SUMMARY OF QUARTERLY RESULTS (UNAUDITED)

12 Months Ended

Dec. 31, 2012

SUMMARY OF QUARTERLY RESULTS (UNAUDITED) [Abstract]

SUMMARY OF QUARTERLY RESULTS (UNAUDITED)

NOTE 23 - SUMMARY OF QUARTERLY RESULTS (UNAUDITED)

The following summarizes the consolidated results of operations during 2012 and 2011, on a quarterly basis, for the Company:

	For the year ended December 31, 2012
(In thousands, except per share data)	Fourth Quarter			Third Quarter			Second Quarter			First Quarter
Interest income	$	6,991		$	7,761		$	8,423		$	8,806
Net interest income		4,801			5,382			5,906			5,993
Provision for loan and lease losses		2,637			1,761			1,515			84
Net interest income after provision		2,164			3,621			4,391			5,909
Other  income		(148	)		1,151			1,945			661
Other expenses		10,256			9,409			8,592			8,067
Loss before income tax		(8,240	)		(4,637	)		(2,256	)		(1,497	)
Net loss from continuing operations	$	(8,240	)	$	(4,637	)	$	(2,256	)	$	(1,497	)
Less net (loss) income attributable to noncontrolling interest		(246	)		175			(306	)		(628	)
Net loss attributable to Royal Bancshares of Pennsylvania, Inc.	$	(7,994	)	$	(4,812	)	$	(1,950	)	$	(869	)
Net loss available to common shareholders	$	(8,507	)	$	(5,323	)	$	(2,458	)	$	(1,375	)
Net loss per common share
Basic and diluted	$	(0.64	)	$	(0.40	)	$	(0.19	)	$	(0.10	)

Operating results for the fourth quarter of 2012 amounted to a loss of $8.0 million, which resulted in an increase of $7.0 million from the loss recorded in the fourth quarter of 2011. The year over year decline in the quarterly results was primarily related to a $2.4 million increase in OREO impairment, a $1.8 million decrease in interest income, a $1.5 million OTTI charge, and a $1.1 million increase in impairment on LHFS. The additional OREO impairment was primarily due to the declining values of four of the vacant land properties in the portfolio.   The decrease in interest income was primarily driven by a decline in average loan balances year over year and a decline in the yield on investment securities.  As a result of the historically sustained low interest rates, the yield on investment securities declined despite the increase in average balances.  This decline in yield was due to the replacement of sold and called higher yielding investment securities and the reinvestment of increased payments received on cash flowing investment securities during 2012 with lower yielding government agency securities coupled with accelerated amortization of premiums paid on investment securities within the MBS/CMO portfolio.  The $1.5 million increase in OTTI was entirely related to the complete write down of one private equity security.  The increase in the impairment on LHFS was related to the challenges with the one remaining non-accrual LHFS and an agreement of sale.

	For the year ended December 31, 2011
(In thousands, except per share data)	Fourth Quarter			Third Quarter			Second Quarter			First Quarter
Interest income	$	8,754		$	10,049		$	10,000		$	10,574
Net interest income		5,744			6,832			6,160			6,555
Provision for loan and lease losses		2,160			428			3,056			2,084
Net interest income (loss) after provision		3,584			6,404			3,104			4,471
Other  income		2,594			73			2,787			1,364
Other expenses		7,206			8,109			9,785			6,969
Loss before income tax		(1,028	)		(1,632	)		(3,894	)		(1,134	)
Net loss	$	(1,028	)	$	(1,632	)	$	(3,894	)	$	(1,134	)
Less net (loss) income attributable to noncontrolling interest		(94	)		261			331			377
Net loss attributable to Royal Bancshares of Pennsylavania, Inc.	$	(934	)	$	(1,893	)	$	(4,225	)	$	(1,511	)
Net loss available to common shareholders	$	(1,438	)	$	(2,395	)	$	(4,724	)	$	(2,009	)
Net loss per common share
Basic and diluted	$	(0.11	)	$	(0.18	)	$	(0.36	)	$	(0.15	)