10-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K/A

Amendment No. 1

(Mark One)

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

For the fiscal year ended December 31, 2012

OR

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

For the transition period from:                    to

Commission file number: 0-25976

UNITED BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

Pennsylvania	23-2802415
(State or other jurisdiction of	(IRS Employer
incorporation or organization)	Identification No.)

30 S. 15th Street
Philadelphia, PA	19102
(Address of principal	(Zip code)
executive offices)

Registrant's telephone number, including area code:  (215)351-4600

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

Yes [X]   No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T 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 the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

(Check one):
Large accelerated filer [ ]	Accelerated filer [ ]
Non-accelerated filer [ ]	Smaller reporting company [ X]
(Do not check if a smaller
reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the 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 May 31, 2013, the aggregate number of the shares of the Registrant’s Common Stock issued was 1,068,588 (including 191,667 Class B non-voting).

The Series Preferred Stock consists of 500,000 authorized shares of stock of which 250,000 have been designated as Series A Preferred stock of which 136,842 shares are issued as of May 31, 2013.

EXPLANATORY NOTE

The sole purpose of this amendment to our Annual Report on Form 10-K for the fiscal year ended December 31, 2012, originally filed with the Securities and Exchange Commission on May 10, 2013, is to furnish Exhibit 101 to the Form 10-K which contains the XBRL (eXtensible Business Reporting Language) Interactive Data File for the financial statements and notes included in Part 1, Item 1 of the Form 10-K. As permitted by Rule 405(a)(2)(ii) of Regulation S-T, Exhibit 101 was required to be furnished with the original filing.

No changes have been made to the Form 10-K other than the furnishing of Exhibit 101 described above. This amendment does not reflect subsequent events occurring after the original filing date of the Form 10-K or modify or update in any way disclosures made in the Form 10-K.

Pursuant to Rule 406T of Regulation S-T, the Interactive Data File on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Act of 1934, as amended, and otherwise are not subject to liability under those sections.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	UNITED BANCSHARES, INC
	(Registrant)
May 31, 2013	/s/ Evelyn F. Smalls
Date	Evelyn F. Smalls
	President and Chief Executive Officer
May 31, 2013	/s/ Brenda Hudson-Nelson
Date	Executive Vice President,
	Chief Financial Officer

Exhibit No.	Description
3.1	Certificate of Incorporation (1)
3.2	Bylaws (1)
31.1	Rule 13a-14(a)/15d-14(a) Certifications (1)
31.2	Rule 13a-14(a)/15d-14(a) Certifications (1)
32.1	Section 1350 Certifications (1)
32.2 101.INS 101.SCH 101.CAL 101.DEF 101.LAB 101.PRE	Section 1350 Certifications (1) XBRL Instance Document (2) XBRL Taxonomy Extension Schema Document(2) XBRL Taxonomy Extension Calculation Linkbase Document(2) XBRL Taxonomy Extension Definition Linkbase Document(2) XBRL Taxonomy Extension Label Linkbase Document(2) XBRL Taxonomy Extension Presentation Linkbase Document(2)

(1)	Filed previously.
(2)	Furnished herewith.

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Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Deferred Tax Assets and Liabilities

	December 31, 2012	December 31, 2011
Deferred tax assets(liabilities):
Provision for loan losses	$333,853	$212,652
Unrealized gain on investment securities	(17,334)	(19,710)
Depreciation	94,393	369,764
Net operating loss carryforwards	2,897,243	2,313,074
Other, net	134,614	159,278
Valuation allowance for deferred tax assets	(3,442,769)	(3,035,058)
Net deferred tax assets	-	-

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Summary of Significant Accounting Policies: Intangible Assets: Schedule of Intangible Assets (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011	Sep. 24, 1999
Details
Finite-Lived Core Deposits, Gross	$ 2,449,488	$ 2,449,488	$ 2,449,488
Finite-Lived Intangible Assets, Accumulated Amortization	(2,313,755)	(2,135,677)
Intangible assets	$ 135,733	$ 313,811

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Regulatory Capital Requirements under Banking Regulations: Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations

	Actual		For capital adequacy purposes		To be well capitalized under prompt corrective action provisions
	Amount	Ratio	Amount	Ratio	Amount	Ratio
As of December 31, 2012:
Total capital to risk-
weighted assets:
Consolidated	$4,584	11.16%	$3,287	8.00%	N/A
Bank	4,584	11.16%	3,287	8.00%	$4,109	10.00%
Tier I capital to risk-
weighted assets:
Consolidated	4,070	9.91%	1,644	4.00%	N/A
Bank	4,070	9.91%	1,644	4.00%	2,465	6.00%
Tier I capital to average assets:
Consolidated	4,070	6.00%	2,715	4.00%	N/A
Bank	4,070	6.00%	2,715	4.00%	3,394	5.00%

	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:
Total capital to risk-
weighted assets:
Consolidated	$5,460	12.45%	$3,513	8.00%	N/A
Bank	5,440	12.41%	3,507	8.00%	$4,384	10.00%
Tier I capital to risk-
weighted assets:
Consolidated	4,908	11.20%	1,756	4.00%	N/A
Bank	4,888	11.15%	1,754	4.00%	2,630	6.00%
Tier I capital to average assets:
Consolidated	4,908	6.29%	3,122	4.00%	N/A
Bank	4,888	6.27%	3,119	4.00%	3,899	5.00%

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Items (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Depreciation on fixed assets	$ 220,281	$ 246,272
Operating Leases, Rent Expense	465,800	454,895
Proceeds from sale of bank premises	874,943
Gain (Loss) on Sale of Properties	527,000
Other Real Estate
Proceeds from sale of bank premises	$ 875,000

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Summary of Significant Accounting Policies: Other Real Estate Owned (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Details
Other Real Estate, Foreclosed Assets, and Repossessed Assets	$ 775,000	$ 1,284,000

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Income Taxes (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Details
Operating Loss Carryforwards	$ 8,440,000
Operating Loss Carryforwards, Expiration Dates	2013 through 2027
Deferred Tax Assets, Valuation Allowance	$ 3,442,769	$ 3,035,058

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Condensed Financial Information of Parent Company Only Disclosure: Condensed Statements of Operations (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Condensed Statements of Operations

Condensed Statements of Operations

Years ended December 31,
(Dollars in thousands)	2012	2011
Other Expenses	$(20)	$(50)
Equity in net loss of subsidiary	(996)	(981)
Net loss	$(1,016)	$(1,031)

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4. Loans and Allowance For Loan Losses: Allowance for Credit Losses on Financing Receivables (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Allowance for Credit Losses on Financing Receivables

(in 000's)	For the Year Ended December 31, 2012
	Commercial and industrial	Commercial real estate	Consumer real estate	Consumer and other loans	Total
Beginning balance	$387	$412	$68	-	$867
Provision for loan losses	560	(112)	-	5	453
Charge-offs	(56)	-	(80)	(21)	(157)
Recoveries	-	8	17	16	41
Net charge-offs	(56)	8	(63)	(5)	(116)
Ending balance	$891	$308	$5	-	$1,204

(in 000's)	For the Year Ended December 31, 2011
	Commercial and industrial	Commercial real estate	Consumer real estate	Consumer and other loans	Total
Beginning balance	$301	$553	$52	$20	$926
Provision for loan losses	150	-	15	5	170
Charge-offs	(65)	(150)	(5)	(46)	(266)
Recoveries	1	9	6	21	37
Net charge-offs	(64)	(141)	1	(25)	(229)
Ending balance	$387	$412	$68	-	$867

(in 000's)	As of December 31, 2012
	Commercial and industrial	Commercial real estate	Consumer real estate	Consumer and other loans	Total
Period-end amount allocated to:
Loans individually evaluated for impairment	$843	-	-	-	$843
Loans collectively  evaluated for impairment	48	308	5	-	361
	$891	$308	$5	-	$1,204
Loans, ending balance:
Loans individually evaluated for impairment	$1,021	$1,323	-	-	2,344
Loans collectively  evaluated for impairment	2,713	30,058	4,619	1,768	39,158
Total	$3,734	$31,381	$4,619	$1,768	$41,502

(in 000's)		As of December 31, 2011
	Commercial and industrial	Commercial real estate	Consumer real estate	Consumer and other loans	Total
Period-end amount allocated to:
Loans individually evaluated for impairment	$308	-	-	-	$308
Loans collectively  evaluated for impairment	79	412	68	-	559
	$387	$412	$68	-	$867
Loans, ending balance:
Loans individually evaluated for impairment	$592	$1,095	-	-	$1,687
Loans collectively  evaluated for impairment	3,138	29,102	5,586	1,989	39,815
Total	$3,730	$30,197	$5,586	$1,989	$41,502

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Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Details
Unrealized gain on investment securities	$ (17,334)	$ (19,710)
Net operating loss carryforwards	2,897,243	2,313,074
Other, net	134,614	159,278
Valuation allowance for deferred tax assets	$ (3,442,769)	$ (3,035,058)

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Other Real Estate Owned: Other Real Estate Owned (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Details
Other Real Estate, Beginning Balance	$ 1,284,390	$ 1,417,000
Other Real Estate, Additions	156,000	602,000
Other Real Estate, Disposals	(434,000)	(730,000)
Other Real Estate, Period Increase (Decrease)	1,007,000	1,289,000
Other Real Estate, Valuation Adjustments	(232,000)	(4,000)
Other Real Estate, Ending Balance	$ 775,407	$ 1,284,390

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Regulatory Capital Requirements under Banking Regulations: Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Consolidated
Tier One Risk Based Capital	$ 4,070	$ 4,908
Tier One Risk Based Capital to Risk Weighted Assets	9.91%	11.20%
Tier One Risk Based Capital Required for Capital Adequacy	1,644	1,756
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets	4.00%	4.00%
Tier One Risk Based Capital Required to be Well Capitalized
Tier One Leverage Capital	4,070	4,908
Tier One Leverage Capital to Average Assets	6.00%	6.29%
Tier One Leverage Capital Required for Capital Adequacy	2,715	3,122
Tier One Leverage Capital Required for Capital Adequacy to Average Assets	4.00%	4.00%
Tier One Leverage Capital Required to be Well Capitalized
Bank
Capital	4,584	5,440
Capital to Risk Weighted Assets	11.16%	12.41%
Capital Required for Capital Adequacy	3,287	3,507
Capital Required for Capital Adequacy to Risk Weighted Assets	8.00%	8.00%
Capital Required to be Well Capitalized	4,109	4,384
Tier One Risk Based Capital	4,070	4,888
Tier One Risk Based Capital to Risk Weighted Assets	9.91%	11.15%
Tier One Risk Based Capital Required for Capital Adequacy	1,644	1,754
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets	4.00%	4.00%
Tier One Risk Based Capital Required to be Well Capitalized	2,465	3,899
Tier One Risk Based Capital Required to be Well Capitalized to Risk Weighted Assets	6.00%	6.00%
Tier One Leverage Capital	4,070	4,888
Tier One Leverage Capital to Average Assets	6.00%	6.27%
Tier One Leverage Capital Required for Capital Adequacy	2,715	3,119
Tier One Leverage Capital Required for Capital Adequacy to Average Assets	4.00%	4.00%
Tier One Leverage Capital Required to be Well Capitalized	$ 3,394	$ 2,630
Tier One Leverage Capital Required to be Well Capitalized to Average Assets	5.00%	5.00%

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Cash and Due From Bank Balances (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Details
Valuation Allowances and Reserves, Balance	$ 100,000	$ 125,000

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Deposits (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Total deposits	$ 60,976,743	$ 71,300,458
Time Deposits	16,886,000
City Of Philadelphia
Total deposits	7,300,000
Time Deposits	$ 5,000,000

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Condensed Financial Information of Parent Company Only Disclosure: Condensed Balance Sheets (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Cash and cash equivalents at beginning of year	$ 10,236,199	$ 14,497,329	$ 8,696,111
Total assets	65,615,506	77,016,922
Series A preferred stock, noncumulative, 6%, $0.01 par value, 500,000 shares authorized; 136,842 issued and outstanding	1,368	1,368
Parent Company
Cash and cash equivalents at beginning of year		20,000	70,000
Investment in United Bank of Philadelphia	4,240,000	5,241,000
Total assets	4,240,000	5,261,000
Series A preferred stock, noncumulative, 6%, $0.01 par value, 500,000 shares authorized; 136,842 issued and outstanding	1,000	1,000
Common Stock	11,000	11,000
Additional paid-in-capital	14,750,000	14,750,000
Accumulated deficit	(10,556,000)	(9,540,000)
Available-for-sale Securities, Gross Unrealized Gain (Loss)	34,000	39,000
Total shareholders' equity	$ 4,240,000	$ 5,261,000

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Financial Instrument Commitments: Schedule of Financial Instruments Owned and Pledged as Collateral (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Letters of Credit Outstanding, Amount	$ 1,173,374	$ 1,208,183
Commitments to Extend Credit
Fair Value Disclosure, Off-balance Sheet Risks, Amount, Liability	$ 9,484,309	$ 9,162,490

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Condensed Financial Information of Parent Company Only Disclosure: Condensed Statements of Operations (Details) (USD $)	3 Months Ended								12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011
Net loss	$ (134,000)	$ (408,000)	$ (236,000)	$ (238,000)	$ (273,000)	$ (282,000)	$ (169,000)	$ (307,000)	$ (1,016,247)	$ (1,031,240)
Parent Company
Other Expenses									(20,000)	(50,000)
Equity in net loss of subsidiary									(996,000)	(981,000)
Net loss									$ (1,016,000)	$ (1,031,000)

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Borrowings (Details) (Secured Borrowing Federal Reserve, USD $)	Dec. 31, 2012	Dec. 31, 2011
Secured Borrowing Federal Reserve
Line of Credit Facility, Maximum Borrowing Capacity	$ 1,500,000
Securities Held as Collateral, at Fair Value	1,750,000
Line of Credit Facility, Amount Outstanding	$ 0	$ 0

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Schedule of Future Minimum Lease Payments Under Operating Leases (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012
Details
Operating Leases, Future Minimum Payments, Next Rolling Twelve Months	$ 501
Operating Leases, Future Minimum Payments, Due in Rolling Year Two	493
Operating Leases, Future Minimum Payments, Due in Rolling Year Three	489
Operating Leases, Future Minimum Payments, Due in Rolling Year Four	171
Operating Leases, Future Minimum Payments, Due in Rolling Year Five	103
Operating Leases, Future Minimum Payments, Due Thereafter	168
Operating Leases, Future Minimum Payments Due	$ 1,925

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Investments: Summary of Investment Securities (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Summary of Investment Securities

(In 000’s)	2012
		Gross	Gross
	Amortized	unrealized	unrealized	Fair
	Cost	gains	losses	value
Available-for-sale:
Government Sponsored Enterprises residential mortgage-backed securities	$847	$51	-	$898
Investments in money market funds	129	-	-	129
	$976	$51	-	$1,027

Held-to-maturity:
U.S. Government agency securities	$3,605	$159	$(4)	$3,760
Government Sponsored Enterprises residential mortgage-backed securities	8,290	437	(1)	8,726
	$11,895	$596	$(5)	$12,486

	2011
		Gross	Gross
	Amortized	unrealized	unrealized	Fair
	Cost	gains	losses	Value
Available-for-sale:
Government Sponsored Enterprises residential mortgage-backed securities	$1,094	$58	-	$1,152
Investments in money market funds	129	-	-	129
	$1,223	$58	-	$1,281

Held-to-maturity:
U.S. Government agency securities	$7,531	$158	-	$7,689
Government Sponsored Enterprises residential mortgage-backed securities	9,678	373	(2)	10,049
	$17,209	$531	$(2)	$17,738

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Summary of Quarterly Results (unaudited): Schedule of Quarterly Financial Information (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Quarterly Financial Information

            (Dollars in thousands)

	2012
	Fourth  Quarter	Third  Quarter	Second  Quarter	First  Quarter
Interest income	$736	$768	$779	$802
Interest expense	31	32	33	43
Net interest income	705	736	746	759
Provision for loan losses	332	61	30	30
Net interest after provision for loan losses	373	675	716	729
Noninterest income	792	260	279	194
Noninterest expense	1,299	1,343	1,231	1,161
Net loss	$(134)	$(408)	$(236)	$(238)
Basic loss per common share	$(0.13)	$(0.38)	$(0.22)	$(0.22)
Diluted loss per common share	$(0.13)	$(0.38)	$(0.22)	$(0.22)

            (Dollars in thousands)

	2011
	Fourth Quarter	Third Quarter	Second Quarter	First  Quarter
Interest income	$847	$818	$813	$825
Interest expense	52	60	62	61
Net interest income	795	758	751	764
Provision for loan losses	70	30	40	30
Net interest after provision for loan losses	725	728	711	734
Noninterest income	259	199	399	214
Noninterest expense	1,257	1,209	1,279	1,255
Net loss	$(273)	$(282)	$(169)	$(307)
Basic loss per common share	$(0.26)	$(0.26)	$(0.16)	$(0.29)
Diluted loss per common share	$(0.26)	$(0.26)	$(0.16)	$(0.29)

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Fair Value Measurements: Schedule of Fair Value of Assets on a Recurring Basis (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Fair Value of Assets on a Recurring Basis

Assets on the consolidated balance sheets measured at fair value on a recurring basis are summarized below.

(in 000’s)	Fair Value Measurements at Reporting Date Using:
	Assets/Liabilities Measured at Fair Value at December 31, 2012	Quoted Prices in Active Markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)
Investment securities available-for-sale:
Government Sponsored Enterprises residential mortgage-backed securities	$898	-	$898	-
Money Market Funds	129	129	-	-
Total	$1,027	$129	$898

(in 000’s)		Fair Value Measurements at Reporting Date Using:
	Assets/Liabilities Measured at Fair Value at December 31, 2011	Quoted Prices in Active Markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)
Investment securities available-for-sale:
Government Sponsored Enterprises residential mortgage-backed securities	$1,152	-	$1,152	-
Money Market Funds	129	129	-	-
Total	$1,281	$129	$1,281

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Deposits: Schedule of Maturities of Time Deposits (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012
Details
2013	$ 15,244
2014	975
2015	441
2016	133
2017	57
Thereafter	36
Time Deposits	$ 16,886

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Other Real Estate Owned: Schedule of Components of Net Expense of Other Real Estate (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Components of Net Expense of Other Real Estate

(in 000's)
	Year ended December 31, 2012	Year ended December 31, 2011
Insurance	$24	$20
Legal fees	5	-
Maintenance	3	9
Professional fees	8	19
Real estate taxes	99	15
Utilities	21	9
Transfer-in write-up	(43)	-
Impairment charges	232	4
	$349	$76

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Summary of Significant Accounting Policies: Income Taxes (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Details
Liability for Uncertain Tax Positions, Current	$ 0	$ 0

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4. Loans and Allowance For Loan Losses: Schedule of Bank's Loans by Class To Their Credit Quality Indictors (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Loans Receivable, Gross, Commercial, Real Estate	$ 31,381,000	$ 30,197,000
Loans and Leases Receivable, Gross, Consumer, Real Estate	4,619,000	5,586,000
Loans and Leases Receivable, Gross, Consumer	1,768,000	1,989,000
Loans Receivable, Net	41,502,000	41,502,000
Good Excellent
Loans and Leases Receivable, Gross, Commercial	250,000	379,000
Good Excellent | Commercial And Industrial
Loans and Leases Receivable, Gross, Commercial	250,000	379,000
Good Excellent | Commercial And Industrial | Commercial
Loans and Leases Receivable, Gross, Commercial	250,000	379,000
Satisfactory
Loans and Leases Receivable, Gross, Commercial	26,249,000	27,294,000
Satisfactory | Commercial And Industrial
Loans and Leases Receivable, Gross, Commercial	2,000,000	2,563,000
Satisfactory | Commercial And Industrial | Commercial
Loans and Leases Receivable, Gross, Commercial	104,000	586,000
Satisfactory | Commercial And Industrial | SBA Loans
Loans and Leases Receivable, Gross, Commercial	27,000	130,000
Satisfactory | Commercial And Industrial | Asset Based
Loans and Leases Receivable, Gross, Commercial	1,869,000	1,847,000
Satisfactory | Commercial Real Estate
Loans Receivable, Gross, Commercial, Real Estate	24,349,000	24,731,000
Satisfactory | Commercial Real Estate | SBA Loans
Loans Receivable, Gross, Commercial, Real Estate	621,000	472,000
Satisfactory | Commercial Real Estate | Commercial Mortgages
Loans Receivable, Gross, Commercial, Real Estate	12,678,000	13,117,000
Satisfactory | Commercial Real Estate | Construction
Loans Receivable, Gross, Commercial, Real Estate	2,767,000	1,391,000
Satisfactory | Commercial Real Estate | Religious Organizations
Loans Receivable, Gross, Commercial, Real Estate	8,183,000	9,751,000
Pass
Loans and Leases Receivable, Gross, Commercial	5,085,000	3,193,000
Pass | Commercial And Industrial
Loans and Leases Receivable, Gross, Commercial	140,000	117,000
Pass | Commercial And Industrial | Commercial
Loans and Leases Receivable, Gross, Commercial	15,000
Pass | Commercial And Industrial | SBA Loans
Loans and Leases Receivable, Gross, Commercial		56,000
Pass | Commercial And Industrial | Asset Based
Loans and Leases Receivable, Gross, Commercial	125,000	61,000
Pass | Commercial Real Estate
Loans Receivable, Gross, Commercial, Real Estate	4,945,000	3,076,000
Pass | Commercial Real Estate | Commercial Mortgages
Loans Receivable, Gross, Commercial, Real Estate	1,322,000	151,000
Pass | Commercial Real Estate | Religious Organizations
Loans Receivable, Gross, Commercial, Real Estate	3,623,000	2,925,000
Special Mention
Loans and Leases Receivable, Gross, Commercial	485,000	31,000
Special Mention | Commercial And Industrial
Loans and Leases Receivable, Gross, Commercial	323,000	31,000
Special Mention | Commercial And Industrial | Commercial
Loans and Leases Receivable, Gross, Commercial	220,000	31,000
Special Mention | Commercial And Industrial | SBA Loans
Loans and Leases Receivable, Gross, Commercial	49,000
Special Mention | Commercial And Industrial | Asset Based
Loans and Leases Receivable, Gross, Commercial	54,000
Special Mention | Commercial Real Estate
Loans Receivable, Gross, Commercial, Real Estate	162,000
Special Mention | Commercial Real Estate | Religious Organizations
Loans Receivable, Gross, Commercial, Real Estate	162,000
Substandard
Loans and Leases Receivable, Gross, Commercial	2,336,000	2,804,000
Substandard | Commercial And Industrial
Loans and Leases Receivable, Gross, Commercial	628,000	414,000
Substandard | Commercial And Industrial | Commercial
Loans and Leases Receivable, Gross, Commercial	480,000	264,000
Substandard | Commercial And Industrial | SBA Loans
Loans and Leases Receivable, Gross, Commercial	49,000	49,000
Substandard | Commercial And Industrial | Asset Based
Loans and Leases Receivable, Gross, Commercial	99,000	101,000
Substandard | Commercial Real Estate
Loans Receivable, Gross, Commercial, Real Estate	1,708,000	2,390,000
Substandard | Commercial Real Estate | SBA Loans
Loans Receivable, Gross, Commercial, Real Estate		5,000
Substandard | Commercial Real Estate | Commercial Mortgages
Loans Receivable, Gross, Commercial, Real Estate	403,000	1,408,000
Substandard | Commercial Real Estate | Construction
Loans Receivable, Gross, Commercial, Real Estate	631,000
Substandard | Commercial Real Estate | Religious Organizations
Loans Receivable, Gross, Commercial, Real Estate	674,000	977,000
Doubtful
Loans and Leases Receivable, Gross, Commercial	710,000	226,000
Doubtful | Commercial And Industrial
Loans and Leases Receivable, Gross, Commercial	393,000	226,000
Doubtful | Commercial And Industrial | Commercial
Loans and Leases Receivable, Gross, Commercial	393,000	226,000
Doubtful | Commercial Real Estate
Loans Receivable, Gross, Commercial, Real Estate	317,000
Doubtful | Commercial Real Estate | Commercial Mortgages
Loans Receivable, Gross, Commercial, Real Estate	317,000
Total
Loans and Leases Receivable, Gross, Commercial	33,115,000	33,927,000
Loans and Leases Receivable, Gross, Consumer, Real Estate	1,768,000	1,989,000
Loans and Leases Receivable, Gross, Consumer	6,387,000	7,575,000
Total | Commercial And Industrial
Loans and Leases Receivable, Gross, Commercial	3,734,000	3,730,000
Total | Commercial And Industrial | Commercial
Loans and Leases Receivable, Gross, Commercial	1,462,000	1,486,000
Total | Commercial And Industrial | SBA Loans
Loans and Leases Receivable, Gross, Commercial	125,000	235,000
Total | Commercial And Industrial | Asset Based
Loans and Leases Receivable, Gross, Commercial	2,147,000	2,009,000
Total | Commercial Real Estate
Loans Receivable, Gross, Commercial, Real Estate	31,381,000	30,197,000
Loans and Leases Receivable, Gross, Consumer, Real Estate	4,619,000	5,586,000
Total | Commercial Real Estate | SBA Loans
Loans Receivable, Gross, Commercial, Real Estate	621,000	477,000
Total | Commercial Real Estate | Commercial Mortgages
Loans Receivable, Gross, Commercial, Real Estate	14,721,000	14,676,000
Total | Commercial Real Estate | Construction
Loans Receivable, Gross, Commercial, Real Estate	3,398,000	1,391,000
Total | Commercial Real Estate | Religious Organizations
Loans Receivable, Gross, Commercial, Real Estate	12,642,000	13,653,000
Total | Home Equity | Consumer Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate	1,453,000	2,145,000
Total | Home Equity Line Of Credit | Consumer Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate	26,000	85,000
Total | 14 Family Residential Mortgages | Consumer Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate	3,140,000	3,356,000
Total | Consumer Installment | Consumer Other
Loans and Leases Receivable, Gross, Consumer, Real Estate	30,000	58,000
Total | Student Loans | Consumer Other
Loans and Leases Receivable, Gross, Consumer, Real Estate	1,588,000	1,761,000
Total | Other | Consumer Other
Loans and Leases Receivable, Gross, Consumer, Real Estate	150,000	170,000
Performing
Loans and Leases Receivable, Gross, Consumer, Real Estate	1,768,000	1,989,000
Loans and Leases Receivable, Gross, Consumer	6,098,000	7,130,000
Performing | Commercial Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate	4,330,000	5,141,000
Performing | Home Equity | Consumer Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate	1,390,000	2,039,000
Performing | Home Equity Line Of Credit | Consumer Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate	26,000	47,000
Performing | 14 Family Residential Mortgages | Consumer Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate	2,914,000	3,055,000
Performing | Consumer Installment | Consumer Other
Loans and Leases Receivable, Gross, Consumer, Real Estate	30,000	58,000
Performing | Student Loans | Consumer Other
Loans and Leases Receivable, Gross, Consumer, Real Estate	1,588,000	1,761,000
Performing | Other | Consumer Other
Loans and Leases Receivable, Gross, Consumer, Real Estate	150,000	170,000
Nonperforming
Loans and Leases Receivable, Gross, Consumer	289,000	445,000
Nonperforming | Commercial Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate	289,000	445,000
Nonperforming | Home Equity | Consumer Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate	63,000	106,000
Nonperforming | Home Equity Line Of Credit | Consumer Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate		38,000
Nonperforming | 14 Family Residential Mortgages | Consumer Real Estate
Loans and Leases Receivable, Gross, Consumer, Real Estate	$ 226,000	$ 301,000

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Investments: Contractual Maturities of Investment Securities (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Available-for-sale Securities, Amortized Cost Basis	$ 976	$ 1,223
Available-for-sale Securities, Fair Value Disclosure	1,027	1,281
Available-for-sale Debt Securities, Amortized Cost Basis	847
Available-for-sale Securities, Debt Securities	89
Held-to-maturity Securities, Debt Maturities, within One Year, Net Carrying Amount	250
Held-to-maturity Securities, Debt Maturities, Rolling Year Two Through Five, Fair Value	269
Held-to-maturity Securities, Debt Maturities, after Five Through Ten Years, Net Carrying Amount	3,355
Held-to-maturity Securities, Debt Maturities, Rolling Year Six Through Ten, Fair Value	3,491
Held-to-maturity Securities, Fair Value Disclosure	12,486	17,738
Held-to-maturity Securities, Amortized Cost before Other than Temporary Impairment	11,895	17,209
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises
Available-for-sale Securities, Amortized Cost Basis	847	1,094
Available-for-sale Securities, Fair Value Disclosure	898	1,152
Held-to-maturity Securities, Fair Value Disclosure	8,726	10,049
Held-to-maturity Securities, Amortized Cost before Other than Temporary Impairment	8,290	9,678
Money Market Funds
Available-for-sale Securities, Amortized Cost Basis	129	129
Available-for-sale Securities, Fair Value Disclosure	$ 129	$ 129

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Condensed Financial Information of Parent Company Only Disclosure: Condensed Statements of Cash Flows (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Condensed Statements of Cash Flows

Condensed Statements of Cash Flows

Years ended December 31,
(Dollars in thousands)	2012	2011
Cash flows from operating activities:
Net loss	$(1,016)	$(1,031)
Adjustments:
Equity in net loss of subsidiary	996	981
Net cash used in operating activities	(20)	(50)
Cash and cash equivalents at beginning of year	20	70
Cash and cash equivalents at end of year	-	$20

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Investments

12 Months Ended

Dec. 31, 2012

Notes

Investments

3. INVESTMENTS

The amortized cost, gross unrealized holding gains and losses, and estimated fair value of the available-for-sale and held-to-maturity investment securities by major security type at December 31, 2012 and 2011 are as follows:

(In 000’s)	2012
		Gross	Gross
	Amortized	unrealized	unrealized	Fair
	Cost	gains	losses	value
Available-for-sale:
Government Sponsored Enterprises residential mortgage-backed securities	$847	$51	-	$898
Investments in money market funds	129	-	-	129
	$976	$51	-	$1,027

Held-to-maturity:
U.S. Government agency securities	$3,605	$159	$(4)	$3,760
Government Sponsored Enterprises residential mortgage-backed securities	8,290	437	(1)	8,726
	$11,895	$596	$(5)	$12,486

	2011
		Gross	Gross
	Amortized	unrealized	unrealized	Fair
	Cost	gains	losses	Value
Available-for-sale:
Government Sponsored Enterprises residential mortgage-backed securities	$1,094	$58	-	$1,152
Investments in money market funds	129	-	-	129
	$1,223	$58	-	$1,281

Held-to-maturity:
U.S. Government agency securities	$7,531	$158	-	$7,689
Government Sponsored Enterprises residential mortgage-backed securities	9,678	373	(2)	10,049
	$17,209	$531	$(2)	$17,738

In 2012, $7,725,000 in U.S. Government agencies securities were called.  In 2011, $8,863,000 in U.S. Government agencies securities were called.  There was $2,571 in gross losses from these transactions during 2012. There were no gross gains or losses realized from these transactions during 2011. No securities were sold during 2012 or 2011.

The table below indicates the length of time individual securities held-to-maturity have been in a continuous unrealized loss position at December 31, 2012 (in thousands):

	Number		Less than 12 months				12 months or longer				Total
Description of	of		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
Securities	securities		value		Losses		value		losses		value		losses
U.S. Government agency securities		3	$	746	$	(4)	$	-	$	-	$	746	$	(4)
Mortgage backed securities		2	$	253	$	(1)	$	-	$	-	$	253	$	(1)
Total temporarily
impaired investment
securities		5	$	999	$	(5)	$	-	$	-	$	999	$	(5)

The table below indicates the length of time individual securities held-to-maturity have been in a continuous unrealized loss position at December 31, 2011 (in thousands):

	Number		Less than 12 months				12 months or longer				Total
Description of	of		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
Securities	securities		value		Losses		Value		losses		value		losses
Mortgage backed securities		4	$	1,018		(2)		-		-	$	1,018		(2)
Total temporarily
impaired investment
securities		4	$	1,018	$	(2)	$	-	$	-	$	1,018	$	(2)

U.S. Government and Agency Securities. Unrealized losses on the Company’s investments in direct obligations of U.S. government agencies were caused by interest rate increases. The contractual terms of those investments do not permit the issuer to settle the securities at a price less than the amortized cost bases of the investments. Because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at December 31, 2012.

Residential Government Sponsored Enterprise Mortgage-Backed Securities. Unrealized losses on the Company’s investment in government sponsored enterprise mortgage-backed securities may be caused by interest rate increases. The Company purchased those investments at a discount relative to their face amount, and the contractual cash flows of those investments are guaranteed by an agency of the U.S. government. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company’s investments. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider those investments to be other-than-temporarily impaired at December 31, 2012 and 2011.

The Company has a process in place to identify debt securities that could potentially have a credit impairment that is other than temporary.  This process involves monitoring late payments, pricing levels, downgrades by rating agencies, key financial ratios, financial statements, revenue forecasts and cash flow projections as indicators of credit issues.  On a quarterly basis, we review all securities to determine whether an other-than-temporary decline in value exists and whether losses should be recognized. We consider relevant facts and circumstances in evaluating whether a credit or interest rate-related impairment of a security is other than temporary. Relevant facts and circumstances considered include: (1) the extent and length of time the fair value has been below cost; (2) the reasons for the decline in value; (3) the financial position and access to capital of the issuer, including the current and future impact of any specific events and (4) for fixed maturity securities, our intent to sell a security or whether it is more likely than not we will be required to sell the security before the recovery of its amortized cost which, in some cases, may extend to maturity and for equity securities, our ability and intent to hold the security for a period of time that allows for the recovery in value.

Maturities of investment securities classified as available-for-sale and held-to-maturity at December 31, 2011 were as follows. Expected maturities may differ from contractual maturities because the underlying mortgages supporting mortgage backed securities may be prepaid without any penalties. Consequently, mortgage-backed securities are not presented by maturity category.

(In 000’s)

	Amortized Cost	Fair Value
Available-for-sale:
Due in one year	-	-
Due after one year through five years	-	-
Due after five years through ten years	-	-
Government-sponsored enterprises residential mortgage-backed securities	847	898
Total debt securities	847	89
Investments in money market funds	129	129
	$976	$1,027
Held-to-maturity:
Due in one year	-	-
Due after one year through five years	250	269
Due after five years through ten years	3,355	3,491
Due after ten years	-	-
Government-sponsored enterprises residential mortgage-backed securities	8,290	8,726
	$11,895	$12,486

As of December 31, 2012 and 2011, investment securities with a carrying value of $10,041,655 and $17,953,933, respectively, were pledged as collateral to secure public deposits and contingent borrowing at the Discount Window.

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4. Loans and Allowance For Loan Losses: Schedule of Net Loans (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Loans Receivable, Gross, Commercial and Industrial	$ 3,734,000	$ 3,730,000
Loans Receivable, Gross, Commercial, Real Estate	31,381,000	30,197,000
Loans and Leases Receivable, Gross, Consumer, Real Estate	4,619,000	5,586,000
Loans Receivable Real Estate	36,000,000	35,783,000
Loans and Leases Receivable, Gross, Consumer	1,768,000	1,989,000
Loans Receivable, Net	41,502,000	41,502,000
SBA Loans
Loans Receivable, Gross, Commercial and Industrial	125,000	235,000
Loans Receivable, Gross, Commercial, Real Estate	621,000	477,000
Asset Based Loans
Loans Receivable, Gross, Commercial and Industrial	2,147,000	2,009,000
Commercial Mortgages
Loans Receivable, Gross, Commercial, Real Estate	14,720,000	14,676,000
Construction
Loans Receivable, Gross, Commercial, Real Estate	3,398,000	1,391,000
Religious Organizations
Loans Receivable, Gross, Commercial, Real Estate	12,642,000	13,653,000
Home Equity Loans
Loans and Leases Receivable, Gross, Consumer, Real Estate	1,453,000	2,145,000
Home Equity Line of Credit
Loans and Leases Receivable, Gross, Consumer, Real Estate	26,000	85,000
Family Residential Mortgage
Loans and Leases Receivable, Gross, Consumer, Real Estate	3,140,000	3,356,000
Consumer Installment
Loans and Leases Receivable, Gross, Consumer	30,000	58,000
Student Loans
Loans and Leases Receivable, Gross, Consumer	1,588,000	1,761,000
Other
Loans and Leases Receivable, Gross, Consumer	150,000	170,000
Commercial Portfolio Segment
Loans Receivable, Gross, Commercial and Industrial	$ 1,462,000	$ 1,486,000

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Fair Value Measurements: Schedule of Fair Value of Assets on a Nonrecurring Basis (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Fair Value of Assets on a Nonrecurring Basis

The following table presents the assets carried on the consolidated balance sheets by level within the fair value hierarchy as of December 31, 2012, for which a nonrecurring change in fair value has been recorded during the year ended December 31, 2012.

Carrying Value at December 31, 2012:

(in 000’s)	Total	Quoted Prices in Active markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total fair value gain (loss) during the year ended December 31, 2012
Impaired Loans	$1,501	-	-	$1,501	$(843)
Other real estate owned	775	-	-	775	(233)

The following table presents the assets and liabilities carried on the consolidated balance sheets by level within the fair value hierarchy as of December 31, 2011, for which a nonrecurring change in fair value has been recorded during the year ended December 31, 2011.

Carrying Value at December 31, 2011:

(in 000’s)	Total	Quoted Prices in Active markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total fair value gain (loss) during the year ended December 31, 2011
Impaired Loans	$1,379	-	-	$1,379	$(308)
Other real estate owned	1,284	-	-	1,284	(4)

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4. Loans and Allowance For Loan Losses: Schedule of Related Party Loans (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Related Party Loans

	2012	2011
Balance outstanding at January 1,	$1,702,648	$1,931,722
Principal additions	30,000	-
Principal reductions	(160,622)	$(229,074)
Balance outstanding at December 31,	$1,572,026	$1,702,648

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4. Loans and Allowance For Loan Losses: Schedule of Net Loans (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Net Loans

(In 000's)	December 31, 2012	December 31, 2011
Commercial and industrial:
Commercial	$1,462	$1,486
SBA loans	125	235
Asset-based	2,147	2,009
Total commercial and industrial	3,734	3,730
Commercial real estate:
Commercial mortgages	14,720	14,676
SBA loans	621	477
Construction	3,398	1,391
Religious organizations	12,642	13,653
Total commercial real estate	31,381	30,197
Consumer real estate:
Home equity loans	1,453	2,145
Home equity lines of credit	26	85
1-4 family residential mortgages	3,140	3,356
Total consumer real estate	4,619	5,586
Total real estate	36,000	35,783
Consumer and other:
Consumer installment	30	58
Student loans	1,588	1,761
Other	150	170
Total consumer and other	1,768	1,989
Loans, net	$41,502	$41,502

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Summary of Significant Accounting Policies: Comprehensive Loss: Schedule of Comprehensive Loss (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Details
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, before Reclassification Adjustments and Tax	$ (6,990)	$ (7,851)
Other Comprehensive Income (Loss), Available-for-sale Securities, before Reclassification Adjustments, Tax	2,307	2,591
Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, before Reclassification Adjustments, Net of Tax	(4,684)	(5,260)
Other Comprehensive Income (Loss), Reclassification Adjustment for Sale of Securities Included in Net Income, before Tax	0	0
Other Comprehensive Income (Loss), Reclassification Adjustment for Sale of Securities Included in Net Income, Tax	0	0
Other Comprehensive Income (Loss), Reclassification Adjustment for Sale of Securities Included in Net Income, Net of Tax	0	0
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, before Tax	(6,990)	(7,851)
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Tax	2,307	2,591
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Net of Tax	$ (4,684)	$ (5,260)

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Fair Value Measurements: Schedule of Fair Value of Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Fair Value of Assets and Liabilities

      (in 000’s)

	Level in	2012		2011
	Value	Carrying	Fair	Carrying	Fair
Assets:	Hierarchy	Amount	Value	Amount	Value
Cash and cash equivalents	Level 1	$10,236	$10,236	$14,497	$14,497
Available for sale securities	(1)	1,027	1,027	1,281	1,281
Held to maturity securities	Level 2	11,895	12,486	17,209	17,738
Loans, net of allowance for loan losses	(2)	40,298	40,325	40,635	40,552
Interest receivable	Level 2	310	310	342	342
Liabilities:
Demand deposits	Level 2	29,851	29,851	31,260	31,260
Savings deposits	Level 2	14,239	14,239	14,689	14,689
Time deposits	Level 2	16,886	16,902	25,352	25,401
Interest Payable	Level 2	368	368	397	397

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4. Loans and Allowance For Loan Losses: Past Due Financing Receivables (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Past Due Financing Receivables

An age analysis of past due loans, segregated by class of loans, as of December 31, 2012 follows:

(In 000's)
	Loans 30-89 Days Past Due	Accruing  Loans 90 or  More Days  Past Due	Nonaccrual	Total Past  Due Loans	Current  Loans	Total Loans
Commercial and industrial:
Commercial	$15	-	$873	888	$574	$1,462
SBA loans	-	-	-	-	125	125
Asset-based	83	-	99	182	1,965	2,147
Total Commercial and industrial	98	-	972	1,070	2,664	3,734
Commercial real estate:
Commercial mortgages	306	-	649	955	13,765	14,720
SBA loans	-	-	-	-	621	621
Construction	-	-	-	-	3,398	3,398
Religious organizations	-	-	674	674	11,968	12,642
Total Commercial real estate	306	-	1,323	1,629	29,752	31,381
Consumer real estate:
Home equity loans	274	44	63	381	1,072	1,453
Home equity lines of credit	-	26	-	26	-	26
1-4 family residential mortgages	69	-	226	295	2,845	3,140
Total consumer real estate	343	70	289	702	3,917	4,619
Total real estate	649	70	1,612	2,331	33,669	36,000
Consumer and other:
Consumer installment	-	-	-	-	30	30
Student loans	87	141	-	228	1,360	1,588
Other	5	-	-	5	145	150
Total consumer and other	92	141	-	233	1,535	1,768
Total loans	$839	$211	$2,584	$3,634	$37,867	$41,502

An age analysis of past due loans, segregated by class of loans, as of December 31, 2011 is as follows:

(In 000's)
	Loans  30-89 Days  Past Due	Accruing  Loans 90 or  More Days  Past Due	Nonaccrual	Total Past  Due Loans	Current  Loans	Total Loans
Commercial and industrial:
Commercial	$32	-	$491	$523	$963	$1,486
SBA loans	-	-	-	-	235	235
Asset-based	-	-	101	101	1,908	2,009
Total Commercial and industrial	32	-	592	624	3,106	3,730
Commercial real estate:
Commercial mortgages	99	-	677	776	13,900	14,676
SBA loans	-	-	-	-	477	477
Construction	-	-	-	-	1,391	1,391
Religious organizations	559	173	418	1,150	12,503	13,653
Total Commercial real estate	658	173	1,095	1,926	28,271	30,197
Consumer real estate:
Home equity loans	173	152	106	431	1,714	2,145
Home equity lines of credit	-	-	38	38	47	85
1-4 family residential mortgages	-	-	301	301	3,055	3,356
Total consumer real estate	173	152	445	770	4,816	5,586
Total real estate	831	325	1,540	2,696	33,087	35,783
Consumer and other:
Consumer installment	-	-	-	-	58	58
Student loans	112	146	-	258	1,503	1,761
Other	3	-	-	3	167	17
Total consumer and other	115	146	-	261	1,728	1,989
Total loans	$978	$471	$2,132	$3,581	$37,921	$41,502

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4. Loans and Allowance For Loan Losses: Impaired Financing Receivables (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Impaired Financing Receivables

Year-end 2012 impaired loans are set forth in the following table.

(In 000’s)
	Unpaid Contractual  Principal  Balance	Recorded Investment  With No  Allowance	Recorded Investment  With  Allowance	Total  Recorded  Investment	Related  Allowance	Average  Recorded  Investment	Interest recognized  on impaired  loans
Commercial and industrial:
Commercial	$873	$78	$795	$873	$695	$541	$11
SBA  loans	49	-	49	49	49	29	-
Asset-based	99	-	99	99	99	119	-
Total Commercial and industrial	1,021	78	943	1,021	843	689	11
Commercial real estate:
Commercial mortgages	649	649	-	649	-	681	1
SBA  Loans	-	-	-	-	-	-	-
Religious Organizations	674	674	-	674	-	420	27
Total Commercial real estate	1,323	1,323	-	1,323	-	1,101	28
Total Loans	$2,344	$1,401	$943	$2,344	$843	$1,790	$39

Year-end 2011 impaired loans are set forth in the following table.

(In 000’s)
	Unpaid Contractual  Principal  Balance	Recorded Investment  With No  Allowance	Recorded Investment  With  Allowance	Total  Recorded  Investment	Related  Allowance	Average  Recorded  Investment	Interest recognized  on impaired  loans
Commercial and industrial:
Commercial	$491	$78	$413	$491	$246	$483	-
SBA  loans	-	-	-	-	-	15	-
Asset-based	101	-	101	101	62	59	-
Total Commercial and industrial	592	78	514	592	308	557	-
Commercial real estate:
Commercial mortgages	677	677	-	677	-	797	2
SBA  Loans	-	-	-	-	-	49	-
Religious Organizations	418	418	-	418	-	436	3
Total Commercial real estate	1,095	1,095	-	1,095	-	1,282	5
Total Loans	$1,687	$1,173	$514	$1,687	$308	$1,839	$5

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Cash and Due From Bank Balances

12 Months Ended

Dec. 31, 2012

Notes

Cash and Due From Bank Balances

2.  CASH AND DUE FROM BANK BALANCES

The Bank maintains various deposit accounts with other banks to meet normal fund transaction requirements and to compensate other banks for certain correspondent services.  The withdrawal or usage restrictions of these balances did not have a significant impact on the operations of the Bank as of December 31, 2012.  Reserve balances were $100,000 and $125,000 as of December 31, 2012 and 2011, respectively.

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4. Loans and Allowance For Loan Losses: Schedule of Bank's Loans by Class To Their Credit Quality Indictors (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Bank's Loans by Class To Their Credit Quality Indictors

The tables below detail the Bank’s loans by class according to their credit quality indictors discussed above.

(In 000's)	Commercial Loans, December 31, 2012
	Good/ Excellent	Satisfactory	Pass	Special Mention	Substandard	Doubtful	Total
Commercial and industrial:
Commercial	$250	$104	$15	$220	$480	$393	$1,462
SBA loans	-	27	-	49	49	-	125
Asset-based	-	1,869	125	54	99	-	2,147
	250	2,000	140	323	628	393	3,734
Commercial real estate:
Commercial mortgages	-	12,678	1,322	-	403	317	14,721
SBA Loans	-	621	-	-	-	-	621
Construction	-	2,767	-	-	631	-	3,398
Religious organizations	-	8,183	3,623	162	674	-	12,642
	-	24,349	4,945	162	1,708	317	31,381
Total commercial loans	$250	$26,249	$5,085	$485	$2,336	$710	$33,115

	Residential Mortgage and Consumer Loans December 31, 2012
	- Performing/Nonperforming
	Performing	Nonperforming	Total
Consumer Real Estate:
Home equity	$1,390	$63	$1,453
Home equity line of credit	26	-	26
1-4 family residential mortgages	2,914	226	3,140
	4,330	289	4,619
Consumer Other:
Consumer Installment	30	-	30
Student loans	1,588	-	1,588
Other	150	-	150
	1,768	-	1,768
Total consumer loans	$6,098	$289	$6,387
Total loans				$ 41,502

(In 000's)			Commercial Loans, December 31, 2011
	Good/ Excellent	Satisfactory	Pass	Special Mention	Substandard	Doubtful	Total
Commercial and industrial:
Commercial	$379	$586	-	$31	$264	$226	$1,486
SBA loans	-	130	56	-	49	-	235
Asset-based	-	1,847	61	-	101	-	2,009
	379	2,563	117	31	414	226	3,730
Commercial real estate:
Commercial mortgages	-	13,117	151	-	1,408	-	14,676
SBA Loans	-	472	-	-	5	-	477
Construction	-	1,391	-	-	-	-	1,391
Religious organizations	-	9,751	2,925	-	977	-	13,653
	-	24,731	3,076	-	2,390	-	30,197
Total commercial loans	$379	$27,294	$3,193	$31	$2,804	$226	$33,927

	Residential Mortgage and Consumer Loans December 31, 2011
	- Performing/Nonperforming
	Performing	Nonperforming	Total
Consumer Real Estate:
Home equity	$2,039	$106	$2,145
Home equity line of credit	47	38	85
1-4 family residential mortgages	3,055	301	3,356
	5,141	445	5,586
Consumer Other:
Consumer Installment	58	-	58
Student loans	1,761	-	1,761
Other	170	-	170
	1,989	-	1,989
Total  consumer loans	$7,130	$445	$7,575
Total loans				$ 41,502

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Fair Value Measurements (Details) (USD $)					12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012 Other Real Estate Owned	Dec. 31, 2011 Other Real Estate Owned	Dec. 31, 2012 Minimum	Dec. 31, 2012 Maximum
Fair Value Inputs, Discount Rate					6.00%	10.00%
Impaired Financing Receivable, Related Allowance	$ 843,000	$ 308,000
Real Estate Owned, Valuation Allowance			$ 233,000	$ 4,000

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Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Effective Income Tax Rate Reconciliation

	2012	2011
Effective rate reconciliation:
Tax at statutory rate (34%)	$(345,524)	$(350,622)
Nondeductible expenses	6,507	6,278
Increase in valuation allowance	407,711	285,290
Other	(68,694)	59,054
Total tax expense	-	-

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Summary of Significant Accounting Policies: Intangible Assets (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2013	Dec. 31, 1999	Sep. 24, 1999
Details
Acquired Bank Deposits Prior to Acquisition				$ 31,500,000
Finite-Lived Core Deposits, Gross	2,449,488	2,449,488			2,449,488
Amortization of core deposit intangible	178,078	178,078
Finite-Lived Intangible Assets, Amortization Expense, Remainder of Fiscal Year			136,000
Impairment of Intangible Assets (Excluding Goodwill)	$ 0

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Other Real Estate Owned: Schedule of Components of Other Real Estate Owned (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Other Real Estate, Foreclosed Assets, and Repossessed Assets	$ 775,000	$ 1,284,000
Commercial Real Estate
Other Real Estate, Foreclosed Assets, and Repossessed Assets	206,000	206,000
Residential Real Estate
Other Real Estate, Foreclosed Assets, and Repossessed Assets	569,000	1,079,000
Real Estate
Other Real Estate, Foreclosed Assets, and Repossessed Assets	$ 775,000	$ 1,285,000

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CONSOLIDATED BALANCE SHEETS (USD $)	Dec. 31, 2012		Dec. 31, 2011
Assets:
Cash and due from banks	$ 2,363,166		$ 2,778,924
Interest-bearing deposits with banks	306,033		305,405
Federal funds sold	7,567,000		11,413,000
Cash and cash equivalents	10,236,199		14,497,329
Investment securities:
Available-for-sale, at fair value	1,027,293		1,280,874
Held-to-maturity, at amortized cost (fair value of $12,485,687 and $17,738,368 in 2012 and 2011, respectively)	11,895,037		17,209,295
Loans, net of unearned discounts and deferred fees	41,501,555		41,502,204
Less allowance for loan losses	(1,203,942)		(867,019)
Net loans	40,297,613		40,635,186
Bank premises and equipment, net	562,729		988,170
Accrued interest receivable	309,971		342,029
Other real estate owned	775,407		1,284,390
Intangible assets	135,733		313,811
Prepaid expenses and other assets	375,524		465,838
Total assets	65,615,506		77,016,922
Liabilities:
Demand deposits, noninterest-bearing	14,324,970		14,373,040
Demand deposits, interest-bearing	15,526,344		16,886,633
Savings deposits	14,239,216		14,688,985
Time deposits, under $100,000	7,243,593		7,768,057
Time deposits, $100,000 and over	9,642,620		17,583,743
Total deposits	60,976,743		71,300,458
Accrued interest payable	30,500		58,361
Accrued expenses and other liabilities	368,278		397,187
Total liabilities	61,375,521		71,756,006
Shareholders' equity:
Series A preferred stock, noncumulative, 6%, $0.01 par value, 500,000 shares authorized; 136,842 issued and outstanding	1,368		1,368
Common Stock
Shareholders' equity:
Common Stock	8,769	[1]	8,769	[1]
Class B Non-voting common stock
Shareholders' equity:
Common Stock	1,917	[2]	1,917	[2]
Additional paid-in-capital	14,749,852		14,749,852
Accumulated deficit	(10,556,078)		(9,539,831)
Accumulated other comprehensive income	34,157		38,841
Total shareholders' equity	4,239,985		5,260,916
Total liabilities and shareholders' equity	$ 65,615,506		$ 77,016,922

[1] Common stock, $0.01 par value; 2,000,000 shares authorized; 876,921 issued and outstanding

[2] Class B Non-voting common stock; 250,000 shares authorized; $0.01 par value; 191,667 issued and outstanding

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Condensed Financial Information of Parent Company Only Disclosure: Condensed Balance Sheets (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Condensed Balance Sheets

Condensed Balance Sheets

(Dollars in thousands)	2012	2011
Assets:
Cash and cash equivalents	-	$20
Investment in United Bank of Philadelphia	4,240	5,241
Total assets	$4,240	$5,261
Shareholders’ equity:
Series A preferred stock	1	1
Common stock	11	11
Additional paid-in capital	14,750	14,750
Accumulated deficit	(10,556)	(9,540)
Net unrealized holding gains on securities available-for-sale	34	39
Total shareholders’ equity	$4,240	$5,261

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CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Cash flows from operating activities:
Net loss	$ (1,016,247)	$ (1,031,240)
Adjustments to reconcile net loss to net cash used in operating activities:
Provision for loan losses	453,000	170,000
Net loss (gain) on sale of other real estate	8,273	(111,291)
Gain on sale of loans	(69,163)
Gain on sale of bank premises	(526,990)
Amortization of premiums on investments	117,544	76,181
Amortization of core deposit intangible	178,078	178,078
Depreciation on fixed assets	220,281	246,272
Write-down of other real estate owned	232,298	3,879
Decrease in accrued interest receivable and other assets	122,372	242,480
Decrease in accrued interest payable and other liabilities	(56,769)	(2,061)
Net cash used in operating activities	(337,323)	(227,702)
Cash flows from investing activities:
Purchase of available-for-sale investment securities		(262,041)
Purchase of held-to-maturity investment securities	(5,110,337)	(12,696,606)
Proceeds from maturity and principal reductions of available-for-sale investment securities	244,186	310,689
Proceeds from maturity and principal reductions of held-to-maturity investment securities	10,311,762	10,553,635
Proceeds from sale of other real estate owned	425,528	845,544
Net (increase) decrease in loans	(841,001)	3,279,026
Proceeds from sale of loans	637,621
Proceeds from sale of bank premises	874,943
Purchase of bank premises and equipment	(142,793)	(91,095)
Net cash provided by investing activities	6,399,909	1,939,152
Cash flows from financing activities:
Net (decrease) increase in deposits	(10,323,715)	4,089,768
Net cash (used in) provided by financing activities	(10,323,715)	4,089,768
Net (decrease) increase in cash and cash equivalents	(4,261,130)	5,801,218
Cash and cash equivalents at beginning of year	14,497,329	8,696,111
Cash and cash equivalents at end of year	10,236,199	14,497,329
Supplemental disclosure of cash flow information:
Cash paid during the year for interest	166,726	233,531
Noncash transfer of loans to other real estate owned	$ 157,116	$ 602,100

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Investments (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Details
Held-to-maturity Securities, Debt Maturities, Net Carrying Amount	$ 7,725,000	$ 8,863,000
Held-to-maturity Securities, Gross Gains (Losses), Derivatives	2,571	0
Held-to-maturity Securities, Sold Security, at Carrying Value	0	0
Held-to-maturity Securities Pledged as Collateral	$ 10,041,655	$ 17,953,933

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Other Real Estate Owned: Schedule of Components of Other Real Estate Owned (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Components of Other Real Estate Owned

(in 000's)	2012	2011
Commercial real estate	$206	$206
Residential real estate	569	1,079
Total	$775	$1,285

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4. Loans and Allowance For Loan Losses: Past Due Financing Receivables (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	$ 839	$ 978
Financing Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due	211	471
Financing Receivable, Recorded Investment, Nonaccrual Status	2,584	2,132
Financing Receivable, Recorded Investment, Past Due	3,634	3,581
Financing Receivable, Recorded Investment, Current	37,867	37,921
Total Loans	41,502	41,502
Commercial And Industrial
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	98	32
Financing Receivable, Recorded Investment, Nonaccrual Status	972	592
Financing Receivable, Recorded Investment, Past Due	1,070	624
Financing Receivable, Recorded Investment, Current	2,664	3,106
Total Loans	3,734	3,730
Commercial And Industrial | Commercial
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	15	32
Financing Receivable, Recorded Investment, Nonaccrual Status	873	491
Financing Receivable, Recorded Investment, Past Due	888	523
Financing Receivable, Recorded Investment, Current	574	963
Total Loans	1,462	1,486
Commercial And Industrial | SBA Loans
Financing Receivable, Recorded Investment, Current	125	235
Total Loans	125	235
Commercial And Industrial | Asset Based Loans
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	83
Financing Receivable, Recorded Investment, Nonaccrual Status	99	101
Financing Receivable, Recorded Investment, Past Due	182	101
Financing Receivable, Recorded Investment, Current	1,965	1,908
Total Loans	2,147	2,009
Commercial Real Estate Portfolio Segment
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	306	658
Financing Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due		173
Financing Receivable, Recorded Investment, Nonaccrual Status	1,323	1,095
Financing Receivable, Recorded Investment, Past Due	1,629	1,926
Financing Receivable, Recorded Investment, Current	29,752	28,271
Total Loans	31,381	30,197
Commercial Real Estate Portfolio Segment | SBA Loans
Financing Receivable, Recorded Investment, Current	621	477
Total Loans	621	477
Commercial Real Estate Portfolio Segment | Commercial Mortgages
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	306	99
Financing Receivable, Recorded Investment, Nonaccrual Status	649	677
Financing Receivable, Recorded Investment, Past Due	955	776
Financing Receivable, Recorded Investment, Current	13,765	13,900
Total Loans	14,720	14,676
Commercial Real Estate Portfolio Segment | Construction
Financing Receivable, Recorded Investment, Current	3,398	1,391
Total Loans	3,398	1,391
Commercial Real Estate Portfolio Segment | Religious Organizations
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due		559
Financing Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due		173
Financing Receivable, Recorded Investment, Nonaccrual Status	674	418
Financing Receivable, Recorded Investment, Past Due	674	1,150
Financing Receivable, Recorded Investment, Current	11,968	12,503
Total Loans	12,642	13,653
Consumer Real Estate
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	343	173
Financing Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due	70	152
Financing Receivable, Recorded Investment, Nonaccrual Status	289	445
Financing Receivable, Recorded Investment, Past Due	702	770
Financing Receivable, Recorded Investment, Current	3,917	4,816
Total Loans	4,619	5,586
Consumer Real Estate | Home Equity Loans
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	274	173
Financing Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due	44	152
Financing Receivable, Recorded Investment, Nonaccrual Status	63	106
Financing Receivable, Recorded Investment, Past Due	381	431
Financing Receivable, Recorded Investment, Current	1,072	1,714
Total Loans	1,453	2,145
Consumer Real Estate | Home Equity Line of Credit
Financing Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due	26
Financing Receivable, Recorded Investment, Nonaccrual Status		38
Financing Receivable, Recorded Investment, Past Due	26	38
Financing Receivable, Recorded Investment, Current		47
Total Loans	26	85
Consumer Real Estate | Family Residential Mortgage
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	69
Financing Receivable, Recorded Investment, Nonaccrual Status	226	301
Financing Receivable, Recorded Investment, Past Due	295	301
Financing Receivable, Recorded Investment, Current	2,845	3,055
Total Loans	3,140	3,356
Total Real Estate
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	649	831
Financing Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due	70	325
Financing Receivable, Recorded Investment, Nonaccrual Status	1,612	1,540
Financing Receivable, Recorded Investment, Past Due	2,331	2,696
Financing Receivable, Recorded Investment, Current	33,669	33,087
Total Loans	36,000	35,783
Consumer And Other Loans
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	92	115
Financing Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due	141	146
Financing Receivable, Recorded Investment, Past Due	233	261
Financing Receivable, Recorded Investment, Current	1,535	1,728
Total Loans	1,768	1,989
Consumer And Other Loans | Consumer Installment
Financing Receivable, Recorded Investment, Current	30	58
Total Loans	30	58
Consumer And Other Loans | Student Loans
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	87	112
Financing Receivable, Recorded Investment, Equal to Greater than 90 Days Past Due	141	146
Financing Receivable, Recorded Investment, Past Due	228	258
Financing Receivable, Recorded Investment, Current	1,360	1,503
Total Loans	1,588	1,761
Consumer And Other Loans | Other
Financing Receivable Recorded Investment Thirty To Eighty Nine Days Past Due	5	3
Financing Receivable, Recorded Investment, Past Due	5	3
Financing Receivable, Recorded Investment, Current	145	167
Total Loans	$ 150	$ 17

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2012

Policies

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, the Bank.  All significant intercompany transactions and balances have been eliminated.

Management's Use of Estimates

Management’s Use of Estimates

The preparation of the financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.  Actual results could differ from those estimates.  Material estimates which are particularly susceptible to significant change in the near term relate to the fair value of investment securities, the determination of the allowance for loan losses, valuation allowance for deferred tax assets, the carrying value of other real estate owned, the determination of other than temporary impairment for securities and consideration of impairment of other intangible assets.

Marketing and Advertising

Marketing and Advertising

Marketing and advertising costs are expenses as incurred.

Statement of Cash Flows

Statement of Cash Flows

For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, interest bearing deposits with banks that mature within 90 days and federal funds sold on an overnight basis.  Changes in loans made to and deposits received from customers are reported on a net basis.

Securities

Securities

Bonds, notes, and debentures for which the Company has both the positive intent and ability to hold to maturity are classified as held-to-maturity and carried at cost, adjusted for premiums and discounts that are recognized in interest income using the interest method over the period to maturity.

Investment securities that would be held for indefinite periods of time but not necessarily to maturity, including securities that would be used as part of the Bank’s asset/liability management strategy and possibly sold in response to changes in interest rates, prepayments and similar factors are classified as “Available for Sale.”  These securities are carried at fair value, with any temporary unrealized gains or losses reported as a separate component of other comprehensive income, net of the related income tax effect.  Gains and losses on the sale of such securities are accounted for on the specific identification basis in the statements of operations on the trade date.

Management evaluates securities for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concern warrants such evaluation.  Declines in the fair value of individual debt securities below their cost that are deemed to be other than temporary result in write-downs of the individual securities to their fair value.  Debt securities that are deemed to be other-than-temporarily impaired are reflected in earnings as realized losses to the extent impairment is related to credit losses. The amount of the impairment for debt securities related to other factors is recognized in other comprehensive income.  In evaluating whether impairment is temporary or other-than-temporary, management first considers whether the Bank intends to sell the security or it is more-likely-than-not that the Bank will be required to sell the security prior to recovery.  In these circumstances, the loss is determined to be other-than-temporary and the difference between the security’s fair value and its amortized cost is reflected as a loss in the statement of operations.  If management does not intend to sell the security and likely will not be required to sell the security prior to forecasted recovery, management evaluates whether it expects to recover the entire amortized cost of the debt security or if there is a credit loss.  In evaluating whether there is a credit loss, management considers various qualitative factors which include (1) the length of time and the extent to which the fair value has been less than cost, (2) the reasons for the decline in the fair value, and (3) the financial position and access to capital of the issuer, including the current and future impact of any specific events.  If, based on an analysis of these factors, management concludes that there is a credit loss, then management calculates the expected cash flows and records a loss in earnings equal to the difference between the amortized cost of the debt security and the expected cash flows.  The portion of the decline in fair value that is due to factors other than credit loss is recognized in other comprehensive income.  No investment securities held by the Bank as of December 31, 2012 and 2011 were subjected to a write-down due to credit related other-than-temporary impairment.  Interest income from securities adjusted for the amortization of premiums and accretion of discounts is recognized in interest income using the interest method over the contractual lives of the related securities.  Realized gains and losses, determined using the amortized cost value of the specific securities sold, are included in noninterest income in the statement of operations.

Loans

Loans

The Bank has both the positive intent and ability to hold the majority of its loans to maturity.  These loans are stated at the amount of unpaid principal, reduced by net unearned discount and an allowance for loan losses.  Interest income on loans is recognized as earned based on contractual interest rates applied to daily principal amounts outstanding and accretion of discount.  It is the Bank’s policy to discontinue the accrual of interest income when a default of principal or interest exists for a period of 90 days except when, in management’s judgment, the loan is well collateralized and in the process of collection. Interest received on nonaccrual loans is either applied against principal or reported as interest income according to management’s judgment as to collectability of principal.  When interest accruals are discontinued, unpaid accrued interest previously credited to income is reversed and the loan is classified as impaired.

Non-accrual and Past Due Loans

Non-accrual and Past Due Loans

Loans are considered past due if the required principal and interest payments have not been received 30 days as of the date such payments were due.  The Bank generally places a loan on non-accrual status when interest or principal is past due 90 days or more.  If it otherwise appears doubtful that the loan will be repaid, management may place the loan on nonaccrual status before the lapse of 90 days. Interest on loans past due 90 days or more ceases to accrue except for loans that are well collateralized and in the process of collection.  When a loan is placed on nonaccrual status, previously accrued and unpaid interest is reversed out of income.  Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Unearned discount is amortized over the weighted average maturity of the related mortgage loan portfolio.  Loan origination and commitment fees and certain direct loan origination costs are deferred, and the net amount is amortized as an adjustment of the related loan’s yield.  The Bank is amortizing these amounts over the contractual life of the loan.

For purchased loans, the discount remaining after the loan loss allocation is being amortized over the remaining life of the purchased loans using the interest method.

Transfers of Financial Assets

Transfers of Financial Assets

Transfers of financial assets are accounted for as sales when all the components meet the definition of a participating interest and when control over the assets has been surrendered.  A participating interest generally represents (1) a proportionate (pro rata) ownership interest in an entire financial assets, (2) a relationship where from the date of transfer all cash flows received from the entire financial asset are divided proportionately among the participating interest holders in an amount equal  to their share of ownership, (3) the priority of cash flows has certain characteristics, including no reduction in priority, subordination of interest, or recourse to the transferor other than standard representation or warranties, and (4) no party has the right to pledge or exchange the entire financial asset unless all participating interest holders agree to pledge or exchange the entire financial asset.  Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Bank, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the bank does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

Allowance For Loan Losses, policy

Allowance for Loan Losses

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses.  Loans that are determined to be uncollectible are charged against the allowance account, and subsequent recoveries, if any, are credited to the allowance.  When evaluating the adequacy of the allowance, an assessment of the loan portfolio will typically include changes in the composition and volume of the loan portfolio, overall portfolio quality and past loss experience, review of specific problem loans, current economic conditions which may affect borrowers’ ability to repay, and other factors which may warrant current recognition.  Such periodic assessments may, in management’s judgment, require the Bank to recognize additions or reductions to the allowance.

Various regulatory agencies periodically review the adequacy of the Bank’s allowance for loan losses as an integral part of their examination process.  Such agencies may require the Bank to recognize additions or reductions to the allowance based on their evaluation of information available to them at the time of their examination.  It is reasonably possible that the above factors may change significantly and, therefore, affects management’s determination of the allowance for loan losses in the near term.

The allowance consists of specific and general components. The specific component relates to loans that are classified as impaired.  For those loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan.  The general component covers non-impaired loans and is based on historical charge-off experience, other qualitative factors, and adjustments made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data.  The Bank does not allocate reserves for unfunded commitments to fund lines of credit.

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

· During regularly scheduled meetings of the Asset Quality Committee

· During regular reviews of the delinquency report

· During the course of routine account servicing, annual review, or credit file update

· Upon receipt of verifiable evidence of a material reduction in the value of collateral to a level that creates a less than desirable LTV ratio

Impairment is measured on a loan by loan basis for commercial loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral dependent.

Large groups of smaller, homogeneous loans, including consumer installment and home equity loans, 1-4 family residential mortgages, and student loans are evaluated collectively for impairment. Accordingly, the Bank does not separately identify individual consumer and residential loans for impairment disclosures.

Bank Premises and Equipment

Bank Premises and Equipment

Bank premises and equipment are stated at cost less accumulated depreciation.  Depreciation is computed on the straight-line method over the estimated useful lives of the assets.  Amortization of leasehold improvements is computed over the shorter of the related lease term or the useful life of the assets.

Income Taxes

Income Taxes

The liability method is used in accounting for income taxes.  Deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.  Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.  Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.  Realization of deferred tax assets is dependent on generating sufficient taxable income in the future.

When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that ultimately would be sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more-likely-than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. The evaluation of a tax position taken is considered by itself and not offset or aggregated with other positions. Tax positions that meet the more-likely-than not recognition threshold are measured as the largest amount of tax benefit that is more than 50  percent likely of being realized upon settlement with the applicable taxing authority. The portion of benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination.  It is the Bank’s policy to recognize interest and penalties related to unrecognized tax liabilities within income tax expense in the statement of operations.

The Bank does not have an accrual for uncertain tax positions as of December 31, 2012 or 2011, as deductions taken and benefits accrued are based on widely understood administrative practices and procedures and are based on clear and unambiguous tax law.

Earnings (loss) Per Share ("eps")

Earnings (Loss) Per Share (“EPS”)

Basic EPS excludes dilution and is computed by dividing income available to common shareholders by the weighted average common shares outstanding during the period.  Diluted EPS takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted into common stock.

Off-balance-sheet Financial Instruments

Off-Balance-Sheet Financial Instruments

In the ordinary course of business, the Bank has entered into off-balance-sheet financial instruments consisting of commitments to extend credit and letters of credit.  Such financial instruments are recorded in the financial statements when they become payable.

Intangible Assets

Intangible Assets

On September 24, 1999, the Bank acquired four branches from First Union Corporation with deposits totaling $31.5 million.   As a result of the acquisition, the Bank recorded a core deposit intangible of $2,449,488.    The core deposit intangible is being amortized over 14 years.

	2012	2011
Core Deposit Premium (cost)	$2,449,488	$2,449,488
Less accumulated amortization	(2,313,755)	(2,135,677)
	$135,733	$313,811

Amortization of the intangible totaled approximately $178,000 for each of the years ended December 31, 2012 and 2011.  The amortization of the intangible is projected to be approximately $136,000 in 2013.  Intangible assets are reviewed for possible impairment when events or changed circumstances may affect the underlying basis of the net asset.  Such reviews include an analysis of current results and take into consideration the discounted value of projected operating cash flows. No impairment has been recognized.

Other Real Estate Owned

Other Real Estate Owned

Real estate properties acquired through, or in lieu of, loan foreclosure are to be sold and are initially recorded at fair value, net of estimated cost to sell, at the date of foreclosure, establishing a new cost basis.  After foreclosure, valuations are periodically performed by management, and the real estate is carried at the lower of carrying amount or fair value less the cost to sell.  Revenue and expenses from operations and changes in valuation allowance are charged to operations.  The Bank had approximately $775,000 and $1,284,000 in foreclosed real estate as of December 31, 2012 and 2011, respectively.

Segments

Segments

The Company has one reportable segment, “Community Banking.” All of the Company’s activities are interrelated, and each activity is dependent and assessed based on how each of the activities of the Company supports the other.  For example, commercial lending is dependent upon the ability of the Bank to fund it with retail deposits and other borrowings and to manage interest rate and credit risk.  This situation is also similar for consumer and residential mortgage lending.  Accordingly, all significant operating decisions are based upon analysis of the Company as one operating segment or unit.

Reclassifications

Reclassifications

Certain reclassifications have been made to the prior years’ financial statements to conform to the 2012 presentation, with no impact on earnings or shareholders’ equity.

Comprehensive Loss

Comprehensive Loss

Comprehensive loss includes net loss as well as certain other items that result in a change to equity during the period. The components of other comprehensive income are as follows:

	December 31, 2012
	Before tax amount	Tax benefit	Net of tax Amount
Unrealized loss on securities
Unrealized holding loss arising during period	$(6,990)	$2,307	$(4,684)
Less: reclassification adjustment for gains (losses)
realized in net loss	-	-	-
Other comprehensive loss, net	$(6,990)	$2,307	$(4,684)

	December 31, 2011
	Before tax amount	Tax benefit	Net of tax Amount
Unrealized loss on securities
Unrealized holding loss arising during period	$(7,851)	$2,591	$(5,260)
Less: reclassification adjustment for gains (losses)
realized in net loss	-	-	-
Other comprehensive loss, net	$(7,851)	$2,591	$(5,260)

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In May 2011, the FASB issued Accounting Standards Update (ASU) No. 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs. This ASU represents the converged guidance of the FASB and the International Accounting Standards Board (the “Boards”) on fair value measurement. The collective efforts of the Boards and their staffs, reflected in ASU 2011-04, have resulted in common requirements for measuring fair value and for disclosing information about fair value measurements, including a consistent meaning of the term “fair value.” The Boards have concluded the common requirements will result in greater comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. GAAP and International Financial Reporting Standards. The amendments to the Codification in ASU 2011-04 are to be applied prospectively. For public entities, the amendments are effective during interim and annual periods beginning after December 15, 2011.  The Company adopted ASU No. 2011-04 as of March 31, 2012.

In June 2011, the FASB issued Accounting Standards Update (ASU) No. 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. This ASU amends the Codification to allow an entity the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In both choices, an entity is required to present each component of net income along with total net income, each component of other comprehensive income along with a total for other comprehensive income, and a total amount for comprehensive income. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. The amendments to the Codification in ASU 2011-05 do not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income.  ASU 2011-05 should be applied retrospectively. For public entities, the amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011. The Company adopted ASU 2011-05 during the quarter ended March 31, 2012 and presents comprehensive loss in a single continuous statement.

In December 2011, the FASB issued Accounting Standards Update ASU 2011-11: Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities. The amendments in this Update require an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. This Update affects all entities that have financial instruments and derivative instruments that are either (1) offset in accordance with either Section 210-20-45 or Section 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement. The requirements amend the disclosure requirements on offsetting in Section 210-20-50. This information is intended to enable users of an entity’s financial statements to evaluate the effect or potential effect of netting arrangements on an entity’s financial position, including the effect or potential effect of rights of setoff associated with certain financial instruments and derivative instruments in the scope of this Update. The amendments are effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. An entity should provide the disclosures required by those amendments retrospectively for all comparative periods presented. The Company is evaluating the impact of ASU 2011-11 on its consolidated financial statements.

In February 2013, the FASB issued an update (ASU 2013-02 – Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income) which requires entities to disclose, for items reclassified out of accumulated other comprehensive income (“AOCI”) and into net income in their entirety, the effect of the reclassification on each affected net income line item and, for AOCI reclassification items that are not reclassified in their entirety into net income, a cross reference to other required U.S. GAAP disclosures. The guidance is effective for annual and interim reporting periods beginning after December 15, 2012; early adoption is allowed. The Company is currently evaluating the impact of this guidance but does not expect it to have a material impact on its financial statements.

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Other Real Estate Owned: Other Real Estate Owned (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Other Real Estate Owned

(in 000's)	Year Ended	Year Ended
	December 31, 2012	December 31, 2011
Beginning balance	$1,285	$1,417
Additions, transfers from loans	156	602
Proceeds from sales, net	(434)	(730)
	1,007	1,289
Less: write-downs	(232)	(4)
Ending balance	$775	$1,285

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Summary of Significant Accounting Policies: Comprehensive Loss: Schedule of Comprehensive Loss (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Comprehensive Loss

Comprehensive loss includes net loss as well as certain other items that result in a change to equity during the period. The components of other comprehensive income are as follows:

	December 31, 2012
	Before tax amount	Tax benefit	Net of tax Amount
Unrealized loss on securities
Unrealized holding loss arising during period	$(6,990)	$2,307	$(4,684)
Less: reclassification adjustment for gains (losses)
realized in net loss	-	-	-
Other comprehensive loss, net	$(6,990)	$2,307	$(4,684)

	December 31, 2011
	Before tax amount	Tax benefit	Net of tax Amount
Unrealized loss on securities
Unrealized holding loss arising during period	$(7,851)	$2,591	$(5,260)
Less: reclassification adjustment for gains (losses)
realized in net loss	-	-	-
Other comprehensive loss, net	$(7,851)	$2,591	$(5,260)

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4. Loans and Allowance For Loan Losses: Allowance for Credit Losses on Financing Receivables (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Beginning balance	$ 867
Provision for loan losses	453	170
Provision for loan losses	453	170
Charge-offs	(157)	(266)
Charge-offs	(157)	(266)
Recoveries	41	37
Recoveries	41	37
Net charge-offs	(116)	(229)
Net charge-offs	(116)	(229)
Ending balance	1,204	867
Period-end amount allocated to loans individually evaluated for impairment	843	308
Period-end amount allocated to loans collectively evaluated for impairment	361	559
Total allocation	1,204	867
Loans, ending balance: Loans individually evaluated for impairment	2,344	1,687
Loans, ending balance: Loans collectively evaluated for impairment	39,158	39,815
Total	41,502	41,502
Commercial And Industrial
Beginning balance	387	301
Provision for loan losses	560	150
Provision for loan losses	560	150
Charge-offs	(56)	(65)
Charge-offs	(56)	(65)
Recoveries		1
Recoveries		1
Net charge-offs	(56)	(64)
Net charge-offs	(56)	(64)
Ending balance	891	387
Period-end amount allocated to loans individually evaluated for impairment	843	308
Period-end amount allocated to loans collectively evaluated for impairment	48	79
Total allocation	891	387
Loans, ending balance: Loans individually evaluated for impairment	1,021	592
Loans, ending balance: Loans collectively evaluated for impairment	2,713	3,138
Total	3,734	3,730
Commercial Real Estate
Beginning balance	412	553
Provision for loan losses	(112)
Provision for loan losses	(112)
Charge-offs		(150)
Charge-offs		(150)
Recoveries	8	9
Recoveries	8	9
Net charge-offs	8	(141)
Net charge-offs	8	(141)
Ending balance	308	412
Period-end amount allocated to loans collectively evaluated for impairment	308	412
Total allocation	308	412
Loans, ending balance: Loans individually evaluated for impairment	1,323	1,095
Loans, ending balance: Loans collectively evaluated for impairment	30,058	29,102
Total	31,381	30,197
Consumer Real Estate
Beginning balance	68	52
Provision for loan losses		15
Provision for loan losses		15
Charge-offs	(80)	(5)
Charge-offs	(80)	(5)
Recoveries	17	6
Recoveries	17	6
Net charge-offs	(63)	1
Net charge-offs	(63)	1
Ending balance	5	68
Period-end amount allocated to loans collectively evaluated for impairment	5	68
Total allocation	5	68
Loans, ending balance: Loans collectively evaluated for impairment	4,619	5,586
Total	4,619	5,586
Consumer And Other Loans
Beginning balance		20
Provision for loan losses	5	5
Provision for loan losses	5	5
Charge-offs	(21)	(46)
Charge-offs	(21)	(46)
Recoveries	16	21
Recoveries	16	21
Net charge-offs	(5)	(25)
Net charge-offs	(5)	(25)
Loans, ending balance: Loans collectively evaluated for impairment	1,768	1,989
Total	$ 1,768	$ 1,989

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Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2012

Notes

Summary of Significant Accounting Policies

1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

United Bancshares, Inc. (“the Company”) is the holding company for United Bank of Philadelphia (the “Bank”).  The Company was incorporated under the laws of the Commonwealth of Pennsylvania on April 8, 1993 and provides financial services through the Bank.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, the Bank.  All significant intercompany transactions and balances have been eliminated.

Management’s Use of Estimates

The preparation of the financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.  Actual results could differ from those estimates.  Material estimates which are particularly susceptible to significant change in the near term relate to the fair value of investment securities, the determination of the allowance for loan losses, valuation allowance for deferred tax assets, the carrying value of other real estate owned, the determination of other than temporary impairment for securities and consideration of impairment of other intangible assets.

Marketing and Advertising

Marketing and advertising costs are expenses as incurred.

Statement of Cash Flows

For purposes of reporting cash flows, cash and cash equivalents include cash on hand, amounts due from banks, interest bearing deposits with banks that mature within 90 days and federal funds sold on an overnight basis.  Changes in loans made to and deposits received from customers are reported on a net basis.

Securities

Bonds, notes, and debentures for which the Company has both the positive intent and ability to hold to maturity are classified as held-to-maturity and carried at cost, adjusted for premiums and discounts that are recognized in interest income using the interest method over the period to maturity.

Investment securities that would be held for indefinite periods of time but not necessarily to maturity, including securities that would be used as part of the Bank’s asset/liability management strategy and possibly sold in response to changes in interest rates, prepayments and similar factors are classified as “Available for Sale.”  These securities are carried at fair value, with any temporary unrealized gains or losses reported as a separate component of other comprehensive income, net of the related income tax effect.  Gains and losses on the sale of such securities are accounted for on the specific identification basis in the statements of operations on the trade date.

Management evaluates securities for other-than-temporary impairment at least on a quarterly basis, and more frequently when economic or market concern warrants such evaluation.  Declines in the fair value of individual debt securities below their cost that are deemed to be other than temporary result in write-downs of the individual securities to their fair value.  Debt securities that are deemed to be other-than-temporarily impaired are reflected in earnings as realized losses to the extent impairment is related to credit losses. The amount of the impairment for debt securities related to other factors is recognized in other comprehensive income.  In evaluating whether impairment is temporary or other-than-temporary, management first considers whether the Bank intends to sell the security or it is more-likely-than-not that the Bank will be required to sell the security prior to recovery.  In these circumstances, the loss is determined to be other-than-temporary and the difference between the security’s fair value and its amortized cost is reflected as a loss in the statement of operations.  If management does not intend to sell the security and likely will not be required to sell the security prior to forecasted recovery, management evaluates whether it expects to recover the entire amortized cost of the debt security or if there is a credit loss.  In evaluating whether there is a credit loss, management considers various qualitative factors which include (1) the length of time and the extent to which the fair value has been less than cost, (2) the reasons for the decline in the fair value, and (3) the financial position and access to capital of the issuer, including the current and future impact of any specific events.  If, based on an analysis of these factors, management concludes that there is a credit loss, then management calculates the expected cash flows and records a loss in earnings equal to the difference between the amortized cost of the debt security and the expected cash flows.  The portion of the decline in fair value that is due to factors other than credit loss is recognized in other comprehensive income.  No investment securities held by the Bank as of December 31, 2012 and 2011 were subjected to a write-down due to credit related other-than-temporary impairment.  Interest income from securities adjusted for the amortization of premiums and accretion of discounts is recognized in interest income using the interest method over the contractual lives of the related securities.  Realized gains and losses, determined using the amortized cost value of the specific securities sold, are included in noninterest income in the statement of operations.

Loans

The Bank has both the positive intent and ability to hold the majority of its loans to maturity.  These loans are stated at the amount of unpaid principal, reduced by net unearned discount and an allowance for loan losses.  Interest income on loans is recognized as earned based on contractual interest rates applied to daily principal amounts outstanding and accretion of discount.  It is the Bank’s policy to discontinue the accrual of interest income when a default of principal or interest exists for a period of 90 days except when, in management’s judgment, the loan is well collateralized and in the process of collection. Interest received on nonaccrual loans is either applied against principal or reported as interest income according to management’s judgment as to collectability of principal.  When interest accruals are discontinued, unpaid accrued interest previously credited to income is reversed and the loan is classified as impaired.

Non-accrual and Past Due Loans

Loans are considered past due if the required principal and interest payments have not been received 30 days as of the date such payments were due.  The Bank generally places a loan on non-accrual status when interest or principal is past due 90 days or more.  If it otherwise appears doubtful that the loan will be repaid, management may place the loan on nonaccrual status before the lapse of 90 days. Interest on loans past due 90 days or more ceases to accrue except for loans that are well collateralized and in the process of collection.  When a loan is placed on nonaccrual status, previously accrued and unpaid interest is reversed out of income.  Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Unearned discount is amortized over the weighted average maturity of the related mortgage loan portfolio.  Loan origination and commitment fees and certain direct loan origination costs are deferred, and the net amount is amortized as an adjustment of the related loan’s yield.  The Bank is amortizing these amounts over the contractual life of the loan.

For purchased loans, the discount remaining after the loan loss allocation is being amortized over the remaining life of the purchased loans using the interest method.

Transfers of Financial Assets

Transfers of financial assets are accounted for as sales when all the components meet the definition of a participating interest and when control over the assets has been surrendered.  A participating interest generally represents (1) a proportionate (pro rata) ownership interest in an entire financial assets, (2) a relationship where from the date of transfer all cash flows received from the entire financial asset are divided proportionately among the participating interest holders in an amount equal  to their share of ownership, (3) the priority of cash flows has certain characteristics, including no reduction in priority, subordination of interest, or recourse to the transferor other than standard representation or warranties, and (4) no party has the right to pledge or exchange the entire financial asset unless all participating interest holders agree to pledge or exchange the entire financial asset.  Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Bank, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the bank does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

Allowance for Loan Losses

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses.  Loans that are determined to be uncollectible are charged against the allowance account, and subsequent recoveries, if any, are credited to the allowance.  When evaluating the adequacy of the allowance, an assessment of the loan portfolio will typically include changes in the composition and volume of the loan portfolio, overall portfolio quality and past loss experience, review of specific problem loans, current economic conditions which may affect borrowers’ ability to repay, and other factors which may warrant current recognition.  Such periodic assessments may, in management’s judgment, require the Bank to recognize additions or reductions to the allowance.

Various regulatory agencies periodically review the adequacy of the Bank’s allowance for loan losses as an integral part of their examination process.  Such agencies may require the Bank to recognize additions or reductions to the allowance based on their evaluation of information available to them at the time of their examination.  It is reasonably possible that the above factors may change significantly and, therefore, affects management’s determination of the allowance for loan losses in the near term.

The allowance consists of specific and general components. The specific component relates to loans that are classified as impaired.  For those loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan.  The general component covers non-impaired loans and is based on historical charge-off experience, other qualitative factors, and adjustments made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data.  The Bank does not allocate reserves for unfunded commitments to fund lines of credit.

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

· During regularly scheduled meetings of the Asset Quality Committee

· During regular reviews of the delinquency report

· During the course of routine account servicing, annual review, or credit file update

· Upon receipt of verifiable evidence of a material reduction in the value of collateral to a level that creates a less than desirable LTV ratio

Impairment is measured on a loan by loan basis for commercial loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral dependent.

Large groups of smaller, homogeneous loans, including consumer installment and home equity loans, 1-4 family residential mortgages, and student loans are evaluated collectively for impairment. Accordingly, the Bank does not separately identify individual consumer and residential loans for impairment disclosures.

Bank Premises and Equipment

Bank premises and equipment are stated at cost less accumulated depreciation.  Depreciation is computed on the straight-line method over the estimated useful lives of the assets.  Amortization of leasehold improvements is computed over the shorter of the related lease term or the useful life of the assets.

Income Taxes

The liability method is used in accounting for income taxes.  Deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.  Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.  Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.  Realization of deferred tax assets is dependent on generating sufficient taxable income in the future.

When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that ultimately would be sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more-likely-than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. The evaluation of a tax position taken is considered by itself and not offset or aggregated with other positions. Tax positions that meet the more-likely-than not recognition threshold are measured as the largest amount of tax benefit that is more than 50  percent likely of being realized upon settlement with the applicable taxing authority. The portion of benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination.  It is the Bank’s policy to recognize interest and penalties related to unrecognized tax liabilities within income tax expense in the statement of operations.

The Bank does not have an accrual for uncertain tax positions as of December 31, 2012 or 2011, as deductions taken and benefits accrued are based on widely understood administrative practices and procedures and are based on clear and unambiguous tax law.

Earnings (Loss) Per Share (“EPS”)

Basic EPS excludes dilution and is computed by dividing income available to common shareholders by the weighted average common shares outstanding during the period.  Diluted EPS takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted into common stock.

Off-Balance-Sheet Financial Instruments

In the ordinary course of business, the Bank has entered into off-balance-sheet financial instruments consisting of commitments to extend credit and letters of credit.  Such financial instruments are recorded in the financial statements when they become payable.

Intangible Assets

On September 24, 1999, the Bank acquired four branches from First Union Corporation with deposits totaling $31.5 million.   As a result of the acquisition, the Bank recorded a core deposit intangible of $2,449,488.    The core deposit intangible is being amortized over 14 years.

	2012	2011
Core Deposit Premium (cost)	$2,449,488	$2,449,488
Less accumulated amortization	(2,313,755)	(2,135,677)
	$135,733	$313,811

Amortization of the intangible totaled approximately $178,000 for each of the years ended December 31, 2012 and 2011.  The amortization of the intangible is projected to be approximately $136,000 in 2013.  Intangible assets are reviewed for possible impairment when events or changed circumstances may affect the underlying basis of the net asset.  Such reviews include an analysis of current results and take into consideration the discounted value of projected operating cash flows. No impairment has been recognized.

Other Real Estate Owned

Real estate properties acquired through, or in lieu of, loan foreclosure are to be sold and are initially recorded at fair value, net of estimated cost to sell, at the date of foreclosure, establishing a new cost basis.  After foreclosure, valuations are periodically performed by management, and the real estate is carried at the lower of carrying amount or fair value less the cost to sell.  Revenue and expenses from operations and changes in valuation allowance are charged to operations.  The Bank had approximately $775,000 and $1,284,000 in foreclosed real estate as of December 31, 2012 and 2011, respectively.

Segments

The Company has one reportable segment, “Community Banking.” All of the Company’s activities are interrelated, and each activity is dependent and assessed based on how each of the activities of the Company supports the other.  For example, commercial lending is dependent upon the ability of the Bank to fund it with retail deposits and other borrowings and to manage interest rate and credit risk.  This situation is also similar for consumer and residential mortgage lending.  Accordingly, all significant operating decisions are based upon analysis of the Company as one operating segment or unit.

Reclassifications

Certain reclassifications have been made to the prior years’ financial statements to conform to the 2012 presentation, with no impact on earnings or shareholders’ equity.

Comprehensive Loss

Comprehensive loss includes net loss as well as certain other items that result in a change to equity during the period. The components of other comprehensive income are as follows:

	December 31, 2012
	Before tax amount	Tax benefit	Net of tax Amount
Unrealized loss on securities
Unrealized holding loss arising during period	$(6,990)	$2,307	$(4,684)
Less: reclassification adjustment for gains (losses)
realized in net loss	-	-	-
Other comprehensive loss, net	$(6,990)	$2,307	$(4,684)

	December 31, 2011
	Before tax amount	Tax benefit	Net of tax Amount
Unrealized loss on securities
Unrealized holding loss arising during period	$(7,851)	$2,591	$(5,260)
Less: reclassification adjustment for gains (losses)
realized in net loss	-	-	-
Other comprehensive loss, net	$(7,851)	$2,591	$(5,260)

Recent Accounting Pronouncements

In May 2011, the FASB issued Accounting Standards Update (ASU) No. 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs. This ASU represents the converged guidance of the FASB and the International Accounting Standards Board (the “Boards”) on fair value measurement. The collective efforts of the Boards and their staffs, reflected in ASU 2011-04, have resulted in common requirements for measuring fair value and for disclosing information about fair value measurements, including a consistent meaning of the term “fair value.” The Boards have concluded the common requirements will result in greater comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. GAAP and International Financial Reporting Standards. The amendments to the Codification in ASU 2011-04 are to be applied prospectively. For public entities, the amendments are effective during interim and annual periods beginning after December 15, 2011.  The Company adopted ASU No. 2011-04 as of March 31, 2012.

In June 2011, the FASB issued Accounting Standards Update (ASU) No. 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. This ASU amends the Codification to allow an entity the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In both choices, an entity is required to present each component of net income along with total net income, each component of other comprehensive income along with a total for other comprehensive income, and a total amount for comprehensive income. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. The amendments to the Codification in ASU 2011-05 do not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income.  ASU 2011-05 should be applied retrospectively. For public entities, the amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011. The Company adopted ASU 2011-05 during the quarter ended March 31, 2012 and presents comprehensive loss in a single continuous statement.

In December 2011, the FASB issued Accounting Standards Update ASU 2011-11: Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities. The amendments in this Update require an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. This Update affects all entities that have financial instruments and derivative instruments that are either (1) offset in accordance with either Section 210-20-45 or Section 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement. The requirements amend the disclosure requirements on offsetting in Section 210-20-50. This information is intended to enable users of an entity’s financial statements to evaluate the effect or potential effect of netting arrangements on an entity’s financial position, including the effect or potential effect of rights of setoff associated with certain financial instruments and derivative instruments in the scope of this Update. The amendments are effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. An entity should provide the disclosures required by those amendments retrospectively for all comparative periods presented. The Company is evaluating the impact of ASU 2011-11 on its consolidated financial statements.

In February 2013, the FASB issued an update (ASU 2013-02 – Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income) which requires entities to disclose, for items reclassified out of accumulated other comprehensive income (“AOCI”) and into net income in their entirety, the effect of the reclassification on each affected net income line item and, for AOCI reclassification items that are not reclassified in their entirety into net income, a cross reference to other required U.S. GAAP disclosures. The guidance is effective for annual and interim reporting periods beginning after December 15, 2012; early adoption is allowed. The Company is currently evaluating the impact of this guidance but does not expect it to have a material impact on its financial statements.

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CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Held-to-maturity, fair value	$ 12,485,687	$ 17,738,368
Preferred stock, dividend rate	6.00%	6.00%
Preferred stock, par value per share	$ 0.01	$ 0.01
Preferred stock, shares authorized	500,000	500,000
Preferred stock, shares issued	136,842	136,842
Preferred stock, shares outstanding	136,842	136,842
Common stock, par value per share	$ 0.01	$ 0.01
Common stock, shares authorized	2,000,000	2,000,000
Common stock, shares issued	876,921	876,921
Common stock, shares outstanding	876,921	876,921
Class B Non-voting common stock
Common stock, par value per share	$ 0.01	$ 0.01
Common stock, shares authorized	250,000	250,000
Common stock, shares issued	191,667	191,667
Common stock, shares outstanding	191,667	191,667

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Condensed Financial Information of Parent Company Only Disclosure

12 Months Ended

Dec. 31, 2012

Notes

Condensed Financial Information of Parent Company Only Disclosure

12.  CONSOLIDATED FINANCIAL INFORMATION—PARENT COMPANY ONLY

Condensed Balance Sheets

(Dollars in thousands)	2012	2011
Assets:
Cash and cash equivalents	-	$20
Investment in United Bank of Philadelphia	4,240	5,241
Total assets	$4,240	$5,261
Shareholders’ equity:
Series A preferred stock	1	1
Common stock	11	11
Additional paid-in capital	14,750	14,750
Accumulated deficit	(10,556)	(9,540)
Net unrealized holding gains on securities available-for-sale	34	39
Total shareholders’ equity	$4,240	$5,261

Condensed Statements of Operations

Years ended December 31,
(Dollars in thousands)	2012	2011
Other Expenses	$(20)	$(50)
Equity in net loss of subsidiary	(996)	(981)
Net loss	$(1,016)	$(1,031)

Condensed Statements of Cash Flows

Years ended December 31,
(Dollars in thousands)	2012	2011
Cash flows from operating activities:
Net loss	$(1,016)	$(1,031)
Adjustments:
Equity in net loss of subsidiary	996	981
Net cash used in operating activities	(20)	(50)
Cash and cash equivalents at beginning of year	20	70
Cash and cash equivalents at end of year	-	$20

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Earnings Per Share Computation: Schedule of Earnings Per Shares Basic And Diluted (Details) (USD $)	3 Months Ended								12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011
Details
Net loss attributable to common stockholders	$ (134,000)	$ (408,000)	$ (236,000)	$ (238,000)	$ (273,000)	$ (282,000)	$ (169,000)	$ (307,000)	$ (1,016,247)	$ (1,031,240)
Weighted Average Number of Shares Outstanding, Basic									1,068,588	1,068,588
Earnings Per Share, Basic	$ (130)	$ (380)	$ (220)	$ (220)	$ (260)	$ (260)	$ (160)	$ (290)	$ (0.95)	$ (0.97)
Weighted Average Number of Shares Outstanding, Diluted									1,068,588	1,068,588
Earnings Per Share, Diluted	$ (130)	$ (380)	$ (220)	$ (220)	$ (260)	$ (260)	$ (160)	$ (290)	$ (0.95)	$ (0.97)

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Document and Entity Information (USD $)	12 Months Ended
	Dec. 31, 2012	Mar. 04, 2013	Jun. 30, 2012
Document and Entity Information:
Entity Registrant Name	UNITED BANCSHARES INC /PA
Document Type	10-K
Document Period End Date	Dec. 31, 2012
Amendment Flag	false
Entity Central Index Key	0000944792
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		1,068,588
Entity Public Float			$ 0
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	FY

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Regulatory Capital Requirements under Banking Regulations

12 Months Ended

Dec. 31, 2012

Notes

Regulatory Capital Requirements under Banking Regulations

13.  REGULATORY MATTERS AND GOING CONCERN

The Bank engages in the commercial banking business, with a particular focus on serving African Americans, Hispanics and women, and is subject to substantial competition from financial institutions in the Bank’s service area.  As a bank holding company and a banking subsidiary, the Company and the Bank, respectively, are subject to regulation by the FDIC and the Pennsylvania Department of Banking (“PADOB”) and are required to maintain capital requirements established by those regulators. Effective January 1, 2010, the FDIC became the Bank’s primary regulator after it voluntarily surrendered its Federal Reserve Membership.

Prompt corrective actions may be taken by those regulators against banks that do not meet minimum capital requirements.  Prompt corrective actions range from restriction or prohibition of certain activities to the appointment of a receiver or conservator of an institution’s net assets.  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 Bank’s financial statements.  Under capital adequacy guidelines that involve quantitative measures of the Bank’s assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices, the Bank’s 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 Bank to maintain minimum amounts and ratios (set forth in the table below) of total Tier I capital (as defined in the regulations) for capital adequacy purposes to risk-weighted assets (as defined).

Although the bank meets the framework to be considered “well capitalized” as setforth in tables below, the most recent notification as of September 30, 2012, from the FDIC and PADOB categorized the Bank as “adequately capitalized” under the regulatory framework for prompt and corrective action due to the Orders.     The Bank’s growth and other operating factors such as the need for additional pro­visions to the allowance for loans losses may have an adverse effect on its capital ratios.

The Company and the Bank’s actual capital amounts and ratios are as follows:

	Actual		For capital adequacy purposes		To be well capitalized under prompt corrective action provisions
	Amount	Ratio	Amount	Ratio	Amount	Ratio
As of December 31, 2012:
Total capital to risk-
weighted assets:
Consolidated	$4,584	11.16%	$3,287	8.00%	N/A
Bank	4,584	11.16%	3,287	8.00%	$4,109	10.00%
Tier I capital to risk-
weighted assets:
Consolidated	4,070	9.91%	1,644	4.00%	N/A
Bank	4,070	9.91%	1,644	4.00%	2,465	6.00%
Tier I capital to average assets:
Consolidated	4,070	6.00%	2,715	4.00%	N/A
Bank	4,070	6.00%	2,715	4.00%	3,394	5.00%

	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:
Total capital to risk-
weighted assets:
Consolidated	$5,460	12.45%	$3,513	8.00%	N/A
Bank	5,440	12.41%	3,507	8.00%	$4,384	10.00%
Tier I capital to risk-
weighted assets:
Consolidated	4,908	11.20%	1,756	4.00%	N/A
Bank	4,888	11.15%	1,754	4.00%	2,630	6.00%
Tier I capital to average assets:
Consolidated	4,908	6.29%	3,122	4.00%	N/A
Bank	4,888	6.27%	3,119	4.00%	3,899	5.00%

On January 31, 2012, the Bank entered into stipulations consenting to the issuance of Consent Orders with the Federal Deposit Insurance Corporation (“FDIC”) and the Pennsylvania Department of Banking (“Department”).  The material terms of the Consent Orders are identical.  The Consent Orders require the Bank to

·      increase participation of the Bank’s board of directors in the Bank’s affairs by having the board assume full responsibility for approving the Bank’s policies and objectives and for supervising the Bank’s management;

·      have and retain qualified management, and notify the FDIC and the Department of any changes in the Bank’s board of directors or senior executive officers;

·      retain a bank consultant acceptable to the FDIC and the Department to develop a written analysis and assessment of the Bank’s management needs and thereafter formulate a written management plan;

·      formulate and implement written profit and budget plans for each year during which the orders are in effect;

·      develop and implement a strategic plan for each year during which the orders are in effect, to be revised annually;

·      develop a written capital plan detailing the manner in which the Bank will meet and maintain a ratio of Tier 1 capital to total assets (“leverage ratio”) of at least 8.5% and a ratio of qualifying total capital to risk-weighted assets (total risk-based capital ratio) of at least 12.5%, within a reasonable but unspecified time period;

·      formulate a written plan to reduce the Bank’s risk positions in each asset or loan in excess of $100,000 classified as “Doubtful” or “Substandard” at its current regulatory examination;

·      eliminate all assets classified as “Loss” at its current regulatory examination;

·      revise the Bank’s loan policy to establish and monitor procedures for adherence to the loan policy and to eliminate credit administration and underwriting deficiencies identified at its current regulatory examination;

·      develop a comprehensive policy and methodology for determining the allowance for loan and lease losses;

·      develop an interest rate risk policy and procedures to identify, measure, monitor and control the nature and amount of interest rate risk the Bank takes;

·      revise its liquidity and funds management policy and update and review the policy annually;

·      refrain from accepting any brokered deposits;

·      refrain from paying cash dividends without prior approval of the FDIC and the Department;

·      establish an oversight committee of the board of directors of the Bank with the responsibility to ensure the Bank’s compliance with the orders, and

·      prepare and submit quarterly reports to the FDIC and the Department detailing the actions taken to secure compliance with the orders.

The Orders will remain in effect until modified or terminated by the FDIC and the Department and do not restrict the Bank from transacting its normal banking business.  The Bank will continue to serve its customers in all areas including making loans, establishing lines of credit, accepting deposits and processing banking transactions.  Customer deposits remain fully insured to the highest limits set by the FDIC.  The FDIC and the Department did not impose or recommend any monetary penalties in connection with the Consent Orders.

As of December 31, 2012, the Bank’s tier one leverage capital ratio was 6.00% and its total risk based capital ratio was 11.16%. These ratios are below the levels required by the Consent Orders.  Management is in the process of addressing all matters outlined in the Consent Orders.  The Bank has increased the participation of the Bank’s Board of Directors in the Bank’s affairs and has established an oversight committee of the Board of Directors of the Bank with the responsibility to insure the Bank’s compliance with the Consent Orders.  Management has developed the written plans and policies required by the Consent Orders.  Management believes that the Bank will continue to endeavor to comply with the terms and conditions of the Orders and will continue to operate as an independent financial institution for the foreseeable future.

The uncertainty surrounding the Bank’s ability to comply with the Consent Orders gives rise to substantial doubt about the Bank’s ability to continue as a going concern.  The financial statements do not include any adjustments that might be necessary if the Bank is unable to continue as a going concern.

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Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Details
Income Tax Reconciliation Income Tax Expense Benefit At Federal Statutory Income Tax Rate	$ (345,524)	$ (350,622)
Income Tax Reconciliation Nondeductible Expense	6,507	6,278
Income Tax Reconciliation, Change in Deferred Tax Assets Valuation Allowance	407,711	285,290
Other	(68,694)	59,054
Provision for income taxes

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Regulatory Capital Requirements under Banking Regulations (Details)	12 Months Ended
	Dec. 31, 2012
Details
Description of Regulatory Requirements, Prompt Corrective Action	develop a written capital plan detailing the manner in which the Bank will meet and maintain a ratio of Tier 1 capital to total assets (“leverage ratio”) of at least 8.5% and a ratio of qualifying total capital to risk-weighted assets (total risk-based capital ratio) of at least 12.5%, within a reasonable but unspecified time period; · formulate a written plan to reduce the Bank’s risk positions in each asset or loan in excess of $100,000 classified as “Doubtful” or “Substandard” at its current regulatory examination;

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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Interest income:
Interest and fees on loans	$ 2,627,890	$ 2,665,637
Interest on investment securities	439,166	616,754
Interest on federal funds sold	17,074	20,100
Interest on time deposits with other banks	642	695
Total interest income	3,084,772	3,303,186
Interest expense:
Interest on time deposits	83,300	150,443
Interest on demand deposits	48,447	73,139
Interest on savings deposits	7,118	11,403
Total interest expense	138,865	234,985
Net interest income	2,945,907	3,068,201
Provision for loan losses	453,000	170,000
Net interest income after provision for loan losses	2,492,907	2,898,201
Noninterest income:
Customer service fees	400,162	379,933
ATM fee income	318,503	348,948
Loan syndication fee income	145,000	145,000
Net (loss) gain on sale of other real estate	(8,273)	111,291
Gain on sale of bank premises	526,990
Gain on sale of loans	69,163
Other income	73,194	85,708
Total noninterest income	1,524,739	1,070,880
Noninterest expense:
Salaries, wages and employee benefits	1,554,497	1,643,327
Occupancy and equipment	1,066,031	1,096,040
Office operations and supplies	304,946	304,373
Marketing and public relations	73,448	113,290
Professional services	317,880	261,183
Data processing	472,737	488,899
Loan and collection cost	107,072	133,570
Other real estate owned, net	348,908	76,073
Deposit insurance assessments	114,786	167,695
Other operating	673,588	715,871
Total noninterest expense	5,033,893	5,000,321
Net loss before income taxes	(1,016,247)	(1,031,240)
Provision for income taxes
Net loss	(1,016,247)	(1,031,240)
Net loss per common share-basic and diluted	$ (0.95)	$ (0.97)
Weighted average number of common shares	1,068,588	1,068,588
Comprehensive Loss
Net loss	(1,016,247)	(1,031,240)
Unrealized losses on available for sale securities	(4,684)	(5,260)
Total comprehensive loss	$ (1,020,931)	$ (1,036,500)

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Deposits

12 Months Ended

Dec. 31, 2012

Notes

Deposits

 7.  DEPOSITS

At December 31, 2012, the scheduled maturities of time deposits (certificates of deposit) are as follows:

(In 000’s)
	2013	$15,244
	2014	975
	2015	441
	2016	133
	2017	57
	Thereafter	36
		$16,886

At December 31, 2012, the Company has a significant deposit relationship with the City of Philadelphia for which deposits totaled approximately $7.3 million, including a $5 million time deposit.

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Other Real Estate Owned

12 Months Ended

Dec. 31, 2012

Notes

Other Real Estate Owned

6.  OTHER REAL ESTATE OWNED

Other real estate owned (“OREO”) consists of properties acquired as a result of deed in-lieu-of foreclosure and foreclosures. Properties or other assets are classified as OREO and are reported at the lower of carrying value or fair value, less estimated costs to sell. Costs relating to the development or improvement of assets are capitalized, and costs relating to holding the property are charged to expense.

The following schedule reflects the components of other real estate owned at December 31, 2012 and 2011:

(in 000's)	2012	2011
Commercial real estate	$206	$206
Residential real estate	569	1,079
Total	$775	$1,285

A summary of the change in other real estate owned follows:

(in 000's)	Year Ended	Year Ended
	December 31, 2012	December 31, 2011
Beginning balance	$1,285	$1,417
Additions, transfers from loans	156	602
Proceeds from sales, net	(434)	(730)
	1,007	1,289
Less: write-downs	(232)	(4)
Ending balance	$775	$1,285

The following table details the components of net expense of other real estate owned for the years ended December 31, 2012 and 2011:

(in 000's)
	Year ended December 31, 2012	Year ended December 31, 2011
Insurance	$24	$20
Legal fees	5	-
Maintenance	3	9
Professional fees	8	19
Real estate taxes	99	15
Utilities	21	9
Transfer-in write-up	(43)	-
Impairment charges	232	4
	$349	$76

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Summary of Significant Accounting Policies: Intangible Assets: Schedule of Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Intangible Assets

	2012	2011
Core Deposit Premium (cost)	$2,449,488	$2,449,488
Less accumulated amortization	(2,313,755)	(2,135,677)
	$135,733	$313,811

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2012

Notes

Commitments and Contingencies

14.  COMMITMENTS AND CONTINGENCIES

The Bank is a defendant in certain claims and legal actions arising in the ordinary course of business.  In the opinion of management, after consultation with legal counsel, the ultimate disposition of these matters is not expected to have a material adverse effect on the consolidated financial condition of the Company.

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Fair Value Measurements: Schedule of Fair Value of Assets on a Nonrecurring Basis (Details) (USD $) In Thousands, unless otherwise specified	0 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Impaired Loans
Assets, Fair Value Disclosure, Nonrecurring	$ 1,501	$ 1,379
Other Real Estate Owned
Assets, Fair Value Disclosure, Nonrecurring	775	1,284
Fair Value, Option, Changes in Fair Value, Gain (Loss)	(233)	(4)
Fair Value, Inputs, Level 3 | Impaired Loans
Assets, Fair Value Disclosure, Nonrecurring	1,501	1,379
Fair Value, Inputs, Level 3 | Other Real Estate Owned
Assets, Fair Value Disclosure, Nonrecurring	$ 775	$ 1,284

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Financial Instrument Commitments

12 Months Ended

Dec. 31, 2012

Notes

Financial Instrument Commitments

10.  FINANCIAL INSTRUMENT COMMITMENTS

The Bank is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers.  These financial instruments include commitments to extend credit and letters of credit, which are conditional commitments issued by the Bank to guarantee the performance of an obligation of a customer to a third party.  Both arrangements have credit risk essentially the same as that involved in extending loans and are subject to the Bank’s normal credit policies.  Collateral may be obtained based on management’s assessment of the customer.  The Bank’s exposure to credit loss in the event of nonperformance by the other party to the financial instruments is represented by the contractual amount of those instruments.

      Summaries of the Bank’s financial instrument commitments are as follows:

	2012	2011
Commitments to extend credit	$9,484,309	$9,162,490
Outstanding letters of credit	1,173,374	1,208,183

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract and unused credit card lines.  Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements.  Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee.

Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party.  The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers.

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Investments: Schedule of Unrealized Loss on Investments (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Held-to-maturity, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions	5	4
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	$ 999	$ 1,018
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	(5)	(2)
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value	999	1,018
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Losses	(5)	(2)
US Government Agencies Debt Securities
Held-to-maturity, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions	3
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	746
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	(4)
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value	746
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Losses	(4)
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises
Held-to-maturity, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions	2	4
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value	253	1,018
Held-to-maturity Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses	(1)	(2)
Held-to-maturity Securities, Continuous Unrealized Loss Position, Fair Value	253	1,018
Held-to-maturity Securities, Continuous Unrealized Loss Position, Aggregate Losses	$ (1)	$ (2)

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Borrowings

12 Months Ended

Dec. 31, 2012

Notes

Borrowings

8.   BORROWINGS

At December 31, 2012, the Bank has the ability to borrow up to $1.5 million on a fully secured basis at the Discount Window of the Federal Reserve Bank for which the Bank currently has $1.75 million in securities.  As of December 31, 2012 and 2011, the Bank had no borrowings outstanding.

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Income Taxes

12 Months Ended

Dec. 31, 2012

Notes

Income Taxes

9. INCOME TAXES

At December 31, 2012, the Bank has net operating loss carry forwards of approximately $8,440,000 for income tax purposes that expire in 2013 through 2027.

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amount used for income tax purposes.  For financial reporting purposes, a valuation allowance of $3,442,769 and $3,035,058 as of December 31, 2012 and 2011, respectively, has been recognized to offset the net deferred tax assets related to the cumulative temporary differences and the tax loss carry forwards.  Significant components of the Bank’s net deferred tax assets are as follows:

	December 31, 2012	December 31, 2011
Deferred tax assets(liabilities):
Provision for loan losses	$333,853	$212,652
Unrealized gain on investment securities	(17,334)	(19,710)
Depreciation	94,393	369,764
Net operating loss carryforwards	2,897,243	2,313,074
Other, net	134,614	159,278
Valuation allowance for deferred tax assets	(3,442,769)	(3,035,058)
Net deferred tax assets	-	-

	2012	2011
Effective rate reconciliation:
Tax at statutory rate (34%)	$(345,524)	$(350,622)
Nondeductible expenses	6,507	6,278
Increase in valuation allowance	407,711	285,290
Other	(68,694)	59,054
Total tax expense	-	-

Management has evaluated the Bank’s tax positions and concluded that the Bank has taken no uncertain tax positions that require adjustment to the financial statements. With few exceptions, the Bank is no longer subject to income tax examinations by the U.S. federal, state or local tax authorities for the years before 2009.

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Fair Value Measurements

12 Months Ended

Dec. 31, 2012

Notes

Fair Value Measurements

11.  FAIR VALUE MEASUREMENTS

The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. In accordance with the Fair Value Measurements and Disclosures topic of FASB ASC 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Bank's various assets and liabilities. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument.

The fair value guidance provides a consistent definition of fair value, which focuses on exit price in an orderly transaction (that is, not a forced liquidation or distressed sale) between market participants at the measurement date under current market conditions. If there has been a significant decrease in the volume and level of activity for the asset or liability, a change in valuation technique or the use of multiple valuation techniques may be appropriate. In such instances, determining the price at which willing market participants would transact at the measurement date under current market conditions depends on the facts and circumstances and requires the use of significant judgment. The fair value is a reasonable point within the range that is most representative of fair value under current market conditions. In accordance with this guidance, the Company groups its assets and liabilities carried or disclosed at fair value in three levels as follows:

Level 1

o Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2 Inputs

o    Quoted prices for similar assets or liabilities in active markets.

o    Quoted prices for identical or similar assets or liabilities in markets that are not active.

o Inputs other than quoted prices that are observable, either directly or indirectly, for the term of the asset or liability (e.g., interest rates, yield curves, credit risks, prepayment speeds or volatilities) or “market corroborated inputs.”

Level 3 Inputs

o            Prices or valuation techniques that require inputs that are both unobservable (i.e. supported by little or no market activity) and that are significant to the fair value of the assets or liabilities.

o            These assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

An asset’s or liability’s financial categorization within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement.

Fair Value on a Recurring Basis

Securities Available for Sale:  Where quoted prices are available in an active market, securities would be classified within Level 1 of the valuation hierarchy. Level 1 securities include money market funds. If quoted market prices are not available, then fair values are estimated by using pricing models, quoted prices of securities with similar characteristics, or discounted cash flow. Level 2 securities include U.S. agency securities and mortgage backed agency securities. In certain cases where there is limited activity or less transparency around inputs to the valuation, securities are classified within Level 3 of the valuation hierarchy.

Assets on the consolidated balance sheets measured at fair value on a recurring basis are summarized below.

(in 000’s)	Fair Value Measurements at Reporting Date Using:
	Assets/Liabilities Measured at Fair Value at December 31, 2012	Quoted Prices in Active Markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)
Investment securities available-for-sale:
Government Sponsored Enterprises residential mortgage-backed securities	$898	-	$898	-
Money Market Funds	129	129	-	-
Total	$1,027	$129	$898

(in 000’s)		Fair Value Measurements at Reporting Date Using:
	Assets/Liabilities Measured at Fair Value at December 31, 2011	Quoted Prices in Active Markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)
Investment securities available-for-sale:
Government Sponsored Enterprises residential mortgage-backed securities	$1,152	-	$1,152	-
Money Market Funds	129	129	-	-
Total	$1,281	$129	$1,281

As of December 31, 2012 and 2011, the fair value of the Bank’s available-for-sale securities portfolio was approximately $1,027,000 and $1,281,000, respectively.  The portfolio primarily consisted of residential mortgage-backed securities, which had a fair value of approximately $898,000 and $1,152,000 at December 31, 2012 and 2011, respectively.  All the residential mortgage-backed securities were issued or guaranteed by the Government National Mortgage Association (“GNMA”), the Federal National Mortgage Association (“FNMA”) or the Federal Home Loan Mortgage Corporation (“FHLMC”).  The underlying loans for these securities are residential mortgages that are geographically dispersed throughout the United States.  The valuation of AFS securities using Level 2 inputs was primarily determined using the market approach, which uses quoted prices for similar instruments and all relevant information.  There were no transfers between Level 1 and Level 2 assets during the years ended December 31, 2012 or 2011.

Fair Value on a Nonrecurring Basis

Certain 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).

Impaired Loans (net of specific reserves):  The carrying value of certain impaired loans is derived in accordance with FASB ASC Topic 310, “Receivables”.  Impairment is determined based on the loan’s observable market price or the fair value of the collateral if the loan is collateral dependent.  Appraised and reported values for collateral dependent loans may be discounted based on management’s historical knowledge, changes in market conditions from the time of valuation. The Bank will discount the value 6-10% for selling and closing costs.  The valuation allowance for impaired loans is included in the allowance for loan losses in the balance sheets.  The valuation allowance for impaired loans at December 31, 2012 and December 31, 2011 was approximately $843,000 and $308,000, respectively.

Other real estate owned:  Other real estate owned (“OREO”) consists of properties acquired as a result of foreclosures and deeds in-lieu-of foreclosure. Properties are classified as OREO and are reported at the lower of cost or fair value less cost to sell.  The valuation allowance for OREO at December 31, 2012 and 2011 was approximately $233,000 and $4,000, respectively.

The following table presents the assets carried on the consolidated balance sheets by level within the fair value hierarchy as of December 31, 2012, for which a nonrecurring change in fair value has been recorded during the year ended December 31, 2012.

Carrying Value at December 31, 2012:

(in 000’s)	Total	Quoted Prices in Active markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total fair value gain (loss) during the year ended December 31, 2012
Impaired Loans	$1,501	-	-	$1,501	$(843)
Other real estate owned	775	-	-	775	(233)

The following table presents the assets and liabilities carried on the consolidated balance sheets by level within the fair value hierarchy as of December 31, 2011, for which a nonrecurring change in fair value has been recorded during the year ended December 31, 2011.

Carrying Value at December 31, 2011:

(in 000’s)	Total	Quoted Prices in Active markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total fair value gain (loss) during the year ended December 31, 2011
Impaired Loans	$1,379	-	-	$1,379	$(308)
Other real estate owned	1,284	-	-	1,284	(4)

Fair Value of Financial Instruments

FASB ASC Topic 825 “Disclosure About Fair Value of Financial Instruments”, requires the disclosure of the fair value of financial instruments.  The methodology for estimating the fair value of financial assets that are measured on a recurring or non recurring basis are discussed above.

The following methods and assumptions were used by the Bank in estimating its fair value disclosures for other financial instruments:

Cash and cash equivalents, accrued interest receivable, and accrued interest payable: The carrying amounts reported  in the balance sheet approximates fair value.

Investment securities: Fair values for investment securities available for sale are as described above.  Investment securities held to maturity are determined in a similar manner.

Loans (other than impaired loans): The fair value of loans was estimated using a discounted cash flow analysis, which considered estimated pre­payments, amortizations, and non performance risk.  Prepayments and discount rates were based on current marketplace estimates and rates.  Residential mortgage loans were discounted at the current effective yield, including fees, of conventional loans, adjusted for their maturities with a spread to the Treasury yield curve

Deposit liabilities: The fair values disclosed for demand deposits (e.g., interest and noninterest checking, passbook savings, and certain types of money market accounts) are equal to the amounts payable on demand at the reporting date (e.g., their carrying amounts).  The carrying amounts for variable-rate, fixed-term money market accounts and certificates of deposit approximate the fair values at the reporting date.  Fair values for fixed-rate certificates of deposit are estimated using a discounted cash flow calculation.  The Treasury Yield Curve was utilized for discounting cash flows as it approximates the average marketplace certificate of deposit rates across the relevant maturity spectrum.

Commitments to extend credit: The carrying amounts for commitments to extend credit approximate fair value as such commitments are not substantially different from the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present creditworthiness of the counterparts.  Such amounts were not significant.

The fair value of financial instruments at year-end are presented below:

      (in 000’s)

	Level in	2012		2011
	Value	Carrying	Fair	Carrying	Fair
Assets:	Hierarchy	Amount	Value	Amount	Value
Cash and cash equivalents	Level 1	$10,236	$10,236	$14,497	$14,497
Available for sale securities	(1)	1,027	1,027	1,281	1,281
Held to maturity securities	Level 2	11,895	12,486	17,209	17,738
Loans, net of allowance for loan losses	(2)	40,298	40,325	40,635	40,552
Interest receivable	Level 2	310	310	342	342
Liabilities:
Demand deposits	Level 2	29,851	29,851	31,260	31,260
Savings deposits	Level 2	14,239	14,239	14,689	14,689
Time deposits	Level 2	16,886	16,902	25,352	25,401
Interest Payable	Level 2	368	368	397	397

(1) Level 1 for money market funds; Level 2 for all other securities.

(2) Level 2 for non-impaired loans; Level 3 for impaired loans.

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4. Loans and Allowance For Loan Losses: Schedule of Related Party Loans (Details) (USD $)	1 Months Ended	12 Months Ended
	Dec. 31, 2011	Dec. 31, 2012
Details
Loans and Leases Receivable, Related Parties, Beginning Balance	$ 1,931,722	$ 1,702,648
Loans and Leases Receivable, Related Parties, Additions		30,000
Loans and Leases Receivable, Related Parties, Collections	(229,074)	(160,622)
Loans and Leases Receivable, Related Parties, Ending Balance	$ 1,702,648	$ 1,572,026

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Fair Value Measurements: Schedule of Fair Value of Assets and Liabilities (Details) (USD $)	Dec. 31, 2012		Dec. 31, 2011		Dec. 31, 2010
Cash and cash equivalents at beginning of year	$ 10,236,199		$ 14,497,329		$ 8,696,111
Available-for-sale, at fair value	1,027,293		1,280,874
Available-for-sale Securities, Fair Value Disclosure	1,027,000		1,281,000
Held-to-maturity, at amortized cost (fair value of $12,485,687 and $17,738,368 in 2012 and 2011, respectively)	11,895,037		17,209,295
Held-to-maturity Securities, Fair Value Disclosure	12,486,000		17,738,000
Loans, net of unearned discounts and deferred fees	41,501,555		41,502,204
Accrued interest receivable	309,971		342,029
Savings deposits	14,239,216		14,688,985
Time Deposits	16,886,000
Accrued interest payable	30,500		58,361
Carrying Amount
Cash and cash equivalents at beginning of year	10,236,000	[1]	14,497,000	[1]
Available-for-sale, at fair value	1,027,000	[2]	1,281,000	[2]
Held-to-maturity, at amortized cost (fair value of $12,485,687 and $17,738,368 in 2012 and 2011, respectively)	11,895,000	[3]	17,209,000	[3]
Loans, net of unearned discounts and deferred fees	40,298,000	[4]	40,635,000	[4]
Accrued interest receivable	310,000	[3]	342,000	[3]
Demand Deposit Accounts	29,851,000	[3]	31,260,000	[3]
Savings deposits	14,239,000	[3]	14,689,000	[3]
Time Deposits	16,886,000	[3]	25,352,000	[3]
Accrued interest payable	368,000	[3]	397,000	[3]
Fair Value
Cash and Cash Equivalents, Fair Value Disclosure	10,236,000	[1]	14,497,000	[1]
Available-for-sale Securities, Fair Value Disclosure	1,027,000	[2]	1,281,000	[2]
Held-to-maturity Securities, Fair Value Disclosure	12,486,000	[3]	17,738,000	[3]
Loans Receivable, Fair Value Disclosure	40,325,000	[4]	40,552,000	[4]
Accrued interest receivable	310,000	[3]	342,000	[3]
Demand Deposit Accounts	29,851,000	[3]	31,260,000	[3]
Savings deposits	14,239,000	[3]	14,689,000	[3]
Time Deposits	16,902,000	[3]	25,401,000	[3]
Accrued Liabilities, Fair Value Disclosure	$ 368,000	[3]	$ 397,000	[3]

[1] Level in Value Hierarchy - Level 1.

[2] Level 1 for money market funds; Level 2 for all other securities.

[3] Level in Value Hierarchy - Level 2.

[4] Level 2 for non-impaired loans; Level 3 for impaired loans.

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4. Loans and Allowance For Loan Losses: Impaired Financing Receivables (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Impaired Financing Receivable, Unpaid Principal Balance	$ 2,344,000	$ 1,687,000
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	1,401,000	1,173,000
Impaired Financing Receivable, with Related Allowance, Recorded Investment	943,000	514,000
Impaired Financing Receivable, Recorded Investment	2,344,000	1,687,000
Impaired Financing Receivable, Related Allowance	843,000	308,000
Impaired Financing Receivable, Average Recorded Investment	1,790,000	1,839,000
Impaired Financing Receivable, Interest Income, Accrual Method	39,000	5,000
Commercial And Industrial
Impaired Financing Receivable, Unpaid Principal Balance	1,021,000	592,000
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	78,000	78,000
Impaired Financing Receivable, with Related Allowance, Recorded Investment	943,000	514,000
Impaired Financing Receivable, Recorded Investment	1,021,000	592,000
Impaired Financing Receivable, Related Allowance	843,000	308,000
Impaired Financing Receivable, Average Recorded Investment	689,000	557,000
Impaired Financing Receivable, Interest Income, Accrual Method	11,000
Commercial And Industrial | Commercial
Impaired Financing Receivable, Unpaid Principal Balance	873,000	491,000
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	78,000	78,000
Impaired Financing Receivable, with Related Allowance, Recorded Investment	795,000	413,000
Impaired Financing Receivable, Recorded Investment	873,000	491,000
Impaired Financing Receivable, Related Allowance	695,000	246,000
Impaired Financing Receivable, Average Recorded Investment	541,000	483,000
Impaired Financing Receivable, Interest Income, Accrual Method	11,000
Commercial And Industrial | SBA Loans
Impaired Financing Receivable, Unpaid Principal Balance	49,000
Impaired Financing Receivable, with Related Allowance, Recorded Investment	49,000
Impaired Financing Receivable, Recorded Investment	49,000
Impaired Financing Receivable, Related Allowance	49,000
Impaired Financing Receivable, Average Recorded Investment	29,000	15,000
Commercial And Industrial | Asset Based Loans
Impaired Financing Receivable, Unpaid Principal Balance	99,000	101,000
Impaired Financing Receivable, with Related Allowance, Recorded Investment	99,000	101,000
Impaired Financing Receivable, Recorded Investment	99,000	101,000
Impaired Financing Receivable, Related Allowance	99,000	62,000
Impaired Financing Receivable, Average Recorded Investment	119,000	59,000
Commercial Real Estate
Impaired Financing Receivable, Unpaid Principal Balance	1,323,000	1,095,000
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	1,323,000	1,095,000
Impaired Financing Receivable, Recorded Investment	1,323,000	1,095,000
Impaired Financing Receivable, Average Recorded Investment	1,101,000	1,282,000
Impaired Financing Receivable, Interest Income, Accrual Method	28,000	5,000
Commercial Real Estate | SBA Loans
Impaired Financing Receivable, Average Recorded Investment		49,000
Commercial Real Estate | Commercial Mortgages
Impaired Financing Receivable, Unpaid Principal Balance	649,000	677,000
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	649,000	677,000
Impaired Financing Receivable, Recorded Investment	649,000	677,000
Impaired Financing Receivable, Average Recorded Investment	681,000	797,000
Impaired Financing Receivable, Interest Income, Accrual Method	1,000	2,000
Commercial Real Estate | Religious Organizations
Impaired Financing Receivable, Unpaid Principal Balance	674,000	418,000
Impaired Financing Receivable, with No Related Allowance, Recorded Investment	674,000	418,000
Impaired Financing Receivable, Recorded Investment	674,000	418,000
Impaired Financing Receivable, Average Recorded Investment	420,000	436,000
Impaired Financing Receivable, Interest Income, Accrual Method	$ 27,000	$ 3,000

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4. Loans and Allowance For Loan Losses (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Loans and Leases Receivable, Deferred Income	$ 107,803	$ 106,551
Loans and Leases Receivable Unearned Discount	29,660	39,024
Loans Receivable, Gross, Commercial, Real Estate	31,381,000	30,197,000
Allowance for Doubtful Accounts Receivable, Charge-offs	0	0
Loans Receivable Portfoloio Percentage (by segment)
Loans Receivable, Gross, Commercial, Real Estate	15,300,000
Religious Organizations
Loans Receivable, Gross, Commercial, Real Estate	$ 12,642,000	$ 13,653,000
Loans Receivable Portfoloio Percentage (by segment)	36.00%

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Summary of Quarterly Results (unaudited): Schedule of Quarterly Financial Information (Details) (USD $)	3 Months Ended								12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011
Details
Total interest income	$ 736,000	$ 768,000	$ 779,000	$ 802,000	$ 847,000	$ 818,000	$ 813,000	$ 825,000	$ 3,084,772	$ 3,303,186
Total interest expense	31,000	32,000	33,000	43,000	52,000	60,000	62,000	61,000	138,865	234,985
Net interest income	705,000	736,000	746,000	759,000	795,000	758,000	751,000	764,000	2,945,907	3,068,201
Provision for loan losses	332,000	61,000	30,000	30,000	70,000	30,000	40,000	30,000	453,000	170,000
Net interest income after provision for loan losses	373,000	675,000	716,000	729,000	725,000	728,000	711,000	734,000	2,492,907	2,898,201
Total noninterest income	792,000	260,000	279,000	194,000	259,000	199,000	399,000	214,000	1,524,739	1,070,880
Total noninterest expense	1,299,000	1,343,000	1,231,000	1,161,000	1,257,000	1,209,000	1,279,000	1,255,000	5,033,893	5,000,321
Net loss	$ (134,000)	$ (408,000)	$ (236,000)	$ (238,000)	$ (273,000)	$ (282,000)	$ (169,000)	$ (307,000)	$ (1,016,247)	$ (1,031,240)
Earnings Per Share, Basic	$ (130)	$ (380)	$ (220)	$ (220)	$ (260)	$ (260)	$ (160)	$ (290)	$ (0.95)	$ (0.97)
Earnings Per Share, Diluted	$ (130)	$ (380)	$ (220)	$ (220)	$ (260)	$ (260)	$ (160)	$ (290)	$ (0.95)	$ (0.97)

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Bank Premises and Equipment (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Bank Premises and Equipment

5.  BANK PREMISES AND EQUIPMENT

The major classes of bank premises and equipment and the total accumulated depreciation are as follows at December 31:

(In 000’s)
	Estimated useful life	2012	2011
Buildings and leasehold improvements	10-15 years	$874	$1,328
Furniture and equipment	3- 7 years	775	746
		$1,649	2,074
Less accumulated depreciation		(1,086)	(1,086)
		$563	$988

Depreciation expense on fixed assets totaled $220,281 and $246,272 for the years ended December 31, 2012 and 2011, respectively.

The Bank leases other facilities and other equipment under non-cancelable operating lease agreements. The amount of expense for operating leases for the years ended December 31, 2012 and 2011was $465,800 and $454,895, respectively. Future minimum lease payments under operating leases are as follows:

 (In 000’s)

Year ending December 31,	Operating leases
2013	$501
2014	493
2015	489
2016	171
2017	103
Thereafter	168
Total minimum lease payments	$1,925

In December 2012, the Bank sold its branch located at 38th and Lancaster Avenue in Philadelphia for $875,000 and realized a gain of approximately $527,000 on the sale.  Simultaneous with the sale, the Bank entered into a License Agreement that expires on April 28, 2013 to operate the branch until the office is closed and operations transferred to a branch located at corporate headquarters.  In addition, the Bank entered into a one year Operating Agreement for its ATM located at 38th and Lancaster Avenue.

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Summary of Significant Accounting Policies: Securities (Details) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Details
Other than Temporary Impairment, Credit Losses Recognized in Earnings, Credit Losses on Debt Securities Held	$ 0	$ 0

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Summary of Quarterly Results (unaudited)

12 Months Ended

Dec. 31, 2012

Notes

Summary of Quarterly Results (unaudited)

16.  SUMMARY OF QUARTERLY RESULTS (UNAUDITED)

The following summarizes the company’s consolidated results of operations during 2012 and 2011, on a quarterly basis:

            (Dollars in thousands)

	2012
	Fourth  Quarter	Third  Quarter	Second  Quarter	First  Quarter
Interest income	$736	$768	$779	$802
Interest expense	31	32	33	43
Net interest income	705	736	746	759
Provision for loan losses	332	61	30	30
Net interest after provision for loan losses	373	675	716	729
Noninterest income	792	260	279	194
Noninterest expense	1,299	1,343	1,231	1,161
Net loss	$(134)	$(408)	$(236)	$(238)
Basic loss per common share	$(0.13)	$(0.38)	$(0.22)	$(0.22)
Diluted loss per common share	$(0.13)	$(0.38)	$(0.22)	$(0.22)

            (Dollars in thousands)

	2011
	Fourth Quarter	Third Quarter	Second Quarter	First  Quarter
Interest income	$847	$818	$813	$825
Interest expense	52	60	62	61
Net interest income	795	758	751	764
Provision for loan losses	70	30	40	30
Net interest after provision for loan losses	725	728	711	734
Noninterest income	259	199	399	214
Noninterest expense	1,257	1,209	1,279	1,255
Net loss	$(273)	$(282)	$(169)	$(307)
Basic loss per common share	$(0.26)	$(0.26)	$(0.16)	$(0.29)
Diluted loss per common share	$(0.26)	$(0.26)	$(0.16)	$(0.29)

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Investments: Schedule of Unrealized Loss on Investments (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Unrealized Loss on Investments

The table below indicates the length of time individual securities held-to-maturity have been in a continuous unrealized loss position at December 31, 2012 (in thousands):

	Number		Less than 12 months				12 months or longer				Total
Description of	of		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
Securities	securities		value		Losses		value		losses		value		losses
U.S. Government agency securities		3	$	746	$	(4)	$	-	$	-	$	746	$	(4)
Mortgage backed securities		2	$	253	$	(1)	$	-	$	-	$	253	$	(1)
Total temporarily
impaired investment
securities		5	$	999	$	(5)	$	-	$	-	$	999	$	(5)

The table below indicates the length of time individual securities held-to-maturity have been in a continuous unrealized loss position at December 31, 2011 (in thousands):

	Number		Less than 12 months				12 months or longer				Total
Description of	of		Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
Securities	securities		value		Losses		Value		losses		value		losses
Mortgage backed securities		4	$	1,018		(2)		-		-	$	1,018		(2)
Total temporarily
impaired investment
securities		4	$	1,018	$	(2)	$	-	$	-	$	1,018	$	(2)

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Earnings Per Share Computation: Schedule of Earnings Per Shares Basic And Diluted (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Earnings Per Shares Basic And Diluted

Net loss per common share is calculated as follows:

	Year ended December 31, 2012
	Loss (numerator)	Shares (denominator)	Per share amount
Net loss	$(1,016,247)
Basic  EPS
Loss attributable to common stockholders	$(1,016,247)	1,068,588	$(0.95)
Diluted EPS
Loss attributable to common stockholders	$(1,016,247)	1,068,588	$(0.95)
	Year ended December 31, 2011
	Loss (numerator)	Shares (denominator)	Per share amount
Net loss	$(1,031,240)
Basic  EPS
Loss attributable to common stockholders	$(1,031,240)	1,068,588	$(0.97)
Diluted EPS
Loss attributable to common stockholders	$(1,031,240)	1,068,588	$(0.97)

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Financial Instrument Commitments: Schedule of Financial Instruments Owned and Pledged as Collateral (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Financial Instruments Owned and Pledged as Collateral

	2012	2011
Commitments to extend credit	$9,484,309	$9,162,490
Outstanding letters of credit	1,173,374	1,208,183

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CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (USD $)	Total	Series A preferred stock	Common Stock	Additional paid-in capital	Accumulated deficit	Accumulated other comprehensive income(loss)	Total shareholders' equity
Stockholders' Equity at Dec. 31, 2010		$ 1,368	$ 10,686	$ 14,749,852	$ (8,508,591)	$ 44,101	$ 6,297,416
Shares, Outstanding at Dec. 31, 2010		136,842	1,068,588
Net loss	(1,031,240)				(1,031,240)		(1,031,240)
Comprehensive loss, net of tax						(5,260)	(5,260)
Stockholders' Equity at Dec. 31, 2011		1,368	10,686	14,749,852	(9,539,831)	38,841	5,260,916
Shares, Outstanding at Dec. 31, 2011		136,842	1,068,588
Net loss	(1,016,247)				(1,016,247)		(1,016,247)
Comprehensive loss, net of tax						(4,684)	(4,684)
Stockholders' Equity at Dec. 31, 2012		$ 1,368	$ 10,686	$ 14,749,852	$ (10,556,078)	$ 34,157	$ 4,239,985
Shares, Outstanding at Dec. 31, 2012		136,842	1,068,588

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Condensed Financial Information of Parent Company Only Disclosure: Condensed Statements of Cash Flows (Details) (USD $)	3 Months Ended				12 Months Ended
	Dec. 31, 2012	Mar. 31, 2012	Dec. 31, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011
Net loss	$ (134,000)	$ (238,000)	$ (273,000)	$ (307,000)	$ (1,016,247)	$ (1,031,240)
Net cash used in operating activities					(337,323)	(227,702)
Cash and cash equivalents at beginning of year		14,497,329		8,696,111	14,497,329	8,696,111
Cash and cash equivalents at end of year	10,236,199		14,497,329		10,236,199	14,497,329
Parent Company
Net loss					(1,016,000)	(1,031,000)
Equity in net loss of subsidiary					996,000	981,000
Net cash used in operating activities					(20,000)	(50,000)
Cash and cash equivalents at beginning of year		20,000		70,000	20,000	70,000
Cash and cash equivalents at end of year			$ 20,000			$ 20,000

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4. Loans and Allowance For Loan Losses

12 Months Ended

Dec. 31, 2012

Notes

4. Loans and Allowance For Loan Losses

4.  LOANS AND ALLOWANCE FOR LOAN LOSSES

The composition of the net loans is as follows:

(In 000's)	December 31, 2012	December 31, 2011
Commercial and industrial:
Commercial	$1,462	$1,486
SBA loans	125	235
Asset-based	2,147	2,009
Total commercial and industrial	3,734	3,730
Commercial real estate:
Commercial mortgages	14,720	14,676
SBA loans	621	477
Construction	3,398	1,391
Religious organizations	12,642	13,653
Total commercial real estate	31,381	30,197
Consumer real estate:
Home equity loans	1,453	2,145
Home equity lines of credit	26	85
1-4 family residential mortgages	3,140	3,356
Total consumer real estate	4,619	5,586
Total real estate	36,000	35,783
Consumer and other:
Consumer installment	30	58
Student loans	1,588	1,761
Other	150	170
Total consumer and other	1,768	1,989
Loans, net	$41,502	$41,502

At December 31, 2012 and 2011, unamortized net deferred fees totaled $107,803 and $106,551, respectively, and are included in the related loan accounts. At December 31, 2012 and 2011, the unearned discount totaled $29,660 and $39,024, respectively, and are included in the related loan accounts.

Loan Origination/Risk Management.  The Bank has lending policies and procedures in place to maximize loan income within an acceptable level of risk.  Management reviews and approves these policies and procedures on a regular basis.  A reporting system supplements the review process by providing management with periodic reports related to loan origination, asset quality, concentrations of credit, loan delinquencies and non-performing and emerging problem loans.  Diversification in the portfolio is a means of managing risk with fluctuations in economic conditions.

Commercial and industrial loans are underwritten after evaluating and understanding the borrower’s ability to operate prudently to service the projected debt.  Once it is determined that the borrower’s management possesses sound ethics and solid business acumen, the Bank’s management examines current and projected cash flows to determine the ability of the borrower to repay their obligations as agreed.  Commercial and industrial loans are primarily based on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the borrower.  The cash flows of borrowers, however, may not be as expected and collateral securing these loans may fluctuate in value.  Most commercial and industrial loans are secured by the assets being financed or other business assets such as accounts receivable. The Bank may also seek credit enhancements for commercial and industrial loans from the Small Business Administration, Department of Transportation or other available programs.  Generally, the Bank utilizes an advance formula for loans secured by eligible accounts receivable and other available programs to mitigate risk.

Commercial real estate loans are subject to underwriting standards and processes similar to commercial and industrial loans. These loans are viewed as cash flow loans first and secondarily as loans secured by real estate.  Commercial real estate loans typically have higher principal amounts and the repayment of these loans is dependent on the successful operation of property securing the loan or business conducted on the property securing the loan.  Commercial real estate loans may be more adversely affected by conditions in the real estate markets or in the general economy.  The Bank tracks the level of owner occupied versus non-owner occupied loans.   Typically, owner-occupied real estate loans represent less risk for the Bank.

The Bank’s commercial real estate loans are largely concentrated in loans to religious organizations. These loans are generally made to these organizations are primarily for expansion and repair of church facilities (construction loans).  The source of repayment is viewed as cash flow from tithes and offerings and secondarily as loans secured by real estate.

The Bank’s construction lending has primarily involved lending for construction of commercial properties although the Bank does lend funds for construction of single-family residences. Construction loans are underwritten utilizing feasibility studies, independent appraisals, analysis of lease rates, and the financial analysis of the developers and property owners. Construction loans are generally based upon estimates of costs and value associated with the complete project. These estimates can be inaccurate. Construction loans often involve the disbursement of substantial funds with repayment substantially dependent on the success of the ultimate project. Loan proceeds are disbursed during the construction phase according to a draw schedule based on the stage of completion. Construction projects are inspected by contracted inspectors or bank personnel. These loans are considered to have higher risks than other real estate loans due to their ultimate repayment being sensitive to interest rate changes, regulations of real property, general economic conditions and the availability of long-term financing.

Consumer loans are underwritten after an analysis of the borrower’s past and present financial information including credit score, personal financial statements, tax returns and other information deemed necessary to calculate debt service ratios that determine the ability of a borrower to repay the loan.  Minimum debt service ratios have been established by policy.  Underwriting standards for home equity loans are also heavily influenced by statutory requirements, which include, but are not limited to, a maximum loan-to-value percentage of 80% and documentation requirements.

The Bank performs an annual loan review by an independent third party firm that reviews and validates the credit risk program.  The results of these reviews are presented to the board and management.  The loan review process reinforces the risk identification and assessment decisions made by lenders and credit administration personnel, as well as the Bank’s policies and procedures.

Concentrations of Credit.  The Bank’s loan portfolio is concentrated in commercial real estate and commercial and industrial loans   Approximately $15.3 million of these loans are secured by owner occupied commercial real estate as of December 31, 2012. The Bank continues to have a significant concentration in lending to religious organizations for which total loans at December 31, 2012 were $12.6 million, or 36%, of the commercial portfolio.

Related Party Loans.  In the ordinary course of business, the Bank granted loans to certain directors, executive officers and there affiliates (collectively referred to as “related parties”).  These loans were made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other unaffiliated persons and do not involve more than normal risk of collectability.  Activity in related party loans is presented in the following table.

	2012	2011
Balance outstanding at January 1,	$1,702,648	$1,931,722
Principal additions	30,000	-
Principal reductions	(160,622)	$(229,074)
Balance outstanding at December 31,	$1,572,026	$1,702,648

Non-accrual and Past Due Loans.  Loans are considered past due if the required principal and interest payments have not been received 30 days as of the date such payments were due.  The Bank generally places a loan on non-accrual status when interest or principal is past due 90 days or more.  If it otherwise appears doubtful that the loan will be repaid, management may place the loan on nonaccrual status before the lapse of 90 days. Interest on loans past due 90 days or more ceases to accrue except for loans that are well collateralized and in the process of collection.  When a loan is placed on nonaccrual status, previously accrued and unpaid interest is reversed out of income.  Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

An age analysis of past due loans, segregated by class of loans, as of December 31, 2012 follows:

(In 000's)
	Loans 30-89 Days Past Due	Accruing  Loans 90 or  More Days  Past Due	Nonaccrual	Total Past  Due Loans	Current  Loans	Total Loans
Commercial and industrial:
Commercial	$15	-	$873	888	$574	$1,462
SBA loans	-	-	-	-	125	125
Asset-based	83	-	99	182	1,965	2,147
Total Commercial and industrial	98	-	972	1,070	2,664	3,734
Commercial real estate:
Commercial mortgages	306	-	649	955	13,765	14,720
SBA loans	-	-	-	-	621	621
Construction	-	-	-	-	3,398	3,398
Religious organizations	-	-	674	674	11,968	12,642
Total Commercial real estate	306	-	1,323	1,629	29,752	31,381
Consumer real estate:
Home equity loans	274	44	63	381	1,072	1,453
Home equity lines of credit	-	26	-	26	-	26
1-4 family residential mortgages	69	-	226	295	2,845	3,140
Total consumer real estate	343	70	289	702	3,917	4,619
Total real estate	649	70	1,612	2,331	33,669	36,000
Consumer and other:
Consumer installment	-	-	-	-	30	30
Student loans	87	141	-	228	1,360	1,588
Other	5	-	-	5	145	150
Total consumer and other	92	141	-	233	1,535	1,768
Total loans	$839	$211	$2,584	$3,634	$37,867	$41,502

An age analysis of past due loans, segregated by class of loans, as of December 31, 2011 is as follows:

(In 000's)
	Loans  30-89 Days  Past Due	Accruing  Loans 90 or  More Days  Past Due	Nonaccrual	Total Past  Due Loans	Current  Loans	Total Loans
Commercial and industrial:
Commercial	$32	-	$491	$523	$963	$1,486
SBA loans	-	-	-	-	235	235
Asset-based	-	-	101	101	1,908	2,009
Total Commercial and industrial	32	-	592	624	3,106	3,730
Commercial real estate:
Commercial mortgages	99	-	677	776	13,900	14,676
SBA loans	-	-	-	-	477	477
Construction	-	-	-	-	1,391	1,391
Religious organizations	559	173	418	1,150	12,503	13,653
Total Commercial real estate	658	173	1,095	1,926	28,271	30,197
Consumer real estate:
Home equity loans	173	152	106	431	1,714	2,145
Home equity lines of credit	-	-	38	38	47	85
1-4 family residential mortgages	-	-	301	301	3,055	3,356
Total consumer real estate	173	152	445	770	4,816	5,586
Total real estate	831	325	1,540	2,696	33,087	35,783
Consumer and other:
Consumer installment	-	-	-	-	58	58
Student loans	112	146	-	258	1,503	1,761
Other	3	-	-	3	167	17
Total consumer and other	115	146	-	261	1,728	1,989
Total loans	$978	$471	$2,132	$3,581	$37,921	$41,502

Impaired Loans. The Bank identifies a loan as impaired when it is probable that interest and principal will not be collected according to the contractual terms of the loan agreement. The Bank recognizes interest income on impaired loans under the cash basis when the collateral on the loan is sufficient to cover the outstanding obligation to the Bank.   If these factors do not exist, the Bank will record interest payments on the cost recovery basis.

In accordance with guidance provided by ASC 310-10, Accounting by Creditors for Impairment of a Loan, management employs one of three methods to determine and measure impairment: the Present Value of Future Cash Flow Method; the Fair Value of Collateral Method; or the Observable Market Price of a Loan Method.  To perform an impairment analysis, the Company reviews a loan’s internally assigned grade, its outstanding balance, guarantors, collateral, strategy, and a current report of the action being implemented. Based on the nature of the specific loans, one of the impairment methods is chosen for the respective loan and any impairment is determined, based on criteria established in ASC 310-10.

The Company makes partial charge-offs of impaired loans when the impairment is deemed permanent and is considered a loss.  To date, these charge-offs have only included the unguaranteed portion of Small Business Administration (“SBA”) loans.  Specific reserves are allocated to cover “other-than-permanent” impairment for which the underlying collateral value may fluctuate with market conditions. During the years ended December 31, 2012 and 2011, there were no partial charge-offs of impaired loans.

Consumer real estate and other loans are not individually evaluated for impairment, but collectively evaluated, because they are pools of smaller balance homogeneous loans.

Year-end 2012 impaired loans are set forth in the following table.

(In 000’s)
	Unpaid Contractual  Principal  Balance	Recorded Investment  With No  Allowance	Recorded Investment  With  Allowance	Total  Recorded  Investment	Related  Allowance	Average  Recorded  Investment	Interest recognized  on impaired  loans
Commercial and industrial:
Commercial	$873	$78	$795	$873	$695	$541	$11
SBA  loans	49	-	49	49	49	29	-
Asset-based	99	-	99	99	99	119	-
Total Commercial and industrial	1,021	78	943	1,021	843	689	11
Commercial real estate:
Commercial mortgages	649	649	-	649	-	681	1
SBA  Loans	-	-	-	-	-	-	-
Religious Organizations	674	674	-	674	-	420	27
Total Commercial real estate	1,323	1,323	-	1,323	-	1,101	28
Total Loans	$2,344	$1,401	$943	$2,344	$843	$1,790	$39

Year-end 2011 impaired loans are set forth in the following table.

(In 000’s)
	Unpaid Contractual  Principal  Balance	Recorded Investment  With No  Allowance	Recorded Investment  With  Allowance	Total  Recorded  Investment	Related  Allowance	Average  Recorded  Investment	Interest recognized  on impaired  loans
Commercial and industrial:
Commercial	$491	$78	$413	$491	$246	$483	-
SBA  loans	-	-	-	-	-	15	-
Asset-based	101	-	101	101	62	59	-
Total Commercial and industrial	592	78	514	592	308	557	-
Commercial real estate:
Commercial mortgages	677	677	-	677	-	797	2
SBA  Loans	-	-	-	-	-	49	-
Religious Organizations	418	418	-	418	-	436	3
Total Commercial real estate	1,095	1,095	-	1,095	-	1,282	5
Total Loans	$1,687	$1,173	$514	$1,687	$308	$1,839	$5

Credit Quality Indicators.  For commercial loans, management uses internally assigned risk ratings as the best indicator of credit quality.  Each loan’s internal risk weighting is assigned at origination and updated at least annually and more frequently if circumstances warrant a change in risk rating.  The Bank uses a 1 through 8 loan grading system that follows regulatory accepted definitions as follows:

·       Risk ratings of “1” through “3” are used for loans that are performing and meet and are expected to continue to meet all of the terms and conditions set forth in the original loan documentation and are generally current on principal and interest payments.  Loans with these risk ratings are reflected as “Good/Excellent” and “Satisfactory” in the following table.

·       Risk ratings of “4” are assigned to “Pass/Watch” loans which may require a higher degree of regular, careful attention.  Borrowers may be exhibiting weaker balance sheets and positive but inconsistent cash flow coverage. Borrowers in this classification generally exhibit a higher level of credit risk and are not adversely classified and do not expose the Bank to sufficient risk to warrant adverse classification. Loans with this rating would not normally be acceptable as new credits unless they are adequately secured and/or carry substantial guarantors. Loans with this rating are reflected as “Pass” in the following table.

·       Risk ratings of “5” are assigned to “Special Mention” loans that do not presently expose the Bank to a significant degree of risks, but have potential weaknesses/deficiencies deserving Management’s closer attention.  If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the Bank’s credit position at some future date. No loss of principal or interest is envisioned.  Borrower is experiencing adverse operating trends, which potentially could impair debt, services capacity and may necessitate restructuring of credit.  Secondary sources of repayment are accessible and considered adequate to cover the Bank's exposure. However a restructuring of the debt should result in repayment.  The asset is currently protected, but is potentially weak.  This category may include credits with inadequate loan agreements, control over the collateral or an unbalanced position in the balance sheet which has not reached a point where the liquidation is jeopardized but exceptions are considered material. These borrowers would have limited ability to obtain credit elsewhere.

·       Risk ratings of “6” are assigned to ‘Substandard” loans which are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Assets must have a well-defined weakness. They are characterized by the distinct possibility that some loss is possible if the deficiencies are not corrected. The borrower’s recent performance indicated an inability to repay the debt, even if restructured. Primary source of repayment is gone or severely impaired and the Bank may have to rely upon the secondary source. Secondary sources of repayment (e.g., guarantors and collateral) should be adequate for a full recovery. Flaws in documentation may leave the bank in a subordinated or unsecured position when the collateral is needed for the repayment.

·       Risk ratings of “7” are assigned to “Doubtful” loans which have all the weaknesses inherent in those classified “Substandard” with the added characteristic that the weakness makes the collection or liquidation in full, on the basis of current existing facts, conditions, and values, highly questionable and improbable.  The borrower's recent performance indicates an inability to repay the debt.  Recovery from secondary sources is uncertain.  The possibility of a loss is extremely high, but because of certain important and reasonably- specific pending factors, its classification as a loss is deferred.

·       Risk rating of “8” are assigned to “Loss” loans which are considered non-collectible and do not warrant classification as active assets.  They are recommended for charge-off if attempts to recover will be long term in nature.  This classification does not mean that an asset has no recovery or salvage value, but rather, that it is not practical or desirable to defer writing off the loss, although a future recovery may be possible.  Loss should always be taken in the period in which they surface and are identified as non-collectible as a result there is no tabular presentation.

      For consumer and residential mortgage loans, management uses performing versus nonperforming as the best indicator of credit quality.  Nonperforming loans consist of loans that are not accruing interest (nonaccrual loans) as a result of principal or interest being in default for a period of 90 days or more or when the ability to collect principal and interest according to contractual terms is in doubt.  These credit quality indicators are updated on an ongoing basis.  A loan is placed on nonaccrual status as soon as management believes there is doubt as to the ultimate ability to collect interest on a loan.

The tables below detail the Bank’s loans by class according to their credit quality indictors discussed above.

(In 000's)	Commercial Loans, December 31, 2012
	Good/ Excellent	Satisfactory	Pass	Special Mention	Substandard	Doubtful	Total
Commercial and industrial:
Commercial	$250	$104	$15	$220	$480	$393	$1,462
SBA loans	-	27	-	49	49	-	125
Asset-based	-	1,869	125	54	99	-	2,147
	250	2,000	140	323	628	393	3,734
Commercial real estate:
Commercial mortgages	-	12,678	1,322	-	403	317	14,721
SBA Loans	-	621	-	-	-	-	621
Construction	-	2,767	-	-	631	-	3,398
Religious organizations	-	8,183	3,623	162	674	-	12,642
	-	24,349	4,945	162	1,708	317	31,381
Total commercial loans	$250	$26,249	$5,085	$485	$2,336	$710	$33,115

	Residential Mortgage and Consumer Loans December 31, 2012
	- Performing/Nonperforming
	Performing	Nonperforming	Total
Consumer Real Estate:
Home equity	$1,390	$63	$1,453
Home equity line of credit	26	-	26
1-4 family residential mortgages	2,914	226	3,140
	4,330	289	4,619
Consumer Other:
Consumer Installment	30	-	30
Student loans	1,588	-	1,588
Other	150	-	150
	1,768	-	1,768
Total consumer loans	$6,098	$289	$6,387
Total loans				$ 41,502

(In 000's)			Commercial Loans, December 31, 2011
	Good/ Excellent	Satisfactory	Pass	Special Mention	Substandard	Doubtful	Total
Commercial and industrial:
Commercial	$379	$586	-	$31	$264	$226	$1,486
SBA loans	-	130	56	-	49	-	235
Asset-based	-	1,847	61	-	101	-	2,009
	379	2,563	117	31	414	226	3,730
Commercial real estate:
Commercial mortgages	-	13,117	151	-	1,408	-	14,676
SBA Loans	-	472	-	-	5	-	477
Construction	-	1,391	-	-	-	-	1,391
Religious organizations	-	9,751	2,925	-	977	-	13,653
	-	24,731	3,076	-	2,390	-	30,197
Total commercial loans	$379	$27,294	$3,193	$31	$2,804	$226	$33,927

	Residential Mortgage and Consumer Loans December 31, 2011
	- Performing/Nonperforming
	Performing	Nonperforming	Total
Consumer Real Estate:
Home equity	$2,039	$106	$2,145
Home equity line of credit	47	38	85
1-4 family residential mortgages	3,055	301	3,356
	5,141	445	5,586
Consumer Other:
Consumer Installment	58	-	58
Student loans	1,761	-	1,761
Other	170	-	170
	1,989	-	1,989
Total  consumer loans	$7,130	$445	$7,575
Total loans				$ 41,502

Allowance for loan losses. The determination of the allowance for loan losses involves a higher degree of judgment and complexity than its other significant accounting policies. The allowance is the accumulation of three components that are calculated based on various independent methodologies that are based on management’s estimates. The three components are as follows:

·Specific Loan Evaluation Component – Includes the specific evaluation of impaired loans.

·Historical Charge-Off Component – Applies a rolling, eight-quarter historical charge-off rate to all pools of non-classified loans.

·Qualitative Factors Component – The loan portfolio is broken down into multiple homogenous sub classifications, upon which multiple factors (such as delinquency trends, economic conditions, concentrations, growth/volume trends, and management/staff ability) are evaluated, resulting in an allowance amount for each of the sub classifications. The sum of these amounts comprises the Qualitative Factors Component.

All of these factors may be susceptible to significant change. There has been no change in qualitative factors during the year ending December 31, 2012 except for commercial and industrial loans for which there was an increase as a result of unfavorable trends. However, the average rolling eight quarter net loss factors have declined during the period in each portfolio segment as a result of a lower level of net charge-offs in 2012, with the exception of the factor for commercial and industrial loans that increased as a result of unfavorable trends. To the extent actual outcomes differ from management’s estimates, additional provisions for loan losses may be required that would adversely impact earnings in future periods.

According to the Bank’s policy, a loss (“charge-off”) is to be recognized and charged to the allowance for loan losses as soon as a loan is recognized as uncollectible. All credits that are 90 days or more past due must be analyzed for the Bank’s ability to collect the outstanding principal and/or interest. Once a loss is known to exist, the charge-off approval process must be followed for all loan types. An analysis of the activity in the allowance for loan losses for the years 2012 and 2011 is as follows:

(in 000's)	For the Year Ended December 31, 2012
	Commercial and industrial	Commercial real estate	Consumer real estate	Consumer and other loans	Total
Beginning balance	$387	$412	$68	-	$867
Provision for loan losses	560	(112)	-	5	453
Charge-offs	(56)	-	(80)	(21)	(157)
Recoveries	-	8	17	16	41
Net charge-offs	(56)	8	(63)	(5)	(116)
Ending balance	$891	$308	$5	-	$1,204

(in 000's)	For the Year Ended December 31, 2011
	Commercial and industrial	Commercial real estate	Consumer real estate	Consumer and other loans	Total
Beginning balance	$301	$553	$52	$20	$926
Provision for loan losses	150	-	15	5	170
Charge-offs	(65)	(150)	(5)	(46)	(266)
Recoveries	1	9	6	21	37
Net charge-offs	(64)	(141)	1	(25)	(229)
Ending balance	$387	$412	$68	-	$867

(in 000's)	As of December 31, 2012
	Commercial and industrial	Commercial real estate	Consumer real estate	Consumer and other loans	Total
Period-end amount allocated to:
Loans individually evaluated for impairment	$843	-	-	-	$843
Loans collectively  evaluated for impairment	48	308	5	-	361
	$891	$308	$5	-	$1,204
Loans, ending balance:
Loans individually evaluated for impairment	$1,021	$1,323	-	-	2,344
Loans collectively  evaluated for impairment	2,713	30,058	4,619	1,768	39,158
Total	$3,734	$31,381	$4,619	$1,768	$41,502

(in 000's)		As of December 31, 2011
	Commercial and industrial	Commercial real estate	Consumer real estate	Consumer and other loans	Total
Period-end amount allocated to:
Loans individually evaluated for impairment	$308	-	-	-	$308
Loans collectively  evaluated for impairment	79	412	68	-	559
	$387	$412	$68	-	$867
Loans, ending balance:
Loans individually evaluated for impairment	$592	$1,095	-	-	$1,687
Loans collectively  evaluated for impairment	3,138	29,102	5,586	1,989	39,815
Total	$3,730	$30,197	$5,586	$1,989	$41,502

Troubled debt restructurings (“TDRs”).  TDRs occur when a creditor, for economic or legal reasons related to a debtor’s financial condition, grants a concession to the debtor that it would not otherwise consider, such as a below market interest rate, extending the maturity of a loan, or a combination of both. The Company made modifications to certain loans in its commercial loan portfolio that included the term out of lines of credit to begin the amortization of principal.  The terms of these loans do not include any financial concessions and are consistent with the current market.  Management reviews all loan modifications to determine whether the modification qualifies as a TDR (i.e. whether the creditor has been granted a concession or is experiencing financial difficulties).  Based on this review and evaluation, none of the loans modified during 2012 and 2011 met the criteria of a TDR.  In addition,  the Company had no loans classified as TDRs at December 31, 2012 and 2011.

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Investments: Summary of Investment Securities (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Available-for-sale Securities, Amortized Cost Basis	$ 976	$ 1,223
Available-for-sale Securities, Gross Unrealized Gains	51	58
Available-for-sale Securities, Fair Value Disclosure	1,027	1,281
Held-to-maturity Securities, Amortized Cost before Other than Temporary Impairment	11,895	17,209
Held-to-maturity Securities, Unrecognized Holding Gain	596	531
Held-to-maturity Securities, Unrecognized Holding Loss	(5)	(2)
Held-to-maturity Securities, Fair Value Disclosure	12,486	17,738
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises
Available-for-sale Securities, Amortized Cost Basis	847	1,094
Available-for-sale Securities, Gross Unrealized Gains	51	58
Available-for-sale Securities, Fair Value Disclosure	898	1,152
Held-to-maturity Securities, Amortized Cost before Other than Temporary Impairment	8,290	9,678
Held-to-maturity Securities, Unrecognized Holding Gain	437	373
Held-to-maturity Securities, Unrecognized Holding Loss	(1)	(2)
Held-to-maturity Securities, Fair Value Disclosure	8,726	10,049
Money Market Funds
Available-for-sale Securities, Amortized Cost Basis	129	129
Available-for-sale Securities, Fair Value Disclosure	129	129
US Government Agencies Debt Securities
Held-to-maturity Securities, Amortized Cost before Other than Temporary Impairment	3,605	7,531
Held-to-maturity Securities, Unrecognized Holding Gain	159	158
Held-to-maturity Securities, Unrecognized Holding Loss	(4)
Held-to-maturity Securities, Fair Value Disclosure	$ 3,760	$ 7,689

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Fair Value Measurements: Schedule of Fair Value of Assets on a Recurring Basis (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Available-for-sale Securities, Fair Value Disclosure	$ 1,027	$ 1,281
Mortgage-backed Securities, Issued by US Government Sponsored Enterprises
Available-for-sale Securities, Fair Value Disclosure	898	1,152
Money Market Funds
Available-for-sale Securities, Fair Value Disclosure	129	129
Fair Value, Inputs, Level 1
Available-for-sale Securities, Fair Value Disclosure	129	129
Fair Value, Inputs, Level 1 | Money Market Funds
Available-for-sale Securities, Fair Value Disclosure	129	129
Fair Value, Inputs, Level 2
Available-for-sale Securities, Fair Value Disclosure	898	1,281
Fair Value, Inputs, Level 2 | Mortgage-backed Securities, Issued by US Government Sponsored Enterprises
Available-for-sale Securities, Fair Value Disclosure	$ 898	$ 1,152

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Schedule of Bank Premises and Equipment (Details) (USD $)					12 Months Ended				12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012 Leaseholds and Leasehold Improvements	Dec. 31, 2011 Leaseholds and Leasehold Improvements	Dec. 31, 2012 Leaseholds and Leasehold Improvements Minimum	Dec. 31, 2012 Leaseholds and Leasehold Improvements Maximum	Dec. 31, 2012 Furniture and Fixtures	Dec. 31, 2011 Furniture and Fixtures	Dec. 31, 2012 Furniture and Fixtures Minimum	Dec. 31, 2012 Furniture and Fixtures Maximum
Property, Plant and Equipment, Gross	$ 1,649,000	$ 2,074,000	$ 874,000	$ 1,328,000			$ 775,000	$ 746,000
Property, Plant and Equipment, Useful Life					10 years	15 years			3 years	7 years
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment	(1,086,000)	(1,086,000)
Bank premises and equipment, net	$ 562,729	$ 988,170

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Investments: Contractual Maturities of Investment Securities (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Contractual Maturities of Investment Securities

(In 000’s)

	Amortized Cost	Fair Value
Available-for-sale:
Due in one year	-	-
Due after one year through five years	-	-
Due after five years through ten years	-	-
Government-sponsored enterprises residential mortgage-backed securities	847	898
Total debt securities	847	89
Investments in money market funds	129	129
	$976	$1,027
Held-to-maturity:
Due in one year	-	-
Due after one year through five years	250	269
Due after five years through ten years	3,355	3,491
Due after ten years	-	-
Government-sponsored enterprises residential mortgage-backed securities	8,290	8,726
	$11,895	$12,486

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Other Real Estate Owned: Schedule of Components of Net Expense of Other Real Estate (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Professional services	$ 317,880	$ 261,183
Other Real Estate, Valuation Adjustments	(232,000)	(4,000)
Other Real Estate, Disposals	(434,000)	(730,000)
Other Real Estate
Real Estate Insurance	24,000	20,000
Legal Fees	5,000
Cost of Property Repairs and Maintenance	3,000	9,000
Professional services	8,000	19,000
Real Estate Tax Expense	99,000	15,000
Utilities Costs	21,000	9,000
Other Real Estate, Valuation Adjustments	(43,000)
Other Real Estate, Disposals	232,000	4,000
Other Real Estate Revenue	$ 349,000	$ 76,000

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Deposits: Schedule of Maturities of Time Deposits (Tables)

12 Months Ended

Dec. 31, 2012

Tables/Schedules

Schedule of Maturities of Time Deposits

(In 000’s)
	2013	$15,244
	2014	975
	2015	441
	2016	133
	2017	57
	Thereafter	36
		$16,886

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Earnings Per Share Computation

12 Months Ended

Dec. 31, 2012

Notes

Earnings Per Share Computation

15.  EARNINGS PER SHARE COMPUTATION

Net loss per common share is calculated as follows:

	Year ended December 31, 2012
	Loss (numerator)	Shares (denominator)	Per share amount
Net loss	$(1,016,247)
Basic  EPS
Loss attributable to common stockholders	$(1,016,247)	1,068,588	$(0.95)
Diluted EPS
Loss attributable to common stockholders	$(1,016,247)	1,068,588	$(0.95)
	Year ended December 31, 2011
	Loss (numerator)	Shares (denominator)	Per share amount
Net loss	$(1,031,240)
Basic  EPS
Loss attributable to common stockholders	$(1,031,240)	1,068,588	$(0.97)
Diluted EPS
Loss attributable to common stockholders	$(1,031,240)	1,068,588	$(0.97)

There were no common stock equivalents for the years December 31, 2012 and 2011.

The preferred stock is non cumulative and the Company is restricted from paying dividends.  Therefore, no effect of the preferred stock is included in the earnings per share calculations.