a strategy for improved pricing is packaging loans together for sale.  From time to time, the Company may execute on this strategy, which may delay the gains on sales of some loans to achieve better pricing.  Despite the fluctuation, the Company will continue to focus on growing small business lending and selling the government guaranteed portion as it continues to be beneficial.

40

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

During the third quarter of 2011, as a result of favorable market conditions, QCBT sold $8.6 million of government agency securities for a pre-tax gain totaling $444 thousand.  The related sales proceeds were reinvested into agency-sponsored residential mortgage-backed securities with higher yields and similar credit risk to the sold securities.  During the second quarter of 2011, as a result of favorable market conditions, RB&T sold $8.3 million of government agency securities for a pre-tax gain totaling $149 thousand,.  Additionally, the sales proceeds were utilized to diversify RB&T’s securities portfolio and fund loan growth.  Separately, during the first quarter of 2011, in an effort to offset the $832 thousand of fees for prepaying $15.0 million of FHLB advances, QCBT sold $37.4 million of government agency securities for a pre-tax gain totaling $880 thousand.

In 2012, the Company incurred increased write-downs of existing other real estate owned as the result of further declines in appraised values.  Of the net losses for the current quarter, the Company wrote down $527 thousand of existing other real estate owned and recognized net losses on sales of $219 thousand.  For the first nine months of 2012, the Company had write-downs of $1.2 million and net losses on sales of $165 thousand.  Management continues to proactively manage its other real estate owned portfolio in an effort to sell timely at minimal loss.

Earnings on bank-owned life insurance experienced strong growth quarter-over-quarter and year-over-year.  The Company purchased $1.6 million, or 4%, of additional bank-owned life insurance since September 30, 2011.  Additionally, a small portion of the Company’s bank-owned life insurance is variable rate whereby the returns are determined by the performance of the equity market.

Included in ‘other’ noninterest income, the Company recognized a $580 thousand pre-tax gain on the sale of a small equity interest in a company that provided data processing services to the Company’s merchant credit card acquiring business that was previously sold in 2008.  In addition, CRBT recognized $303 thousand of fee income for the execution of interest rate swaps related to three commercial loans during the first nine months of 2012 ($207 thousand in first quarter of 2012, and $96 thousand in the third quarter of 2012).  The interest rate swaps allow the commercial borrowers to pay a fixed interest rate while CRBT receives a variable interest rate.  Management believes that these swaps help position CRBT more favorably for rising rate environments.

41

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

NONINTEREST EXPENSE

The following table sets forth the various categories of noninterest expense for the three and nine months ended September 30, 2012 and 2011.

	Three Months Ended
	September 30, 2012		September 30, 2011		$ Change			% Change
Salaries and employee benefits	$	8,201,323	$	7,651,695	$	549,628			7.2	%
Occupancy and equipment expense		1,459,901		1,359,758		100,143			7.4
Professional and data processing fees		1,065,780		1,077,435		(11,655	)		(1.1	)
FDIC and other insurance		599,422		578,776		20,646			3.6
Loan/lease expense		273,166		839,993		(566,827	)		(67.5	)
Advertising and marketing		437,130		277,376		159,754			57.6
Postage and telephone		190,868		242,103		(51,235	)		(21.2	)
Stationery and supplies		139,592		122,582		17,010			13.9
Bank service charges		211,378		186,351		25,027			13.4
Other		452,957		437,080		15,877			3.6
	$	13,031,517	$	12,773,149	$	258,368			2.0	%

	Nine Months Ended
	September 30, 2012		September 30, 2011		$ Change			% Change
Salaries and employee benefits	$	24,581,642	$	22,480,731	$	2,100,911			9.3	%
Occupancy and equipment expense		4,177,076		4,017,506		159,570			4.0
Professional and data processing fees		3,342,847		3,338,935		3,912			0.1
FDIC and other insurance		1,756,493		2,149,093		(392,600	)		(18.3	)
Loan/lease expense		755,066		1,772,290		(1,017,224	)		(57.4	)
Advertising and marketing		1,057,246		836,459		220,787			26.4
Postage and telephone		716,050		703,803		12,247			1.7
Stationery and supplies		417,769		380,754		37,015			9.7
Bank service charges		609,599		525,007		84,592			16.1
Prepayment fees on Federal Home Loan Bank advances		-		832,099		(832,099	)		(100.0	)
Other-than-temporary impairment losses on securities		62,400		118,847		(56,447	)		(47.5	)
Other		1,402,492		1,185,443		217,049			18.3
	$	38,878,680	$	38,340,967	$	537,713			1.4	%

42

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

Salaries and employee benefits, which is the largest component of noninterest expense, increased from prior year.  This increase is largely the result of:

· Customary annual salary and benefits increases for the majority of the Company’s employee base in 2012.

· Continued increases in health insurance-related employee benefits for the majority of the Company’s employee base.

· Higher accrued incentive compensation based on improved performance for the first nine months of 2012.

· Targeted talent additions in late 2011 and early 2012.  Specifically, the Company added four business development officers (three in the Wealth Management Division and one in the Correspondent Banking Division) in an effort to continue to grow market share.

Occupancy and equipment expense increased from the prior year with the purchases of additional technology for enhanced customer service and for improved fraud detection and prevention systems.  In addition, the largest branch of RB&T was renovated to allow for existing and future expansion.

Although the FDIC and other insurance expense increased quarter-over-quarter, FDIC and other insurance expense has generally fallen over the past two years.  FDIC insurance premiums are calculated using a variety of factors, including, but not limited to, balance sheet levels, funding mix, and regulatory compliance.  The subsidiary banks have been successful in managing these factors and driving down FDIC insurance cost.  In addition, the FDIC modified the calculation for premiums effective during the second quarter of 2011.  The modification was favorable for the Company’s subsidiary banks.

Loan/lease expense declined significantly in the first nine months of 2012.  Generally, loan/lease expense has a direct relationship with the level of nonperforming loans/leases.  Over the past several quarters, the Company has been successful in resolving several nonperforming loans that had previously incurred significant recurring costs.

The Company incurred additional expenses for advertising and marketing during 2012 in an effort to gain market share across all three markets.  The largest costs were incurred by QCBT as management sponsored two high profile community events.

Bank service charges, which include costs incurred to provide services to QCBT’s correspondent banking customer portfolio, have increased year over year.  The increase is due, in large part, to the success QCBT has had in growing its correspondent banking customer portfolio over the past year.

In an effort to utilize some of its excess liquidity and improve net interest margin by eliminating some of its higher cost wholesale funding, QCBT prepaid $15.0 million of FHLB advances during the first quarter of 2011.  As a result, QCBT incurred a prepayment fee totaling $832 thousand.  To offset these fees, QCBT sold $37.4 million of government sponsored agency securities for a pre-tax gain totaling $880 thousand.

Overall, management has placed a strong emphasis on prudent cost control through improved efficiency.

43

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

INCOME TAXES

The provision for income taxes totaled $1.0 million, or an effective tax rate of 25%, for the third quarter of 2012 compared to $667 thousand, or an effective tax rate of 23%, for the same quarter in 2011.  The increase in effective tax rate is the result of the proportion of taxable to nontaxable income.  The Company’s growth in taxable income comparing the third quarter of 2012 to the third quarter of 2011 more than offsets the impact of the growth in nontaxable income (the Company grew its tax exempt municipal securities portfolio over threefold during 2012).

For the first nine months of 2012, the provision for income taxes totaled $3.4 million, or an effective tax rate of 26%, compared to $2.7 million, or an effective tax rate of 28%, for the first nine months of 2011.  The decline in the effective tax rate is primarily the result of the following:

· The continued application of tax credits that were acquired in the third quarter of 2011.

· The increase in tax-exempt municipal securities during the first nine months of 2012, which, in turn, resulted in an increase in nontaxable income.  Specifically, the Company grew its municipal securities portfolio from $25.7 million at December 31, 2011 to $90.0 million at September 30, 2012.

FINANCIAL CONDITION

Following is a table that represents the major categories of the Company’s balance sheet.

	As of
	September 30, 2012					December 31, 2011					September 30, 2011
	(dollars in thousands)
	Amount		%			Amount		%			Amount		%
Cash, federal funds sold, and interest-bearing deposits	$	95,727		5	%	$	100,673		5	%	$	75,887		4	%
Securities		591,351		29	%		565,229		29	%		525,912		28	%
Net loans/leases		1,224,875		61	%		1,181,956		60	%		1,178,003		62	%
Other assets		111,993		6	%		118,752		6	%		119,158		6	%
Total assets	$	2,023,946		100	%	$	1,966,610		100	%	$	1,898,960		100	%
Total deposits	$	1,343,235		66	%	$	1,205,458		61	%	$	1,207,469		64	%
Total borrowings		511,561		25	%		590,603		30	%		524,551		28	%
Other liabilities		30,029		2	%		26,116		1	%		23,771		1	%
Total stockholders' equity		139,121		7	%		144,433		8	%		143,169		7	%
Total liabilities and stockholders' equity	$	2,023,946		100	%	$	1,966,610		100	%	$	1,898,960		100	%

During the first nine months of 2012, the Company’s total assets increased $57.3 million, or 3%, to a total of $2.02 billion.   The Company experienced loan/lease growth over the year totaling $42.9 million, or 4%, with most of this growth in the third quarter ($31.0 million, or 3%).  Additionally, the Company continued to grow its securities portfolio with an increase of $26.1 million, or 5%, during the first nine months of 2012.  The asset growth during the first nine months of 2012 was funded by strong and continued growth of the Company’s deposit portfolio (as balances grew $137.8 million, or 11%) partially offset by reductions in federal funds purchased and FHLB advances.

44

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

The composition of the Company’s securities portfolio is managed to meet liquidity needs while prioritizing the impact on asset-liability position and maximizing return.  With the strong growth in deposits more than offsetting the pace of loan growth over the past two years, the Company has grown and diversified its securities portfolio, including increasing the portfolio of agency-sponsored mortgage-backed securities as well as more than tripling the portfolio of municipal securities.  Of the latter, the large majority are located in or near the Company’s existing markets and require a thorough underwriting process before investment.  As the portfolio has grown over recent years, management has elevated its focus on maximizing return while minimizing credit and interest rate risk.

Following is a breakdown of the Company’s securities portfolio by type, the percentage of unrealized gains to amortized cost on the total portfolio, and the portfolio duration:

	As of
	September 30, 2012						December 31, 2011						September 30, 2011
	Amount			%			Amount			%			Amount			%
							(dollars in thousands)
U.S. govt. sponsored agency securities	$	343,244			59	%	$	428,955			76	%	$	414,784			79	%
Residential mortgage-backed and related securities		155,691			26	%		108,854			19	%		83,452			16	%
Municipal securities		90,032			15	%		25,689			5	%		25,991			5	%
Other securities, including held-to-maturity		2,384			0	%		1,731			0	%		1,685			0	%
	$	591,351			100	%	$	565,229			100	%	$	525,912			100	%
Net Unrealized Gains as a % of Amortized Cost		1.7	%					1.4	%					1.3	%
Duration (in years)		2.7						1.8						1.6

The Company has not invested in commercial mortgage-backed securities or pooled trust preferred securities.

See Note 2 for additional information regarding the Company’s investment securities.

45

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

Total loans/leases grew $31.0 million, or 3%, in the third quarter of 2012, and grew $42.9 million, or 4%, during the first nine months of 2012.  This marked the sixth consecutive quarter of net loan/lease growth.  The mix of the loan/lease types within the Company’s loan/lease portfolio is presented in the following table.

	As of
	September 30, 2012						December 31, 2011						September 30, 2011
	Amount			%			Amount			%			Amount			%
	(dollars in thousands)
Commercial and industrial loans	$	355,004			29	%	$	350,794			29	%	$	363,998			30	%
Commercial real estate loans		594,904			48	%		577,804			48	%		568,487			48	%
Direct financing leases		102,039			8	%		93,212			8	%		88,893			7	%
Residential real estate loans		112,492			9	%		98,107			8	%		94,073			8	%
Installment and other consumer loans		76,838			6	%		78,223			7	%		79,893			7	%
Total loans/leases	$	1,241,277			100	%	$	1,198,140			100	%	$	1,195,344			100	%
Plus deferred loan/lease origination costs, net of fees		3,015						2,605						2,238
Less allowance for estimated losses on loans/leases		(19,417	)					(18,789	)					(19,579	)
Net loans/leases	$	1,224,875					$	1,181,956					$	1,178,003

Regarding the Company’s levels of qualified small business lending as defined by Treasury as part of the Company’s participation in SBLF, see the discussion later in this section of the Management’s Discussion and Analysis.

As commercial real estate loans are the largest portfolio segment, management places a strong emphasis on monitoring the composition of the Company’s commercial real estate loan portfolio.  Management tracks the level of owner-occupied commercial real estate loans versus non owner-occupied loans.  Owner-occupied loans are generally considered to have less risk.  As of September 30, 2012 and December 31, 2011, approximately 34% and 29%, respectively, of the commercial real estate loan portfolio was owner-occupied.  The Company’s commercial real estate portfolio grew $17.1 million, or 3%, over the first nine months of 2012.  Further, there was a favorable shift in mix as owner-occupied loans grew $32.0 million, or 19%, while non owner-occupied loans (including commercial construction and land development) declined $14.9 million, or 4%.

46

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

Following is a listing of significant industries within the Company’s commercial real estate loan portfolio as of September 30, 2012 and December 31, 2011:

	As of September 30, 2012					As of December 31, 2011
	Amount		%			Amount		%
	(dollars in thousands)
Lessors of Nonresidential Buildings	$	182,190		31	%	$	179,511		31	%
Lessors of Residential Buildings		49,599		8	%		50,029		9	%
Land Subdivision		28,553		5	%		33,252		6	%
Hotels		27,300		5	%		19,061		3	%
New Car Dealers		26,378		4	%		25,223		4	%
Lessors of Other Real Estate Property		14,638		2	%		15,830		3	%
Other *		266,246		45	%		254,898		44	%
Total Commercial Real Estate Loans	$	594,904		100	%	$	577,804		100	%

*   “Other” consists of all other industries.  None of these had concentrations greater than $15 million, or 2.5% of total commercial real estate loans.

The Company’s residential real estate loan portfolio consists of the following:

· Certain loans that do not meet the criteria for sale into the secondary market.  These are often structured as adjustable rate mortgages with maturities ranging from three to seven years to avoid the long-term interest rate risk.

· A limited amount of 15-year fixed rate residential real estate loans that met certain credit guidelines.

The remaining residential real estate loans originated by the Company were sold on the secondary market to avoid the interest rate risk associated with longer term fixed rate loans.  Loans originated for this purpose were classified as held for sale and are included in the residential real estate loans above.  In addition, the Company has not originated any subprime, Alt-A, no documentation, or stated income residential real estate loans throughout its history.

See Note 3 for additional information regarding the Company’s loan/lease portfolio.

Changes in the allowance for estimated losses on loans/leases for the three and nine months ended September 30, 2012 and 2011 are presented as follows:

	Three Months Ended						Nine Months Ended
	September 30, 2012			September 30, 2011			September 30, 2012			September 30, 2011
	(dollars in thousands)
Balance, beginning	$	18,725		$	19,803		$	18,789		$	20,365
Provisions charged to expense		1,496			2,457			3,325			5,197
Loans/leases charged off		(1,150	)		(3,104	)		(3,709	)		(6,676	)
Recoveries on loans/leases previously charged off		346			423			1,012			693
Balance, ending	$	19,417		$	19,579		$	19,417		$	19,579

47

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

The allowance for estimated losses on loans/leases was $19.4 million at September 30, 2012 compared to $18.8 million at December 31, 2011 and $19.6 million at September 30, 2011.  The allowance for estimated losses on loans/leases was determined based on factors that included the overall composition of the loan/lease portfolio, types of loans/leases, past loss experience, loan/lease delinquencies, potential substandard and doubtful credits, economic conditions, collateral positions, governmental guarantees and other factors that, in management’s judgment, deserved evaluation. To ensure that an adequate allowance was maintained, provisions were made based on a number of factors, including the increase/decrease in loans/leases and a detailed analysis of the loan/lease portfolio.  The loan/lease portfolio was reviewed and analyzed monthly with specific detailed reviews completed on all loans risk-rated worse than “fair quality” and carrying aggregate exposure in excess of $100 thousand.  The adequacy of the allowance for estimated losses on loans/leases is monitored by the loan review staff and reported to management and the board of directors.

The Company continued to strengthen its core loan portfolio as the levels of criticized and classified loans declined further in the third quarter of 2012, as reported in the following table.

	As of
Internally Assigned Risk Rating *	September 30, 2012		December 31, 2011		September 30, 2011
			(dollars in thousands)
Special Mention (Rating 6)	$	21,355	$	26,034	$	31,969
Substandard (Rating 7)		49,232		62,712		73,429
Doubtful (Rating 8)		-		-		-
	$	70,587	$	88,746	$	105,398
Criticized Loans **	$	70,587	$	88,746	$	105,398
Classified Loans ***	$	49,232	$	62,712	$	73,429

* Amounts above include the government guaranteed portion, if any.  For the calculation of allowance for estimated losses on loans/leases, the Company assigns internal risk ratings of Pass (Rating 2) for the government guaranteed portion.

** Criticized loans are defined as commercial and industrial and commercial real estate loans with internally assigned risk ratings of 6, 7, or 8, regardless of performance.

*** Classified loans are defined as commercial and industrial and commercial real estate loans with internally assigned risk ratings of 7 or 8, regardless of performance.

The declining trend in criticized and classified loans over the past several years translated to a reduction in nonperforming loans/leases and that trend continued during the third quarter of 2012 as nonperforming loans/leases fell $3.4 million, or 12%.  Furthermore, nonperforming loans/leases have declined $23.4 million, or 50%, from their peak at September 30, 2010.  As a direct result, the level of allowance has declined.  Notably, the decline in nonperforming loans/leases has outpaced the decline in allowance for estimated losses on loans/leases and strengthened the Company’s ratio of allowance to nonperforming loans/leases.  The following table summarizes the trend in allowance as a percentage of gross loans/leases and as a percentage of nonperforming loans/leases as of September 30, 2012, December 31, 2011, and December 31, 2010.

48

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

	As of
	September 30, 2012			December 31, 2011			December 31, 2010
Allowance / Gross Loans/Leases		1.56	%		1.56	%		1.74	%
Allowance / Nonperforming Loans/Leases *		81.10	%		58.70	%		49.49	%

*Nonperforming loan/leases consist of nonaccrual loans/leases, accruing loans/leases past due 90 days or more, and accruing troubled debt restructurings.

Although management believes that the allowance for estimated losses on loans/leases at September 30, 2012 was at a level adequate to absorb losses on existing loans/leases, there can be no assurance that such losses will not exceed the estimated amounts or that the Company will not be required to make additional provisions for loan/lease losses in the future.  Unpredictable future events could adversely affect cash flows for both commercial and individual borrowers, which could cause the Company to experience increases in problem assets, delinquencies and losses on loans/leases, and require further increases in the provision.  Asset quality is a priority for the Company and its subsidiaries.  The ability to grow profitably is in part dependent upon the ability to maintain that quality.  The Company continually focuses efforts at its subsidiary banks and leasing company with the intention to improve the overall quality of the Company’s loan/lease portfolio.

See Note 3 for additional information regarding the Company’s allowance for estimated losses on loans/leases.

The table below presents the amounts of nonperforming assets.

	As of September 30, 2012			As of December 31, 2011			As of September 30, 2011			As of December 31, 2010
	(dollars in thousands)
Nonaccrual loans/leases (1) (2)	$	17,731		$	18,995		$	29,006		$	37,427
Accruing loans/leases past due 90 days or more		203			1,111			333			320
Troubled debt restructures - accruing		6,009			11,904			2,675			3,405
Other real estate owned		5,003			8,386			8,288			8,535
Other repossessed assets		116			109			160			366
	$	29,062		$	40,505		$	40,462		$	50,053
Nonperforming loans/leases to total loans/leases		1.92	%		2.67	%		2.67	%		3.51	%
Nonperforming assets to total loans/leases plus reposessed property		2.33	%		3.35	%		3.35	%		4.24	%
Nonperforming assets to total assets		1.44	%		2.06	%		2.13	%		2.73	%
Texas ratio (3)		18.66	%		25.58	%		25.58	%		33.57	%

(1) Includes government guaranteed portion of loans, as applicable.

(2) Includes troubled debt restructurings of $5.7 million at September 30, 2012, $8.6 million at December 31, 2011, $8.6 million at September 30, 2011, and $12.6 million at December 31, 2010.

(3) Texas Ratio = Nonperforming Assets (excluding Other Repossessed Assets) / Tangible Equity plus Allowance for Estimated Losses on Loans/Leases.  Texas Ratio is a non-GAAP financial measure.  Management included this ratio as this is considered to be a critical metric with which to analyze and evaluate asset quality.  Other companies may calculate this ratio differently.

The large majority of the nonperforming assets consist of nonaccrual loans/leases, accruing troubled debt restructurings, and other real estate owned.  For nonaccrual loans/leases and accruing troubled debt restructurings, management has thoroughly reviewed these loans/leases and has provided specific allowances as appropriate.  Other real estate owned is carried at the fair value less costs to sell.

49

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

Nonperforming assets at September 30, 2012 were $29.1 million which is a decline of $11.4 million, or 28%, from December 31, 2011.  Further, nonperforming assets have declined $30.3 million, or 51%, from their peak position of $59.4 million at September 30, 2010.  Most of the decline from December 31, 2011 was the result of improved performance on nonperforming loans ($4.4 million) and sales of other real estate owned ($2.1 million), with the remainder due to charge-offs ($3.7 million) and write-downs of other real estate owned ($1.2 million).

Deposits grew $137.8 million, or 11%, during the first nine months of 2012.  The table below presents the composition of the Company’s deposit portfolio.

	As of
	September 30, 2012					December 31, 2011					September 30, 2011
	(dollars in thousands)
	Amount		%			Amount		%			Amount		%
Noninterest bearing demand deposits	$	417,284		31	%	$	357,184		30	%	$	326,710		27	%
Interest bearing demand deposits		567,578		42	%		510,788		42	%		528,552		44	%
Time deposits		308,083		23	%		292,575		24	%		304,674		25	%
Brokered time deposits		50,290		4	%		44,911		4	%		47,533		4	%
	$	1,343,235		100	%	$	1,205,458		100	%	$	1,207,469		100	%

The Company has been successful in growing its noninterest bearing deposit portfolio over the past few years and this continued into the first nine months of 2012 with an increase of $60.1 million, or 17%. Most of this growth continues to be derived from QCBT’s correspondent banking business.  The continued strength of the noninterest bearing deposit portfolio has provided flexibility to manage down deposit pricing and reduce reliance on higher cost wholesale funds which has helped drive down the Company’s interest expense.

The subsidiary banks offer short-term repurchase agreements to some of their significant customers.  Also, the subsidiary banks purchase federal funds for short-term funding needs from the Federal Reserve Bank or from their correspondent banks.  The table below presents the composition of the Company’s short-term borrowings.

	As of
	September 30, 2012		December 31, 2011		September 30, 2011
	(dollars in thousands)
Overnight repurchase agreements with customers	$	114,248	$	110,236	$	101,886
Federal funds purchased		26,640		103,300		41,700
	$	140,888	$	213,536	$	143,586

The Company’s federal funds purchased position was temporarily elevated at December 31, 2011, as a result of short-term fluctuations in noninterest bearing correspondent deposit balances for several customers over the end of the year.

As a result of their memberships in either the FHLB of Des Moines or Chicago, the subsidiary banks have the ability to borrow funds for short or long-term purposes under a variety of programs.  FHLB advances are utilized for loan matching as a hedge against the possibility of rising interest rates, and when these advances provide a less costly or more readily available source of funds than customer deposits.  FHLB advances declined $8.4 million, or 4%, during the first nine months of 2012.

50

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

Other borrowings consist largely of structured wholesale repurchase agreements which are utilized as an alternative funding source to FHLB advances and customer deposits.  The table below presents the composition of the Company’s other borrowings.

	As of
	September 30, 2012		December 31, 2011		September 30, 2011
	(dollars in thousands)
Wholesale repurchase agreements	$	130,000	$	130,000	$	135,000
364-day revolving note		5,600		3,600		2,500
Series A subordinated notes		2,638		2,632		2,630
	$	138,238	$	136,232	$	140,130

The increase in borrowing on the 364-day revolving note of $2.0 million was the result of funding needed to execute on the partial redemption of the Series F Preferred Stock previously issued to Treasury under the SBLF program.  For a detailed discussion of this partial redemption, see below.

It is management’s intention to continue to reduce the reliance on wholesale funding, including FHLB advances, wholesale structured repurchase agreements, and brokered time deposits.  Replacement of this funding with core deposits helps to reduce interest expense as the wholesale funding tends to be higher funding cost.  The table below presents the maturity schedule including weighted average cost for the Company’s combined wholesale funding portfolio.

	September 30, 2012					December 31, 2011
Maturity:	Amount Due		Weighted Average Interest Rate at Quarter-End			Amount Due		Weighted Average Interest Rate at Year-End
	(dollar amounts in thousands)
Year ending December 31:
2012	$	8,000		1.80	%	$	34,601		2.93	%
2013		25,508		1.73			18,000		2.24
2014		39,170		2.88			39,170		2.87
2015		66,000		2.59			67,000		2.97
2016		85,962		3.72			82,890		3.81
2017		46,000		3.70			42,000		3.91
Thereafter		106,000		3.66			96,000		3.75
Total Wholesale Funding	$	376,640		3.24		$	379,661		3.41

Importantly, a large portion of the above FHLB advances and wholesale structured repurchase agreements have putable options which allow the lender (FHLB or counterparty), at its discretion, to terminate the borrowing and require the subsidiary banks to repay at predetermined dates prior to the stated maturity.

51

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

The table below presents the composition of the Company’s stockholders’ equity, including the common and preferred equity components.

	As of
	September 30, 2012						December 31, 2011						September 30, 2011
	Amount			%			Amount			%			Amount			%
	(dollars in thousands)
Common stock	$	4,984					$	4,879					$	4,868
Additional paid in capital - common		25,234						26,381						25,098
Retained earnings		51,078						44,586						43,072
Accumulated other comprehensive income		6,122						4,755						4,173
Noncontrolling interests		146						2,052						1,924
Less:  Treasury stock		(1,606	)					(1,606	)					(1,606	)
Total common stockholders' equity		85,958			62	%		81,047			56	%		77,529			54	%
Preferred stock		55						65						65
Additional paid in capital - preferred		53,108						63,321						65,575
Total preferred stockholders' equity		53,163			38	%		63,386			44	%		65,640			46	%
Total stockholders' equity	$	139,121			100	%	$	144,433			100	%	$	143,169			100	%
Tangible common equity* / total tangible assets		4.09	%					3.85	%					3.82	%

*Tangible common equity is defined as total common stockholders’ equity excluding equity of noncontrolling interests and excluding goodwill and other intangibles.  This ratio is a non-GAAP financial measure.  Management included this ratio as it is considered by many investors and analysts to be a metric with which to analyze and evaluate the equity composition.  Other companies may calculate this ratio differently.

Stockholders’ equity declined $5.3 million, or 4%, during the first nine months of 2012 as a result of the partial redemption of Series F Preferred Stock.  On June 29, 2012, the Company redeemed $10.2 million of the $40.1 million of outstanding Series F Preferred Stock.  The Company originally issued this preferred capital to Treasury in September of 2011.  Net income of $9.4 million grew retained earnings; however, this was partially offset by declaration of preferred stock dividends totaling $2.7 million ($1.3 million for Series E Preferred Stock, and $1.4 million for Series F Preferred Stock).  As part of the purchase of the 20% noncontrolling interest in m2 Lease Funds, the equity in noncontrolling interest decreased $1.9 million.  In addition, as further discussed in Note 8, the Company’s additional paid-in capital declined $2.1 million for the premium paid on the purchase of the 20% noncontrolling interest in m2 Lease Funds.  Lastly, the available for sale portion of the securities portfolio experienced an increase in fair value for the first nine months of 2012 totaling $1.4 million as a result of declines in certain market interest rates.

52

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

The following table presents the details of the preferred stock issued and outstanding as of September 30, 2012.

	Date Issued	Aggregate Purchase Price		Stated Dividend Rate			Annual Dividend
Series E Non-Cumulative Convertible Perpetual Preferred Stock	June 2010	$	25,000,000		7.00	%	$	1,750,000
Series F Non-Cumulative Perpetual Preferred Stock	September 2011		29,867,000		5.00	%		1,493,350
		$	54,867,000				$	3,243,350

The Series E Preferred Stock is perpetually convertible by the holder into shares of common stock at a per share conversion price of $12.15, subject to anti-dilution adjustments upon the occurrence of certain events.  In addition, the Company can exercise a conversion option on or after the third anniversary of the issue date (June 30, 2013) at the same $12.15 conversion price if the Company’s common stock price equals or exceeds $17.22 for at least 20 trading days in a period of 30 consecutive trading days.

Regarding the Series F Preferred Stock, non-cumulative dividends are payable quarterly, and the dividend rate is based on changes in the level of “Qualified Small Business Lending” or “QSBL” by the Company’s wholly owned bank subsidiaries, QCBT, CRBT and RB&T.  Based upon the change in the banks’ level of QSBL over the baseline level (defined below), the dividend rate remained at 5% through the third quarter of 2012.  With the partial redemption, assuming a 5% dividend rate, the Company’s preferred dividends will be reduced by $511 thousand annually.

As of September 30, 2012, the Company reported its QSBL in accordance with SBLF guidelines and calculated a net decline from the baseline of $68.8 million, or 15%.  SBLF defines the baseline as the average of the Company’s QSBL for the last two quarters of 2009 and the first two quarters of 2010.  As a result of the decline, the dividend rate on the Series F Preferred Stock remains at 5%.  Although the Company continues to experience a net decline in QSBL since the baseline, it continues to support small businesses in its communities.  One example of this support is through its significant participation in the SBA and USDA lending programs.  Notably, for 2011, all three of the subsidiary banks were ranked in the top 10 in their respective states for SBA lending volume.  CRBT was ranked first in the state of Iowa for both SBA and USDA lending volume.  The government guaranteed portions of these loans (typically 70% to 85% of the total principal balance) do not qualify as QSBL, as defined by SBLF guidelines.  Through continued participation in these programs and the efforts of the Company’s experienced small business bankers, the Company is well positioned to continue to support the lending needs of small businesses in the communities it serves.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity measures the ability of the Company to meet maturing obligations and its existing commitments, to withstand fluctuations in deposit levels, to fund its operations, and to provide for customers’ credit needs.  The Company monitors liquidity risk through contingency planning stress testing on a regular basis.  The Company seeks to avoid over concentration of funding sources and to establish and maintain contingent funding facilities that can be drawn upon if normal funding sources become unavailable.  One source of liquidity is cash and short-term assets, such as interest-bearing deposits in other banks and federal funds sold, which totaled $95.7 million at September 30, 2012, an increase over $83.7 million at June 30, 2012, and down slightly from $100.7 million at December 31, 2012.  These levels are approximately 5% of total assets.

53

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

The Company has a variety of sources of short-term liquidity available, including federal funds purchased from correspondent banks, FHLB advances, structured wholesale repurchase agreements, brokered certificates of deposit, lines of credit, borrowing at the Federal Reserve Discount Window, sales of securities available for sale, and loan/lease participations or sales.  The Company also generates liquidity from the regular principal payments and prepayments made on its loan/lease portfolio, and on the regular monthly payments on its residential mortgage-backed securities portfolio. At September 30, 2012, the subsidiary banks had 31 lines of credit totaling $301.9 million, of which $52.9 million was secured and $249.0 million was unsecured.  At September 30, 2012, the full $301.9 million was available.  Additionally, the Company has a single $20.0 million secured revolving line of credit with a maturity date of April 1, 2013.  As of September 30 2012, the Company had $14.4 million available as the line of credit carried an outstanding balance of $5.6 million.

Throughout its history, the Company has secured additional capital through various resources, including the issuance of preferred stock (discussed above) and the issuance of trust preferred securities.  Trust preferred securities are reported on the Company’s balance sheet as liabilities, but do qualify for treatment as regulatory capital.

The following table presents the details of the trust preferred securities issued and outstanding as of September 30, 2012.

Name	Date Issued	Amount Issued		Interest Rate	Interest Rate as of 9/30/12			Interest Rate as of 12/31/11
QCR Holdings Statutory Trust II	February 2004	$	12,372,000	2.85% over 3-month LIBOR		3.31	%		3.22	%
QCR Holdings Statutory Trust III	February 2004		8,248,000	2.85% over 3-month LIBOR		3.31	%		3.22	%
QCR Holdings Statutory Trust IV	May 2005		5,155,000	1.80% over 3-month LIBOR		2.25	%		2.20	%
QCR Holdings Statutory Trust V	February 2006		10,310,000	1.55% over 3-month LIBOR		2.00	%		1.95	%
		$	36,085,000	Weighted Average Rate		2.78	%		2.71	%

54

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

The Company (on a consolidated basis) and the subsidiary banks are subject to various regulatory capital requirements administered by the federal banking agencies.  Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company and subsidiary banks’ financial statements.  Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the subsidiary banks must meet specific capital guidelines that involve quantitative measures of their assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices.  The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.  Quantitative measures established by regulation to ensure capital adequacy require the Company and the subsidiary banks to maintain minimum amounts and ratios (set forth in the following table) of total and Tier 1 capital to risk-weighted assets and of Tier 1 capital to average assets, each as defined by regulation.  Management believes, as of September 30, 2012 and December 31, 2011, that the Company and the subsidiary banks met all capital adequacy requirements to which they were subject.

Under the regulatory framework for prompt corrective action, to be categorized as “well capitalized,” an institution must maintain minimum total risk-based, Tier 1 risk-based and Tier 1 leverage ratios as set forth in the following tables.  The Company and the subsidiary banks’ actual capital amounts and ratios as of September 30, 2012 and December 31, 2011 are also presented in the following table (dollars in thousands).  As of September 30, 2012 and December 31, 2011, the subsidiary banks met the requirements to be “well capitalized”.

	Actual					For Capital Adequacy Purposes						To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio				Amount	Ratio
As of September 30, 2012:
Company:
Total risk-based capital	$	185,396		12.98	%	$	114,294	≥	8.0	%		N/A		N/A
Tier 1 risk-based capital		164,598		11.52	%		57,147	≥	4.0			N/A		N/A
Leverage ratio		164,598		8.12	%		81,078	≥	4.0			N/A		N/A
Quad City Bank & Trust:
Total risk-based capital	$	98,164		12.51	%	$	62,795	≥	8.0	%	$	78,493	≥	10.00	%
Tier 1 risk-based capital		90,009		11.47	%		31,397	≥	4.0			47,096	≥	6.00	%
Leverage ratio		90,009		7.76	%		46,409	≥	4.0			58,011	≥	5.00	%
Cedar Rapids Bank & Trust:
Total risk-based capital	$	53,832		13.17	%	$	32,694	≥	8.0	%	$	49,042	≥	10.00	%
Tier 1 risk-based capital		48,700		11.92	%		16,347	≥	4.0			24,521	≥	6.00	%
Leverage ratio		48,700		8.43	%		23,103	≥	4.0			28,879	≥	5.00	%
Rockford Bank & Trust:
Total risk-based capital	$	36,428		15.67	%	$	18,593	≥	8.0	%	$	23,241	≥	10.00	%
Tier 1 risk-based capital		33,506		14.42	%		9,296	≥	4.0			13,945	≥	6.00	%
Leverage ratio		33,506		11.19	%		11,972	≥	4.0			14,965	≥	5.00	%

55

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
As of December 31, 2011:
Company:
Total risk-based capital	$	191,419		13.84	%	$	110,686	≥	8.0	%		N/A		N/A
Tier 1 risk-based capital		169,360		12.24	%		55,343	≥	4.0	%		N/A		N/A
Tier 1 leverage		169,360		8.70	%		77,857	≥	4.0	%		N/A		N/A
Quad City Bank & Trust:
Total risk-based capital	$	98,382		13.03	%	$	60,391	≥	8.0	%	$	75,488	≥	10.00	%
Tier 1 risk-based capital		90,336		11.97	%		30,195	≥	4.0			45,293	≥	6.00	%
Tier 1 leverage		90,336		8.21	%		44,009	≥	4.0			55,012	≥	5.00	%
Cedar Rapids Bank & Trust:
Total risk-based capital	$	56,312		14.44	%	$	31,198	≥	8.0	%	$	38,998	≥	10.00	%
Tier 1 risk-based capital		51,415		13.18	%		15,599	≥	4.0			23,399	≥	6.00	%
Tier 1 leverage		51,415		9.02	%		22,807	≥	4.0			28,509	≥	5.00	%
Rockford Bank & Trust:
Total risk-based capital	$	36,259		15.27	%	$	19,001	≥	8.0	%	$	23,752	≥	10.00	%
Tier 1 risk-based capital		33,277		14.01	%		9,501	≥	4.0			14,251	≥	6.00	%
Tier 1 leverage		33,277		11.31	%		11,770	≥	4.0			14,713	≥	5.00	%

The federal bank regulatory agencies recently issued joint proposed rules that would implement an international capital accord called “Basel III,” developed by the Basel Committee on Banking Supervision, a committee of central banks and bank supervisors.  The proposed rules would apply to all depository organizations in the United States and most of their parent companies and would increase minimum capital ratios, add a new minimum common equity ratio, add a new capital conservation buffer, and would change the risk-weightings of certain assets for the purposes of calculating certain capital ratios.  The proposed changes, if implemented, would be phased in from 2013 through 2019.  The comment period with respect to the proposed rules expired on October 22, 2012.  Various banking associations and industry groups provided comments on the proposed rules to the regulators, and it is unclear when the final rules will be adopted and what changes, if any, may be made to the proposed rules.  Management continues to assess the effect of the proposed rules on the Company and the subsidiary banks’ capital positions and will monitor developments regarding the proposed rules. 

56

Part I

Item 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS – continued

SPECIAL NOTE CONCERNING FORWARD-LOOKING STATEMENTS

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995.This document (including information incorporated by reference) contains, and future oral and written statements of the Company and its management may contain, forward-looking statements, within the meaning of such term in the Private Securities Litigation Reform Act of 1995, with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company.  Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “bode,” “predict,” “suggest,” “project,” “appear,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should,” “likely,” or other similar expressions.  Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. The factors which could have a material adverse effect on the Company’s operations and future prospects are detailed in the “Risk Factors” section included under Item 1.A. of Part I of the Company’s Form 10-K. In addition to the risk factors described in that section, there are other factors that may impact any public company, including the Company, which could have a material adverse effect on the Company’s operations and future prospects of the Company and its subsidiaries.

These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.

57

Part I

Item 3

QUANTITATIVE AND QUALITATVE DISCUSSION ABOUT MARKET RISK

The Company, like other financial institutions, is subject to direct and indirect market risk.  Direct market risk exists from changes in interest rates.  The Company’s net income is dependent on its net interest income.  Net interest income is susceptible to interest rate risk to the degree that interest-bearing liabilities mature or reprice on a different basis than interest-earning assets.  When interest-bearing liabilities mature or reprice more quickly than interest-earning assets in a given period, a significant increase in market rates of interest could adversely affect net interest income.  Similarly, when interest-earning assets mature or reprice more quickly than interest-bearing liabilities, falling interest rates could result in a decrease in net interest income.

In an attempt to manage the Company’s exposure to changes in interest rates, management monitors the Company’s interest rate risk.  Each subsidiary bank has an asset/liability management committee of the board of directors that meets quarterly to review the bank’s interest rate risk position and profitability, and to make or recommend adjustments for consideration by the full board of each bank.  Internal asset/liability management teams consisting of members of the subsidiary banks’ management meet weekly to manage the mix of assets and liabilities to maximize earnings and liquidity and minimize interest rate and other risks.  Management also reviews the subsidiary banks’ securities portfolios, formulates investment strategies, and oversees the timing and implementation of transactions to assure attainment of the board's objectives in the most effective manner.  Notwithstanding the Company’s interest rate risk management activities, the potential for changing interest rates is an uncertainty that can have an adverse effect on net income.

In adjusting the Company’s asset/liability position, the board of directors and management attempt to manage the Company’s interest rate risk while maintaining or enhancing net interest margins.  At times, depending on the level of general interest rates, the relationship between long-term and short-term interest rates, market conditions and competitive factors, the board of directors and management may decide to increase the Company’s interest rate risk position somewhat in order to increase its net interest margin.  The Company’s results of operations and net portfolio values remain vulnerable to increases in interest rates and to fluctuations in the difference between long-term and short-term interest rates.

One method used to quantify interest rate risk is a short-term earnings at risk summary, which is a detailed and dynamic simulation model used to quantify the estimated exposure of net interest income to sustained interest rate changes.  This simulation model captures the impact of changing interest rates on the interest income received and interest expense paid on all interest sensitive assets and liabilities reflected on the Company’s consolidated balance sheet.  This sensitivity analysis demonstrates net interest income exposure annually over a five-year horizon, assuming no balance sheet growth and various interest rate scenarios including no change in rates; 200, 300, 400, and 500 basis point upward shifts; and a 100 basis point downward shift in interest rates, where interest-bearing assets and liabilities reprice at their earliest possible repricing date.  The model assumes parallel and pro rata shifts in interest rates over a twelve-month period for the 200 basis point upward shift and 100 basis point downward shift.  For the 300 basis point upward shift, the model assumes an instantaneous and parallel upward shift in rates.  For the 400 basis point upward shift, the model assumes a parallel and pro rata shift in interest rates over a twenty-four month period.  For the 500 basis point upward shift, the model assumes a flattening and pro rata shift in interest rates over a twelve-month period where the short-end of the yield curve shifts upward greater than the long-end of the yield curve.  The asset/liability management committee of the board of directors has established policy limits of a 10% decline in net interest income for the 200 and the newly added 300 basis point upward shifts and the 100 basis point downward shift.

58

Part I

Item 3

QUANTITATIVE AND QUALITATVE DISCUSSION ABOUT MARKET RISK

Application of the simulation model analysis at the most recent quarter-end available is presented in the following table.  Please note the simulation model analysis as of September 30, 2012 is not yet available.

	NET INTEREST INCOME EXPOSURE in YEAR 1
INTEREST RATE SCENARIO	As of June 30, 2012			As of December 31, 2011			As of December 31, 2010
100 basis point downward shift		-1.3	%		-1.5	%		-1.9	%
200 basis point upward shift		-2.9	%		-3.1	%		-3.0	%
300 basis point upward shock		-6.8	%		-4.2	%		-1.6	%

The simulation is within the board-established policy limit of a 10% decline in net interest income for all three scenarios.

Interest rate risk is considered to be one of the most significant market risks affecting the Company.  For that reason, the Company engages the assistance of a national consulting firm and its risk management system to monitor and control the Company’s interest rate risk exposure.   Other types of market risk, such as foreign currency exchange rate risk and commodity price risk, do not arise in the normal course of the Company’s business activities.

59

Part I

Item 4

CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures.  An evaluation was performed under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Exchange Act) as of September 30, 2012.  Based on that evaluation, the Company’s management, including the Chief Executive Officer and Chief Financial Officer, concluded that the Company’s disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports filed and submitted under the Exchange Act was recorded, processed, summarized and reported as and when required.

Changes in Internal Control over Financial Reporting.  There have been no significant changes to the Company’s internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to affect, the Company’s internal control over financial reporting.

60

Part II

QCR HOLDINGS, INC. AND SUBSIDIARIES

PART II - OTHER INFORMATION

Item 1              Legal Proceedings

There are no material pending legal proceedings to which the Company or any of its subsidiaries is a party other than ordinary routine litigation incidental to their respective businesses.

Item 1.A.         Risk Factors

There have been no material changes in the risk factors applicable to the Company from those disclosed in Part I, Item 1.A. “Risk Factors,” in the Company’s 2011 Annual Report on Form 10-K.  Please refer to that section of the Company’s Form 10-K for disclosures regarding the risks and uncertainties related to the Company’s business.

Item 2              Unregistered Sales of Equity Securities and Use of Proceeds

None

Item 3              Defaults Upon Senior Securities

None

Item 4              Mine Safety Disclosures

Not applicable

Item 5              Other Information

None

61

Part II

QCR HOLDINGS, INC. AND SUBSIDIARIES

PART II - OTHER INFORMATION - continued

Item 6    Exhibits

10.1 Amendment No. 1 to Second Amended and Restated Operating Agreement of m2 Lease Funds, LLC between Quad City Bank & Trust Company and John Engelbrecht dated August 27, 2012.

31.1 Certification of Chief Executive Officer Pursuant to Rule 13a-14(a)/15d-14(a).

31.2 Certification of Chief Financial Officer Pursuant to Rule 13a-14(a)/15d-14(a).

32.1 Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2 Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of  2002.

101* Interactive data files pursuant to Rule 405 of Regulation S-T: (i) Consolidated Balance Sheets as of September 30, 2012 and December 31, 2011; (ii) Consolidated Statements of Income for the three and nine months ended September 30, 2012 and September 30, 2011; (iii) Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2012 and September 30, 2011; (iv) Consolidated Statements of Changes in Stockholders’ Equity for the nine  months ended September 30, 2012 and September 30, 2011; (v) Consolidated Statements of Cash Flows for the nine months ended September 30, 2012 and September 30, 2011; and (vi) Notes to Consolidated Financial Statements.   * As provided in Rule 406T of Regulation S-T, this information shall not be deemed “filed” for purposes of Sections 11 and 12 of the Securities Act of 1933 and Section 18 of the Securities Exchange Act of 1934, or otherwise subject to liability under those sections.

62

SIGNATURES

Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

QCR HOLDINGS, INC.

(Registrant)

Date   November 6, 2012	/s/ Douglas M. Hultquist
	Douglas M. Hultquist, President Chief Executive Officer

Date   November 6, 2012	/s/ Todd A. Gipple
	Todd A. Gipple, Executive Vice President Chief Operating Officer Chief Financial Officer

63

EX-10.1

Exhibit 10.1

AMENDMENT NO. 1 TO

SECOND AMENDED AND RESTATED

OPERATING AGREEMENT

OF

M2 LEASE FUNDS LLC

THIS AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED OPERATING AGREEMENT (this “Amendment”) of M2 Lease Funds LLC (the “Company”) dated and effective as of August 26, 2012, by and between Quad City Bank and Trust Company (“QCBT”) and John Engelbrecht (“Engelbrecht”) (collectively, the “Members,” and individually, a “Member”), amends the Second Amended and Restated Operating Agreement of M2 Lease Funds LLC (as amended, modified, supplemented or restated, the “Second Amended Agreement”).  Capitalized terms used herein without definition have the meanings assigned to them in the Second Amended Agreement.

W I T N E S S E T H:

WHEREAS, certain current and former members of the Company and the Company are parties to that certain Operating Agreement dated as of January 6, 1998 (the “Original Agreement”);

WHEREAS, the Original Agreement was amended and restated in its entirety on January 13, 2005 (the “First Amended Agreement”), when the Company sold and issued certain units to State Financial Services Corporation (“SFSC”);

WHEREAS, pursuant to that certain Unit Purchase Agreement dated August 12, 2005, by and between Engelbrecht and SFSC, Engelbrecht purchased all of SFSC’s ownership interest in the Company;

WHEREAS, pursuant to that certain Unit Purchase Agreement, by and among QCBT and Engelbrecht, QCBT purchased an eighty percent (80%) ownership interest in the Company;

WHEREAS, as of the date hereof Engelbrecht has retained a twenty percent (20%) ownership interest in the Company;

WHEREAS, the First Amended Agreement was amended and rested in its entirety on August 26, 2005 by the Second Amended Agreement;

WHEREAS, Section 11.1 of the Second Amended Agreement permits amendments and modifications to the Second Amended Agreement if made in writing and approved by Unanimous Consent; and

WHEREAS, the Members now desire to amend the Second Amended Agreement to extend the term of Engelbrecht’s ownership interest in the Company and provide for the liquidation thereof.

NOW, THEREFORE, in consideration of the promises set forth herein, the parties hereto do mutually promise and agree as follows:

AGREEMENTS

Section 1.               Section 7.2 of the Second Amended Agreement is hereby deleted and replaced in its entirety with the following:

“Section 7.2    [Reserved]”

Section 2.               Section 7.5 of the Second Amended Agreement is hereby deleted and replaced in its entirety with the following:

“Section 7.5    Liquidation of Units Held by Engelbrecht. Upon the earlier of August 31, 2015 and the termination of Engelbrecht’s employment, the Company shall have the obligation to liquidate all, but not less than all, of Engelbrecht’s Units in the Company.  The liquidating payments shall consist of two separate distributions to Engelbrecht as set forth below:

(a) Initial Liquidating Payment. The Company shall pay the initial liquidating payment (the “Initial Liquidating Payment”) to Engelbrecht in an amount equal to 50% of Book Value (as determined in accordance with Exhibit B) calculated as of August 31, 2012.  The Initial Liquidating Payment shall be made in cash at the closing thereof, which shall take place on Friday, September 14, 2012 at 10:00am CST, or such other time as mutually agreed upon by the parties.

(b) Final Liquidating Payment.  Except as provided below in subsection (i) the Company shall pay the final liquidating payment (the “Final Liquidating Payment”) to Engelbrecht in an amount equal to the sum of (i) the Book Value (as determined in accordance with Exhibit B and as adjusted, if necessary, as set forth in Section 7.5(b)(ii)) calculated as of August 31, 2012; and (ii) 20% of the Net Income from August 31, 2012 to August 31, 2015 less any distributions made to Engelbrecht pursuant to Article IV, including Tax Distributions, if any.  The Final Liquidating Payment shall be made in cash at the closing thereof, which shall take place on Tuesday, September 15, 2015 at 10:00am CST, or such other time as mutually agreed upon by the parties.

(i) Termination — For or Without Cause by the Company, Voluntarily by Engelbrecht or by Death or Disability.  The Final Liquidating Payment for Engelbrecht’s Units for termination by the Company for or without Cause, voluntarily by Engelbrecht or by reason of death or Disability prior to August 31, 2015 shall be an amount equal to the sum of (i) the Book Value (as determined in accordance with Exhibit B) calculated as of August 31, 2012; and (ii) 20% of the Net Income from August 31, 2012 to termination, less any distributions made to Engelbrecht pursuant to Article IV, including Tax Distributions, if any.  For the purposes of this Section 7.5(b)(i), the Final Liquidating Payment shall be made in cash at the closing thereof, which shall take place on a mutually agreed upon date no later than thirty (30) days from the termination of Engelbrecht’s employment.

(ii) Adjustment.  The Book Value computed as of August 31, 2012 shall be adjusted for any liabilities discovered by the Members prior to the date of the Final Liquidation Payment but which were incurred prior to August 31, 2012 and which were not recorded in the original calculation of Book Value, with the impact of this adjustment reflected in the computation of the Final Liquidation Payment pursuant to Section 7.5(b).  For any unrecorded liabilities discovered by the Members prior to the one (1) year anniversary of the date of the Final Liquidation Payment where such unrecorded liabilities were incurred prior to the date of the Final Liquidation Payment, Engelbrecht shall pay the Company in cash the amount of such unrecorded liabilities multiplied by .20 (an “Adjustment Payment”).  The Adjustment Payment shall be made to the Company within thirty (30) days of a written claim for an Adjustment Payment, or such other time as mutually agreed upon by the parties.

(c) Ownership of Units.  Engelbrecht will retain ownership in his Percentage Interest of the Company Units until the Final Liquidating Payment is made.

(i) In the event the Company, for whatever reason, fails to redeem Engelbrecht’s Units as provided in this Section 7.5, QCBT agrees to purchase the Units pursuant to the terms in this Section 7.5.

(ii) If Engelbrecht would be due an Equalizing Distribution in the event an Equalizing Distribution would be required to be paid pursuant to Section 4.1(c) before a distribution could be made pursuant to Section 4.1(d), then the full amount of such Equalizing Distribution (together with accrued interest) shall be paid to Engelbrecht at closing in addition to the Final Liquidating Payment above.

Section 3.                      Section 7.6 of the Second Amended Agreement is hereby deleted and replaced in its entirety with the following:

“Section 7.6                      [Reserved]”

Section 4.                      Section 7.7 of the Second Amended Agreement is hereby deleted and replaced in its entirety with the following:

“Section 7.7                      [Reserved]”

Section 5.                      ARTICLE VIII of the Second Amended Agreement is hereby amended to insert the following at the beginning thereof:

“No transfer of any Units may be made by Engelbrecht without the unanimous approval of the other Members.”

Section 6.                      The following definitions shall be added to Exhibit A of the Second Amended Agreement in alphabetical order, which such definitions shall read in their entirety as follows:

“Initial Liquidating Payment shall have the meaning set forth in Section 7.5(a).”

“Final Liquidating Payment shall have the meaning set forth in Section 7.5(b).”

“Net Income shall mean the Company’s net income as prepared in accordance with generally accepted accounting principles, without regard to any Federal or state income tax.”

Section 7.                      Exhibit B of the Second Amended Agreement is hereby deleted and replaced in its entirety with the following:

“I.           Book Value shall mean an amount equal to the net book value of assets minus liabilities of the Company as of the date called for in the Agreement (the “Determination Date”) pursuant to which the Book Value is established for either the Initial Liquidation Payment or the Final Liquidation Payment (each, a “Liquidation Payment”) multiplied by Engelbrecht’s Percentage Interest, using the following valuation methods:

1.           Except as set forth below in this Exhibit B, Book Value shall be valued and computed in accordance with GAAP heretofore applied by the Company as of the date of this Agreement, and shall not be computed for tax purposes.

2.           Regardless of accounting standard changes, modifications to the Company’s accounting policies, modification to the Company’s lease agreements or other like changes, all leases by the Company shall constitute capital or financing leases, not operating leases, and as such be treated under the direct financing method of accounting.

3.           Liabilities and assets shall include year-end adjustments as of the Determination Date required by GAAP.

4.           Book Value shall include an adjustment for the amount by which amounts paid to Affiliates of the Members in any transaction(s) exceeds the fair market value of such transactions.

5.           The Book Value as of August 26, 2005, the date of this Agreement, using the foregoing methods is $1,377,377.78, which reflects mark-up to Book Value in connection with QCBT's acquisition of 80% of the equity interest from Engelbrecht on the date of this Agreement.

6.           Book Value shall be reduced by the amount of any Equalizing Distribution (plus related interest) which must be paid pursuant to Section 4.1(c) before a distribution could be made pursuant to Section 4.1(d).

II.           Closing.  For purposes of determining a Liquidation Payment, by September 5, 2012 or September 5, 2015, as the case may be, the Company shall prepare and deliver to Engelbrecht a statement of Liquidation Payment (a “Liquidation Payment Statement”) prepared in accordance with this Agreement and Exhibit B, accompanied by sufficient detail to determine the calculation of the Liquidation Payment, and a report by Company’s independent accountant reflecting the Liquidation Payment.

Engelbrecht shall have five (5) days after the receipt of a Liquidation Payment Statement or a written claim for an Adjustment Payment to make a written objection to the calculation.  The parties shall attempt in good faith to reach an agreement with respect to any matters in dispute.

If the parties are unable to resolve the disagreements with respect to the determination of a Liquidation Payment or an Adjustment Payment within five (5) days following an objection by Engelbrecht, then the parties shall refer such differences to Ernst & Young or such other national accounting firm mutually agreed upon by the parties (the “CPA Firm”), who shall, acting as experts and not as arbitrators, determine in accordance with this Agreement and Exhibit B, and only with respect to the differences so submitted, the Liquidation Payment or an Adjustment Payment. The parties shall direct the CPA Firm to use its best efforts to render its determination within five (5) days after such submission.  The CPA Firm’s determination will be conclusive and binding upon the parties, shall not be subject to further review or approval and judgment therein may be entered in any circuit court or any court of competent jurisdiction.  The fees and disbursements of the CPA Firm shall be paid by the non-prevailing party, as determined by the CPA Firm.  The Company shall make readily available to the CPA Firm all relevant books and records and workpapers related to the Company’s operations and all other items reasonably requested by the CPA Firm.

The closing of a Liquidation Payment or an Adjustment Payment, as the case may be, shall take place with five (5) days of the CPA’s determination.”

[Remainder left intentionally blank]

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the date set forth above.

QUAD CITY BANK AND TRUST COMPANY
By:	/s/ John H. Anderson	Address:	2118 Middle Road
	John H. Anderson, President/CEO		Bettendorf, IA 52722
	/s/ John Engelbrecht	Address:	17500 Mariner Court
	John Engelbrecht		Brookfield, WI 53045

Spousal Consent and Acknowledgment

I acknowledge that I have read the foregoing Amendment and that I understand its contents. I am aware that by its provisions my spouse agrees to limit the transferability of and the voting rights attendant upon his Units of M2 Lease Funds LLC held by him on this date, or hereafter acquired, upon the occurrence of certain events. I am further aware that included in such limitations shall be any interest I have in the Units (including without limitation any right or interest by operation of the Wisconsin Marital Property Law, chapter 766 of the Wisconsin Statutes, or by operation of any other law) and the interest of any of my heirs, legatees, or other transferees. I consent to and approve the provisions of this Amendment, and agree that the Units and my interest in them are subject to the provisions of this Amendment, and direct the personal representative of my estate to promptly comply with all of the provisions of this Amendment, including without limitation Article VII.  I further agree that I will take no action at any time to hinder the operation of this Amendment as to the Units or any interest that I or my transferees have in it.

Date:  August 31, 2012	Spouse:	/s/ Janet Engelbrecht
		Janet Engelbrecht

EX-31.1

Exhibit 31.1

I, Douglas M. Hultquist, certify that:

1. I have reviewed this quarterly report on Form 10-Q of QCR Holdings, 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 and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have:

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

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

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

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

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

a) All significant deficiencies and material weaknesses in the design or operation of internal controls 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:           November 6 2012                                                                           /s/  Douglas M. Hultquist

Douglas M. Hultquist

Chief Executive Officer

EX-31.2

Exhibit 31.2

I, Todd A. Gipple, certify that:

1. I have reviewed this quarterly report on Form 10-Q of QCR Holdings, 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 and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have:

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

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

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

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

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

a) All significant deficiencies and material weaknesses in the design or operation of internal controls 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:           November 6, 2012                                                                           /s/ Todd A. Gipple

Todd A. Gipple

Chief Operating Officer

                                                                                                                           Chief Financial Officer

EX-32.1

Exhibit 32.1

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 of QCR Holdings, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report), I, Douglas M. Hultquist, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

   (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/  Douglas M. Hultquist

Douglas M. Hultquist

Chief Executive Officer

November 6, 2012

EX-32.2

Exhibit 32.2

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 of QCR Holdings, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report), I, Todd A. Gipple, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

   (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/  Todd A. Gipple

Todd A. Gipple

Chief Operating Officer

Chief Financial Officer

November 6, 2012

XML

Note 3 - Loans/Leases Receivable (Detail) - Troubed Debt Restructurings (USD $)	Sep. 30, 2012	Dec. 31, 2011	Sep. 30, 2012 Troubled Debt Restructurings [Member] Extension of Maturity [Member] Non-owner occupied Commercial Real Estate [Member] Three month period [Member]	Sep. 30, 2012 Troubled Debt Restructurings [Member] Extension of Maturity [Member] Non-owner occupied Commercial Real Estate [Member] Nine Month Period [Member]	Sep. 30, 2012 Troubled Debt Restructurings [Member] Extension of Maturity [Member] Three month period [Member]	Sep. 30, 2012 Troubled Debt Restructurings [Member] Extension of Maturity [Member] Nine Month Period [Member]	Sep. 30, 2012 Troubled Debt Restructurings [Member] Interest Rate Adjusted Below Market [Member] Non-owner occupied Commercial Real Estate [Member] Three month period [Member]	Sep. 30, 2012 Troubled Debt Restructurings [Member] Interest Rate Adjusted Below Market [Member] Non-owner occupied Commercial Real Estate [Member] Nine Month Period [Member]	Sep. 30, 2012 Troubled Debt Restructurings [Member] Interest Rate Adjusted Below Market [Member] Three month period [Member]	Sep. 30, 2012 Troubled Debt Restructurings [Member] Interest Rate Adjusted Below Market [Member] Nine Month Period [Member]	Sep. 30, 2012 Troubled Debt Restructurings [Member]	Sep. 30, 2012 Troubled Debt Restructurings [Member]	Sep. 30, 2011 Significant Payment Delay [Member] Commercial and Industrial [Member] Nine Month Period [Member]	Sep. 30, 2012 Significant Payment Delay [Member] Commercial construction, land development, and other land [Member] Nine Month Period [Member]	Sep. 30, 2012 Significant Payment Delay [Member] Nine Month Period [Member]	Sep. 30, 2011 Significant Payment Delay [Member] Nine Month Period [Member]	Sep. 30, 2012 Extension of Maturity [Member] Non-owner occupied Commercial Real Estate [Member] Three month period [Member]	Sep. 30, 2012 Extension of Maturity [Member] Non-owner occupied Commercial Real Estate [Member] Nine Month Period [Member]	Sep. 30, 2011 Extension of Maturity [Member] Non-owner occupied Commercial Real Estate [Member] Nine Month Period [Member]	Sep. 30, 2012 Extension of Maturity [Member] Three month period [Member]	Sep. 30, 2012 Extension of Maturity [Member] Nine Month Period [Member]	Sep. 30, 2011 Extension of Maturity [Member] Nine Month Period [Member]	Sep. 30, 2012 Interest Rate Adjusted Below Market [Member] Non-owner occupied Commercial Real Estate [Member] Three month period [Member]	Sep. 30, 2012 Interest Rate Adjusted Below Market [Member] Non-owner occupied Commercial Real Estate [Member] Nine Month Period [Member]	Sep. 30, 2012 Interest Rate Adjusted Below Market [Member] Commercial construction, land development, and other land [Member] Nine Month Period [Member]	Sep. 30, 2012 Interest Rate Adjusted Below Market [Member] Residential Real Estate [Member] Nine Month Period [Member]	Sep. 30, 2012 Interest Rate Adjusted Below Market [Member] Installment and Other Consumer [Member] Nine Month Period [Member]	Sep. 30, 2012 Interest Rate Adjusted Below Market [Member] Three month period [Member]	Sep. 30, 2012 Interest Rate Adjusted Below Market [Member] Nine Month Period [Member]	Sep. 30, 2012 Non-owner occupied Commercial Real Estate [Member]	Dec. 31, 2011 Non-owner occupied Commercial Real Estate [Member]	Sep. 30, 2012 Commercial and Industrial [Member]	Dec. 31, 2011 Commercial and Industrial [Member]	Sep. 30, 2012 Commercial construction, land development, and other land [Member]	Dec. 31, 2011 Commercial construction, land development, and other land [Member]	Sep. 30, 2012 Residential Real Estate [Member]	Dec. 31, 2011 Residential Real Estate [Member]	Sep. 30, 2012 Installment and Other Consumer [Member]	Dec. 31, 2011 Installment and Other Consumer [Member]	Sep. 30, 2012 Troubled Debt Restructurings [Member]	Sep. 30, 2011 Troubled Debt Restructurings [Member]
Troubled Debt Restructurings Number of Loans/Leases	6												4	2	2	4	4	4	1	4	4	1	2	2	1	1	1	2	5											11	5
Troubled Debt Restructurings Pre-Modification Recorded Investment	$ 2,727,073												$ 1,175,819	$ 200,000	$ 200,000	$ 1,175,819	$ 1,184,289	$ 1,184,289	$ 2,851,134	$ 1,184,289	$ 1,184,289	$ 2,851,134	$ 1,542,784	$ 1,542,784	$ 337,500	$ 167,739	$ 16,043	$ 1,542,784	$ 2,064,066											$ 3,448,355	$ 4,026,953
Troubled Debt Restructurings Post-Modification Recorded Investment	2,474,114												1,175,819	200,000	200,000	1,175,819	1,184,289	1,184,289	2,851,134	1,184,289	1,184,289	2,851,134	1,289,825	1,289,825	337,500	167,739	16,043	1,289,825	1,811,107											3,195,396	4,026,953
Troubled Debt Restructurings Specific Allowance	$ 4,152,560	$ 5,346,303	$ 325,923	$ 325,923	$ 325,923	$ 325,923	$ 55,187	$ 55,187	$ 55,187	$ 55,187	$ 381,110	$ 381,110																		$ 2,108,785	$ 1,247,377	$ 274,666	$ 903,187	$ 1,373,340	$ 3,002,450	$ 169,196	$ 55,884	$ 68,673	$ 22,819

XML

Note 6 - Fair Value (Detail) - Fair Values of Company's Financial Assets (USD $)	Sep. 30, 2012		Dec. 31, 2011
Loans/leases receivable, net *	$ 1,243,192,000		$ 1,202,817,000
Time deposits	1,346,256,000		1,209,197,000
Federal Home Loan Bank advances	216,052,000		223,678,000
Other borrowings	140,888,698		213,536,450
Junior subordinated debentures	18,753,000		18,444,000
Excluding Impaired Loans [Member] | Estimate of Fair Value, Fair Value Disclosure [Member]
Loans/leases receivable, net *	1,229,824,367	[1]
Excluding Impaired Loans [Member] | Fair Value, Inputs, Level 1 [Member]
Loans/leases receivable, net *		[1]
Excluding Impaired Loans [Member] | Fair Value, Inputs, Level 2 [Member]
Loans/leases receivable, net *	1,229,824,367	[1]
Excluding Impaired Loans [Member] | Fair Value, Inputs, Level 3 [Member]
Loans/leases receivable, net *		[1]
Estimate of Fair Value, Fair Value Disclosure [Member]
Loans/leases receivable, net *	13,367,633		18,361,757
Time deposits	361,397,000
Federal Home Loan Bank advances	216,052,000
Other borrowings	154,663,000
Junior subordinated debentures	18,753,000
Fair Value, Inputs, Level 1 [Member]
Loans/leases receivable, net *	0		0
Fair Value, Inputs, Level 2 [Member]
Loans/leases receivable, net *	0		0
Time deposits	361,397,000
Federal Home Loan Bank advances	216,052,000
Other borrowings	154,663,000
Junior subordinated debentures	18,753,000
Fair Value, Inputs, Level 3 [Member]
Loans/leases receivable, net *	$ 13,367,633		$ 18,361,757

[1] Excludes impaired loans/leases totaling $13,367,633 measured at fair value on a non-recurring basis and reported separately.

XML

Note 6 - Fair Value (Detail) - Assets Measured at Fair Value on a Non-recurring Basis (USD $)	Sep. 30, 2012	Dec. 31, 2011
Impaired loans/leases	$ 1,243,192,000	$ 1,202,817,000
Estimate of Fair Value, Fair Value Disclosure [Member]
Impaired loans/leases	13,367,633	18,361,757
Other real estate owned	5,403,014	9,056,619
Total	18,770,647	27,418,376
Fair Value, Inputs, Level 1 [Member]
Impaired loans/leases	0	0
Other real estate owned	0	0
Total	0	0
Fair Value, Inputs, Level 2 [Member]
Impaired loans/leases	0	0
Other real estate owned	0	0
Total	0	0
Fair Value, Inputs, Level 3 [Member]
Impaired loans/leases	13,367,633	18,361,757
Other real estate owned	5,403,014	9,056,619
Total	$ 18,770,647	$ 27,418,376

XML

Note 3 - Loans/Leases Receivable (Detail) - Nonperforming Loans/Leases (USD $)	Sep. 30, 2012		Dec. 31, 2011
Nonaccrual loans/leases	$ 17,731,331		$ 18,994,839
Troubled debt restructurings - accruing	11,758,653		20,526,457
Total nonperforming loans/leases	22,893,312		29,859,163
Percentage of total nonperforming loans/leases	100.00%		100.00%
Nonperforming [Member] | Commercial and Industrial [Member]
Total nonperforming loans/leases	1,992,549		3,097,617
Nonperforming [Member] | Owner-occupied commercial real estate [Member]
Total nonperforming loans/leases	671,184		1,011,456
Nonperforming [Member] | Commercial construction, land development, and other land [Member]
Total nonperforming loans/leases	2,448,875		10,020,374
Nonperforming [Member] | Non-owner occupied Commercial Real Estate [Member]
Total nonperforming loans/leases	15,459,160		14,342,900
Nonperforming [Member] | Finance Leases Portfolio Segment [Member]
Total nonperforming loans/leases	1,094,724		1,306,663
Nonperforming [Member] | Residential Portfolio Segment [Member]
Total nonperforming loans/leases	1,517,304		1,133,475
Nonperforming [Member] | Consumer Portfolio Segment [Member]
Total nonperforming loans/leases	759,478		1,097,016
Nonperforming [Member] | Total [Member]
Total nonperforming loans/leases	23,943,274		32,009,501
Commercial and Industrial [Member]
Accruing Past Due 90 Days or More	149,750		120,000
Nonaccrual loans/leases	1,657,986	[1]	2,790,210	[1]
Troubled debt restructurings - accruing	184,813		187,407
Percentage of total nonperforming loans/leases	8.32%		9.68%
Owner-occupied commercial real estate [Member]
Accruing Past Due 90 Days or More	0		0
Nonaccrual loans/leases	671,184	[1]	1,011,456	[1]
Troubled debt restructurings - accruing	0		0
Percentage of total nonperforming loans/leases	2.80%		3.16%
Commercial construction, land development, and other land [Member]
Accruing Past Due 90 Days or More	0		968,919
Nonaccrual loans/leases	2,111,375	[1]	2,975,312	[1]
Troubled debt restructurings - accruing	337,500		6,076,143
Percentage of total nonperforming loans/leases	10.23%		31.30%
Non-owner occupied Commercial Real Estate [Member]
Accruing Past Due 90 Days or More	0		0
Nonaccrual loans/leases	10,155,795	[1]	9,293,105	[1]
Troubled debt restructurings - accruing	5,303,365		5,049,795
Percentage of total nonperforming loans/leases	64.57%		44.81%
Finance Leases Portfolio Segment [Member]
Accruing Past Due 90 Days or More	0		0
Nonaccrual loans/leases	1,094,724	[1]	716,425	[1]
Troubled debt restructurings - accruing	0		590,238
Percentage of total nonperforming loans/leases	4.57%		4.08%
Residential Portfolio Segment [Member]
Accruing Past Due 90 Days or More	0		0
Nonaccrual loans/leases	1,349,565	[1]	1,133,475	[1]
Troubled debt restructurings - accruing	167,739		0
Percentage of total nonperforming loans/leases	6.34%		3.54%
Consumer Portfolio Segment [Member]
Accruing Past Due 90 Days or More	52,733		22,160
Nonaccrual loans/leases	690,702	[1]	1,074,856	[1]
Troubled debt restructurings - accruing	16,043		0
Percentage of total nonperforming loans/leases	3.17%		3.43%
Total [Member]
Accruing Past Due 90 Days or More	202,483		1,111,079
Nonaccrual loans/leases	17,731,331	[1]	18,994,839	[1]
Troubled debt restructurings - accruing	$ 6,009,460		$ 11,903,583
Percentage of total nonperforming loans/leases	100.00%		100.00%

[1] Nonaccrual loans/leases includes $5,749,193 of troubled debt restructurings, including $141,886 in commercial and industrial loans, $5,212,247 in commercial real estate loans, $64,726 in direct financing leases, and $330,334 in installment loans.

XML

Note 2 - Investment Securities (Detail) (USD $)	3 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Number of Securities	360
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions	13
Other than Temporary Impairment, Credit Losses Recognized in Earnings, Period Increase (Decrease) (in Dollars)	$ 62,400	$ 118,847
Unrealized Losses 12 Months or Greater [Member]
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions	1

XML

Note 8 - Acquisition Of 20% Noncontrolling Interest In M2 Lease Funds (Detail) (USD $)	3 Months Ended		3 Months Ended
	Sep. 30, 2012	Sep. 11, 2012	Sep. 30, 2012 m2 Lease Funds LLC [Member]	Jun. 30, 2012 m2 Lease Funds LLC [Member]
Business Acquisition, Percentage of Voting Interests Acquired			20.00%
Equity Method Investment, Ownership Percentage				80.00%
Business Acquisition, Cost of Acquired Entity, Cash Paid		$ 1,653,755
Business Acquisition, Cost of Acquired Entity, Purchase Price	3,307,509
Fair Value Inputs, Discount Rate	5.00%
Business Acquisition, Cost of Acquired Entity, Liabilities Incurred	2,847,687
Adjustments to Additional Paid in Capital, Reallocation of Noncontrolling Interest	(4,527,219)		(2,133,417)
Business Acquisition, Purchase Price Allocation, Assets Acquired (Liabilities Assumed), Net	1,653,755
Business Acquisition, Purchase Price Allocation, Noncontrolling Interest	$ 453,884

XML

Note 5 - Business Segment Information (Detail) (Velie Plantation Holding Company LLC [Member])	Sep. 30, 2012
Velie Plantation Holding Company LLC [Member]
Equity Method Investment, Ownership Percentage	91.00%

XML

Note 3 - Loans/Leases Receivable (Detail) - Recorded Investment by Credit Quality Indicators, Commercial Real Estate (USD $)	Sep. 30, 2012	Dec. 31, 2011
Internally assigned risk rating	$ 1,224,875,461	$ 1,181,956,235
Commercial and Industrial [Member] | Pass [Member]
Internally assigned risk rating	331,637,518	324,225,905
Commercial and Industrial [Member] | Special Mention [Member]
Internally assigned risk rating	7,920,533	8,814,497
Commercial and Industrial [Member] | Substandard [Member]
Internally assigned risk rating	15,445,837	17,753,876
Commercial and Industrial [Member] | Doubtful [Member]
Internally assigned risk rating	0	0
Commercial and Industrial [Member] | Total [Member]
Internally assigned risk rating	355,003,888	350,794,278
Owner-occupied commercial real estate [Member] | Pass [Member]
Internally assigned risk rating	193,587,897	158,955,618
Owner-occupied commercial real estate [Member] | Special Mention [Member]
Internally assigned risk rating	4,213,076	2,700,496
Owner-occupied commercial real estate [Member] | Substandard [Member]
Internally assigned risk rating	1,987,151	6,134,507
Owner-occupied commercial real estate [Member] | Doubtful [Member]
Internally assigned risk rating	0	0
Owner-occupied commercial real estate [Member] | Total [Member]
Internally assigned risk rating	199,788,124	167,790,621
Commercial construction, land development, and other land [Member] | Pass [Member]
Internally assigned risk rating	42,177,159	46,268,554
Commercial construction, land development, and other land [Member] | Special Mention [Member]
Internally assigned risk rating	560,086	764,586
Commercial construction, land development, and other land [Member] | Substandard [Member]
Internally assigned risk rating	6,454,664	13,351,598
Commercial construction, land development, and other land [Member] | Doubtful [Member]
Internally assigned risk rating	0	0
Commercial construction, land development, and other land [Member] | Total [Member]
Internally assigned risk rating	49,191,909	60,384,738
Non-owner occupied Commercial Real Estate [Member] | Pass [Member]
Internally assigned risk rating	311,918,867	310,401,972
Non-owner occupied Commercial Real Estate [Member] | Special Mention [Member]
Internally assigned risk rating	8,660,810	13,754,798
Non-owner occupied Commercial Real Estate [Member] | Substandard [Member]
Internally assigned risk rating	25,344,040	25,471,721
Non-owner occupied Commercial Real Estate [Member] | Doubtful [Member]
Internally assigned risk rating	0	0
Non-owner occupied Commercial Real Estate [Member] | Total [Member]
Internally assigned risk rating	345,923,717	349,628,491
Total [Member] | Pass [Member]
Internally assigned risk rating	879,321,441	839,852,049
Total [Member] | Special Mention [Member]
Internally assigned risk rating	21,354,505	26,034,377
Total [Member] | Substandard [Member]
Internally assigned risk rating	49,231,692	62,711,702
Total [Member] | Doubtful [Member]
Internally assigned risk rating	0	0
Total [Member] | Total [Member]
Internally assigned risk rating	$ 949,907,638	$ 928,598,128

XML

Note 6 - Fair Value (Detail) - Carrying Values and Estimated Fair Values of Financial Assets and Liabilities (USD $)	Sep. 30, 2012	Dec. 31, 2011
Cash and due from banks	$ 40,564,561	$ 53,136,710
Cash and due from banks	40,564,561	53,136,710
Federal funds sold	5,725,000	20,785,000
Federal funds sold	5,725,000	20,785,000
Interest-bearing deposits at financial institutions	49,436,938	26,750,602
Interest-bearing deposits at financial institutions	40,564,561	53,136,710
Investment securities:
Held to maturity	650,000	200,000
Held to maturity	650,000	200,000
Available for sale	590,701,449	565,029,291
Available for sale	590,701,449	565,029,291
Loans/leases receivable, net	1,224,875,461	1,181,956,235
Loans/leases receivable, net	1,243,192,000	1,202,817,000
Accrued interest receivable	6,640,822	6,510,021
Accrued interest receivable	6,640,822	6,510,021
Deposits	1,343,235,434	1,205,457,788
Deposits	1,346,256,000	1,209,197,000
Short-term borrowings	140,888,698	213,536,450
Short-term borrowings	140,888,698	213,536,450
Federal Home Loan Bank advances	196,350,000	204,750,000
Federal Home Loan Bank advances	216,052,000	223,678,000
Other borrowings	138,237,737	136,231,663
Other borrowings	154,663,000	151,813,000
Junior subordinated debentures	36,085,000	36,085,000
Junior subordinated debentures	18,753,000	18,444,000
Accrued interest payable	1,373,671	1,551,842
Accrued interest payable	1,373,671	1,551,842
Interest-bearing Deposits [Member]
Cash and due from banks	49,436,938	26,750,602
Interest-bearing deposits at financial institutions	49,436,938	26,750,602
Interest-bearing deposits at financial institutions	$ 49,436,938	$ 26,750,602

XML

Consolidated Statements of Cash Flows (Unaudited) (Parentheticals)	3 Months Ended		9 Months Ended
	Jun. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Series F Noncumulative Perpetual Preferred Stock [Member]
Shares of Series F Noncumulative Perpetual Preferred Stock redeemed (in Shares)	10,223		10,223
Shares of Series F Noncumulative Perpetual Preferred Stock Issued (in Shares)		40,090		40,090
Series D Cumulative Perpetual Preferred Stock [Member]
Shares of Series F Noncumulative Perpetual Preferred Stock redeemed (in Shares)		38,237

XML

Note 5 - Business Segment Information (Detail) - Selected Financial Information on the Company’s Business Segments (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011	Dec. 31, 2011
Net interest income	$ 14,629,518	$ 13,828,704	$ 43,348,464	$ 39,988,561
Net income attributable to QCR Holdings, Inc.	3,057,333	2,163,155	9,366,307	6,963,084
Total assets	2,023,946,072		2,023,946,072		1,966,610,054
Provision for loan/lease losses			3,325,109	5,196,850
Goodwill	3,222,688		3,222,688		3,222,688
Quad City Bank and Trust [Member]
Total revenue	11,643,674	12,147,213	36,196,909	35,990,157
Net interest income	8,602,967	7,944,108	25,524,594	22,772,375
Net income attributable to QCR Holdings, Inc.	2,586,303	1,854,914	7,603,033	5,777,707
Total assets	1,134,296,418	1,056,656,935	1,134,296,418	1,056,656,935
Provision for loan/lease losses	350,194	1,158,965	1,138,109	2,236,850
Goodwill	3,222,688	3,222,688	3,222,688	3,222,688
Cedar Rapids Bank and Trust [Member]
Total revenue	6,706,485	7,110,970	19,829,521	21,482,485
Net interest income	4,027,693	3,873,339	11,691,876	11,859,003
Net income attributable to QCR Holdings, Inc.	1,532,946	1,375,114	4,214,081	3,964,627
Total assets	587,057,961	565,822,310	587,057,961	565,822,310
Provision for loan/lease losses	300,000	250,000	875,000	1,035,000
Rockford Bank and Trust [Member]
Total revenue	2,897,098	3,377,454	9,665,950	10,046,334
Net interest income	2,368,483	2,355,471	7,259,522	6,641,533
Net income attributable to QCR Holdings, Inc.	(313,019)	(243,710)	482,950	45,697
Total assets	299,947,837	287,574,174	299,947,837	287,574,174
Provision for loan/lease losses	846,000	1,048,000	1,312,000	1,925,000
Wealth Management [Member]
Total revenue	1,490,297	1,311,647	4,427,051	4,238,644
Net income attributable to QCR Holdings, Inc.	108,950	257,611	425,356	741,263
All Other [Member]
Total revenue	4,542,612	3,319,882	13,533,609	10,776,476
Net interest income	(369,625)	(344,214)	(1,127,528)	(1,284,350)
Net income attributable to QCR Holdings, Inc.	3,077,515	2,192,761	9,484,700	7,054,192
Total assets	196,448,244	193,059,135	196,448,244	193,059,135
Intersegment Elimination [Member]
Total revenue	(3,675,459)	(3,362,429)	(13,115,614)	(10,885,546)
Net income attributable to QCR Holdings, Inc.	(3,935,362)	(3,273,535)	(12,843,813)	(10,620,402)
Total assets	(193,804,388)	(204,152,062)	(193,804,388)	(204,152,062)
Consolidated [Member]
Total revenue	23,604,707	23,904,737	70,537,426	71,648,550
Net interest income	14,629,518	13,828,704	43,348,464	39,988,561
Net income attributable to QCR Holdings, Inc.	3,057,333	2,163,155	9,366,307	6,963,084
Total assets	2,023,946,072	1,898,960,492	2,023,946,072	1,898,960,492
Provision for loan/lease losses	1,496,194	2,456,965	3,325,109	5,196,850
Goodwill	$ 3,222,688	$ 3,222,688	$ 3,222,688	$ 3,222,688

XML

Note 2 - Investment Securities (Detail) - Amortized Cost and Fair Value of Securities by Contractual Maturity (USD $)	Sep. 30, 2012
Securities held to maturity:
Due in one year or less	$ 100,000
Due in one year or less	100,000
Due after one year through five years	550,000
Due after one year through five years	550,000
	650,000
	650,000
Securities available for sale:
Due in one year or less	2,251,717
Due in one year or less	2,257,998
Due after one year through five years	40,236,390
Due after one year through five years	40,681,663
Due after five years	385,715,495
Due after five years	390,465,992
Securities Available for Sale - amortized cost	580,796,837
Securities Available for Sale - fair value	590,701,449
Total [Member]
Securities available for sale:
Securities Available for Sale - amortized cost	428,203,602
Securities Available for Sale - fair value	433,405,653
Residential Mortgage Backed Securities [Member]
Securities available for sale:
Securities Available for Sale - amortized cost	151,264,044
Securities Available for Sale - fair value	155,690,575
Debt Securities [Member]
Securities available for sale:
Securities Available for Sale - amortized cost	1,329,191
Securities Available for Sale - fair value	$ 1,605,221

XML

Note 2 - Investment Securities (Detail) - Sales of Securities (USD $)	3 Months Ended	9 Months Ended
	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Proceeds from sales of securities	$ 8,601,107	$ 19,215,075	$ 54,326,191
Pre-tax gross gains from sales of securities	$ 443,614	$ 104,600	$ 1,472,528

XML

Note 6 - Fair Value (Detail) (USD $)	Sep. 30, 2012	Dec. 31, 2011
Impaired Financing Receivable, Recorded Investment	$ 22,893,312	$ 29,859,163
Estimate of Fair Value, Fair Value Disclosure [Member]
Impaired Financing Receivable, Recorded Investment	$ 13,367,633

XML

Note 3 - Loans/Leases Receivable (Detail) (USD $)	Sep. 30, 2012	Dec. 31, 2011
Loans Held-for-sale, Mortgages	$ 6,285,131	$ 3,832,760
Leveraged Lease Investment	1,111,627	1,043,326
Financing Receivable, Modifications, Recorded Investment	11,758,653	20,526,457
Financing Receivable, Modifications, Number of Contracts	6
Financing Receivable, Modifications, Post-Modification Recorded Investment	2,474,114
Total [Member]
Financing Receivable, Modifications, Recorded Investment	5,749,193	8,622,874
Commercial Portfolio Segment [Member]
Financing Receivable, Modifications, Recorded Investment	141,886	198,697
Commercial Real Estate Portfolio Segment [Member]
Financing Receivable, Modifications, Recorded Investment	5,212,247	8,074,777
Finance Leases Portfolio Segment [Member]
Financing Receivable, Modifications, Recorded Investment	64,726	64,726
Installment and Other Consumer [Member]
Financing Receivable, Modifications, Recorded Investment	330,334	284,674
Nonaccrual [Member]
Financing Receivable, Modifications, Number of Contracts	4
Financing Receivable, Modifications, Post-Modification Recorded Investment	$ 4,337,321

XML

Note 3 - Loans/Leases Receivable (Detail) - Composition of the Loan/Lease Portfolio (USD $)	Sep. 30, 2012	Dec. 31, 2011
Loans and Leases	$ 1,244,292,209	$ 1,200,745,497
Total Loans/Leases plus deferred loan/lease origination costs	1,244,292,209	1,200,745,497
Loans/leases net of allowance for estimated losses	1,224,875,461	1,181,956,235
Commercial and Industrial [Member]
Loans and Leases	355,003,888	350,794,278
Owner-occupied commercial real estate [Member]
Loans and Leases	199,788,124	167,790,621
Commercial construction, land development, and other land [Member]
Loans and Leases	49,191,909	60,384,738
Other commercial real estate [Member]
Loans and Leases	345,923,717	349,628,491
Total Commercial [Member]
Loans and Leases	594,903,750	577,803,850
Leases receivable [Member]
Loans and Leases	102,038,868	93,212,362
Plus deferred loan/lease origination costs	3,727,752	3,217,011
Total Loans/Leases plus deferred loan/lease origination costs	105,766,620	96,429,373
Less allowance for estimated losses on loans/leases	(1,884,985)	(1,339,496)
Loans/leases net of allowance for estimated losses	103,881,635	95,089,877
* Direct financing leases:
Net minimum lease payments to be received	115,931,555	106,389,988
Estimated unguaranteed residual values of leased assets	1,111,627	1,043,326
Unearned lease/residual income	(15,004,314)	(14,220,952)
Mortgage Receivable [Member]
Loans and Leases	112,492,219	98,107,051
Loans Receivable [Member]
Loans and Leases	76,837,989	78,223,080
Total [Member]
Loans and Leases	1,241,276,714	1,198,140,621
Plus deferred loan/lease origination costs	3,015,495	2,604,876
Less allowance for estimated losses on loans/leases	$ (19,416,748)	$ (18,789,262)

XML

Consolidated Statements of Cash Flows (Unaudited) (USD $)	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 9,860,738	$ 7,271,299
Depreciation	1,740,621	1,866,403
Provision for loan/lease losses	3,325,109	5,196,850
Amortization of offering costs on subordinated debentures	10,738	10,738
Stock-based compensation expense	672,703	547,087
Losses on other real estate owned, net	1,324,468	90,492
Amortization of premiums on securities, net	2,950,609	2,541,408
Securities gains	(104,600)	(1,472,528)
Other-than-temporary impairment losses on securities	62,400	118,847
Loans originated for sale	(90,563,711)	(65,240,469)
Proceeds on sales of loans	90,077,297	75,960,589
Gains on sales of loans, net	(1,965,957)	(1,923,185)
Prepayment fees on Federal Home Loan Bank advances		832,099
Increase in cash value of bank-owned life insurance	(1,196,987)	(1,032,493)
Decrease in other assets	3,090,716	707,321
Increase in other liabilities	1,467,552	955,174
Net cash provided by operating activities	20,751,696	26,429,632
CASH FLOWS FROM INVESTING ACTIVITIES
Net decrease in federal funds sold	15,060,000	56,170,000
Net (increase) decrease in interest-bearing deposits at financial institutions	(22,686,336)	15,080,252
Proceeds from sales of other real estate owned	4,201,516	8,376,898
Purchases	(363,501,993)	(458,081,700)
Calls, maturities and redemptions	292,291,109	302,145,002
Paydowns	25,174,348	4,977,152
Sales	19,215,075	54,326,191
Purchases	(3,466,800)	(245,000)
Redemptions	3,939,600	1,675,700
Purchases of bank-owned life insurance		(7,000,000)
Net increase in loans/leases originated and held for investment	(45,934,981)	(48,043,333)
Purchase of premises and equipment	(1,589,217)	(1,693,870)
Net cash used in investing activities	(77,297,679)	(72,312,708)
Net increase in deposit accounts	137,777,646	92,653,389
Net increase (decrease) in short-term borrowings	(72,647,752)	2,431,992
Advances	14,000,000	5,000,000
Calls and maturities	(22,400,000)	(24,000,000)
Prepayments		(15,832,099)
Net increase (decrease) in other borrowings	2,006,074	(9,941,030)
Payment of cash dividends on common and preferred stock	(3,278,112)	(3,274,991)
Purchase of noncontrolling interest	(1,679,532)
Net cash provided by financing activities	43,973,834	49,283,981
Net increase (decrease) in cash and due from banks	(12,572,149)	3,400,905
Cash and due from banks, beginning	53,136,710	42,030,806
Cash and due from banks, ending	40,564,561	45,431,711
Interest	15,225,564	18,521,222
Income/franchise taxes	916,000	1,196,948
Change in accumulated other comprehensive income, unrealized gains on securities available for sale, net	1,367,388	3,468,469
Transfers of loans to other real estate owned	2,143,017	8,220,271
Liability for purchase of noncontrolling interest	2,847,687
Series F Noncumulative Perpetual Preferred Stock [Member]
CASH FLOWS FROM INVESTING ACTIVITIES
Redemption of Preferred Stock	(10,223,000)
Proceeds from issuance of stock		40,074,341
Series D Cumulative Perpetual Preferred Stock [Member]
CASH FLOWS FROM INVESTING ACTIVITIES
Redemption of Preferred Stock		(38,237,000)
Common Stock [Member]
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from issuance of stock	$ 418,510	$ 409,379

XML

Note 3 - Loans/Leases Receivable (Detail) - Aging of the Loan/Lease Portfolio (USD $)	Sep. 30, 2012	Dec. 31, 2011
Current	$ 1,217,321,626	$ 1,168,978,194
30-59 Days Past Due	4,085,420	3,798,637
60-89 Days Past Due	1,935,854	5,257,872
Accruing Past Due 90 Days or More	202,483	1,111,079
Nonacrrual Loans/Loans	17,731,331	18,994,839
Total	1,241,276,714	1,198,140,621
Current as a percentage of total loan/lease portfolio	98.07%	97.57%
30-59 Days Past Due as a percentage of total loan/lease portfolio	0.33%	0.32%
60-89 Days Past Due as a percentage of total loan/lease portfolio	0.16%	0.44%
Accruing Past Due 90 Days or More as a percentage of total loan/lease portfolio	0.02%	0.09%
Nonacrrual Loans/Loans as a percentage of total loan/lease portfolio	1.43%	1.59%
Total as a percentage of total loan/lease portfolio	100.00%	100.00%
Commercial and Industrial [Member]
Current	352,308,795	347,417,683
30-59 Days Past Due	872,105	226,394
60-89 Days Past Due	15,252	239,991
Accruing Past Due 90 Days or More	149,750	120,000
Nonacrrual Loans/Loans	1,657,986	2,790,210
Total	355,003,888	350,794,278
Owner-occupied commercial real estate [Member]
Current	198,070,105	166,632,318
30-59 Days Past Due	0	146,847
60-89 Days Past Due	1,046,835	0
Accruing Past Due 90 Days or More	0	0
Nonacrrual Loans/Loans	671,184	1,011,456
Total	199,788,124	167,790,621
Commercial construction, land development, and other land [Member]
Current	47,080,534	55,741,827
30-59 Days Past Due	0	211,878
60-89 Days Past Due	0	486,802
Accruing Past Due 90 Days or More	0	968,919
Nonacrrual Loans/Loans	2,111,375	2,975,312
Total	49,191,909	60,384,738
Other commercial real estate [Member]
Current	332,708,671	336,080,128
30-59 Days Past Due	2,325,809	522,323
60-89 Days Past Due	733,442	3,732,935
Accruing Past Due 90 Days or More	0	0
Nonacrrual Loans/Loans	10,155,795	9,293,105
Total	345,923,717	349,628,491
Leases receivable [Member]
Current	100,205,091	91,273,406
30-59 Days Past Due	632,458	826,187
60-89 Days Past Due	106,595	396,344
Accruing Past Due 90 Days or More	0	0
Nonacrrual Loans/Loans	1,094,724	716,425
Total	102,038,868	93,212,362
Residential Real Estate [Member]
Current	111,142,654	95,456,433
30-59 Days Past Due	0	1,127,465
60-89 Days Past Due	0	389,678
Accruing Past Due 90 Days or More	0	0
Nonacrrual Loans/Loans	1,349,565	1,133,475
Total	112,492,219	98,107,051
Installment and Other Consumer [Member]
Current	75,805,776	76,376,399
30-59 Days Past Due	255,048	737,543
60-89 Days Past Due	33,730	12,122
Accruing Past Due 90 Days or More	52,733	22,160
Nonacrrual Loans/Loans	690,702	1,074,856
Total	$ 76,837,989	$ 78,223,080

XML

Note 4 - Earnings Per Share (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended	9 Months Ended
	Sep. 30, 2011	Sep. 30, 2011
Preferred Stock, Accretion of Redemption Discount	$ 1.2	$ 1.2

XML

Consolidated Balance Sheets (Unaudited) (USD $)	Sep. 30, 2012	Dec. 31, 2011
ASSETS
Cash and due from banks	$ 40,564,561	$ 53,136,710
Federal funds sold	5,725,000	20,785,000
Interest-bearing deposits at financial institutions	49,436,938	26,750,602
Securities held to maturity, at amortized cost	650,000	200,000
Securities available for sale, at fair value	590,701,449	565,029,291
Total securities	591,351,449	565,229,291
Loans receivable held for sale	6,285,131	3,832,760
Loans/leases receivable held for investment	1,238,007,078	1,196,912,737
Gross loans/leases receivable	1,244,292,209	1,200,745,497
Less allowance for estimated losses on loans/leases	(19,416,748)	(18,789,262)
Net loans/leases receivable	1,224,875,461	1,181,956,235
Premises and equipment, net	31,589,347	31,740,751
Goodwill	3,222,688	3,222,688
Bank-owned life insurance	43,208,268	42,011,281
Restricted investment securities	14,780,800	15,253,600
Other real estate owned, net	5,002,791	8,385,758
Other assets	14,188,769	18,138,138
Total assets	2,023,946,072	1,966,610,054
Deposits:
Noninterest-bearing	417,284,214	357,183,481
Interest-bearing	925,951,220	848,274,307
Total deposits	1,343,235,434	1,205,457,788
Short-term borrowings	140,888,698	213,536,450
Federal Home Loan Bank advances	196,350,000	204,750,000
Other borrowings	138,237,737	136,231,663
Junior subordinated debentures	36,085,000	36,085,000
Other liabilities	30,027,917	26,116,451
Total liabilities	1,884,824,786	1,822,177,352
STOCKHOLDERS' EQUITY
Preferred stock, $1 par value; shares authorized 250,000 September 2012 - 54,867 shares issued and outstanding December 2011 - 65,090 shares issued and outstanding	54,867	65,090
Common stock, $1 par value; shares authorized 20,000,000 September 2012 - 4,984,024 shares issued and 4,862,778 outstanding December 2011 - 4,879,435 shares issued and 4,758,189 outstanding	4,984,024	4,879,435
Additional paid-in capital	78,342,963	89,702,533
Retained earnings	51,077,870	44,585,902
Accumulated other comprehensive income	6,122,102	4,754,714
Noncontrolling interests	145,970	2,051,538
Less treasury stock, September 2012 and December 2011 - 121,246 common shares, at cost	(1,606,510)	(1,606,510)
Total stockholders' equity	139,121,286	144,432,702
Total liabilities and stockholders' equity	$ 2,023,946,072	$ 1,966,610,054

XML

Note 6 - Fair Value (Detail) - Assets Measured at Fair Value on a Recurring Basis (USD $)	Sep. 30, 2012	Dec. 31, 2011
Securities available for sale:
Securities available for sale	$ 590,701,449	$ 565,029,291
US Government Agencies Debt Securities [Member] | Estimate of Fair Value, Fair Value Disclosure [Member]
Securities available for sale:
Securities available for sale	343,243,622	428,955,220
US Government Agencies Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Securities available for sale:
Securities available for sale	0	0
US Government Agencies Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Securities available for sale:
Securities available for sale	343,243,622	428,955,220
US Government Agencies Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Securities available for sale:
Securities available for sale	0	0
Residential Mortgage Backed Securities [Member] | Estimate of Fair Value, Fair Value Disclosure [Member]
Securities available for sale:
Securities available for sale	155,690,575	108,853,749
Residential Mortgage Backed Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Securities available for sale:
Securities available for sale	0	0
Residential Mortgage Backed Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Securities available for sale:
Securities available for sale	155,690,575	108,853,749
Residential Mortgage Backed Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Securities available for sale:
Securities available for sale	0	0
US States and Political Subdivisions Debt Securities [Member] | Estimate of Fair Value, Fair Value Disclosure [Member]
Securities available for sale:
Securities available for sale	90,031,631	25,689,364
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Securities available for sale:
Securities available for sale	0	0
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Securities available for sale:
Securities available for sale	90,031,631	25,689,364
US States and Political Subdivisions Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Securities available for sale:
Securities available for sale	0	0
Trust preferred securities [Member] | Estimate of Fair Value, Fair Value Disclosure [Member]
Securities available for sale:
Securities available for sale	130,400	80,800
Trust preferred securities [Member] | Fair Value, Inputs, Level 1 [Member]
Securities available for sale:
Securities available for sale	0	0
Trust preferred securities [Member] | Fair Value, Inputs, Level 2 [Member]
Securities available for sale:
Securities available for sale	130,400	80,800
Trust preferred securities [Member] | Fair Value, Inputs, Level 3 [Member]
Securities available for sale:
Securities available for sale	0	0
Equity Securities [Member] | Estimate of Fair Value, Fair Value Disclosure [Member]
Securities available for sale:
Securities available for sale	1,605,221	1,450,158
Equity Securities [Member] | Fair Value, Inputs, Level 1 [Member]
Securities available for sale:
Securities available for sale	235,027	191,506
Equity Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Securities available for sale:
Securities available for sale	1,370,194	1,258,652
Equity Securities [Member] | Fair Value, Inputs, Level 3 [Member]
Securities available for sale:
Securities available for sale	0	0
Estimate of Fair Value, Fair Value Disclosure [Member]
Securities available for sale:
Securities available for sale	590,701,449	565,029,291
Fair Value, Inputs, Level 1 [Member]
Securities available for sale:
Securities available for sale	235,027	191,506
Fair Value, Inputs, Level 2 [Member]
Securities available for sale:
Securities available for sale	590,466,422	564,837,785
Fair Value, Inputs, Level 3 [Member]
Securities available for sale:
Securities available for sale	$ 0	$ 0

XML

Consolidated Statement of Changes in Stockholders' Equity (Unaudited) (USD $)	Preferred Stock [Member] Series F Noncumulative Perpetual Preferred Stock [Member]	Preferred Stock [Member] Series D Cumulative Perpetual Preferred Stock [Member]	Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member] Series F Noncumulative Perpetual Preferred Stock [Member]	Additional Paid-in Capital [Member] Series D Cumulative Perpetual Preferred Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Noncontrolling Interest [Member]	Treasury Stock [Member]	Series F Noncumulative Perpetual Preferred Stock [Member]	Series D Cumulative Perpetual Preferred Stock [Member]	Total
Balance at Dec. 31, 2010			$ 63,237	$ 4,732,428			$ 86,478,269	$ 40,550,900	$ 704,165	$ 1,648,219	$ (1,606,510)			$ 132,570,708
Comprehensive income														885,930
Preferred cash dividends declared and accrued								(915,462)						(915,462)
Discount accretion on cumulative preferred stock							116,909	(116,909)
Proceeds from issuance of common stock as a result of stock purchased under the Employee Stock Purchase Plan				9,081			49,249							58,330
Proceeds from issuance of common stock as a result of stock options exercised				24,300			146,067							170,367
Exchange of common stock				(2,171)			(14,070)							(16,241)
Stock compensation expense							206,569							206,569
Restricted stock awards				69,924			(69,924)
Other adjustments to noncontrolling interests										(2,065)				(2,065)
Net income								2,124,960		106,524				2,231,484
Other comprehensive income (loss), net of tax									(1,345,554)					(1,345,554)
Balance at Mar. 31, 2011			63,237	4,833,562			86,913,069	41,643,489	(641,389)	1,752,678	(1,606,510)			132,958,136
Balance at Dec. 31, 2010			63,237								(1,606,510)			132,570,708
Comprehensive income														10,739,768
Redemption of preferred stock		(38,237)				(38,198,763)							(38,237,000)
Net income														7,271,299
Other comprehensive income (loss), net of tax														3,468,469
Balance September 30 at Sep. 30, 2011			65,090								(1,606,510)			143,168,873
Balance at Mar. 31, 2011			63,237	4,833,562			86,913,069	41,643,489	(641,389)	1,752,678	(1,606,510)			132,958,136
Comprehensive income														5,182,942
Common cash dividends declared								(185,863)						(185,863)
Preferred cash dividends declared and accrued								(915,462)						(915,462)
Discount accretion on cumulative preferred stock							120,280	(120,280)
Proceeds from issuance of common stock as a result of stock purchased under the Employee Stock Purchase Plan				11,355			61,582							72,937
Proceeds from issuance of common stock as a result of stock options exercised				10,967			65,205							76,172
Exchange of common stock				(379)			(3,033)							(3,412)
Stock compensation expense							141,370							141,370
Other adjustments to noncontrolling interests										(2,066)				(2,066)
Net income								2,674,969		98,245				2,773,214
Other comprehensive income (loss), net of tax									2,409,728					2,409,728
Balance at Jun. 30, 2011			63,237	4,855,505			87,298,473	43,096,853	1,768,339	1,848,857	(1,606,510)			137,324,754
Comprehensive income														4,670,896
Preferred cash dividends declared and accrued								(835,802)						(835,802)
Discount accretion on cumulative preferred stock							1,352,256	(1,352,256)
Proceeds from the issuance of 40,090 shares of Series F Non-Cumulative Perpetual Preferred Stock	40,090				40,034,251							40,074,341
Redemption of preferred stock		(38,237)				(38,198,763)							(38,237,000)
Proceeds from issuance of common stock as a result of stock purchased under the Employee Stock Purchase Plan				7,975			43,251							51,226
Stock compensation expense							149,160							149,160
Restricted stock awards				5,000			(5,000)
Other adjustments to noncontrolling interests										(28,702)				(28,702)
Net income								2,163,155		103,446				2,266,601
Other comprehensive income (loss), net of tax									2,404,295					2,404,295
Balance September 30 at Sep. 30, 2011			65,090	4,868,480			90,673,628	43,071,950	4,172,634	1,923,601	(1,606,510)			143,168,873
Balance at Dec. 31, 2011			65,090	4,879,435			89,702,533	44,585,902	4,754,714	2,051,538	(1,606,510)			144,432,702
Comprehensive income														1,885,614
Preferred cash dividends declared and accrued								(938,625)						(938,625)
Proceeds from issuance of common stock as a result of stock purchased under the Employee Stock Purchase Plan				7,767			55,566							63,333
Proceeds from issuance of common stock as a result of stock options exercised				276			2,374							2,650
Exchange of common stock				(576)			(2,103)							(2,679)
Stock compensation expense							326,245							326,245
Restricted stock awards				57,770			(57,770)
Other adjustments to noncontrolling interests										(2,066)				(2,066)
Net income								3,236,818		166,031				3,402,849
Other comprehensive income (loss), net of tax									(1,517,235)					(1,517,235)
Balance at Mar. 31, 2012			65,090	4,944,672			90,026,845	46,884,095	3,237,479	2,215,503	(1,606,510)			145,767,174
Comprehensive income														4,514,424
Common cash dividends declared								(189,091)						(189,091)
Preferred cash dividends declared and accrued								(935,786)						(935,786)
Redemption of preferred stock	(10,223)				(10,212,777)							(10,223,000)
Proceeds from issuance of common stock as a result of stock purchased under the Employee Stock Purchase Plan				10,856			78,055							88,911
Proceeds from issuance of common stock as a result of stock options exercised				9,090			79,902							88,992
Exchange of 611 shares of common stock in connection with stock options exercised				(611)			(7,125)							(7,736)
Proceeds from exercise of warrants to purchase shares of common stock issued in conjunction with the Series A Subordinated Notes				4,300			38,700							43,000
Stock compensation expense							177,269							177,269
Other adjustments to noncontrolling interests										(2,065)				(2,065)
Net income								3,072,156		201,223				3,273,379
Other comprehensive income (loss), net of tax									1,241,045					1,241,045
Balance at Jun. 30, 2012			54,867	4,968,307			80,180,869	48,831,374	4,478,524	2,414,661	(1,606,510)			139,322,092
Comprehensive income														4,828,088
Preferred cash dividends declared and accrued								(810,837)						(810,837)
Purchase of noncontrolling interest							(2,133,417)			(2,393,802)				(4,527,219)
Proceeds from issuance of common stock as a result of stock purchased under the Employee Stock Purchase Plan				7,642			58,326							65,968
Proceeds from issuance of common stock as a result of stock options exercised				7,075			58,996							66,071
Proceeds from exercise of warrants to purchase shares of common stock issued in conjunction with the Series A Subordinated Notes				1,000			9,000							10,000
Stock compensation expense							169,189							169,189
Other adjustments to noncontrolling interests										(2,066)				(2,066)
Net income								3,057,333		127,177				3,184,510
Other comprehensive income (loss), net of tax									1,643,578					1,643,578
Balance at Sep. 30, 2012														139,121,286
Balance September 30 at Sep. 30, 2012			$ 54,867	$ 4,984,024			$ 78,342,963	$ 51,077,870	$ 6,122,102	$ 145,970	$ (1,606,510)			$ 139,121,286

XML

Note 3 - Loans/Leases Receivable (Detail) - Impaired Loans/Leases (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Dec. 31, 2011
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				$ 7,511,233
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance				8,253,794
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	11,115,924	8,349,249
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	3,513	11,909
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	3,513	11,909
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				22,347,930
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				22,847,930
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	4,152,560		4,152,560	5,346,303
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	15,220,975	16,271,993
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	88,728	473
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	88,728	473
Total Impaired Loans/Leases:
Recorded Investment	22,893,312		22,893,312	29,859,163
Unpaid Principal Balance	24,964,458		24,964,458	31,101,724
Related Allowance	4,152,560		4,152,560	5,346,303
Average Recorded Investment	26,336,899	24,621,242	27,860,397
Interest Income Recognized	92,241	12,382	255,071
Interest Income Recognized for Cash Payments Received	92,241	12,382	255,071
Impaired Loans With No Specific Allowance Recorded [Member] | Commercial and Industrial [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment	845,703		845,703
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance	1,635,373		1,635,373
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment			787,146
Impaired Loans With No Specific Allowance Recorded [Member] | Owner-occupied commercial real estate [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment	542,721		542,721
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance	542,721		542,721
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment			657,327
Impaired Loans With No Specific Allowance Recorded [Member] | Commercial construction, land development, and other land [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment	1,027,200		1,027,200
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance	1,027,200		1,027,200
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment			4,441,935
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized			5,552
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			5,552
Impaired Loans With No Specific Allowance Recorded [Member] | Non-owner occupied Commercial Real Estate [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment	1,498,599		1,498,599
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance	2,298,599		2,298,599
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment			6,613,234
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized			894
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			894
Impaired Loans With No Specific Allowance Recorded [Member] | Leases receivable [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment	853,974		853,974
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance	853,974		853,974
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment			774,855
Impaired Loans With No Specific Allowance Recorded [Member] | Residential Real Estate [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment	948,653		948,653
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance	1,131,684		1,131,684
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment			861,102
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized			5,037
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			5,037
Impaired Loans With No Specific Allowance Recorded [Member] | Installment and Other Consumer [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment	646,466		646,466
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance	646,466		646,466
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment			1,014,236
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized			245
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			245
Impaired Loans With No Specific Allowance Recorded [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment	6,363,316		6,363,316
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance	8,136,017		8,136,017
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment			15,149,835
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized			11,728
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			11,728
Impaired Loans with Specific Allowance Recorded [Member] | Commercial and Industrial [Member]
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment	225,347		225,347
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance	247,599		247,599
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	274,666		274,666
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment			543,668
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized			5,935
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			5,935
Total Impaired Loans/Leases:
Related Allowance	274,666		274,666
Impaired Loans with Specific Allowance Recorded [Member] | Owner-occupied commercial real estate [Member]
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment	0		0
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance	0		0
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	0		0
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment			0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized			0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			0
Total Impaired Loans/Leases:
Related Allowance	0		0
Impaired Loans with Specific Allowance Recorded [Member] | Commercial construction, land development, and other land [Member]
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment	2,031,823		2,031,823
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance	2,055,057		2,055,057
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	1,373,340		1,373,340
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment			1,598,548
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized			0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			0
Total Impaired Loans/Leases:
Related Allowance	1,373,340		1,373,340
Impaired Loans with Specific Allowance Recorded [Member] | Non-owner occupied Commercial Real Estate [Member]
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment	13,350,413		13,350,413
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance	13,603,372		13,603,372
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	2,108,785		2,108,785
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment			9,859,148
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized			237,408
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			237,408
Total Impaired Loans/Leases:
Related Allowance	2,108,785		2,108,785
Impaired Loans with Specific Allowance Recorded [Member] | Leases receivable [Member]
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment	240,750		240,750
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance	240,750		240,750
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	157,900		157,900
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment			177,551
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized			0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			0
Total Impaired Loans/Leases:
Related Allowance	157,900		157,900
Impaired Loans with Specific Allowance Recorded [Member] | Residential Real Estate [Member]
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment	568,651		568,651
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance	568,651		568,651
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	169,196		169,196
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment			463,361
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized			0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			0
Total Impaired Loans/Leases:
Related Allowance	169,196		169,196
Impaired Loans with Specific Allowance Recorded [Member] | Installment and Other Consumer [Member]
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment	113,012		113,012
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance	113,012		113,012
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	68,673		68,673
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment			68,286
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized			0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			0
Total Impaired Loans/Leases:
Related Allowance	68,673		68,673
Impaired Loans with Specific Allowance Recorded [Member]
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment	16,529,996		16,529,996
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance	16,828,441		16,828,441
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	4,152,560		4,152,560
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment			12,710,562
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized			243,343
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received			243,343
Total Impaired Loans/Leases:
Related Allowance	4,152,560		4,152,560
Commercial and Industrial [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				360,947
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance				979,901
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	754,844	2,236,289
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				1,791,908
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				1,791,908
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	274,666		274,666	903,187
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	223,917	1,534,968
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	1,984
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	1,984
Total Impaired Loans/Leases:
Recorded Investment	1,071,050		1,071,050	2,152,855
Unpaid Principal Balance	1,882,972		1,882,972	2,771,809
Related Allowance	274,666		274,666	903,187
Average Recorded Investment	978,761	3,771,257	1,330,814
Interest Income Recognized	1,984		5,935
Interest Income Recognized for Cash Payments Received	1,984		5,935
Owner-occupied commercial real estate [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				736,610
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance				736,610
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	550,725	1,774,342
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	0	11,909
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	11,909
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				217,059
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				217,059
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	0		0	47,911
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment		360,894
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0
Total Impaired Loans/Leases:
Recorded Investment	542,721		542,721	953,669
Unpaid Principal Balance	542,721		542,721	953,669
Related Allowance	0		0	47,911
Average Recorded Investment	550,725	2,135,236	657,327
Interest Income Recognized	0	11,909	0
Interest Income Recognized for Cash Payments Received	0	11,909	0
Commercial construction, land development, and other land [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	1,323,689	286,339
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	1,701
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	1,701
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				9,051,455
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				9,051,455
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	1,373,340		1,373,340	3,002,450
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	3,481,385	5,881,823
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	1,701	473
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	1,701	473
Total Impaired Loans/Leases:
Recorded Investment	3,059,023		3,059,023	9,051,455
Unpaid Principal Balance	3,082,257		3,082,257	9,051,455
Related Allowance	1,373,340		1,373,340	3,002,450
Average Recorded Investment	2,157,696	5,595,484	6,040,483
Interest Income Recognized	0	473	5,552
Interest Income Recognized for Cash Payments Received	0	473	5,552
Non-owner occupied Commercial Real Estate [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				3,936,826
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance				3,986,820
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	5,798,404	1,730,764
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				10,339,415
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				10,839,415
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	2,108,785		2,108,785	1,247,377
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	12,036,134	7,488,032
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	86,744	0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	86,744	0
Total Impaired Loans/Leases:
Recorded Investment	14,849,012		14,849,012	14,276,241
Unpaid Principal Balance	15,901,971		15,901,971	14,826,235
Related Allowance	2,108,785		2,108,785	1,247,377
Average Recorded Investment	17,834,538	9,218,796	16,472,382
Interest Income Recognized	86,744	0	238,302
Interest Income Recognized for Cash Payments Received	86,744	0	238,302
Leases receivable [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				1,094,178
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance				1,094,178
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	680,817	668,944
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				212,485
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				212,485
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	157,900		157,900	66,675
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	210,299	983,131
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Total Impaired Loans/Leases:
Recorded Investment	1,094,724		1,094,724	1,306,663
Unpaid Principal Balance	1,094,724		1,094,724	1,306,663
Related Allowance	157,900		157,900	66,675
Average Recorded Investment	891,116	1,652,075	952,406
Interest Income Recognized	0	0	0
Interest Income Recognized for Cash Payments Received	0	0	0
Residential Real Estate [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				788,685
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance				862,298
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	943,926	942,011
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	1,691
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	1,691
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				344,789
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				344,789
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	169,196		169,196	55,884
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	524,031	200,625
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Total Impaired Loans/Leases:
Recorded Investment	1,517,304		1,517,304	1,133,474
Unpaid Principal Balance	1,700,335		1,700,335	1,207,087
Related Allowance	169,196		169,196	55,884
Average Recorded Investment	1,467,957	1,142,636	1,324,463
Interest Income Recognized	1,691	0	5,037
Interest Income Recognized for Cash Payments Received	1,691	0	5,037
Installment and Other Consumer [Member]
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				593,987
Impaired Loans/Leases with No Specific Allowance Recorded - UnpaidPrincipal Balance				593,987
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	1,063,519	710,560
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	121	0
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	121	0
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				390,819
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				390,819
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	68,673		68,673	22,819
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	68,898	108,859
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Total Impaired Loans/Leases:
Recorded Investment	759,478		759,478	984,806
Unpaid Principal Balance	759,478		759,478	984,806
Related Allowance	68,673		68,673	22,819
Average Recorded Investment	1,132,417	819,419	1,082,522
Interest Income Recognized	121	0	245
Interest Income Recognized for Cash Payments Received	$ 121	$ 0	$ 245

XML

Note 5 - Business Segment Information (Tables)

9 Months Ended

Sep. 30, 2012

Schedule of Segment Reporting Information, by Segment [Table Text Block]

	Commercial Banking
	Quad City Bank & Trust		Cedar Rapids Bank & Trust		Rockford Bank & Trust			Wealth Management		All Other			Intercompany Eliminations			Consolidated Total
Three Months Ended September 30, 2012
Total revenue	$	11,643,674	$	6,706,485	$	2,897,098		$	1,490,297	$	4,542,612		$	(3,675,459	)	$	23,604,707
Net interest income	$	8,602,967	$	4,027,693	$	2,368,483		$	-	$	(369,625	)	$	-		$	14,629,518
Net income attributable to QCR Holdings, Inc.	$	2,586,303	$	1,532,946	$	(313,019	)	$	108,950	$	3,077,515		$	(3,935,362	)	$	3,057,333
Total assets	$	1,134,296,418	$	587,057,961	$	299,947,837		$	-	$	196,448,244		$	(193,804,388	)	$	2,023,946,072
Provision for loan/lease losses	$	350,194	$	300,000	$	846,000		$	-	$	-		$	-		$	1,496,194
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688
Three Months Ended September 30, 2011
Total revenue	$	12,147,213	$	7,110,970	$	3,377,454		$	1,311,647	$	3,319,882		$	(3,362,429	)	$	23,904,737
Net interest income	$	7,944,108	$	3,873,339	$	2,355,471		$	-	$	(344,214	)	$	-		$	13,828,704
Net income attributable to QCR Holdings, Inc.	$	1,854,914	$	1,375,114	$	(243,710	)	$	257,611	$	2,192,761		$	(3,273,535	)	$	2,163,155
Total assets	$	1,056,656,935	$	565,822,310	$	287,574,174		$	-	$	193,059,135		$	(204,152,062	)	$	1,898,960,492
Provision for loan/lease losses	$	1,158,965	$	250,000	$	1,048,000		$	-	$	-		$	-		$	2,456,965
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688
Nine Months Ended September 30, 2012
Total revenue	$	36,196,909	$	19,829,521	$	9,665,950		$	4,427,051	$	13,533,609		$	(13,115,614	)	$	70,537,426
Net interest income	$	25,524,594	$	11,691,876	$	7,259,522		$	-	$	(1,127,528	)	$	-		$	43,348,464
Net income attributable to QCR Holdings, Inc.	$	7,603,033	$	4,214,081	$	482,950		$	425,356	$	9,484,700		$	(12,843,813	)	$	9,366,307
Total assets	$	1,134,296,418	$	587,057,961	$	299,947,837		$	-	$	196,448,244		$	(193,804,388	)	$	2,023,946,072
Provision for loan/lease losses	$	1,138,109	$	875,000	$	1,312,000		$	-	$	-		$	-		$	3,325,109
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688
Nine Months Ended September 30, 2011
Total revenue	$	35,990,157	$	21,482,485	$	10,046,334		$	4,238,644	$	10,776,476		$	(10,885,546	)	$	71,648,550
Net interest income	$	22,772,375	$	11,859,003	$	6,641,533		$	-	$	(1,284,350	)	$	-		$	39,988,561
Net income attributable to QCR Holdings, Inc.	$	5,777,707	$	3,964,627	$	45,697		$	741,263	$	7,054,192		$	(10,620,402	)	$	6,963,084
Total assets	$	1,056,656,935	$	565,822,310	$	287,574,174		$	-	$	193,059,135		$	(204,152,062	)	$	1,898,960,492
Provision for loan/lease losses	$	2,236,850	$	1,035,000	$	1,925,000		$	-	$	-		$	-		$	5,196,850
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688

XML

Note 3 - Loans/Leases Receivable (Detail) - Information For Impaired Loans/Leases by Classes of Financing Receivable (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Dec. 31, 2011
Impaired Loans/Leases with No Specific Allowance Recorded:
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	$ 11,115,924	$ 8,349,249
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	3,513	11,909
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	3,513	11,909
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				7,511,233
Impaired Loans/Leases with No Specific Allowance Recorded - Unpaid Principal Balance				8,253,794
Impaired Loans/Leases with Specific Allowance Recorded:
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	15,220,975	16,271,993
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	88,728	473
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	88,728	473
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				22,347,930
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				22,847,930
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	4,152,560		4,152,560	5,346,303
Commercial Real Estate
Average Recorded Investment	26,336,899	24,621,242	27,860,397
Interest Income Recognized	92,241	12,382	255,071
Interest Income Recognized for Cash Payments Received	92,241	12,382	255,071
Recorded Investment	22,893,312		22,893,312	29,859,163
Unpaid Principal Balance	24,964,458		24,964,458	31,101,724
Related Allowance	4,152,560		4,152,560	5,346,303
Commercial and Industrial [Member]
Impaired Loans/Leases with No Specific Allowance Recorded:
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	754,844	2,236,289
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				360,947
Impaired Loans/Leases with No Specific Allowance Recorded - Unpaid Principal Balance				979,901
Impaired Loans/Leases with Specific Allowance Recorded:
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	223,917	1,534,968
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	1,984
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	1,984
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				1,791,908
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				1,791,908
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	274,666		274,666	903,187
Commercial Real Estate
Average Recorded Investment	978,761	3,771,257	1,330,814
Interest Income Recognized	1,984		5,935
Interest Income Recognized for Cash Payments Received	1,984		5,935
Recorded Investment	1,071,050		1,071,050	2,152,855
Unpaid Principal Balance	1,882,972		1,882,972	2,771,809
Related Allowance	274,666		274,666	903,187
Owner-occupied commercial real estate [Member]
Impaired Loans/Leases with No Specific Allowance Recorded:
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	550,725	1,774,342
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	0	11,909
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	11,909
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				736,610
Impaired Loans/Leases with No Specific Allowance Recorded - Unpaid Principal Balance				736,610
Impaired Loans/Leases with Specific Allowance Recorded:
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment		360,894
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				217,059
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				217,059
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	0		0	47,911
Commercial Real Estate
Average Recorded Investment	550,725	2,135,236	657,327
Interest Income Recognized	0	11,909	0
Interest Income Recognized for Cash Payments Received	0	11,909	0
Recorded Investment	542,721		542,721	953,669
Unpaid Principal Balance	542,721		542,721	953,669
Related Allowance	0		0	47,911
Commercial construction, land development, and other land [Member]
Impaired Loans/Leases with No Specific Allowance Recorded:
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	1,323,689	286,339
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	1,701
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	1,701
Impaired Loans/Leases with Specific Allowance Recorded:
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	3,481,385	5,881,823
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	1,701	473
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	1,701	473
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				9,051,455
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				9,051,455
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	1,373,340		1,373,340	3,002,450
Commercial Real Estate
Average Recorded Investment	2,157,696	5,595,484	6,040,483
Interest Income Recognized	0	473	5,552
Interest Income Recognized for Cash Payments Received	0	473	5,552
Recorded Investment	3,059,023		3,059,023	9,051,455
Unpaid Principal Balance	3,082,257		3,082,257	9,051,455
Related Allowance	1,373,340		1,373,340	3,002,450
Non-owner occupied Commercial Real Estate [Member]
Impaired Loans/Leases with No Specific Allowance Recorded:
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	5,798,404	1,730,764
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				3,936,826
Impaired Loans/Leases with No Specific Allowance Recorded - Unpaid Principal Balance				3,986,820
Impaired Loans/Leases with Specific Allowance Recorded:
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	12,036,134	7,488,032
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	86,744	0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	86,744	0
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				10,339,415
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				10,839,415
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	2,108,785		2,108,785	1,247,377
Commercial Real Estate
Average Recorded Investment	17,834,538	9,218,796	16,472,382
Interest Income Recognized	86,744	0	238,302
Interest Income Recognized for Cash Payments Received	86,744	0	238,302
Recorded Investment	14,849,012		14,849,012	14,276,241
Unpaid Principal Balance	15,901,971		15,901,971	14,826,235
Related Allowance	2,108,785		2,108,785	1,247,377
Leases receivable [Member]
Impaired Loans/Leases with No Specific Allowance Recorded:
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	680,817	668,944
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				1,094,178
Impaired Loans/Leases with No Specific Allowance Recorded - Unpaid Principal Balance				1,094,178
Impaired Loans/Leases with Specific Allowance Recorded:
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	210,299	983,131
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				212,485
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				212,485
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	157,900		157,900	66,675
Commercial Real Estate
Average Recorded Investment	891,116	1,652,075	952,406
Interest Income Recognized	0	0	0
Interest Income Recognized for Cash Payments Received	0	0	0
Recorded Investment	1,094,724		1,094,724	1,306,663
Unpaid Principal Balance	1,094,724		1,094,724	1,306,663
Related Allowance	157,900		157,900	66,675
Residential Real Estate [Member]
Impaired Loans/Leases with No Specific Allowance Recorded:
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	943,926	942,011
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	1,691
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	1,691
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				788,685
Impaired Loans/Leases with No Specific Allowance Recorded - Unpaid Principal Balance				862,298
Impaired Loans/Leases with Specific Allowance Recorded:
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	524,031	200,625
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				344,789
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				344,789
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	169,196		169,196	55,884
Commercial Real Estate
Average Recorded Investment	1,467,957	1,142,636	1,324,463
Interest Income Recognized	1,691	0	5,037
Interest Income Recognized for Cash Payments Received	1,691	0	5,037
Recorded Investment	1,517,304		1,517,304	1,133,474
Unpaid Principal Balance	1,700,335		1,700,335	1,207,087
Related Allowance	169,196		169,196	55,884
Installment and Other Consumer [Member]
Impaired Loans/Leases with No Specific Allowance Recorded:
Impaired Loans/Leases with No Specific Allowance Recorded - Average Recorded Investment	1,063,519	710,560
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized	121	0
Impaired Loans/Leases with No Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	121	0
Impaired Loans/Leases with No Specific Allowance Recorded - Recorded Investment				593,987
Impaired Loans/Leases with No Specific Allowance Recorded - Unpaid Principal Balance				593,987
Impaired Loans/Leases with Specific Allowance Recorded:
Impaired Loans/Leases with Specific Allowance Recorded - Average Recorded Investment	68,898	108,859
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Interest Income Recognized for Cash Payments Received	0	0
Impaired Loans/Leases with Specific Allowance Recorded - Recorded Investment				390,819
Impaired Loans/Leases with Specific Allowance Recorded - Unpaid Principal Balance				390,819
Impaired Loans/Leases with Specific Allowance Recorded - Related Allowance	68,673		68,673	22,819
Commercial Real Estate
Average Recorded Investment	1,132,417	819,419	1,082,522
Interest Income Recognized	121	0	245
Interest Income Recognized for Cash Payments Received	121	0	245
Recorded Investment	759,478		759,478	984,806
Unpaid Principal Balance	759,478		759,478	984,806
Related Allowance	$ 68,673		$ 68,673	$ 22,819

XML

Note 1 - Summary of Significant Accounting Policies (Detail)	Sep. 30, 2012	Jun. 30, 2012
m2 Lease Funds LLC [Member]
Equity Method Investment, Ownership Percentage		80.00%
Business Acquisition, Percentage of Voting Interests Acquired	20.00%
Velie Plantation Holding Company LLC [Member]
Equity Method Investment, Ownership Percentage	91.00%

XML

Consolidated Statement of Changes in Stockholders' Equity (Unaudited) (Parentheticals) (USD $)	3 Months Ended
	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011
Shares of common stock issued as a result of stock purchased under the Employee Stock Purchase Plan (in Shares)	7,642	10,856	7,767	7,975	11,355	9,081
Shares of common stock issued as a result of stock options exercised (in Shares)	7,075	9,090	276		10,967	24,300
Shares of common stock exchanged (in Shares)		611	(576)		379	2,171
Common cash dividends per share (in Dollars per share)		$ 0.04			$ 0.04
Shares of common stock issued in conjunction with the issuance of Series A Subordinated Notes (in Shares)	1,000	4,300
Series F Noncumulative Perpetual Preferred Stock [Member]
Shares of preferred stock redeemed (in Shares)		10,223
Shares of Series F Non-Cumulative Perpetual Preferred Stock issued (in Shares)				40,090
Series D Cumulative Perpetual Preferred Stock [Member]
Shares of preferred stock redeemed (in Shares)				38,237

XML

Consolidated Balance Sheets (Unaudited) (Parentheticals) (USD $)	Sep. 30, 2012	Dec. 31, 2011
Preferred stock, par value (in Dollars per share)	$ 1	$ 1
Preferred stock, shares authorized (in Shares)	250,000	250,000
Preferred stock, shares issued (in Shares)	54,867	65,090
Preferred stock, shares outstanding (in Shares)	54,867	65,090
Common stock, par value (in Dollars per share)	$ 1	$ 1
Common stock, shares authorized (in Shares)	20,000,000	20,000,000
Common stock, shares issued (in Shares)	4,984,024	4,879,435
Common stock, shares outstanding (in Shares)	4,862,778	4,758,189
Treasury Stock, shares (in Shares)	121,246	121,246

XML

Note 8 - Acquisition Of 20% Noncontrolling Interest In M2 Lease Funds

9 Months Ended

Sep. 30, 2012

Business Combination Disclosure [Text Block]

NOTE 8 – ACQUISITION OF 20% NONCONTROLLING INTEREST IN M2 LEASE FUNDS

On August 27, 2012, the Company’s largest subsidiary bank, QCBT, entered into an amendment to the operating agreement of m2 Lease Funds and purchased the 20% noncontrolling interest in m2 Lease Funds.  QCBT previously owned an 80% equity interest in m2 Lease Funds.  The acquisition is structured in two payments with the initial payment of $1,653,755 made on September 11, 2012 and the final payment to be made in September 2015.  The initial payment represented a 50% premium over the book value of the 20% equity interest of $3,307,509 as of August 31, 2012, calculated in accordance with the operating agreement.  The final payment will consist of the book value of the 20% equity interest as of August 31, 2012 plus 20% of the earnings from m2 Lease Funds for the period September 2012 through August 2015.  As a result, for the portion of the final payment related to the book value of the 20% equity interest as of August 31, 2012, QCBT calculated the present value of the future payment using a discount rate of 5% and recorded the resulting liability of $2,847,687.  QCBT will accrete the discount using the effective yield method over three years.  For the portion of the final payment related to the 20% of earnings from m2 Lease Funds for the period September 2012 through August 2015, QCBT will record compensation cost and increase the liability on a monthly basis.  As a result of acquiring additional equity in a majority-owned company, the premium paid is reflected as a reduction of additional paid-in capital.  The total premium paid and resulting reduction of additional paid-in capital totaled $2,133,417 which consists of the 50% premium over the book value as defined by the operating agreement ($1,653,755) and the difference between the discounted book value and the equity in the 20% noncontrolling interest as of August 31, 2012 ($453,884).

XML

Document And Entity Information	9 Months Ended
	Sep. 30, 2012	Nov. 01, 2012
Document and Entity Information [Abstract]
Entity Registrant Name	QCR HOLDINGS INC
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		4,878,317
Amendment Flag	false
Entity Central Index Key	0000906465
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Document Period End Date	Sep. 30, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q3

XML

Accounting Policies, by Policy (Policies)

9 Months Ended

Sep. 30, 2012

Business Description and Basis of Presentation [Text Block]

Basis of presentation:  The interim unaudited consolidated financial statements contained herein should be read in conjunction with the audited consolidated financial statements and accompanying notes to the consolidated financial statements for the fiscal year ended December 31, 2011, including QCR Holdings, Inc.’s (the “Company”) Form 10-K filed with the Securities and Exchange Commission on March 8, 2012.  Accordingly, footnote disclosures, which would substantially duplicate the disclosures contained in the audited consolidated financial statements, have been omitted.

The financial information of the Company included herein has been prepared in accordance with U.S. generally accepted accounting principles for interim financial reporting and has been prepared pursuant to the rules and regulations for reporting on Form 10-Q and Rule 10-01 of Regulation S-X.  Such information reflects all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the periods presented.  Any differences appearing between the numbers presented in financial statements and management’s discussion and analysis are due to rounding.  The results of the interim period ended September 30, 2012, are not necessarily indicative of the results expected for the year ending December 31, 2012.

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries which include three state-chartered commercial banks:  Quad City Bank & Trust Company (“QCBT”), Cedar Rapids Bank & Trust Company (“CRBT”), and Rockford Bank & Trust Company (“RB&T”).  The Company also engages in direct financing lease contracts through its now wholly-owned equity investment by QCBT in m2 Lease Funds, LLC (“m2 Lease Funds”).  QCBT previously owned 80% of m2 Lease Funds.  In August 2012, QCBT entered into an amendment to the operating agreement of m2 Lease Funds and purchased the 20% noncontrolling interest.  See Note 8 for a more detailed discussion of this transaction.  The Company engages in real estate holdings through its 91% equity investment in Velie Plantation Holding Company, LLC (“VPHC”).  All material intercompany transactions and balances have been eliminated in consolidation.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent accounting developments:  In December 2011, the Financial Accounting Standards Board issued ASU 2011-11, Disclosures about Offsetting Assets and Liabilities.  ASU 2011-11 requires entities to disclose both gross information and net information about both instruments and transactions eligible for offset in the balance sheet, and instruments and transactions subject to an agreement similar to a master netting arrangement.  ASU 2011-11 is effective for annual periods beginning on or after January 1, 2013, and interim periods within those annual periods.  Adoption is not expected to have a significant impact on the Company’s consolidated financial statements.

Reclassification, Policy [Policy Text Block]

Reclassifications:  Certain amounts in the prior year financial statements have been reclassified, with no effect on net income or stockholders’ equity, to conform with the current period presentation.

XML

Consolidated Statements Of Income (Unaudited) (USD $)	3 Months Ended			9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011		Sep. 30, 2012	Sep. 30, 2011
Interest and dividend income:
Loans/leases, including fees	$ 15,804,330	$ 16,215,725		$ 47,748,276	$ 48,466,331
Securities:
Taxable	2,781,889	2,877,574		8,353,482	8,035,495
Nontaxable	690,466	244,209		1,624,577	743,368
Interest-bearing deposits at financial institutions	75,818	97,714		288,400	311,807
Restricted investment securities	131,967	126,333		378,067	427,818
Federal funds sold	3,055	7,875		3,055	97,919
Total interest and dividend income	19,487,525	19,569,430		58,395,857	58,082,738
Interest expense:
Deposits	1,488,749	2,201,070		4,834,006	6,948,265
Short-term borrowings	60,500	65,502		202,731	248,079
Federal Home Loan Bank advances	1,809,888	1,931,259		5,503,329	6,053,134
Other borrowings	1,238,254	1,301,144		3,719,730	3,870,062
Junior subordinated debentures	260,616	241,751		787,597	974,637
Total interest expense	4,858,007	5,740,726		15,047,393	18,094,177
Net interest income	14,629,518	13,828,704		43,348,464	39,988,561
Provision for loan/lease losses	1,496,194	2,456,965		3,325,109	5,196,850
Net interest income after provision for loan/lease losses	13,133,324	11,371,739		40,023,355	34,791,711
Noninterest income:
Trust department fees	914,586	762,133		2,650,552	2,607,668
Investment advisory and management fees	575,711	549,515		1,776,499	1,630,976
Deposit service fees	847,343	893,685		2,626,822	2,623,018
Gains on sales of loans, net	684,546	408,364		1,965,957	1,923,185
Securities gains		443,614		104,600	1,472,528
Gains (losses) on other real estate owned, net	(745,799)	42,262		(1,324,468)	(90,492)
Earnings on bank-owned life insurance	399,925	331,440		1,196,987	1,032,493
Credit card issuing fees, net of processing costs	140,542	178,636		409,730	397,132
Other	1,300,328	725,658		2,734,890	1,969,304
Total noninterest income	4,117,182	4,335,307		12,141,569	13,565,812
Noninterest expense:
Salaries and employee benefits	8,201,323	7,651,695		24,581,642	22,480,731
Occupancy and equipment expense	1,459,901	1,359,758		4,177,076	4,017,506
Professional and data processing fees	1,065,780	1,077,435		3,342,847	3,338,935
FDIC and other insurance	599,422	578,776		1,756,493	2,149,093
Loan/lease expense	273,166	839,993		755,066	1,772,290
Advertising and marketing	437,130	277,376		1,057,246	836,459
Postage and telephone	190,868	242,103		716,050	703,803
Stationery and supplies	139,592	122,582		417,769	380,754
Bank service charges	211,378	186,351		609,599	525,007
Prepayment fees on Federal Home Loan Bank advances					832,099
Other-than-temporary impairment losses on securities				62,400	118,847
Other	452,957	437,080		1,402,492	1,185,443
Total noninterest expense	13,031,517	12,773,149		38,878,680	38,340,967
Net income before income taxes	4,218,989	2,933,897		13,286,244	10,016,556
Federal and state income tax expense	1,034,479	667,296		3,425,506	2,745,257
Net income	3,184,510	2,266,601		9,860,738	7,271,299
Less: Net income attributable to noncontrolling interests	127,177	103,446		494,431	308,215
Net income attributable to QCR Holdings, Inc.	3,057,333	2,163,155		9,366,307	6,963,084
Less: Preferred stock dividends	810,837	2,188,058	[1]	2,685,248	4,256,171	[1]
Net income attributable to QCR Holdings, Inc. common stockholders	$ 2,246,496	$ (24,903)		$ 6,681,059	$ 2,706,913
Earnings per common share attributable to QCR Holdings, Inc. common shareholders
Basic (in Dollars per share)	$ 0.45	$ (0.01)		$ 1.37	$ 0.56
Diluted (in Dollars per share)	$ 0.44	$ (0.01)		$ 1.35	$ 0.56
Weighted average common shares outstanding (in Shares)	4,978,699	4,866,692		4,871,626	4,795,382
Weighted average common and common equivalent shares outstanding (in Shares)	5,080,288	4,866,692		4,938,514	4,847,433
Cash dividends declared per common share (in Dollars per share)				$ 0.04	$ 0.04

[1] For the three and nine months ended September 30, 2011, includes approximately $1.2 million of accelerated accretion of discount on the Treasury Captial Purchase Program preferred shares repurchased during the third quarter of 2011.

XML

Note 3 - Loans/Leases Receivable

9 Months Ended

Sep. 30, 2012

Financing Receivables [Text Block]

NOTE 3 – LOANS/LEASES RECEIVABLE

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

	As of September 30, 2012			As of December 31, 2011
Commercial and industrial loans	$	355,003,888		$	350,794,278
Commercial real estate loans
Owner-occupied commercial real estate		199,788,124			167,790,621
Commercial construction, land development, and other land		49,191,909			60,384,738
Other non owner-occupied commercial real estate		345,923,717			349,628,491
		594,903,750			577,803,850
Direct financing leases *		102,038,868			93,212,362
Residential real estate loans **		112,492,219			98,107,051
Installment and other consumer loans		76,837,989			78,223,080
		1,241,276,714			1,198,140,621
Plus deferred loan/lease origination costs, net of fees		3,015,495			2,604,876
		1,244,292,209			1,200,745,497
Less allowance for estimated losses on loans/leases		(19,416,748	)		(18,789,262	)
	$	1,224,875,461		$	1,181,956,235
* Direct financing leases:
Net minimum lease payments to be received	$	115,931,555		$	106,389,988
Estimated unguaranteed residual values of leased assets		1,111,627			1,043,326
Unearned lease/residual income		(15,004,314	)		(14,220,952	)
		102,038,868			93,212,362
Plus deferred lease origination costs, net of fees		3,727,752			3,217,011
		105,766,620			96,429,373
Less allowance for estimated losses on leases		(1,884,985	)		(1,339,496	)
	$	103,881,635		$	95,089,877

**Includes residential real estate loans held for sale totaling $6,285,131 and $3,832,760 as of September 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 nine months ended September 30, 2012 and 2011, there were no losses on residual values.  At September 30, 2012, the Company had 37 leases remaining with residual values totaling $1,111,627 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 September 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	$	352,308,795		$	872,105		$	15,252		$	149,750		$	1,657,986		$	355,003,888
Commercial Real Estate
Owner-Occupied Commercial Real Estate		198,070,105			-			1,046,835			-			671,184			199,788,124
Commercial Construction, Land Development, and Other Land		47,080,534			-			-			-			2,111,375			49,191,909
Other Non Owner-Occupied Commercial Real Estate		332,708,671			2,325,809			733,442			-			10,155,795			345,923,717
Direct Financing Leases		100,205,091			632,458			106,595			-			1,094,724			102,038,868
Residential Real Estate		111,142,654			-			-			-			1,349,565			112,492,219
Installment and Other Consumer		75,805,776			255,048			33,730			52,733			690,702			76,837,989
	$	1,217,321,626		$	4,085,420		$	1,935,854		$	202,483		$	17,731,331		$	1,241,276,714
As a percentage of total loan/lease portfolio		98.07	%		0.33	%		0.16	%		0.02	%		1.43	%		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 September 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	$	149,750	$	1,657,986	$	184,813	$	1,992,549		8.32	%
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		671,184		-		671,184		2.80	%
Commercial Construction, Land Development, and Other Land		-		2,111,375		337,500		2,448,875		10.23	%
Other Non Owner-Occupied Commercial Real Estate		-		10,155,795		5,303,365		15,459,160		64.57	%
Direct Financing Leases		-		1,094,724		-		1,094,724		4.57	%
Residential Real Estate		-		1,349,565		167,739		1,517,304		6.34	%
Installment and Other Consumer		52,733		690,702		16,043		759,478		3.17	%
	$	202,483	$	17,731,331	$	6,009,460	$	23,943,274		100.00	%

*Nonaccrual loans/leases includes $5,749,193 of troubled debt restructurings, including $141,886 in commercial and industrial loans,  $5,212,247 in commercial real estate loans, $64,726 in direct financing leases, and $330,334 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 nine months ended September 30, 2012 and 2011, respectively, are presented as follows:

	Three Months Ended September 30, 2012
	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate			Installment and Other Consumer			Total
Balance, beginning	$	4,180,792		$	10,709,991		$	1,610,999		$	986,714		$	1,236,039		$	18,724,535
Provisions charged to expense		136,766			721,358			350,194			233,226			54,650			1,496,194
Loans/leases charged off		(214,036	)		(552,959	)		(111,326	)		(183,031	)		(88,378	)		(1,149,730	)
Recoveries on loans/leases previously charged off		69,959			175,467			35,118			-			65,205			345,749
Balance, ending	$	4,173,481		$	11,053,857		$	1,884,985		$	1,036,909		$	1,267,516		$	19,416,748

	Three Months Ended September 30, 2011
	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate		Installment and Other Consumer			Total
Balance, beginning	$	7,124,444		$	8,602,639		$	1,591,309		$	757,075	$	1,727,165		$	19,802,632
Provisions charged to expense		(211,491	)		2,645,457			159,965			92,032		(228,998	)		2,456,965
Loans/leases charged off		(1,465,577	)		(852,174	)		(701,658	)		-		(84,358	)		(3,103,767	)
Recoveries on loans/leases previously charged off		174,013			212,683			2,344			-		33,616			422,656
Balance, ending	$	5,621,389		$	10,608,605		$	1,051,960		$	849,107	$	1,447,425		$	19,578,486

	Nine Months Ended September 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		(637,852	)		2,254,732			924,109			519,751			264,369			3,325,109
Loans/leases charged off		(669,778	)		(1,980,946	)		(454,590	)		(187,788	)		(416,179	)		(3,709,281	)
Recoveries on loans/leases previously charged off		603,105			183,113			75,970			-			149,470			1,011,658
Balance, ending	$	4,173,481		$	11,053,857		$	1,884,985		$	1,036,909		$	1,267,516		$	19,416,748

	Nine Months Ended September 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		1,005,002			3,038,359			463,850			101,079		588,560			5,196,850
Loans/leases charged off		(3,256,194	)		(1,773,711	)		(945,104	)		-		(701,390	)		(6,676,399	)
Recoveries on loans/leases previously charged off		323,659			256,642			2,642			-		110,436			693,379
Balance, ending	$	5,621,389		$	10,608,605		$	1,051,960		$	849,107	$	1,447,425		$	19,578,486

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

	As of September 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	$	274,666		$	3,482,125		$	157,900		$	169,196		$	68,673		$	4,152,560
Allowance for loans/leases collectively evaluated for impairment		3,898,815			7,571,732			1,727,085			867,713			1,198,843			15,264,188
	$	4,173,481		$	11,053,857		$	1,884,985		$	1,036,909		$	1,267,516		$	19,416,748
Loans/leases individually evaluated for impairment	$	1,071,050		$	18,450,756		$	1,094,724		$	1,517,304		$	759,478		$	22,893,312
Loans/leases collectively evaluated for impairment		353,932,838			576,452,994			100,944,144			110,974,915			76,078,511			1,218,383,402
	$	355,003,888		$	594,903,750		$	102,038,868		$	112,492,219		$	76,837,989		$	1,241,276,714
Allowance as a percentage of loans/leases individually evaluated for impairment		25.64	%		18.87	%		14.42	%		11.15	%		9.04	%		18.14	%
Allowance as a percentage of loans/leases collectively evaluated for impairment		1.10	%		1.31	%		1.71	%		0.78	%		1.58	%		1.25	%
		1.18	%		1.86	%		1.85	%		0.92	%		1.65	%		1.56	%

	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 nine months ended September 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	$	845,703	$	1,635,373	$	-	$	787,146	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		542,721		542,721		-		657,327		-		-
Commercial Construction, Land Development, and Other Land		1,027,200		1,027,200		-		4,441,935		5,552		5,552
Other Non Owner-Occupied Commercial Real Estate		1,498,599		2,298,599		-		6,613,234		894		894
Direct Financing Leases		853,974		853,974		-		774,855		-		-
Residential Real Estate		948,653		1,131,684		-		861,102		5,037		5,037
Installment and Other Consumer		646,466		646,466		-		1,014,236		245		245
	$	6,363,316	$	8,136,017	$	-	$	15,149,835	$	11,728	$	11,728
Impaired Loans/Leases with Specific Allowance Recorded:
Commercial and Industrial	$	225,347	$	247,599	$	274,666	$	543,668	$	5,935	$	5,935
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		-		-		-		-		-
Commercial Construction, Land Development, and Other Land		2,031,823		2,055,057		1,373,340		1,598,548		-		-
Other Non Owner-Occupied Commercial Real Estate		13,350,413		13,603,372		2,108,785		9,859,148		237,408		237,408
Direct Financing Leases		240,750		240,750		157,900		177,551		-		-
Residential Real Estate		568,651		568,651		169,196		463,361		-		-
Installment and Other Consumer		113,012		113,012		68,673		68,286		-		-
	$	16,529,996	$	16,828,441	$	4,152,560	$	12,710,562	$	243,343	$	243,343
Total Impaired Loans/Leases:
Commercial and Industrial	$	1,071,050	$	1,882,972	$	274,666	$	1,330,814	$	5,935	$	5,935
Commercial Real Estate
Owner-Occupied Commercial Real Estate		542,721		542,721		-		657,327		-		-
Commercial Construction, Land Development, and Other Land		3,059,023		3,082,257		1,373,340		6,040,483		5,552		5,552
Other Non Owner-Occupied Commercial Real Estate		14,849,012		15,901,971		2,108,785		16,472,382		238,302		238,302
Direct Financing Leases		1,094,724		1,094,724		157,900		952,406		-		-
Residential Real Estate		1,517,304		1,700,335		169,196		1,324,463		5,037		5,037
Installment and Other Consumer		759,478		759,478		68,673		1,082,522		245		245
	$	22,893,312	$	24,964,458	$	4,152,560	$	27,860,397	$	255,071	$	255,071

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 September 30, 2012 and 2011 is as follows:

	Three Months Ended September 30, 2012						Three Months Ended September 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	$	754,844	$	-	$	-	$	2,236,289	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		550,725		-		-		1,774,342		11,909		11,909
Commercial Construction, Land Development, and Other Land		1,323,689		1,701		1,701		286,339		-		-
Other Non Owner-Occupied Commercial Real Estate		5,798,404		-		-		1,730,764		-		-
Direct Financing Leases		680,817		-		-		668,944		-		-
Residential Real Estate		943,926		1,691		1,691		942,011		-		-
Installment and Other Consumer		1,063,519		121		121		710,560		-		-
	$	11,115,924	$	3,513	$	3,513	$	8,349,249	$	11,909	$	11,909
Impaired Loans/Leases with Specific Allowance Recorded:
Commercial and Industrial	$	223,917	$	1,984	$	1,984	$	1,534,968	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		-		-		360,894		-		-
Commercial Construction, Land Development, and Other Land		2,157,696		-		-		5,595,484		473		473
Other Non Owner-Occupied Commercial Real Estate		12,036,134		86,744		86,744		7,488,032		-		-
Direct Financing Leases		210,299		-		-		983,131		-		-
Residential Real Estate		524,031		-		-		200,625		-		-
Installment and Other Consumer		68,898		-		-		108,859		-		-
	$	15,220,975	$	88,728	$	88,728	$	16,271,993	$	473	$	473
Total Impaired Loans/Leases:
Commercial and Industrial	$	978,761	$	1,984	$	1,984	$	3,771,257	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		550,725		-		-		2,135,236		11,909		11,909
Commercial Construction, Land Development, and Other Land		3,481,385		1,701		1,701		5,881,823		473		473
Other Non Owner-Occupied Commercial Real Estate		17,834,538		86,744		86,744		9,218,796		-		-
Direct Financing Leases		891,116		-		-		1,652,075		-		-
Residential Real Estate		1,467,957		1,691		1,691		1,142,636		-		-
Installment and Other Consumer		1,132,417		121		121		819,419		-		-
	$	26,336,899	$	92,241	$	92,241	$	24,621,242	$	12,382	$	12,382

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 September 30, 2012 and December 31, 2011:

	As of September 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)	$	331,637,518	$	193,587,897	$	42,177,159	$	311,918,867	$	879,321,441
Special Mention (Rating 6)		7,920,533		4,213,076		560,086		8,660,810		21,354,505
Substandard (Rating 7)		15,445,837		1,987,151		6,454,664		25,344,040		49,231,692
Doubtful (Rating 8)		-		-		-		-		-
	$	355,003,888	$	199,788,124	$	49,191,909	$	345,923,717	$	949,907,638

	As of September 30, 2012
Delinquency Status *	Direct Financing Leases		Residential Real Estate		Installment and Other Consumer		Total
Performing	$	100,944,144	$	110,974,915	$	76,078,511	$	287,997,570
Nonperforming		1,094,724		1,517,304		759,478		3,371,506
	$	102,038,868	$	112,492,219	$	76,837,989	$	291,369,076

*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

*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.

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 September 30, 2012 and December 31, 2011, troubled debt restructurings totaled $11,758,653 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 nine months ended September 30, 2012 and 2011.  The difference between the pre-modification recorded investment and the post-modification recorded investment would be any partial charge-offs at the time of the restructuring.

	For the three months ended September 30, 2012								For the three months ended September 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		4	$	1,184,289	$	1,184,289	$	325,923		-	$	-	$	-	$	-
		4	$	1,184,289	$	1,184,289	$	325,923		-	$	-	$	-	$	-
CONCESSION - Interest rate adjusted below market
Other Non Owner-Occupied Commercial Real Estate		2	$	1,542,784	$	1,289,825	$	55,187		-	$	-	$	-	$	-
		2	$	1,542,784	$	1,289,825	$	55,187		-	$	-	$	-	$	-
TOTAL		6	$	2,727,073	$	2,474,114	$	381,110		-	$	-	$	-	$	-

	For the nine months ended September 30, 2012								For the nine months ended September 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		4	$	1,184,289	$	1,184,289	$	325,923		1	$	2,851,134	$	2,851,134	$	-
		4	$	1,184,289	$	1,184,289	$	325,923		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		-		-		-		-		-
		2	$	200,000	$	200,000	$	-		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	$	-		-	$	-	$	-	$	-
Other Non Owner-Occupied Commercial Real Estate		2		1,542,784		1,289,825		55,187		-		-		-		-
Residential Real Estate		1		167,739		167,739		-		-		-		-		-
Installment and Other Consumer		1		16,043		16,043		-		-		-		-		-
		5	$	2,064,066	$	1,811,107	$	55,187		-	$	-	$	-	$	-
TOTAL		11	$	3,448,355	$	3,195,396	$	381,110		5	$	4,026,953	$	4,026,953	$	-

Of the troubled debt restructurings reported above, four with post-modification recorded investments totaling $4,337,321 were on nonaccrual as of September 30, 2012.

For the three and nine months ended September 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.

XML

Note 2 - Investment Securities

9 Months Ended

Sep. 30, 2012

Investment Holdings [Text Block]

NOTE 2 – INVESTMENT SECURITIES

The amortized cost and fair value of investment securities as of September 30, 2012 and December 31, 2011 are summarized as follows:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
September 30, 2012:
Securities held to maturity:
Other bonds	$	650,000	$	-	$	-		$	650,000
Securities available for sale:
U.S. govt. sponsored agency securities	$	340,538,125	$	2,712,996	$	(7,499	)	$	343,243,622
Residential mortgage-backed and related securities		151,264,044		4,450,612		(24,081	)		155,690,575
Municipal securities		87,579,277		2,478,687		(26,333	)		90,031,631
Trust preferred securities		86,200		44,200		-			130,400
Other securities		1,329,191		301,728		(25,698	)		1,605,221
	$	580,796,837	$	9,988,223	$	(83,611	)	$	590,701,449
December 31, 2011:
Securities held to maturity:
Other bonds	$	200,000	$	-	$	-		$	200,000
Securities available for sale:
U.S. govt. sponsored agency securities	$	426,581,913	$	2,428,994	$	(55,687	)	$	428,955,220
Residential mortgage-backed and related securities		105,373,614		3,488,350		(8,215	)		108,853,749
Municipal securities		23,937,118		1,752,246		-			25,689,364
Trust preferred securities		86,200		-		(5,400	)		80,800
Other securities		1,354,940		140,022		(44,804	)		1,450,158
	$	557,333,785	$	7,809,612	$	(114,106	)	$	565,029,291

The Company’s residential mortgage-backed and related securities portfolio consists entirely of government sponsored or government guaranteed securities.  The Company has not invested in commercial mortgage-backed securities or pooled trust preferred securities.

Gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of September 30, 2012 and December 31, 2011, are summarized as follows:

	Less than 12 Months					12 Months or More					Total
	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
September 30, 2012:
Securities available for sale:
U.S. govt. sponsored agency securities	$	10,988,570	$	(7,499	)	$	-	$	-		$	10,988,570	$	(7,499	)
Residential mortgage-backed and related securities		5,430,389		(24,081	)		-		-			5,430,389		(24,081	)
Municipal securities		3,455,797		(26,333	)		-		-			3,455,797		(26,333	)
Other securities		-		-			215,000		(25,698	)		215,000		(25,698	)
	$	19,874,756	$	(57,913	)	$	215,000	$	(25,698	)	$	20,089,756	$	(83,611	)
December 31, 2011:
Securities available for sale:
U.S. govt. sponsored agency securities	$	59,979,620	$	(55,687	)	$	-	$	-		$	59,979,620	$	(55,687	)
Residential mortgage-backed and related securities		4,906,398		(8,215	)		-		-			4,906,398		(8,215	)
Trust preferred securities		-		-			80,800		(5,400	)		80,800		(5,400	)
Other securities		251,957		(44,332	)		2,778		(472	)		254,735		(44,804	)
	$	65,137,975	$	(108,234	)	$	83,578	$	(5,872	)	$	65,221,553	$	(114,106	)

At September 30, 2012, the investment portfolio included 360 securities.  Of this number, 13 securities had current unrealized losses with aggregate depreciation of less than 1% from the amortized cost basis.  Of these 13, only one had unrealized losses for twelve months or more.  All of the debt securities in unrealized loss positions are considered acceptable credit risks.  Based upon an evaluation of the available evidence, including the recent changes in market rates, credit rating information and information obtained from regulatory filings, management believes the declines in fair value for these debt securities are temporary.  In addition, the Company does not intend to sell these securities and it is not more-likely-than-not that the Company will be required to sell these debt securities before their anticipated recovery.  At September 30, 2012 and December 31, 2011, equity securities represented less than 1% of the total portfolio.

The Company did not recognize other-than-temporary impairment on any debt securities for the three and nine months ended September 30, 2012 and 2011.

The Company did not recognize other-than-temporary impairment on any equity securities for the three months ended September 30, 2012 and 2011.

During the second quarter of 2012, the Company’s evaluation determined that one privately held equity security experienced a decline in fair value that was other-than-temporary.  As a result, the Company wrote down the value of this security and recognized a loss in the amount of $62,400.  The Company did not recognize other-than-temporary impairment on any of its equity securities during the first quarter of 2012.

During the second quarter of 2011, the Company’s evaluation determined that two privately held equity securities experienced declines in fair value that were other-than-temporary.  As a result, the Company wrote down the value of these securities and recognized losses in the amount of $118,847.  The Company did not recognize other-than-temporary impairment on any of its equity securities during the first quarter of 2011.

All sales of securities, as applicable, for the three and nine months ended September 30, 2012 and 2011, respectively, were from securities identified as available for sale.  Information on proceeds received, as well as pre-tax gross gains from sales of those securities is as follows:

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Proceeds from sales of securities	$	-	$	8,601,107	$	19,215,075	$	54,326,191
Pre-tax gross gains from sales of securities		-		443,614		104,600		1,472,528

The amortized cost and fair value of securities as of September 30, 2012 by contractual maturity are shown below.  A portion of the Company’s U.S. government sponsored agency securities contain call options which allow the issuer, at its discretion, to call the security at predetermined dates prior to the contractual maturity date.Expected maturities of residential mortgage-backed and related securities may differ from contractual maturities because the residential mortgages underlying the residential mortgage-backed and related securities may be called or prepaid without any penalties.  Therefore, these securities are not included in the maturity categories in the following table.  “Other securities” are excluded from the maturity categories as there is no fixed maturity date.

	Amortized Cost		Fair Value
Securities held to maturity:
Due in one year or less	$	100,000	$	100,000
Due after one year through five years		550,000		550,000
	$	650,000	$	650,000
Securities available for sale:
Due in one year or less	$	2,251,717	$	2,257,998
Due after one year through five years		40,236,390		40,681,663
Due after five years		385,715,495		390,465,992
	$	428,203,602	$	433,405,653
Residential mortgage-backed and related securities		151,264,044		155,690,575
Other securities		1,329,191		1,605,221
	$	580,796,837	$	590,701,449

XML

Note 6 - Fair Value (Tables)

9 Months Ended

Sep. 30, 2012

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

			Fair Value Measurements at Reporting Date Using
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
September 30, 2012:
Securities available for sale:
U.S. govt. sponsored agency securities	$	343,243,622	$	-	$	343,243,622	$	-
Residential mortgage-backed and related securities		155,690,575		-		155,690,575		-
Municipal securities		90,031,631		-		90,031,631		-
Trust preferred securities		130,400		-		130,400		-
Other securities		1,605,221		235,027		1,370,194		-
	$	590,701,449	$	235,027	$	590,466,422	$	-
December 31, 2011:
Securities available for sale:
U.S. govt. sponsored agency securities	$	428,955,220	$	-	$	428,955,220	$	-
Residential mortgage-backed and related securities		108,853,749		-		108,853,749		-
Municipal securities		25,689,364		-		25,689,364		-
Trust preferred securities		80,800		-		80,800		-
Other securities		1,450,158		191,506		1,258,652		-
	$	565,029,291	$	191,506	$	564,837,785	$	-

Fair Value Measurements, Nonrecurring [Table Text Block]

			Fair Value Measurements at Reporting Date Using
	Fair Value		Level 1		Level 2		Level 3
September 30, 2012:
Impaired loans/leases	$	13,367,633	$	-	$	-	$	13,367,633
Other real estate owned		5,403,014		-		-		5,403,014
	$	18,770,647	$	-	$	-	$	18,770,647
December 31, 2011:
Impaired loans/leases	$	18,361,757	$	-	$	-	$	18,361,757
Other real estate owned		9,056,619		-		-		9,056,619
	$	27,418,376	$	-	$	-	$	27,418,376

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]

	As of September 30, 2012				As of December 31, 2011
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Cash and due from banks	$	40,564,561	$	40,564,561	$	53,136,710	$	53,136,710
Federal funds sold		5,725,000		5,725,000		20,785,000		20,785,000
Interest-bearing deposits at financial institutions		49,436,938		49,436,938		26,750,602		26,750,602
Investment securities:
Held to maturity		650,000		650,000		200,000		200,000
Available for sale		590,701,449		590,701,449		565,029,291		565,029,291
Loans/leases receivable, net		1,224,875,461		1,243,192,000		1,181,956,235		1,202,817,000
Accrued interest receivable		6,640,822		6,640,822		6,510,021		6,510,021
Deposits		1,343,235,434		1,346,256,000		1,205,457,788		1,209,197,000
Short-term borrowings		140,888,698		140,888,698		213,536,450		213,536,450
Federal Home Loan Bank advances		196,350,000		216,052,000		204,750,000		223,678,000
Other borrowings		138,237,737		154,663,000		136,231,663		151,813,000
Junior subordinated debentures		36,085,000		18,753,000		36,085,000		18,444,000
Accrued interest payable		1,373,671		1,373,671		1,551,842		1,551,842

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

	Fair Value		Level 1		Level 2		Level 3
Loans/leases receivable, net *	$	1,229,824,367	$	-	$	1,229,824,367	$	-
Time deposits		361,397,000		-		361,397,000		-
Federal Home Loan Bank advances		216,052,000		-		216,052,000		-
Other borrowings		154,663,000		-		154,663,000		-
Junior subordinated debentures		18,753,000		-		18,753,000		-

XML

Note 2 - Investment Securities (Tables)

9 Months Ended

Sep. 30, 2012

Unrealized Gain (Loss) on Investments [Table Text Block]

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized (Losses)			Fair Value
September 30, 2012:
Securities held to maturity:
Other bonds	$	650,000	$	-	$	-		$	650,000
Securities available for sale:
U.S. govt. sponsored agency securities	$	340,538,125	$	2,712,996	$	(7,499	)	$	343,243,622
Residential mortgage-backed and related securities		151,264,044		4,450,612		(24,081	)		155,690,575
Municipal securities		87,579,277		2,478,687		(26,333	)		90,031,631
Trust preferred securities		86,200		44,200		-			130,400
Other securities		1,329,191		301,728		(25,698	)		1,605,221
	$	580,796,837	$	9,988,223	$	(83,611	)	$	590,701,449
December 31, 2011:
Securities held to maturity:
Other bonds	$	200,000	$	-	$	-		$	200,000
Securities available for sale:
U.S. govt. sponsored agency securities	$	426,581,913	$	2,428,994	$	(55,687	)	$	428,955,220
Residential mortgage-backed and related securities		105,373,614		3,488,350		(8,215	)		108,853,749
Municipal securities		23,937,118		1,752,246		-			25,689,364
Trust preferred securities		86,200		-		(5,400	)		80,800
Other securities		1,354,940		140,022		(44,804	)		1,450,158
	$	557,333,785	$	7,809,612	$	(114,106	)	$	565,029,291

Schedule of Unrealized Loss on Investments [Table Text Block]

	Less than 12 Months					12 Months or More					Total
	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
September 30, 2012:
Securities available for sale:
U.S. govt. sponsored agency securities	$	10,988,570	$	(7,499	)	$	-	$	-		$	10,988,570	$	(7,499	)
Residential mortgage-backed and related securities		5,430,389		(24,081	)		-		-			5,430,389		(24,081	)
Municipal securities		3,455,797		(26,333	)		-		-			3,455,797		(26,333	)
Other securities		-		-			215,000		(25,698	)		215,000		(25,698	)
	$	19,874,756	$	(57,913	)	$	215,000	$	(25,698	)	$	20,089,756	$	(83,611	)
December 31, 2011:
Securities available for sale:
U.S. govt. sponsored agency securities	$	59,979,620	$	(55,687	)	$	-	$	-		$	59,979,620	$	(55,687	)
Residential mortgage-backed and related securities		4,906,398		(8,215	)		-		-			4,906,398		(8,215	)
Trust preferred securities		-		-			80,800		(5,400	)		80,800		(5,400	)
Other securities		251,957		(44,332	)		2,778		(472	)		254,735		(44,804	)
	$	65,137,975	$	(108,234	)	$	83,578	$	(5,872	)	$	65,221,553	$	(114,106	)

Realized Gain (Loss) on Investments [Table Text Block]

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 30, 2011		September 30, 2012		September 30, 2011
Proceeds from sales of securities	$	-	$	8,601,107	$	19,215,075	$	54,326,191
Pre-tax gross gains from sales of securities		-		443,614		104,600		1,472,528

Investments Classified by Contractual Maturity Date [Table Text Block]

	Amortized Cost		Fair Value
Securities held to maturity:
Due in one year or less	$	100,000	$	100,000
Due after one year through five years		550,000		550,000
	$	650,000	$	650,000
Securities available for sale:
Due in one year or less	$	2,251,717	$	2,257,998
Due after one year through five years		40,236,390		40,681,663
Due after five years		385,715,495		390,465,992
	$	428,203,602	$	433,405,653
Residential mortgage-backed and related securities		151,264,044		155,690,575
Other securities		1,329,191		1,605,221
	$	580,796,837	$	590,701,449

XML

Note 6 - Fair Value

9 Months Ended

Sep. 30, 2012

Fair Value Disclosures [Text Block]

NOTE 6 – FAIR VALUE

The measurement of fair value under U.S. GAAP uses a hierarchy intended to maximize the use of observable inputs and minimize the use of unobservable inputs.  This hierarchy includes three levels and is based upon the valuation techniques used to measure assets and liabilities.  The three levels are as follows:

1. Level 1 – Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in markets;

2. Level 2 – Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument; and

3. Level 3 – Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

There were no transfers of assets or liabilities between Levels 1, 2, and 3 of the fair value hierarchy for the three and nine months ended September 30, 2012 or 2011.

Assets measured at fair value on a recurring basis comprise the following at September 30, 2012 and December 31, 2011:

			Fair Value Measurements at Reporting Date Using
	Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
September 30, 2012:
Securities available for sale:
U.S. govt. sponsored agency securities	$	343,243,622	$	-	$	343,243,622	$	-
Residential mortgage-backed and related securities		155,690,575		-		155,690,575		-
Municipal securities		90,031,631		-		90,031,631		-
Trust preferred securities		130,400		-		130,400		-
Other securities		1,605,221		235,027		1,370,194		-
	$	590,701,449	$	235,027	$	590,466,422	$	-
December 31, 2011:
Securities available for sale:
U.S. govt. sponsored agency securities	$	428,955,220	$	-	$	428,955,220	$	-
Residential mortgage-backed and related securities		108,853,749		-		108,853,749		-
Municipal securities		25,689,364		-		25,689,364		-
Trust preferred securities		80,800		-		80,800		-
Other securities		1,450,158		191,506		1,258,652		-
	$	565,029,291	$	191,506	$	564,837,785	$	-

A small portion of the securities available for sale portfolio consists of common stock issued by various unrelated bank holding companies.  The fair values used by the Company are obtained from an independent pricing service and represent quoted market prices for the identical securities (Level 1 inputs).

The large majority of the securities available for sale portfolio consists of U.S. government sponsored agency securities for which the Company obtains fair values from an independent pricing service.  The fair values are determined by pricing models that consider observable market data, such as interest rate volatilities, LIBOR yield curve, credit spreads and prices from market makers and live trading systems (Level 2 inputs).

Certain financial assets are measured at fair value on a non-recurring basis; that is, the assets are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment).

Assets measured at fair value on a non-recurring basis comprise the following at September 30, 2012 and December 31, 2011:

			Fair Value Measurements at Reporting Date Using
	Fair Value		Level 1		Level 2		Level 3
September 30, 2012:
Impaired loans/leases	$	13,367,633	$	-	$	-	$	13,367,633
Other real estate owned		5,403,014		-		-		5,403,014
	$	18,770,647	$	-	$	-	$	18,770,647
December 31, 2011:
Impaired loans/leases	$	18,361,757	$	-	$	-	$	18,361,757
Other real estate owned		9,056,619		-		-		9,056,619
	$	27,418,376	$	-	$	-	$	27,418,376

Impaired loans/leases are evaluated and valued at the time the loan/lease is identified as impaired, at the lower of cost or fair value, and are classified as Level 3 in the fair value hierarchy.  Fair value is measured based on the value of the collateral securing these loans/leases.  Collateral may be real estate and/or business assets, including equipment, inventory and/or accounts receivable, and is determined based on appraisals by qualified licensed appraisers hired by the Company.  Appraised and reported values may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation, and/or management’s expertise and knowledge of the client and client’s business.  

Other real estate owned in the table above consists of property acquired through foreclosures and settlements of loans.  Property acquired is carried at the lower of the principal amount of loans outstanding, or the estimated fair value of the property, less disposal costs, and is classified as Level 3 in the fair value hierarchy.

For the impaired loans/leases and other real estate owned, the Company records carrying value at fair value less disposal or selling costs.  The amounts reported in the tables above are fair values before the adjustment for disposal or selling costs.

There have been no changes in valuation techniques used for any assets measured at fair value during the three and nine months ended September 30, 2012 or 2011.

The following table presents the carrying values and estimated fair values of financial assets and liabilities carried on the Company’s consolidated balance sheets, including those financial assets and liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis:

	As of September 30, 2012				As of December 31, 2011
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Cash and due from banks	$	40,564,561	$	40,564,561	$	53,136,710	$	53,136,710
Federal funds sold		5,725,000		5,725,000		20,785,000		20,785,000
Interest-bearing deposits at financial institutions		49,436,938		49,436,938		26,750,602		26,750,602
Investment securities:
Held to maturity		650,000		650,000		200,000		200,000
Available for sale		590,701,449		590,701,449		565,029,291		565,029,291
Loans/leases receivable, net		1,224,875,461		1,243,192,000		1,181,956,235		1,202,817,000
Accrued interest receivable		6,640,822		6,640,822		6,510,021		6,510,021
Deposits		1,343,235,434		1,346,256,000		1,205,457,788		1,209,197,000
Short-term borrowings		140,888,698		140,888,698		213,536,450		213,536,450
Federal Home Loan Bank advances		196,350,000		216,052,000		204,750,000		223,678,000
Other borrowings		138,237,737		154,663,000		136,231,663		151,813,000
Junior subordinated debentures		36,085,000		18,753,000		36,085,000		18,444,000
Accrued interest payable		1,373,671		1,373,671		1,551,842		1,551,842

The methodologies for estimating the fair value of financial assets and liabilities that are measured at fair value on a recurring or non-recurring basis are discussed above.  For certain financial assets and liabilities, carrying value approximates fair value due to the nature of the financial instrument.  These instruments include:  cash and due from banks, federal funds sold, interest-bearing deposits at financial institutions, accrued interest receivable and payable, demand and other non-maturity deposits, and short-term borrowings.  The Company used the following methods and assumptions in estimating the fair value of the following instruments:

Loans/leases receivable:  The fair values for variable rate loans equal their carrying values.  The fair values for all other types of loans/leases are estimated using discounted cash flow analyses, using interest rates currently being offered for loans/leases with similar terms to borrowers with similar credit quality.  The fair value of loans held for sale is based on quoted market prices of similar loans sold on the secondary market.  All of the above are classified as Level 2 in the fair value hierarchy as presented in the table below.

Deposits:  The fair values disclosed for demand and other non-maturity deposits equal their carrying amounts, which represent the amount payable on demand.  Fair values for time deposits are estimated using a discounted cash flow calculation that applies interest rates currently being offered on time deposits to a schedule of aggregate expected monthly maturities on time deposits, and are classified as Level 2 in the fair value hierarchy as presented in the table below.

Federal Home Loan Bank advances and junior subordinated debentures:  The fair value of these instruments is estimated using discounted cash flow analyses, based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements, and are classified as Level 2 in the fair value hierarchy as presented in the table below.

Other borrowings:  The fair value for the wholesale repurchase agreements and fixed rate other borrowings is estimated using rates currently available for debt with similar terms and remaining maturities.  The fair value for variable rate other borrowings is equal to its carrying value.  All of the above are classified as Level 2 in the fair value hierarchy as presented in the table below.

Commitments to extend credit:  The fair value of these instruments is not material.

The following table presents the level in the fair value hierarchy for the estimated fair values of the Company’s financial instruments that are not already on the Consolidated Balance Sheet at fair value at September 30, 2012.

	Fair Value		Level 1		Level 2		Level 3
Loans/leases receivable, net *	$	1,229,824,367	$	-	$	1,229,824,367	$	-
Time deposits		361,397,000		-		361,397,000		-
Federal Home Loan Bank advances		216,052,000		-		216,052,000		-
Other borrowings		154,663,000		-		154,663,000		-
Junior subordinated debentures		18,753,000		-		18,753,000		-

*Excludes impaired loans/leases totaling $13,367,633 measured at fair value on a non-recurring basis and reported separately.

XML

Note 4 - Earnings Per Share

9 Months Ended

Sep. 30, 2012

Earnings Per Share [Text Block]

NOTE 4 - EARNINGS PER SHARE

The following information was used in the computation of earnings per share on a basic and diluted basis:

	Three months ended September 30,					Nine months ended September 30,
	2012		2011			2012		2011
Net income	$	3,184,510	$	2,266,601		$	9,860,738	$	7,271,299
Less:  Net income attributable to noncontrolling interests		127,177		103,446			494,431		308,215
Net income attributable to QCR Holdings, Inc.	$	3,057,333	$	2,163,155		$	9,366,307	$	6,963,084
Less:  Preferred stock dividends and discount accretion		810,837		2,188,058	*		2,685,248		4,256,171	*
Net income attributable to QCR Holdings, Inc. common stockholders	$	2,246,496	$	(24,903	)	$	6,681,059	$	2,706,913
Earnings per common share attributable to QCR Holdings, Inc. common stockholders
Basic	$	0.45	$	(0.01	)	$	1.37	$	0.56
Diluted	$	0.44	$	(0.01	)	$	1.35	$	0.56
Weighted average common shares outstanding		4,978,699		4,866,692			4,871,626		4,795,382
Weighted average common shares issuable upon exercise of stock options and under the employee stock purchase plan		101,589		-	**		66,888		52,051
Weighted average common and common equivalent shares outstanding		5,080,288		4,866,692	**		4,938,514		4,847,433

* For the three and nine months ended September 30, 2011, includes approximately $1.2 million of accelerated accretion of discount on the U.S. Department of the Treasury ("Treasury") Captial Purchase Program preferred shares repurchased during the third quarter of 2011.

** In accordance with U.S. GAAP, the common equivalent shares are not considered in the calculation of diluted earnings per share as the numerator is a loss.

XML

Note 5 - Business Segment Information

9 Months Ended

Sep. 30, 2012

Segment Reporting Disclosure [Text Block]

NOTE 5 – BUSINESS SEGMENT INFORMATION

Selected financial and descriptive information is required to be disclosed for reportable operating segments, applying a “management perspective” as the basis for identifying reportable segments.  The management perspective is determined by the view that management takes of the segments within the Company when making operating decisions, allocating resources, and measuring performance.  The segments of the Company have been defined by the structure of the Company’s internal organization, focusing on the financial information that the Company’s operating decision-makers routinely use to make decisions about operating matters.

The Company’s primary segment, Commercial Banking, is geographically divided by markets into the secondary segments which are the three subsidiary banks wholly-owned by the Company:  QCBT, CRBT, and RB&T.  Each of these secondary segments offers similar products and services, but is managed separately due to different pricing, product demand, and consumer markets.  Each offers commercial, consumer, and mortgage loans and deposit services.

The Company’s Wealth Management segment represents the trust and asset management and investment management and advisory services offered at the Company’s three subsidiary banks in aggregate.  This segment generates income primarily from fees charged based on assets under administration for corporate and personal trusts, custodial services, and investments managed.  No assets of the subsidiary banks have been allocated to the Wealth Management segment.

The Company’s All Other segment includes the operations of all other consolidated subsidiaries and/or defined operating segments that fall below the segment reporting thresholds.  This segment includes the corporate operations of the parent company and the 91% owned real estate holding operations of VPHC.

Selected financial information on the Company’s business segments is presented as follows for the three and nine months ended September 30, 2012 and 2011.

	Commercial Banking
	Quad City Bank & Trust		Cedar Rapids Bank & Trust		Rockford Bank & Trust			Wealth Management		All Other			Intercompany Eliminations			Consolidated Total
Three Months Ended September 30, 2012
Total revenue	$	11,643,674	$	6,706,485	$	2,897,098		$	1,490,297	$	4,542,612		$	(3,675,459	)	$	23,604,707
Net interest income	$	8,602,967	$	4,027,693	$	2,368,483		$	-	$	(369,625	)	$	-		$	14,629,518
Net income attributable to QCR Holdings, Inc.	$	2,586,303	$	1,532,946	$	(313,019	)	$	108,950	$	3,077,515		$	(3,935,362	)	$	3,057,333
Total assets	$	1,134,296,418	$	587,057,961	$	299,947,837		$	-	$	196,448,244		$	(193,804,388	)	$	2,023,946,072
Provision for loan/lease losses	$	350,194	$	300,000	$	846,000		$	-	$	-		$	-		$	1,496,194
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688
Three Months Ended September 30, 2011
Total revenue	$	12,147,213	$	7,110,970	$	3,377,454		$	1,311,647	$	3,319,882		$	(3,362,429	)	$	23,904,737
Net interest income	$	7,944,108	$	3,873,339	$	2,355,471		$	-	$	(344,214	)	$	-		$	13,828,704
Net income attributable to QCR Holdings, Inc.	$	1,854,914	$	1,375,114	$	(243,710	)	$	257,611	$	2,192,761		$	(3,273,535	)	$	2,163,155
Total assets	$	1,056,656,935	$	565,822,310	$	287,574,174		$	-	$	193,059,135		$	(204,152,062	)	$	1,898,960,492
Provision for loan/lease losses	$	1,158,965	$	250,000	$	1,048,000		$	-	$	-		$	-		$	2,456,965
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688
Nine Months Ended September 30, 2012
Total revenue	$	36,196,909	$	19,829,521	$	9,665,950		$	4,427,051	$	13,533,609		$	(13,115,614	)	$	70,537,426
Net interest income	$	25,524,594	$	11,691,876	$	7,259,522		$	-	$	(1,127,528	)	$	-		$	43,348,464
Net income attributable to QCR Holdings, Inc.	$	7,603,033	$	4,214,081	$	482,950		$	425,356	$	9,484,700		$	(12,843,813	)	$	9,366,307
Total assets	$	1,134,296,418	$	587,057,961	$	299,947,837		$	-	$	196,448,244		$	(193,804,388	)	$	2,023,946,072
Provision for loan/lease losses	$	1,138,109	$	875,000	$	1,312,000		$	-	$	-		$	-		$	3,325,109
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688
Nine Months Ended September 30, 2011
Total revenue	$	35,990,157	$	21,482,485	$	10,046,334		$	4,238,644	$	10,776,476		$	(10,885,546	)	$	71,648,550
Net interest income	$	22,772,375	$	11,859,003	$	6,641,533		$	-	$	(1,284,350	)	$	-		$	39,988,561
Net income attributable to QCR Holdings, Inc.	$	5,777,707	$	3,964,627	$	45,697		$	741,263	$	7,054,192		$	(10,620,402	)	$	6,963,084
Total assets	$	1,056,656,935	$	565,822,310	$	287,574,174		$	-	$	193,059,135		$	(204,152,062	)	$	1,898,960,492
Provision for loan/lease losses	$	2,236,850	$	1,035,000	$	1,925,000		$	-	$	-		$	-		$	5,196,850
Goodwill	$	3,222,688	$	-	$	-		$	-	$	-		$	-		$	3,222,688

XML

Note 7 - Partial Redemption of Series F Preferred Stock

9 Months Ended

Sep. 30, 2012

Preferred Stock [Text Block]

NOTE 7 – PARTIAL REDEMPTION OF SERIES F PREFERRED STOCK

On June 29, 2012, the Company redeemed 10,223 shares of Series F Preferred Stock from Treasury for an aggregate redemption amount of $10,223,000 plus unpaid dividends to the date of redemption of $124,948.  Previously, on September 15, 2011, the Company issued 40,090 shares of Series F Preferred Stock to Treasury for an aggregate purchase price of $40,090,000.  The sale of Series F Preferred Stock was the result of an investment by Treasury from the Small Business Lending Fund (“SBLF”), a $30 billion fund established under the Small Business Jobs Act of 2010, which was intended to encourage lending to small business by providing capital to qualified community banks with assets of less than $10 billion.

The remaining Series F Preferred Stock may be redeemed at any time at the option of the Company, subject to the approval of the Company’s primary federal banking regulator.  All redemptions must be in amounts equal to at least 25% of the number of originally issued shares, or 100% of the then-outstanding shares (if less than 25% of the originally issued shares).

XML

Note 3 - Loans/Leases Receivable (Detail) - Allowance for Estimated Losses on Loans/Leases (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011	Dec. 31, 2011
Loans/leases receivable	$ 1,224,875,461		$ 1,224,875,461		$ 1,181,956,235
Provisions charged to expense	1,496,194	2,456,965	3,325,109	5,196,850
Before Deferred Loan Costs/Fees [Member] | Commercial and Industrial [Member]
Balance, beginning	4,180,792	7,124,444	4,878,006	7,548,922
Balance, ending	4,173,481	5,621,389	4,173,481	5,621,389
Loans/leases individually evaluated for impairment	1,071,050		1,071,050		2,152,855
Loans/leases collectively evaluated for impairment	353,932,838		353,932,838		348,641,423
Loans/leases receivable	355,003,888		355,003,888		350,794,278
Allowance as a percentage of loans/leases individually evaluated for impairment	25.64%		25.64%		41.95%
Allowance as a percentage of loans/leases collectively evaluated for impairment	1.10%		1.10%		1.14%
Allowance as a percentage of loans/leases	1.18%		1.18%		1.39%
Allowance for loans/leases individually evaluated for impairment	274,666		274,666		903,187
Allowance for loans/leases collectively evaluated for impairment	3,898,815		3,898,815		3,974,819
Provisions charged to expense	136,766	(211,491)	(637,852)	1,005,002
Loans/leases charged off	(214,036)	(1,465,577)	(669,778)	(3,256,194)
Recoveries on loans/leases previously charged off	69,959	174,013	603,105	323,659
Before Deferred Loan Costs/Fees [Member] | Other commercial real estate [Member]
Balance, beginning	10,709,991	8,602,639	10,596,958	9,087,315
Balance, ending	11,053,857	10,608,605	11,053,857	10,608,605
Loans/leases individually evaluated for impairment	18,450,756		18,450,756		24,281,365
Loans/leases collectively evaluated for impairment	576,452,994		576,452,994		553,522,485
Loans/leases receivable	594,903,750		594,903,750		577,803,850
Allowance as a percentage of loans/leases individually evaluated for impairment	18.87%		18.87%		17.70%
Allowance as a percentage of loans/leases collectively evaluated for impairment	1.31%		1.31%		1.14%
Allowance as a percentage of loans/leases	1.86%		1.86%		1.83%
Allowance for loans/leases individually evaluated for impairment	3,482,125		3,482,125		4,297,738
Allowance for loans/leases collectively evaluated for impairment	7,571,732		7,571,732		6,299,220
Provisions charged to expense	721,358	2,645,457	2,254,732	3,038,359
Loans/leases charged off	(552,959)	(852,174)	(1,980,946)	(1,773,711)
Recoveries on loans/leases previously charged off	175,467	212,683	183,113	256,642
Before Deferred Loan Costs/Fees [Member] | Leases receivable [Member]
Balance, beginning	1,610,999	1,591,309	1,339,496	1,530,572
Balance, ending	1,884,985	1,051,960	1,884,985	1,051,960
Loans/leases individually evaluated for impairment	1,094,724		1,094,724		1,306,663
Loans/leases collectively evaluated for impairment	100,944,144		100,944,144		91,905,699
Loans/leases receivable	102,038,868		102,038,868		93,212,362
Allowance as a percentage of loans/leases individually evaluated for impairment	14.42%		14.42%		5.10%
Allowance as a percentage of loans/leases collectively evaluated for impairment	1.71%		1.71%		1.38%
Allowance as a percentage of loans/leases	1.85%		1.85%		1.44%
Allowance for loans/leases individually evaluated for impairment	157,900		157,900		66,675
Allowance for loans/leases collectively evaluated for impairment	1,727,085		1,727,085		1,272,821
Provisions charged to expense	350,194	159,965	924,109	463,850
Loans/leases charged off	(111,326)	(701,658)	(454,590)	(945,104)
Recoveries on loans/leases previously charged off	35,118	2,344	75,970	2,642
Before Deferred Loan Costs/Fees [Member] | Residential Real Estate [Member]
Balance, beginning	986,714	757,075	704,946	748,028
Balance, ending	1,036,909	849,107	1,036,909	849,107
Loans/leases individually evaluated for impairment	1,517,304		1,517,304		1,133,474
Loans/leases collectively evaluated for impairment	110,974,915		110,974,915		96,973,577
Loans/leases receivable	112,492,219		112,492,219		98,107,051
Allowance as a percentage of loans/leases individually evaluated for impairment	11.15%		11.15%		4.93%
Allowance as a percentage of loans/leases collectively evaluated for impairment	0.78%		0.78%		0.67%
Allowance as a percentage of loans/leases	0.92%		0.92%		0.72%
Allowance for loans/leases individually evaluated for impairment	169,196		169,196		55,884
Allowance for loans/leases collectively evaluated for impairment	867,713		867,713		649,062
Provisions charged to expense	233,226	92,032	519,751	101,079
Loans/leases charged off	(183,031)		(187,788)
Before Deferred Loan Costs/Fees [Member] | Installment and Other Consumer [Member]
Balance, beginning	1,236,039	1,727,165	1,269,856	1,449,819
Balance, ending	1,267,516	1,447,425	1,267,516	1,447,425
Loans/leases individually evaluated for impairment	759,478		759,478		984,806
Loans/leases collectively evaluated for impairment	76,078,511		76,078,511		77,238,274
Loans/leases receivable	76,837,989		76,837,989		78,223,080
Allowance as a percentage of loans/leases individually evaluated for impairment	9.04%		9.04%		2.32%
Allowance as a percentage of loans/leases collectively evaluated for impairment	1.58%		1.58%		1.61%
Allowance as a percentage of loans/leases	1.65%		1.65%		1.62%
Allowance for loans/leases individually evaluated for impairment	68,673		68,673		22,819
Allowance for loans/leases collectively evaluated for impairment	1,198,843		1,198,843		1,247,037
Provisions charged to expense	54,650	(228,998)	264,369	588,560
Loans/leases charged off	(88,378)	(84,358)	(416,179)	(701,390)
Recoveries on loans/leases previously charged off	65,205	33,616	149,470	110,436
Before Deferred Loan Costs/Fees [Member]
Balance, beginning	18,724,535	19,802,632	18,789,262	20,364,656
Balance, ending	19,416,748	19,578,486	19,416,748	19,578,486
Loans/leases individually evaluated for impairment	22,893,312		22,893,312		29,859,163
Loans/leases collectively evaluated for impairment	1,218,383,402		1,218,383,402		1,168,281,458
Loans/leases receivable	1,241,276,714		1,241,276,714		1,198,140,621
Allowance as a percentage of loans/leases individually evaluated for impairment	18.14%		18.14%		17.91%
Allowance as a percentage of loans/leases collectively evaluated for impairment	1.25%		1.25%		1.15%
Allowance as a percentage of loans/leases	1.56%		1.56%		1.56%
Allowance for loans/leases individually evaluated for impairment	4,152,560		4,152,560		5,346,303
Allowance for loans/leases collectively evaluated for impairment	15,264,188		15,264,188		13,442,959
Provisions charged to expense	1,496,194	2,456,965	3,325,109	5,196,850
Loans/leases charged off	(1,149,730)	(3,103,767)	(3,709,281)	(6,676,399)
Recoveries on loans/leases previously charged off	345,749	422,656	1,011,658	693,379
Leases receivable [Member]
Balance, beginning					1,339,496
Balance, ending	$ 1,884,985		$ 1,884,985		$ 1,339,496

XML

Note 4 - Earnings Per Share (Tables)

9 Months Ended

Sep. 30, 2012

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

	Three months ended September 30,					Nine months ended September 30,
	2012		2011			2012		2011
Net income	$	3,184,510	$	2,266,601		$	9,860,738	$	7,271,299
Less:  Net income attributable to noncontrolling interests		127,177		103,446			494,431		308,215
Net income attributable to QCR Holdings, Inc.	$	3,057,333	$	2,163,155		$	9,366,307	$	6,963,084
Less:  Preferred stock dividends and discount accretion		810,837		2,188,058	*		2,685,248		4,256,171	*
Net income attributable to QCR Holdings, Inc. common stockholders	$	2,246,496	$	(24,903	)	$	6,681,059	$	2,706,913
Earnings per common share attributable to QCR Holdings, Inc. common stockholders
Basic	$	0.45	$	(0.01	)	$	1.37	$	0.56
Diluted	$	0.44	$	(0.01	)	$	1.35	$	0.56
Weighted average common shares outstanding		4,978,699		4,866,692			4,871,626		4,795,382
Weighted average common shares issuable upon exercise of stock options and under the employee stock purchase plan		101,589		-	**		66,888		52,051
Weighted average common and common equivalent shares outstanding		5,080,288		4,866,692	**		4,938,514		4,847,433

XML

Note 2 - Investment Securities (Detail) - Amortized Cost and Fair Value of Investment Securities (USD $)	Sep. 30, 2012	Dec. 31, 2011
Securities held to maturity:
Securities held to maturity, other bonds, amortized cost	$ 650,000	$ 200,000
Securities held to maturity, other bonds, gross unrealized gains	0	0
Securities held to maturity, other bonds, gross unrealized losses	0	0
Securities held to maturity, other bonds, fair value	650,000	200,000
Securities available for sale:
Available for Sale Securities, amortized cost	580,796,837	557,333,785
Available for Sale Securities, gross unrealized gains	9,988,223	7,809,612
Available for Sale Securities, gross unrealized losses	(83,611)	(114,106)
Available for Sale Securities, fair value	590,701,449	565,029,291
US Government Agencies Debt Securities [Member]
Securities available for sale:
Available for Sale Securities, amortized cost	340,538,125	426,581,913
Available for Sale Securities, gross unrealized gains	2,712,996	2,428,994
Available for Sale Securities, gross unrealized losses	(7,499)	(55,687)
Available for Sale Securities, fair value	343,243,622	428,955,220
Residential Mortgage Backed Securities [Member]
Securities available for sale:
Available for Sale Securities, amortized cost	151,264,044	105,373,614
Available for Sale Securities, gross unrealized gains	4,450,612	3,488,350
Available for Sale Securities, gross unrealized losses	(24,081)	(8,215)
Available for Sale Securities, fair value	155,690,575	108,853,749
US States and Political Subdivisions Debt Securities [Member]
Securities available for sale:
Available for Sale Securities, amortized cost	87,579,277	23,937,118
Available for Sale Securities, gross unrealized gains	2,478,687	1,752,246
Available for Sale Securities, gross unrealized losses	(26,333)	0
Available for Sale Securities, fair value	90,031,631	25,689,364
Trust preferred securities [Member]
Securities available for sale:
Available for Sale Securities, amortized cost	86,200	86,200
Available for Sale Securities, gross unrealized gains	44,200	0
Available for Sale Securities, gross unrealized losses	0	(5,400)
Available for Sale Securities, fair value	130,400	80,800
Securities (Assets) [Member]
Securities available for sale:
Available for Sale Securities, amortized cost	1,329,191	1,354,940
Available for Sale Securities, gross unrealized gains	301,728	140,022
Available for Sale Securities, gross unrealized losses	(25,698)	(44,804)
Available for Sale Securities, fair value	$ 1,605,221	$ 1,450,158

XML

Note 7 - Partial Redemption of Series F Preferred Stock (Detail) (USD $)			6 Months Ended	9 Months Ended
	Sep. 30, 2012	Dec. 31, 2011	Jun. 29, 2012 Series F Preferred Stock [Member]	Sep. 15, 2011 Series F Preferred Stock [Member]
Stock Repurchased During Period, Shares (in Shares)			10,223
Preferred Stock, Redemption Amount			$ 10,223,000
Dividends Payable			124,948
Preferred Stock, Shares Issued (in Shares)	54,867	65,090		40,090
Proceeds from Sale of Treasury Stock				$ 40,090,000

XML

Note 4 - Earnings Per Share (Detail) - Earnings Per Share - Basic and Diluted (USD $)	3 Months Ended							9 Months Ended
	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Sep. 30, 2011		Jun. 30, 2011	Mar. 31, 2011	Sep. 30, 2012	Sep. 30, 2011
Net income	$ 3,184,510	$ 3,273,379	$ 3,402,849	$ 2,266,601		$ 2,773,214	$ 2,231,484	$ 9,860,738	$ 7,271,299
Less: Net income attributable to noncontrolling interests	127,177			103,446				494,431	308,215
Net income attributable to QCR Holdings, Inc.	3,057,333			2,163,155				9,366,307	6,963,084
Less: Preferred stock dividends and discount accretion	810,837			2,188,058	[1]			2,685,248	4,256,171	[1]
Net income attributable to QCR Holdings, Inc. common stockholders	$ 2,246,496			$ (24,903)				$ 6,681,059	$ 2,706,913
Earnings per common share attributable to QCR Holdings, Inc. common stockholders
Basic (in Dollars per share)	$ 0.45			$ (0.01)				$ 1.37	$ 0.56
Diluted (in Dollars per share)	$ 0.44			$ (0.01)				$ 1.35	$ 0.56
Weighted average common shares outstanding (in Shares)	4,978,699			4,866,692				4,871,626	4,795,382
Weighted average common shares issuable upon exercise of stock options and under the employee stock purchase plan (in Shares)	101,589				[2]			66,888	52,051
Weighted average common and common equivalent shares outstanding (in Shares)	5,080,288			4,866,692				4,938,514	4,847,433

[1] For the three and nine months ended September 30, 2011, includes approximately $1.2 million of accelerated accretion of discount on the Treasury Captial Purchase Program preferred shares repurchased during the third quarter of 2011.

[2] In accordance with U.S. GAAP, the common equivalent shares are not considered in the calculation of diluted earnings per share as the numerator is a loss.

XML

Consolidated Statements Of Comprehensive Income (Unaudited) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Net income	$ 3,184,510	$ 2,266,601	$ 9,860,738	$ 7,271,299
Unrealized gains on securities available for sale:
Unrealized holding gains arising during the period before tax	2,660,251	4,340,017	2,313,706	7,091,919
Less reclassification adjustment for gains included in net income before tax		443,614	104,600	1,472,528
	2,660,251	3,896,403	2,209,106	5,619,391
Tax expense	1,016,673	1,492,108	841,718	2,150,922
Other comprehensive income, net of tax	1,643,578	2,404,295	1,367,388	3,468,469
Comprehensive income attributable to QCR Holdings, Inc.	$ 4,828,088	$ 4,670,896	$ 11,228,126	$ 10,739,768

XML

Note 1 - Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2012

Significant Accounting Policies [Text Block]

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation:  The interim unaudited consolidated financial statements contained herein should be read in conjunction with the audited consolidated financial statements and accompanying notes to the consolidated financial statements for the fiscal year ended December 31, 2011, including QCR Holdings, Inc.’s (the “Company”) Form 10-K filed with the Securities and Exchange Commission on March 8, 2012.  Accordingly, footnote disclosures, which would substantially duplicate the disclosures contained in the audited consolidated financial statements, have been omitted.

The financial information of the Company included herein has been prepared in accordance with U.S. generally accepted accounting principles for interim financial reporting and has been prepared pursuant to the rules and regulations for reporting on Form 10-Q and Rule 10-01 of Regulation S-X.  Such information reflects all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the periods presented.  Any differences appearing between the numbers presented in financial statements and management’s discussion and analysis are due to rounding.  The results of the interim period ended September 30, 2012, are not necessarily indicative of the results expected for the year ending December 31, 2012.

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries which include three state-chartered commercial banks:  Quad City Bank & Trust Company (“QCBT”), Cedar Rapids Bank & Trust Company (“CRBT”), and Rockford Bank & Trust Company (“RB&T”).  The Company also engages in direct financing lease contracts through its now wholly-owned equity investment by QCBT in m2 Lease Funds, LLC (“m2 Lease Funds”).  QCBT previously owned 80% of m2 Lease Funds.  In August 2012, QCBT entered into an amendment to the operating agreement of m2 Lease Funds and purchased the 20% noncontrolling interest.  See Note 8 for a more detailed discussion of this transaction.  The Company engages in real estate holdings through its 91% equity investment in Velie Plantation Holding Company, LLC (“VPHC”).  All material intercompany transactions and balances have been eliminated in consolidation.

Recent accounting developments:  In December 2011, the Financial Accounting Standards Board issued ASU 2011-11, Disclosures about Offsetting Assets and Liabilities.  ASU 2011-11 requires entities to disclose both gross information and net information about both instruments and transactions eligible for offset in the balance sheet, and instruments and transactions subject to an agreement similar to a master netting arrangement.  ASU 2011-11 is effective for annual periods beginning on or after January 1, 2013, and interim periods within those annual periods.  Adoption is not expected to have a significant impact on the Company’s consolidated financial statements.

Reclassifications:  Certain amounts in the prior year financial statements have been reclassified, with no effect on net income or stockholders’ equity, to conform with the current period presentation.

XML

Note 2 - Investment Securities (Detail) - Gross Unrealized Losses and Fair value of Securities in a Continuous Unrealized Loss Position (USD $)	Sep. 30, 2012	Dec. 31, 2011
Securities available for sale:
Available for Sale Securities less than 12 months fair value	$ 19,874,756	$ 65,137,975
Available for Sale Securities less than 12 months gross unrealized losses	(57,913)	(108,234)
Available for Sale Securities 12 months or more fair value	215,000	83,578
Available for Sale Securities 12 months or more gross unrealized losses	(25,698)	(5,872)
Available for Sale Securities fair value	20,089,756	65,221,553
Available for Sale Securities gross unrealized losses	(83,611)	(114,106)
US Government Agencies Debt Securities [Member]
Securities available for sale:
Available for Sale Securities less than 12 months fair value	10,988,570	59,979,620
Available for Sale Securities less than 12 months gross unrealized losses	(7,499)	(55,687)
Available for Sale Securities 12 months or more fair value	0	0
Available for Sale Securities 12 months or more gross unrealized losses	0	0
Available for Sale Securities fair value	10,988,570	59,979,620
Available for Sale Securities gross unrealized losses	(7,499)	(55,687)
Residential Mortgage Backed Securities [Member]
Securities available for sale:
Available for Sale Securities less than 12 months fair value	5,430,389	4,906,398
Available for Sale Securities less than 12 months gross unrealized losses	(24,081)	(8,215)
Available for Sale Securities 12 months or more fair value	0	0
Available for Sale Securities 12 months or more gross unrealized losses	0	0
Available for Sale Securities fair value	5,430,389	4,906,398
Available for Sale Securities gross unrealized losses	(24,081)	(8,215)
US States and Political Subdivisions Debt Securities [Member]
Securities available for sale:
Available for Sale Securities less than 12 months fair value	3,455,797
Available for Sale Securities less than 12 months gross unrealized losses	(26,333)
Available for Sale Securities 12 months or more fair value	0
Available for Sale Securities 12 months or more gross unrealized losses	0
Available for Sale Securities fair value	3,455,797
Available for Sale Securities gross unrealized losses	(26,333)
Securities (Assets) [Member]
Securities available for sale:
Available for Sale Securities less than 12 months fair value	0	251,957
Available for Sale Securities less than 12 months gross unrealized losses	0	(44,332)
Available for Sale Securities 12 months or more fair value	215,000	2,778
Available for Sale Securities 12 months or more gross unrealized losses	(25,698)	(472)
Available for Sale Securities fair value	215,000	254,735
Available for Sale Securities gross unrealized losses	(25,698)	(44,804)
Trust preferred securities [Member]
Securities available for sale:
Available for Sale Securities less than 12 months fair value		0
Available for Sale Securities less than 12 months gross unrealized losses		0
Available for Sale Securities 12 months or more fair value		80,800
Available for Sale Securities 12 months or more gross unrealized losses		(5,400)
Available for Sale Securities fair value		80,800
Available for Sale Securities gross unrealized losses		$ (5,400)

XML

Note 3 - Loans/Leases Receivable (Detail) - Delinquency Status (USD $)	Sep. 30, 2012	Dec. 31, 2011
Delinquent Loan Status	$ 1,224,875,461	$ 1,181,956,235
Performing [Member] | Leases receivable [Member]
Delinquent Loan Status	100,944,144	91,905,699
Performing [Member] | Residential Real Estate [Member]
Delinquent Loan Status	110,974,915	96,973,576
Performing [Member] | Installment and Other Consumer [Member]
Delinquent Loan Status	76,078,511	77,126,064
Performing [Member]
Delinquent Loan Status	287,997,570	266,005,339
Nonperforming [Member] | Leases receivable [Member]
Delinquent Loan Status	1,094,724	1,306,663
Nonperforming [Member] | Residential Real Estate [Member]
Delinquent Loan Status	1,517,304	1,133,475
Nonperforming [Member] | Installment and Other Consumer [Member]
Delinquent Loan Status	759,478	1,097,016
Nonperforming [Member]
Delinquent Loan Status	3,371,506	3,537,154
Delinquent Loans [Member] | Leases receivable [Member]
Delinquent Loan Status	102,038,868	93,212,362
Delinquent Loans [Member] | Residential Real Estate [Member]
Delinquent Loan Status	112,492,219	98,107,051
Delinquent Loans [Member] | Installment and Other Consumer [Member]
Delinquent Loan Status	76,837,989	78,223,080
Delinquent Loans [Member]
Delinquent Loan Status	291,369,076	269,542,493
Leases receivable [Member]
Delinquent Loan Status	$ 103,881,635	$ 95,089,877

XML

Note 3 - Loans/Leases Receivable (Tables)

9 Months Ended

Sep. 30, 2012

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

	As of September 30, 2012			As of December 31, 2011
Commercial and industrial loans	$	355,003,888		$	350,794,278
Commercial real estate loans
Owner-occupied commercial real estate		199,788,124			167,790,621
Commercial construction, land development, and other land		49,191,909			60,384,738
Other non owner-occupied commercial real estate		345,923,717			349,628,491
		594,903,750			577,803,850
Direct financing leases *		102,038,868			93,212,362
Residential real estate loans **		112,492,219			98,107,051
Installment and other consumer loans		76,837,989			78,223,080
		1,241,276,714			1,198,140,621
Plus deferred loan/lease origination costs, net of fees		3,015,495			2,604,876
		1,244,292,209			1,200,745,497
Less allowance for estimated losses on loans/leases		(19,416,748	)		(18,789,262	)
	$	1,224,875,461		$	1,181,956,235
* Direct financing leases:
Net minimum lease payments to be received	$	115,931,555		$	106,389,988
Estimated unguaranteed residual values of leased assets		1,111,627			1,043,326
Unearned lease/residual income		(15,004,314	)		(14,220,952	)
		102,038,868			93,212,362
Plus deferred lease origination costs, net of fees		3,727,752			3,217,011
		105,766,620			96,429,373
Less allowance for estimated losses on leases		(1,884,985	)		(1,339,496	)
	$	103,881,635		$	95,089,877

Past Due Financing Receivables [Table Text Block]

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	$	352,308,795		$	872,105		$	15,252		$	149,750		$	1,657,986		$	355,003,888
Commercial Real Estate
Owner-Occupied Commercial Real Estate		198,070,105			-			1,046,835			-			671,184			199,788,124
Commercial Construction, Land Development, and Other Land		47,080,534			-			-			-			2,111,375			49,191,909
Other Non Owner-Occupied Commercial Real Estate		332,708,671			2,325,809			733,442			-			10,155,795			345,923,717
Direct Financing Leases		100,205,091			632,458			106,595			-			1,094,724			102,038,868
Residential Real Estate		111,142,654			-			-			-			1,349,565			112,492,219
Installment and Other Consumer		75,805,776			255,048			33,730			52,733			690,702			76,837,989
	$	1,217,321,626		$	4,085,420		$	1,935,854		$	202,483		$	17,731,331		$	1,241,276,714
As a percentage of total loan/lease portfolio		98.07	%		0.33	%		0.16	%		0.02	%		1.43	%		100.00	%

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	%

Schedule of Nonperforming Loans Leases [Table Text Block]

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	$	149,750	$	1,657,986	$	184,813	$	1,992,549		8.32	%
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		671,184		-		671,184		2.80	%
Commercial Construction, Land Development, and Other Land		-		2,111,375		337,500		2,448,875		10.23	%
Other Non Owner-Occupied Commercial Real Estate		-		10,155,795		5,303,365		15,459,160		64.57	%
Direct Financing Leases		-		1,094,724		-		1,094,724		4.57	%
Residential Real Estate		-		1,349,565		167,739		1,517,304		6.34	%
Installment and Other Consumer		52,733		690,702		16,043		759,478		3.17	%
	$	202,483	$	17,731,331	$	6,009,460	$	23,943,274		100.00	%

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	%

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

	Three Months Ended September 30, 2012
	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate			Installment and Other Consumer			Total
Balance, beginning	$	4,180,792		$	10,709,991		$	1,610,999		$	986,714		$	1,236,039		$	18,724,535
Provisions charged to expense		136,766			721,358			350,194			233,226			54,650			1,496,194
Loans/leases charged off		(214,036	)		(552,959	)		(111,326	)		(183,031	)		(88,378	)		(1,149,730	)
Recoveries on loans/leases previously charged off		69,959			175,467			35,118			-			65,205			345,749
Balance, ending	$	4,173,481		$	11,053,857		$	1,884,985		$	1,036,909		$	1,267,516		$	19,416,748

	Three Months Ended September 30, 2011
	Commercial and Industrial			Commercial Real Estate			Direct Financing Leases			Residential Real Estate		Installment and Other Consumer			Total
Balance, beginning	$	7,124,444		$	8,602,639		$	1,591,309		$	757,075	$	1,727,165		$	19,802,632
Provisions charged to expense		(211,491	)		2,645,457			159,965			92,032		(228,998	)		2,456,965
Loans/leases charged off		(1,465,577	)		(852,174	)		(701,658	)		-		(84,358	)		(3,103,767	)
Recoveries on loans/leases previously charged off		174,013			212,683			2,344			-		33,616			422,656
Balance, ending	$	5,621,389		$	10,608,605		$	1,051,960		$	849,107	$	1,447,425		$	19,578,486

	Nine Months Ended September 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		(637,852	)		2,254,732			924,109			519,751			264,369			3,325,109
Loans/leases charged off		(669,778	)		(1,980,946	)		(454,590	)		(187,788	)		(416,179	)		(3,709,281	)
Recoveries on loans/leases previously charged off		603,105			183,113			75,970			-			149,470			1,011,658
Balance, ending	$	4,173,481		$	11,053,857		$	1,884,985		$	1,036,909		$	1,267,516		$	19,416,748

	Nine Months Ended September 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		1,005,002			3,038,359			463,850			101,079		588,560			5,196,850
Loans/leases charged off		(3,256,194	)		(1,773,711	)		(945,104	)		-		(701,390	)		(6,676,399	)
Recoveries on loans/leases previously charged off		323,659			256,642			2,642			-		110,436			693,379
Balance, ending	$	5,621,389		$	10,608,605		$	1,051,960		$	849,107	$	1,447,425		$	19,578,486

	As of September 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	$	274,666		$	3,482,125		$	157,900		$	169,196		$	68,673		$	4,152,560
Allowance for loans/leases collectively evaluated for impairment		3,898,815			7,571,732			1,727,085			867,713			1,198,843			15,264,188
	$	4,173,481		$	11,053,857		$	1,884,985		$	1,036,909		$	1,267,516		$	19,416,748
Loans/leases individually evaluated for impairment	$	1,071,050		$	18,450,756		$	1,094,724		$	1,517,304		$	759,478		$	22,893,312
Loans/leases collectively evaluated for impairment		353,932,838			576,452,994			100,944,144			110,974,915			76,078,511			1,218,383,402
	$	355,003,888		$	594,903,750		$	102,038,868		$	112,492,219		$	76,837,989		$	1,241,276,714
Allowance as a percentage of loans/leases individually evaluated for impairment		25.64	%		18.87	%		14.42	%		11.15	%		9.04	%		18.14	%
Allowance as a percentage of loans/leases collectively evaluated for impairment		1.10	%		1.31	%		1.71	%		0.78	%		1.58	%		1.25	%
		1.18	%		1.86	%		1.85	%		0.92	%		1.65	%		1.56	%

	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	%

Impaired Financing Receivables [Table Text Block]

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	$	845,703	$	1,635,373	$	-	$	787,146	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		542,721		542,721		-		657,327		-		-
Commercial Construction, Land Development, and Other Land		1,027,200		1,027,200		-		4,441,935		5,552		5,552
Other Non Owner-Occupied Commercial Real Estate		1,498,599		2,298,599		-		6,613,234		894		894
Direct Financing Leases		853,974		853,974		-		774,855		-		-
Residential Real Estate		948,653		1,131,684		-		861,102		5,037		5,037
Installment and Other Consumer		646,466		646,466		-		1,014,236		245		245
	$	6,363,316	$	8,136,017	$	-	$	15,149,835	$	11,728	$	11,728
Impaired Loans/Leases with Specific Allowance Recorded:
Commercial and Industrial	$	225,347	$	247,599	$	274,666	$	543,668	$	5,935	$	5,935
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		-		-		-		-		-
Commercial Construction, Land Development, and Other Land		2,031,823		2,055,057		1,373,340		1,598,548		-		-
Other Non Owner-Occupied Commercial Real Estate		13,350,413		13,603,372		2,108,785		9,859,148		237,408		237,408
Direct Financing Leases		240,750		240,750		157,900		177,551		-		-
Residential Real Estate		568,651		568,651		169,196		463,361		-		-
Installment and Other Consumer		113,012		113,012		68,673		68,286		-		-
	$	16,529,996	$	16,828,441	$	4,152,560	$	12,710,562	$	243,343	$	243,343
Total Impaired Loans/Leases:
Commercial and Industrial	$	1,071,050	$	1,882,972	$	274,666	$	1,330,814	$	5,935	$	5,935
Commercial Real Estate
Owner-Occupied Commercial Real Estate		542,721		542,721		-		657,327		-		-
Commercial Construction, Land Development, and Other Land		3,059,023		3,082,257		1,373,340		6,040,483		5,552		5,552
Other Non Owner-Occupied Commercial Real Estate		14,849,012		15,901,971		2,108,785		16,472,382		238,302		238,302
Direct Financing Leases		1,094,724		1,094,724		157,900		952,406		-		-
Residential Real Estate		1,517,304		1,700,335		169,196		1,324,463		5,037		5,037
Installment and Other Consumer		759,478		759,478		68,673		1,082,522		245		245
	$	22,893,312	$	24,964,458	$	4,152,560	$	27,860,397	$	255,071	$	255,071

Information for Impaired Loans/Leases [Table Text Block]

	Three Months Ended September 30, 2012						Three Months Ended September 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	$	754,844	$	-	$	-	$	2,236,289	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		550,725		-		-		1,774,342		11,909		11,909
Commercial Construction, Land Development, and Other Land		1,323,689		1,701		1,701		286,339		-		-
Other Non Owner-Occupied Commercial Real Estate		5,798,404		-		-		1,730,764		-		-
Direct Financing Leases		680,817		-		-		668,944		-		-
Residential Real Estate		943,926		1,691		1,691		942,011		-		-
Installment and Other Consumer		1,063,519		121		121		710,560		-		-
	$	11,115,924	$	3,513	$	3,513	$	8,349,249	$	11,909	$	11,909
Impaired Loans/Leases with Specific Allowance Recorded:
Commercial and Industrial	$	223,917	$	1,984	$	1,984	$	1,534,968	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		-		-		-		360,894		-		-
Commercial Construction, Land Development, and Other Land		2,157,696		-		-		5,595,484		473		473
Other Non Owner-Occupied Commercial Real Estate		12,036,134		86,744		86,744		7,488,032		-		-
Direct Financing Leases		210,299		-		-		983,131		-		-
Residential Real Estate		524,031		-		-		200,625		-		-
Installment and Other Consumer		68,898		-		-		108,859		-		-
	$	15,220,975	$	88,728	$	88,728	$	16,271,993	$	473	$	473
Total Impaired Loans/Leases:
Commercial and Industrial	$	978,761	$	1,984	$	1,984	$	3,771,257	$	-	$	-
Commercial Real Estate
Owner-Occupied Commercial Real Estate		550,725		-		-		2,135,236		11,909		11,909
Commercial Construction, Land Development, and Other Land		3,481,385		1,701		1,701		5,881,823		473		473
Other Non Owner-Occupied Commercial Real Estate		17,834,538		86,744		86,744		9,218,796		-		-
Direct Financing Leases		891,116		-		-		1,652,075		-		-
Residential Real Estate		1,467,957		1,691		1,691		1,142,636		-		-
Installment and Other Consumer		1,132,417		121		121		819,419		-		-
	$	26,336,899	$	92,241	$	92,241	$	24,621,242	$	12,382	$	12,382

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

Financing Receivable Credit Quality Indicators [Table Text Block]

	As of September 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)	$	331,637,518	$	193,587,897	$	42,177,159	$	311,918,867	$	879,321,441
Special Mention (Rating 6)		7,920,533		4,213,076		560,086		8,660,810		21,354,505
Substandard (Rating 7)		15,445,837		1,987,151		6,454,664		25,344,040		49,231,692
Doubtful (Rating 8)		-		-		-		-		-
	$	355,003,888	$	199,788,124	$	49,191,909	$	345,923,717	$	949,907,638

	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

Schedule of Credit Losses Related to Financing Receivables, Current and Noncurrent [Table Text Block]

	As of September 30, 2012
Delinquency Status *	Direct Financing Leases		Residential Real Estate		Installment and Other Consumer		Total
Performing	$	100,944,144	$	110,974,915	$	76,078,511	$	287,997,570
Nonperforming		1,094,724		1,517,304		759,478		3,371,506
	$	102,038,868	$	112,492,219	$	76,837,989	$	291,369,076

	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

Troubled Debt Restructurings on Financing Receivables [Table Text Block]

	For the three months ended September 30, 2012								For the three months ended September 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		4	$	1,184,289	$	1,184,289	$	325,923		-	$	-	$	-	$	-
		4	$	1,184,289	$	1,184,289	$	325,923		-	$	-	$	-	$	-
CONCESSION - Interest rate adjusted below market
Other Non Owner-Occupied Commercial Real Estate		2	$	1,542,784	$	1,289,825	$	55,187		-	$	-	$	-	$	-
		2	$	1,542,784	$	1,289,825	$	55,187		-	$	-	$	-	$	-
TOTAL		6	$	2,727,073	$	2,474,114	$	381,110		-	$	-	$	-	$	-

	For the nine months ended September 30, 2012								For the nine months ended September 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		4	$	1,184,289	$	1,184,289	$	325,923		1	$	2,851,134	$	2,851,134	$	-
		4	$	1,184,289	$	1,184,289	$	325,923		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		-		-		-		-		-
		2	$	200,000	$	200,000	$	-		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	$	-		-	$	-	$	-	$	-
Other Non Owner-Occupied Commercial Real Estate		2		1,542,784		1,289,825		55,187		-		-		-		-
Residential Real Estate		1		167,739		167,739		-		-		-		-		-
Installment and Other Consumer		1		16,043		16,043		-		-		-		-		-
		5	$	2,064,066	$	1,811,107	$	55,187		-	$	-	$	-	$	-
TOTAL		11	$	3,448,355	$	3,195,396	$	381,110		5	$	4,026,953	$	4,026,953	$	-