New
Jersey
|
22-3537895
|
(State
or other jurisdiction of
|
(I.R.S.
Employer
|
incorporation
or organization)
|
Identification
No.)
|
Large
accelerated filer ___
|
Accelerated
filer _ X__
|
|
Non-accelerated
filer (do not check if a smaller reporting company)__
|
Smaller
reporting company __
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37
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June
30,
|
December
31,
|
|||||||
2010
|
2009
|
|||||||
ASSETS
|
||||||||
Cash
and due from banks
|
$ | 10,735 | $ | 7,864 | ||||
Federal
funds sold
|
201 | 201 | ||||||
Interest-earning
deposits
|
59,356 | 71,907 | ||||||
Total
cash and cash equivalents
|
70,292 | 79,972 | ||||||
Investment
securities held to maturity (approximate fair
|
||||||||
value
$101,395 in 2010 and $87,827 in 2009)
|
101,603 | 89,459 | ||||||
Securities
available for sale
|
252,646 | 272,484 | ||||||
FHLB
and FRB Stock, at cost
|
4,807 | 5,315 | ||||||
Loans
|
959,256 | 983,537 | ||||||
Less: Allowance
for loan losses
|
13,856 | 13,192 | ||||||
Net
Loans
|
945,400 | 970,345 | ||||||
Premises
and equipment
|
34,626 | 27,911 | ||||||
Other
real estate owned
|
210 | 360 | ||||||
Accrued
interest receivable
|
4,533 | 4,444 | ||||||
Cash
surrender value of life insurance
|
26,672 | 26,292 | ||||||
Deferred
tax assets, net
|
23,438 | 23,522 | ||||||
Other
assets
|
13,036 | 12,249 | ||||||
TOTAL
ASSETS
|
$ | 1,477,263 | $ | 1,512,353 | ||||
LIABILITIES
|
||||||||
Deposits:
|
||||||||
Noninterest-bearing
demand deposits
|
$ | 216,314 | $ | 216,127 | ||||
Interest-bearing
deposits:
|
||||||||
Checking
|
249,472 | 255,058 | ||||||
Savings
|
76,937 | 73,866 | ||||||
Money
market accounts
|
503,829 | 458,303 | ||||||
Certificates
of deposit $100,000 and over
|
101,034 | 147,138 | ||||||
Certificates
of deposit less than $100,000
|
163,769 | 199,177 | ||||||
Total
deposits
|
1,311,355 | 1,349,669 | ||||||
Federal
Home Loan Bank advances
|
28,342 | 36,499 | ||||||
Capital
lease obligation
|
6,148 | - | ||||||
Accrued
expenses and other liabilities
|
15,435 | 6,676 | ||||||
TOTAL
LIABILITIES
|
1,361,280 | 1,392,844 | ||||||
SHAREHOLDERS’
EQUITY *
|
||||||||
Preferred
stock (no par value; authorized 500,000 shares; issued
21,513
|
||||||||
shares
at June 30, 2010 and 28,685 at December 31, 2009;
|
||||||||
liquidation
preference of $1,000 per share)
|
20,633 | 27,359 | ||||||
Common
stock (no par value; $0.83 per share; authorized
21,000,000
|
||||||||
shares;
issued shares, 9,193,200 at June 30, 2010 and 9,131,666
|
||||||||
at
December 31, 2009; outstanding shares, 8,785,022 at June
|
||||||||
30,
2010 and 8,723,488 at December 31, 2009)
|
7,645 | 7,593 | ||||||
Surplus
|
95,265 | 95,021 | ||||||
Treasury
stock at cost, 408,178 shares at June 30, 2010 and
|
||||||||
408,178
shares at December 31, 2009
|
(8,988 | ) | (8,988 | ) | ||||
Retained
earnings
|
2,440 | 471 | ||||||
Accumulated
other comprehensive loss, net of income tax
|
(1,012 | ) | (1,947 | ) | ||||
TOTAL
SHAREHOLDERS’ EQUITY
|
115,983 | 119,509 | ||||||
TOTAL
LIABILITIES & SHAREHOLDERS’ EQUITY
|
$ | 1,477,263 | $ | 1,512,353 |
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
INTEREST
INCOME
|
||||||||||||||||
Interest
and fees on loans
|
$ | 12,756 | $ | 14,026 | $ | 25,731 | $ | 28,264 | ||||||||
Interest
on investment securities:
|
||||||||||||||||
Taxable
|
542 | 270 | 1,056 | 512 | ||||||||||||
Tax-exempt
|
123 | 228 | 264 | 458 | ||||||||||||
Interest
on securities available for sale:
|
||||||||||||||||
Taxable
|
1,862 | 2,017 | 3,858 | 3,914 | ||||||||||||
Tax-exempt
|
139 | 159 | 279 | 338 | ||||||||||||
Interest-earning
deposits
|
28 | 9 | 52 | 18 | ||||||||||||
Total
interest income
|
15,450 | 16,709 | 31,240 | 33,504 | ||||||||||||
INTEREST
EXPENSE
|
||||||||||||||||
Interest
on savings and interest-bearing deposit
|
||||||||||||||||
accounts
|
1,518 | 1,557 | 3,120 | 3,103 | ||||||||||||
Interest
on certificates of deposit over $100,000
|
419 | 1,151 | 924 | 2,531 | ||||||||||||
Interest
on other time deposits
|
684 | 1,487 | 1,496 | 3,197 | ||||||||||||
Interest
on borrowed funds
|
291 | 348 | 615 | 699 | ||||||||||||
Interest
on capital lease obligation
|
51 | - | 51 | - | ||||||||||||
Total
interest expense
|
2,963 | 4,543 | 6,206 | 9,530 | ||||||||||||
NET
INTEREST INCOME BEFORE
|
||||||||||||||||
PROVISION
FOR LOAN LOSSES
|
12,487 | 12,166 | 25,034 | 23,974 | ||||||||||||
Provision
for loan losses
|
2,750 | 2,000 | 5,150 | 4,000 | ||||||||||||
NET
INTEREST INCOME AFTER
|
||||||||||||||||
PROVISION
FOR LOAN LOSSES
|
9,737 | 10,166 | 19,884 | 19,974 | ||||||||||||
OTHER
INCOME
|
||||||||||||||||
Trust
department income
|
2,686 | 2,550 | 5,050 | 4,882 | ||||||||||||
Service
charges and fees
|
691 | 607 | 1,348 | 1,202 | ||||||||||||
Bank
owned life insurance
|
219 | 214 | 416 | 428 | ||||||||||||
Securities
gains, net
|
2 | 108 | 2 | 113 | ||||||||||||
Other
income
|
188 | 293 | 443 | 467 | ||||||||||||
Total
other income
|
3,786 | 3,772 | 7,259 | 7,092 | ||||||||||||
OPERATING
EXPENSES
|
||||||||||||||||
Salaries
and employee benefits
|
5,704 | 5,430 | 11,413 | 10,964 | ||||||||||||
Premises
and equipment
|
2,588 | 2,171 | 4,960 | 4,260 | ||||||||||||
Other
expenses
|
2,713 | 3,594 | 5,162 | 5,495 | ||||||||||||
Total
operating expenses
|
11,005 | 11,195 | 21,535 | 20,719 | ||||||||||||
INCOME
BEFORE INCOME TAX EXPENSE
|
2,518 | 2,743 | 5,608 | 6,347 | ||||||||||||
Income
tax expense
|
762 | 813 | 1,727 | 1,935 | ||||||||||||
NET
INCOME
|
1,756 | 1,930 | 3,881 | 4,412 | ||||||||||||
Dividends
on preferred stock and accretion
|
324 | 428 | 1,034 | 633 | ||||||||||||
NET
INCOME AVAILABLE TO COMMON
|
||||||||||||||||
SHAREHOLDERS
|
$ | 1,432 | $ | 1,502 | $ | 2,847 | $ | 3,779 | ||||||||
EARNINGS
PER COMMON SHARE *
|
||||||||||||||||
Basic
|
$ | 0.16 | $ | 0.17 | $ | 0.32 | $ | 0.43 | ||||||||
Diluted
|
$ | 0.16 | $ | 0.17 | $ | 0.32 | $ | 0.43 | ||||||||
WEIGHTED
AVERAGE NUMBER OF COMMON
|
||||||||||||||||
SHARES
OUTSTANDING
|
||||||||||||||||
Basic
|
8,783,615 | 8,714,913 | 8,781,203 | 8,712,703 | ||||||||||||
Diluted
|
8,861,346 | 8,780,414 | 8,860,374 | 8,781,048 |
|
* Share
data reflects the five percent common stock dividend declared on June 18,
2009, and issued August 3, 2009 to shareholders of record on July 9,
2009.
|
|
See
accompanying notes to consolidated financial
statements.
|
Accumulated
|
||||||||||||||||||||||||||||
Other
|
||||||||||||||||||||||||||||
(In
Thousands, Except
|
Common
|
Preferred
|
Treasury
|
Retained
|
Comprehensive
|
|||||||||||||||||||||||
Per
Share Data)
|
Stock
|
Stock
|
Surplus
|
Stock
|
Earnings
|
Income/(Loss)
|
Total
|
|||||||||||||||||||||
Balance
at January 1, 2010
|
||||||||||||||||||||||||||||
8,723,488
Common Shares
|
||||||||||||||||||||||||||||
Outstanding
|
$ | 7,593 | $ | 27,359 | $ | 95,021 | $ | (8,988 | ) | $ | 471 | $ | (1,947 | ) | $ | 119,509 | ||||||||||||
Comprehensive
Income:
|
||||||||||||||||||||||||||||
Net
Income 2010
|
3,881 | 3,881 | ||||||||||||||||||||||||||
Unrealized Holding
Gains on
|
||||||||||||||||||||||||||||
Securities
Arising During the
|
||||||||||||||||||||||||||||
Period,
Net of Amortization
|
||||||||||||||||||||||||||||
(Net
of Income Tax
|
||||||||||||||||||||||||||||
Expense
of $328)
|
936 | |||||||||||||||||||||||||||
Less:
Reclassification
|
||||||||||||||||||||||||||||
Adjustment
for Gains
|
||||||||||||||||||||||||||||
Included
in Net Income (Net
|
||||||||||||||||||||||||||||
of
Income Tax Expense
|
||||||||||||||||||||||||||||
of
$1)
|
1 | |||||||||||||||||||||||||||
Net
Unrealized Holding
|
||||||||||||||||||||||||||||
Gains
on Securities Arising
|
||||||||||||||||||||||||||||
During
the Period (Net of
|
||||||||||||||||||||||||||||
Income
Tax Expense
|
||||||||||||||||||||||||||||
of
$327)
|
935 | 935 | ||||||||||||||||||||||||||
Total
Comprehensive Income
|
4,816 | |||||||||||||||||||||||||||
Issuance
of Restricted Stock
|
47 | (47 | ) | - | ||||||||||||||||||||||||
Amortization
of Restricted Stock
|
76 | 76 | ||||||||||||||||||||||||||
Redemption
of Preferred Stock
|
(7,172 | ) | (7,172 | ) | ||||||||||||||||||||||||
Accretion
of Discount on
|
||||||||||||||||||||||||||||
Preferred
Stock
|
446 | (446 | ) | - | ||||||||||||||||||||||||
Cash
Dividends Declared on
|
||||||||||||||||||||||||||||
Common
Stock
|
(878 | ) | (878 | ) | ||||||||||||||||||||||||
Cash
Dividends Declared on
|
||||||||||||||||||||||||||||
Preferred
Stock
|
(588 | ) | (588 | ) | ||||||||||||||||||||||||
Common
Stock Option Expense
|
151 | 151 | ||||||||||||||||||||||||||
Sales
of Shares (Dividend
|
||||||||||||||||||||||||||||
Reinvestment
Program)
|
5 | 64 | 69 | |||||||||||||||||||||||||
Balance
at June 30, 2010
|
||||||||||||||||||||||||||||
8,785,022
Common Shares
|
||||||||||||||||||||||||||||
Outstanding
|
$ | 7,645 | $ | 20,633 | $ | 95,265 | $ | (8,988 | ) | $ | 2,440 | $ | (1,012 | ) | $ | 115,983 | ||||||||||||
Six
Months Ended June 30,
|
||||||||
2010
|
2009
|
|||||||
OPERATING
ACTIVITIES:
|
||||||||
Net
income:
|
$ | 3,881 | $ | 4,412 | ||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||
Depreciation
|
1,695 | 1,184 | ||||||
Amortization
of premium and accretion of discount on securities, net
|
69 | (58 | ) | |||||
Amortization
of restricted stock
|
76 | - | ||||||
Provision
for loan losses
|
5,150 | 4,000 | ||||||
Provision
for other real estate owned losses
|
- | 265 | ||||||
Provision
for deferred taxes
|
(559 | ) | - | |||||
Tax
benefit on stock option exercises
|
- | 156 | ||||||
Stock-based
compensation
|
151 | 153 | ||||||
Gains
on security sales, available for sale
|
(2 | ) | (109 | ) | ||||
Gains
on security sales, held to maturity
|
- | (4 | ) | |||||
Loans
originated for sale
|
(25,965 | ) | - | |||||
Proceeds
from sales of loans
|
26,238 | 29,492 | ||||||
Gains
on loans sold
|
(273 | ) | - | |||||
Gain
on sale of other real estate owned
|
(15 | ) | (16 | ) | ||||
Loss
on disposal of fixed assets
|
- | 13 | ||||||
Increase
in cash surrender value of life insurance, net
|
(380 | ) | (385 | ) | ||||
Increase
in accrued interest receivable
|
(89 | ) | (535 | ) | ||||
(Increase)/decrease in
other assets
|
(787 | ) | 617 | |||||
Increase
in accrued expenses and other liabilities
|
8,810 | 1,199 | ||||||
NET
CASH PROVIDED BY OPERATING ACTIVITIES
|
17,924 | 40,384 | ||||||
INVESTING
ACTIVITIES:
|
||||||||
Proceeds
from maturities of investment securities
|
9,205 | 4,317 | ||||||
Proceeds
from maturities of securities available for sale
|
19,094 | 19,735 | ||||||
Proceeds
from calls of investment securities
|
11,458 | 580 | ||||||
Proceeds
from calls of securities available for sale
|
99,326 | 1,329 | ||||||
Proceeds
from sales of securities available for sale
|
1,763 | - | ||||||
Purchase
of investment securities
|
(32,837 | ) | (31,081 | ) | ||||
Purchase
of securities available for sale
|
(98,296 | ) | (73,266 | ) | ||||
Net
increase/(decrease) in loans
|
19,795 | (2,861 | ) | |||||
Proceeds
from sales of other real estate owned
|
335 | 262 | ||||||
Purchases
of premises and equipment
|
(2,483 | ) | (1,452 | ) | ||||
Disposal
of premises and equipment
|
- | 2 | ||||||
NET
CASH PROVIDED BY/ (USED IN) INVESTING ACTIVITIES
|
27,360 | (82,435 | ) | |||||
FINANCING
ACTIVITIES:
|
||||||||
Net
(decrease)/increase in deposits
|
(38,314 | ) | 58,345 | |||||
Net
decrease in other borrowings
|
- | (15,250 | ) | |||||
Repayments
of Federal Home Loan Bank advances
|
(8,157 | ) | (2,620 | ) | ||||
Gross
proceeds from preferred stock and warrants
|
- | 28,685 | ||||||
Redemption
of preferred stock
|
(7,172 | ) | - | |||||
Issuance
costs of preferred stock
|
- | (112 | ) | |||||
Cash
dividends paid on preferred stock
|
(588 | ) | (501 | ) | ||||
Cash
dividends paid on common stock
|
(878 | ) | (1,764 | ) | ||||
Exercise
of stock options
|
- | 1,041 | ||||||
Sales
of shares (DRIP Program)
|
69 | - | ||||||
Increase
in treasury shares associated with common stock options
|
||||||||
exercised/purchase
of treasury shares
|
- | (1,028 | ) | |||||
NET
CASH (USED IN)/PROVIDED BY FINANCING ACTIVITIES
|
(54,964 | ) | 66,796 | |||||
Net
(decrease)/increase in cash and cash equivalents
|
(9,680 | ) | 24,745 | |||||
Cash
and cash equivalents at beginning of period
|
79,972 | 26,889 | ||||||
Cash
and cash equivalents at end of period
|
$ | 70,292 | $ | 51,634 | ||||
Supplemental
disclosures of cash flow information:
|
||||||||
Cash
paid during the period for:
|
||||||||
Interest
|
$ | 6,560 | $ | 10,191 | ||||
Income
taxes
|
3,120 | 2,887 | ||||||
Transfer
of loans to other real estate owned
|
170 | - | ||||||
Acquisition
of leased premises
|
6,097 | - | ||||||
See
accompanying notes to consolidated financial statements.
|
|
1.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
|
Number
|
Exercise
|
Weighted
|
Aggregate
|
|||||||||||||
of
|
Price
|
Average
|
Intrinsic
|
|||||||||||||
(Dollars
in thousands except share data)
|
Shares
|
Per
Share
|
Exercise
Price
|
Value
|
||||||||||||
Balance,
January 1, 2010
|
557,882 | $ | 11.91-$31.60 | $ | 24.86 | |||||||||||
Granted
|
66,300 | 11.05-15.49 | 13.44 | |||||||||||||
Forfeited
|
(37,735 | ) | 13.43-31.60 | 23.34 | ||||||||||||
Balance,
June 30, 2010
|
586,447 | $ | 11.05-$31.60 | $ | 23.67 | $ | - | |||||||||
Vested
and Expected to Vest (1)
|
573,703 | $ | 11.05-$31.60 | $ | 23.79 | $ | - | |||||||||
Exercisable
at June 30, 2010
|
451,617 | $ | 12.97-$31.60 | $ | 25.11 | $ | - |
|
(1)
|
Does
not include shares which are not expected to vest as a result of
anticipated forfeitures.
|
2010
|
2009
|
|||||||
Dividend
yield
|
1.30 | % | 2.47 | % | ||||
Expected
volatility
|
72 | % | 50 | % | ||||
Expected
life
|
7
years
|
7
years
|
||||||
Risk-free
interest rate
|
2.94 | % | 2.21 | % |
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
(In
Thousands, except per share data)
|
2010
|
2009
|
2010
|
2009
|
||||||||||||
Net
Income to Common Shareholders
|
$ | 1,432 | $ | 1,502 | $ | 2,847 | $ | 3,779 | ||||||||
Basic
Weighted-Average Common
|
||||||||||||||||
Shares
Outstanding
|
8,783,615 | 8,714,913 | 8,781,203 | 8,712,703 | ||||||||||||
Plus: Common
Stock Equivalents
|
77,731 | 65,501 | 79,172 | 68,345 | ||||||||||||
Diluted
Weighted-Average Common
|
||||||||||||||||
Shares
Outstanding
|
8,861,346 | 8,780,414 | 8,860,375 | 8,781,048 | ||||||||||||
Net
Income Per Common Share
|
||||||||||||||||
Basic
|
$ | 0.16 | $ | 0.17 | $ | 0.32 | $ | 0.43 | ||||||||
Diluted
|
0.16 | 0.17 | 0.32 | 0.43 |
%
of
|
%
of
|
|||||||||||||||
June
30,
|
Total
|
December
31,
|
Total
|
|||||||||||||
(In
thousands)
|
2010
|
Loans
|
2009
|
Loans
|
||||||||||||
Residential
mortgage
|
$ | 430,021 | 44.8 | % | $ | 452,641 | 46.0 | % | ||||||||
Commercial
mortgage
|
280,513 | 29.2 | 279,595 | 28.4 | ||||||||||||
Commercial
loans
|
133,881 | 14.0 | 120,554 | 12.3 | ||||||||||||
Construction
loans
|
46,286 | 4.8 | 64,816 | 6.6 | ||||||||||||
Home
equity lines of credit
|
41,956 | 4.4 | 38,728 | 3.9 | ||||||||||||
Consumer
loans, including
|
||||||||||||||||
fixed
rate home equity loans
|
23,811 | 2.5 | 25,638 | 2.6 | ||||||||||||
Other
loans
|
2,788 | 0.3 | 1,565 | 0.2 | ||||||||||||
Total
loans
|
$ | 959,256 | 100.0 | % | $ | 983,537 | 100.0 | % |
June
30,
|
Number
of
|
December
31,
|
Number
of
|
|||||||||||||
(Dollars
in thousands)
|
2010
|
Relationships
|
2009
|
Relationships
|
||||||||||||
Residential
Mortgage
|
$ | 3,954 | 13 | $ | 2,567 | 9 | ||||||||||
Commercial
Mortgage
|
2,589 | 8 | 2,195 | 5 | ||||||||||||
Commercial
Loans
|
1,728 | 5 | 1,698 | 4 | ||||||||||||
Construction
Loans
|
12,741 | 2 | 5,035 | 1 | ||||||||||||
Home
Equity Lines of Credit
|
85 | 1 | 85 | 1 | ||||||||||||
Consumer
Loans
|
- | - | 172 | 1 | ||||||||||||
Total
|
$ | 21,097 | 29 | $ | 11,752 | 21 |
June
30,
|
Number
of
|
December
31,
|
Number
of
|
|||||||||||||
(Dollars
in thousands)
|
2010
|
Relationships
|
2009
|
Relationships
|
||||||||||||
Residential
Mortgage
|
$ | 2,998 | 12 | $ | 4,186 | 17 | ||||||||||
Commercial
Mortgage
|
7,615 | 3 | 6,937 | 2 | ||||||||||||
Total
|
$ | 10,613 | 15 | $ | 11,123 | 19 |
June
30,
|
Number
of
|
December
31,
|
Number
of
|
|||||||||||||
(Dollars
in thousands)
|
2010
|
Relationships
|
2009
|
Relationships
|
||||||||||||
Residential
Mortgage
|
$ | 3,746 | 12 | $ | 2,479 | 8 | ||||||||||
Commercial
Mortgage
|
25,456 | 18 | 21,382 | 10 | ||||||||||||
Commercial
Loans
|
4,754 | 11 | 5,426 | 12 | ||||||||||||
Construction
Loans
|
14,681 | 2 | 17,437 | 2 | ||||||||||||
Home
Equity Lines of Credit
|
85 | 1 | 85 | 1 | ||||||||||||
Total
|
$ | 48,722 | 44 | (1) | $ | 46,809 | 33 | |||||||||
Specific
Reserves, Included
|
||||||||||||||||
in
the Allowance for Loan
|
||||||||||||||||
Losses
|
$ | 2,082 | $ | 2,064 |
|
(1)
|
There
are a total of 37 impaired relationships; however, several borrowers have
multiple types of loans.
|
June 30, 2010 | ||||||||||||||||
Gross
|
Gross
|
Approximate
|
||||||||||||||
Carrying
|
Unrecognized
|
Unrecognized
|
Fair
|
|||||||||||||
(In
Thousands)
|
Amount
|
Gains
|
Losses
|
Value
|
||||||||||||
U.S.
Government-Sponsored Agencies
|
$ | 36,705 | $ | 104 | $ | (3 | ) | $ | 36,806 | |||||||
Mortgage-Backed
Securities -
|
||||||||||||||||
Residential
|
38,070 | 1,222 | - | 39,292 | ||||||||||||
State
and Political Subdivisions
|
16,818 | 295 | (6 | ) | 17,107 | |||||||||||
Trust
Preferred Pooled Securities
|
10,010 | - | (1,820 | ) | 8,190 | |||||||||||
Total
|
$ | 101,603 | $ | 1,621 | $ | (1,829 | ) | $ | 101,395 |
December 31, 2009 | ||||||||||||||||
Gross
|
Gross
|
Approximate
|
||||||||||||||
Carrying
|
Unrecognized
|
Unrecognized
|
Fair
|
|||||||||||||
(In
Thousands)
|
Amount
|
Gains
|
Losses
|
Value
|
||||||||||||
U.S.
Government-Sponsored Agencies
|
$ | 16,200 | $ | 13 | $ | (117 | ) | $ | 16,096 | |||||||
Mortgage-Backed
Securities -
|
||||||||||||||||
Residential
|
42,538 | 325 | (18 | ) | 42,845 | |||||||||||
State
and Political Subdivisions
|
20,646 | 361 | - | 21,007 | ||||||||||||
Trust
Preferred Pooled Securities
|
10,075 | - | (2,196 | ) | 7,879 | |||||||||||
Total
|
$ | 89,459 | $ | 699 | $ | (2,331 | ) | $ | 87,827 |
June
30, 2010
|
||||||||||||||||||||||||
Duration
of Unrealized Loss
|
||||||||||||||||||||||||
Less
Than 12 Months
|
12
Months or Longer
|
Total
|
||||||||||||||||||||||
Approximate
|
Approximate
|
Approximate
|
||||||||||||||||||||||
Fair
|
Unrecognized
|
Fair
|
Unrecognized
|
Fair
|
Unrecognized
|
|||||||||||||||||||
(In
Thousands)
|
Value
|
Losses
|
Value
|
Losses
|
Value
|
Losses
|
||||||||||||||||||
U.S.
Government-
|
||||||||||||||||||||||||
Sponsored
|
||||||||||||||||||||||||
Agencies
|
$ | 4,997 | $ | (3 | ) | $ | - | $ | - | $ | 4,997 | $ | (3 | ) | ||||||||||
State
& Political
|
||||||||||||||||||||||||
Subdivisions
|
2,314 | (6 | ) | - | - | 2,314 | (6 | ) | ||||||||||||||||
Trust
Preferred
|
||||||||||||||||||||||||
Pooled
Securities
|
- | - | 1,623 | (1,820 | ) | 1,623 | (1,820 | ) | ||||||||||||||||
Total
|
$ | 7,311 | $ | (9 | ) | $ | 1,623 | $ | (1,820 | ) | $ | 8,934 | $ | (1,829 | ) |
December
31, 2009
|
||||||||||||||||||||||||
Duration
of Unrealized Loss
|
||||||||||||||||||||||||
Less
Than 12 Months
|
12
Months or Longer
|
Total
|
||||||||||||||||||||||
Approximate
|
Approximate
|
Approximate
|
||||||||||||||||||||||
Fair
|
Unrecognized
|
Fair
|
Unrecognized
|
Fair
|
Unrecognized
|
|||||||||||||||||||
(In
Thousands)
|
Value
|
Losses
|
Value
|
Losses
|
Value
|
Losses
|
||||||||||||||||||
U.S.
Government-
|
||||||||||||||||||||||||
Sponsored
|
||||||||||||||||||||||||
Agencies
|
11,084 | (117 | ) | - | - | 11,084 | (117 | ) | ||||||||||||||||
Mortgage-Backed
|
||||||||||||||||||||||||
Securities
-
|
||||||||||||||||||||||||
Residential
|
$ | 9,633 | $ | (16 | ) | $ | 19 | $ | (2 | ) | $ | 9,652 | $ | (18 | ) | |||||||||
Trust
Preferred
|
||||||||||||||||||||||||
Pooled
Securities
|
1,258 | (2,196 | ) | - | - | 1,258 | (2,196 | ) | ||||||||||||||||
Total
|
$ | 21,975 | $ | (2,329 | ) | $ | 19 | $ | (2 | ) | $ | 21,994 | $ | (2,331 | ) |
June
30, 2010
|
||||||||||||||||
Gross
|
Gross
|
Approximate
|
||||||||||||||
Amortized
|
Unrealized
|
Unrealized
|
Fair
|
|||||||||||||
(In
Thousands)
|
Cost
|
Gains
|
Losses
|
Value
|
||||||||||||
U.S.
Government-Sponsored
|
||||||||||||||||
Agencies
|
$ | 119,926 | $ | 708 | $ | - | $ | 120,634 | ||||||||
Mortgage-Backed
Securities -
|
||||||||||||||||
Residential
|
105,244 | 5,223 | (463 | ) | 110,004 | |||||||||||
State
and Political Subdivisions
|
17,697 | 384 | (42 | ) | 18,039 | |||||||||||
Other
Securities
|
3,998 | - | (1,151 | ) | 2,847 | |||||||||||
Marketable
Equity Securities
|
1,535 | 1 | (414 | ) | 1,122 | |||||||||||
Total
|
$ | 248,400 | $ | 6,316 | $ | (2,070 | ) | $ | 252,646 |
December
31, 2009
|
||||||||||||||||
Gross
|
Gross
|
Approximate
|
||||||||||||||
Amortized
|
Unrealized
|
Unrealized
|
Fair
|
|||||||||||||
(In
Thousands)
|
Cost
|
Gains
|
Losses
|
Value
|
||||||||||||
U.S.
Government Sponsored
|
||||||||||||||||
Agencies
|
$ | 129,748 | $ | 353 | $ | (117 | ) | $ | 129,984 | |||||||
Mortgage-Backed
Securities -
|
||||||||||||||||
Residential
|
113,926 | 4,114 | (576 | ) | 117,464 | |||||||||||
State
and Political Subdivisions
|
18,830 | 304 | (61 | ) | 19,073 | |||||||||||
Other
Securities
|
3,998 | - | (952 | ) | 3,046 | |||||||||||
Marketable
Equity Securities
|
3,296 | 80 | (459 | ) | 2,917 | |||||||||||
Total
|
$ | 269,798 | $ | 4,851 | $ | (2,165 | ) | $ | 272,484 |
June
30, 2010
|
||||||||||||||||||||||||
Duration
of Unrealized Loss
|
||||||||||||||||||||||||
Less
Than 12 Months
|
12
Months or Longer
|
Total
|
||||||||||||||||||||||
Approximate
|
Approximate
|
Approximate
|
||||||||||||||||||||||
Fair
|
Unrealized
|
Fair
|
Unrealized
|
Fair
|
Unrealized
|
|||||||||||||||||||
(In
Thousands)
|
Value
|
Losses
|
Value
|
Losses
|
Value
|
Losses
|
||||||||||||||||||
Mortgage-Backed
|
||||||||||||||||||||||||
Securities
-
|
||||||||||||||||||||||||
Residential
|
$ | 2,748 | $ | (90 | ) | $ | 3,403 | $ | (373 | ) | $ | 6,151 | $ | (463 | ) | |||||||||
State
and Political
|
||||||||||||||||||||||||
Subdivisions
|
- | - | 733 | (42 | ) | 733 | (42 | ) | ||||||||||||||||
Other
Securities
|
- | - | 2,847 | (1,151 | ) | 2,847 | (1,151 | ) | ||||||||||||||||
Marketable
Equity
|
||||||||||||||||||||||||
Securities
|
- | - | 897 | (414 | ) | 897 | (414 | ) | ||||||||||||||||
Total
|
$ | 2,748 | $ | (90 | ) | $ | 7,880 | $ | (1,980 | ) | $ | 10,628 | $ | (2,070 | ) |
December
31, 2009
|
||||||||||||||||||||||||
Duration
of Unrealized Loss
|
||||||||||||||||||||||||
Less
Than 12 Months
|
12
Months or Longer
|
Total
|
||||||||||||||||||||||
Approximate
|
Approximate
|
Approximate
|
||||||||||||||||||||||
Fair
|
Unrealized
|
Fair
|
Unrealized
|
Fair
|
Unrealized
|
|||||||||||||||||||
(In
Thousands)
|
Value
|
Losses
|
Value
|
Losses
|
Value
|
Losses
|
||||||||||||||||||
U.S.
Government-
|
||||||||||||||||||||||||
Sponsored
Agencies
|
$ | 34,170 | $ | (117 | ) | $ | - | $ | - | $ | 34,170 | $ | (117 | ) | ||||||||||
Mortgage-Backed
|
||||||||||||||||||||||||
Securities
-
|
||||||||||||||||||||||||
Residential
|
5,388 | (69 | ) | 7,118 | (507 | ) | 12,506 | (576 | ) | |||||||||||||||
State
and Political
|
||||||||||||||||||||||||
Subdivisions
|
980 | (6 | ) | 720 | (55 | ) | 1,700 | (61 | ) | |||||||||||||||
Other
Securities
|
- | - | 2,046 | (952 | ) | 2,046 | (952 | ) | ||||||||||||||||
Marketable
Equity
|
||||||||||||||||||||||||
Securities
|
- | - | 1,508 | (459 | ) | 1,508 | (459 | ) | ||||||||||||||||
Total
|
$ | 40,538 | $ | (192 | ) | $ | 11,392 | $ | (1,973 | ) | $ | 51,930 | $ | (2,165 | ) |
(In
thousands)
|
||
2010
|
4,000
|
|
2011
|
3,000
|
|
2012
|
5,000
|
|
2013
|
1,342
|
|
2014
|
-
|
|
Over
5 years
|
15,000
|
|
Total
|
$
|
28,342
|
Three Months Ended June 30,
2010
|
||||||||||||
(in
thousands)
|
PGB
Trust
|
|||||||||||
Banking
|
&
Investments
|
Total
|
||||||||||
Net
interest income
|
$ | 11,857 | $ | 630 | $ | 12,487 | ||||||
Noninterest
income
|
1,067 | 2,719 | 3,786 | |||||||||
Total
income
|
12,924 | 3,349 | 16,273 | |||||||||
Provision
for loan losses
|
2,750 | - | 2,750 | |||||||||
Salaries
and benefits
|
4,364 | 1,340 | 5,704 | |||||||||
Premises
and equipment expense
|
2,395 | 193 | 2,588 | |||||||||
Other
noninterest expense
|
1,852 | 861 | 2,713 | |||||||||
Total
noninterest expense
|
11,361 | 2,394 | 13,755 | |||||||||
Income
before income tax expense
|
1,563 | 955 | 2,518 | |||||||||
Income
tax expense
|
478 | 284 | 762 | |||||||||
Net
income
|
$ | 1,085 | $ | 671 | $ | 1,756 |
Three Months Ended June 30,
2009
|
||||||||||||
(in
thousands)
|
PGB
Trust
|
|||||||||||
Banking
|
&
Investments
|
Total
|
||||||||||
Net
interest income
|
$ | 11,409 | $ | 758 | $ | 12,166 | ||||||
Noninterest
income
|
1,171 | 2,600 | 3,771 | |||||||||
Total
income
|
12,580 | 3,358 | 15,938 | |||||||||
Provision
for loan losses
|
2,000 | - | 2,000 | |||||||||
Salaries
and benefits
|
4,301 | 1,129 | 5,430 | |||||||||
Premises
and equipment expense
|
1,971 | 200 | 2,171 | |||||||||
Other
noninterest expense
|
2,832 | 762 | 3,594 | |||||||||
Total
noninterest expense
|
11,104 | 2,091 | 13,195 | |||||||||
Income
before income tax expense
|
1,476 | 1,267 | 2,743 | |||||||||
Income
tax expense
|
436 | 377 | 813 | |||||||||
Net
income
|
$ | 1,040 | $ | 890 | $ | 1,930 | ||||||
Six Months Ended June 30,
2010
|
||||||||||||
(in
thousands)
|
PGB
Trust
|
|||||||||||
Banking
|
&
Investments
|
Total
|
||||||||||
Net
interest income
|
$ | 23,593 | $ | 1,441 | $ | 25,034 | ||||||
Noninterest
income
|
2,135 | 5,124 | 7,259 | |||||||||
Total
income
|
25,728 | 6,565 | 32,293 | |||||||||
Provision
for loan losses
|
5,150 | - | 5,150 | |||||||||
Salaries
and benefits
|
8,734 | 2,679 | 11,413 | |||||||||
Premises
and equipment expense
|
4,563 | 397 | 4,960 | |||||||||
Other
noninterest expense
|
3,608 | 1,554 | 5,162 | |||||||||
Total
noninterest expense
|
22,055 | 4,630 | 26,685 | |||||||||
Income
before income tax expense
|
3,673 | 1,935 | 5,608 | |||||||||
Income
tax expense
|
1,131 | 596 | 1,727 | |||||||||
Net
income
|
$ | 2,542 | $ | 1,339 | $ | 3,881 | ||||||
Total
assets at period end
|
$ | 1,475,858 | $ | 1,405 | $ | 1,477,263 |
Six Months Ended June 30,
2009
|
||||||||||||
(in
thousands)
|
PGB
Trust
|
|||||||||||
Banking
|
&
Investments
|
Total
|
||||||||||
Net
interest income
|
$ | 22,429 | $ | 1,545 | $ | 23,974 | ||||||
Noninterest
income
|
2,127 | 4,965 | 7,092 | |||||||||
Total
income
|
24,556 | 6,510 | 31,066 | |||||||||
Provision
for loan losses
|
4,000 | - | 4,000 | |||||||||
Salaries
and benefits
|
8,674 | 2,290 | 10,964 | |||||||||
Premises
and equipment expense
|
3,885 | 374 | 4,259 | |||||||||
Other
noninterest expense
|
4,177 | 1,319 | 5,496 | |||||||||
Total
noninterest expense
|
20,736 | 3,983 | 24,719 | |||||||||
Income
before income tax expense
|
3,820 | 2,527 | 6,347 | |||||||||
Income
tax expense
|
1,165 | 770 | 1,935 | |||||||||
Net
income
|
$ | 2,655 | $ | 1,757 | $ | 4,412 | ||||||
Total
assets at period end
|
$ | 1,457,234 | $ | 1,645 | $ | 1,458,879 |
June
30, 2010
|
December
31, 2009
|
|||||||||||||||
Carrying
|
Fair
|
Carrying
|
Fair
|
|||||||||||||
(In
Thousands)
|
Amount
|
Value
|
Amount
|
Value
|
||||||||||||
Financial
Assets:
|
||||||||||||||||
Cash
and Cash Equivalents
|
$ | 70,292 | $ | 70,292 | $ | 79,972 | $ | 79,972 | ||||||||
Investment
Securities, Held to Maturity
|
101,603 | 101,395 | 89,459 | 87,827 | ||||||||||||
Securities
Available for Sale
|
252,646 | 252,646 | 272,484 | 272,484 | ||||||||||||
Loans,
Net of Allowance for
|
||||||||||||||||
Loan
Losses
|
945,400 | 946,755 | 970,345 | 974,143 | ||||||||||||
Accrued
Interest Receivable
|
4,533 | 4,533 | 4,444 | 4,444 | ||||||||||||
Financial
Liabilities:
|
||||||||||||||||
Deposits
|
1,311,355 | 1,313,995 | 1,349,669 | 1,351,549 | ||||||||||||
Capital
Lease Obligation
|
6,148 | 6,148 | - | - | ||||||||||||
Federal
Home Loan Bank Advances
|
28,342 | 30,589 | 36,499 | 37,729 | ||||||||||||
Accrued
Interest Payable
|
1,042 | 1,042 | 1,447 | 1,447 |
Fair
Value Measurements Using
|
||||||||||||||||
Quoted
|
||||||||||||||||
Prices
in
|
||||||||||||||||
Active
|
||||||||||||||||
Markets
|
Significant
|
|||||||||||||||
For
|
Other
|
Significant
|
||||||||||||||
Identical
|
Observable
|
Unobservable
|
||||||||||||||
Assets
|
Inputs
|
Inputs
|
||||||||||||||
(Level
1)
|
(Level
2)
|
(Level
3)
|
||||||||||||||
June
30,
|
||||||||||||||||
2010
|
||||||||||||||||
Assets:
|
||||||||||||||||
Available
for Sale:
|
||||||||||||||||
U.S.
Government-Sponsored
|
||||||||||||||||
Agencies
|
$ | 120,634 | $ | - | $ | 120,634 | $ | - | ||||||||
Mortgage-Backed
Securities -
|
||||||||||||||||
Residential
|
110,004 | - | 110,004 | - | ||||||||||||
State
and Political Subdivisions
|
18,039 | - | 18,039 | - | ||||||||||||
Other
Securities
|
2,847 | - | 2,847 | - | ||||||||||||
Marketable
Equity Securities
|
1,122 | 1,122 | - | - | ||||||||||||
Total
|
$ | 252,646 | $ | 1,122 | $ | 251,524 | $ | - | ||||||||
December
31,
|
||||||||||||||||
2009 | ||||||||||||||||
Assets:
|
||||||||||||||||
Available
for Sale:
|
||||||||||||||||
U.S.
Government-Sponsored
|
||||||||||||||||
Agencies
|
$ | 129,984 | $ | - | $ | 129,984 | $ | - | ||||||||
Mortgage-Backed
Securities -
|
||||||||||||||||
Residential
|
117,464 | - | 117,464 | - | ||||||||||||
State
and Political Subdivisions
|
19,073 | - | 19,073 | - | ||||||||||||
Other
Securities
|
3,046 | - | 3,046 | - | ||||||||||||
Marketable
Equity Securities
|
2,917 | 2,917 | - | - | ||||||||||||
Total
|
$ | 272,484 | $ | 2,917 | $ | 269,567 | $ | - |
Fair
Value Measurements Using
|
||||||||||||||||
Quoted
|
||||||||||||||||
Prices
in
|
||||||||||||||||
Active
|
||||||||||||||||
Markets
|
Significant
|
|||||||||||||||
For
|
Other
|
Significant
|
||||||||||||||
Identical
|
Observable
|
Unobservable
|
||||||||||||||
Assets
|
Inputs
|
Inputs
|
||||||||||||||
(Level
1)
|
(Level
2)
|
(Level
3)
|
||||||||||||||
June
30,
|
||||||||||||||||
2010
|
||||||||||||||||
Assets:
|
||||||||||||||||
Impaired
Loans
|
$ | 9,985 | $ | - | $ | - | $ | 9,985 | ||||||||
December
31,
|
||||||||||||||||
2009 | ||||||||||||||||
Assets:
|
||||||||||||||||
Impaired
Loans
|
$ | 9,001 | $ | - | $ | - | $ | 9,001 |
|
8.
|
PREFERRED
STOCK
|
|
·
|
a
continued or unexpected decline in the economy, in particular in our New
Jersey market area;
|
|
·
|
declines
in value in our investment
portfolio;
|
|
·
|
higher
than expected increases in our allowance for loan
losses;
|
|
·
|
higher
than expected increases in loan losses or in the level of
nonperforming loans;
|
|
·
|
unexpected
changes in interest rates;
|
|
·
|
we
may be unable to successfully grow our
business;
|
|
·
|
we
may be unable to manage our growth;
|
|
·
|
a
continued or unexpected decline in real estate values within our market
areas;
|
|
·
|
legislative
and regulatory actions (including the impact of the Dodd-Frank Wall Street
and Consumer Protection Act and related regulations) subject us to
additional regulatory oversight which may result in increased compliance
costs;
|
|
·
|
higher
than expected FDIC insurance
premiums;
|
|
·
|
lack
of liquidity to fund our various cash
obligations;
|
|
·
|
repurchase
of our preferred shares issued under the Treasury’s Capital Purchase
Program which will impact net income available to our common shareholders
and our earnings per share;
|
|
·
|
further
offerings of our equity securities may result in dilution of our common
stock;
|
|
·
|
reduction
in our lower-cost funding sources;
|
|
·
|
changes
in accounting policies or accounting
standards;
|
|
·
|
we
may be unable to adapt to technological
changes;
|
|
·
|
our
internal controls and procedures may not be adequate to prevent
losses;
|
|
·
|
claims
and litigation pertaining to fiduciary responsibility, environmental laws
and other matters; and
|
|
·
|
other
unexpected material adverse changes in our operations or
earnings.
|
June 30, 2010
|
June 30, 2009
|
|||||||||||||||||||||||
Average
|
Income/
|
Average
|
Income/
|
|||||||||||||||||||||
Balance
|
Expense
|
Yield
|
Balance
|
Expense
|
Yield
|
|||||||||||||||||||
ASSETS:
|
||||||||||||||||||||||||
Interest-earnings
assets:
|
||||||||||||||||||||||||
Investments:
|
||||||||||||||||||||||||
Taxable
(1)
|
$ | 321,887 | $ | 2,404 | 2.99 | % | $ | 229,392 | $ | 2,287 | 3.99 | % | ||||||||||||
Tax-exempt
(1) (2)
|
35,111 | 420 | 4.78 | 49,031 | 618 | 5.05 | ||||||||||||||||||
Loans
(2) (3)
|
964,070 | 12,774 | 5.30 | 1,032,665 | 14,046 | 5.44 | ||||||||||||||||||
Federal
funds sold
|
201 | - | 0.22 | 200 | - | 0.20 | ||||||||||||||||||
Interest-earning
deposits
|
69,245 | 28 | 0.16 | 27,574 | 9 | 0.13 | ||||||||||||||||||
Total
interest-earning assets
|
1,390,514 | $ | 15,626 | 4.50 | % | 1,338,862 | $ | 16,960 | 5.07 | % | ||||||||||||||
Noninterest
-earning assets:
|
||||||||||||||||||||||||
Cash
and due from banks
|
8,478 | 31,381 | ||||||||||||||||||||||
Allowance
for loan losses
|
(14,075 | ) | (9,853 | ) | ||||||||||||||||||||
Premises
and equipment
|
30,675 | 26,890 | ||||||||||||||||||||||
Other
assets
|
68,786 | 55,486 | ||||||||||||||||||||||
Total
noninterest-earning assets
|
93,964 | 103,904 | ||||||||||||||||||||||
Total
assets
|
$ | 1,484,378 | $ | 1,442,766 | ||||||||||||||||||||
LIABILITIES:
|
||||||||||||||||||||||||
Interest-bearing
deposits:
|
||||||||||||||||||||||||
Checking
|
$ | 254,018 | $ | 420 | 0.66 | % | $ | 193,245 | $ | 349 | 0.72 | % | ||||||||||||
Money
markets
|
510,589 | 1,019 | 0.80 | 414,082 | 1,127 | 1.09 | ||||||||||||||||||
Savings
|
76,092 | 79 | 0.42 | 70,802 | 81 | 0.46 | ||||||||||||||||||
Certificates
of deposit
|
274,240 | 1,103 | 1.61 | 406,518 | 2,638 | 2.60 | ||||||||||||||||||
Total
interest-bearing deposits
|
1,114,939 | 2,621 | 0.94 | 1,084,647 | 4,195 | 1.55 | ||||||||||||||||||
Borrowings
|
32,403 | 291 | 3.59 | 38,925 | 348 | 3.58 | ||||||||||||||||||
Capital
lease obligation
|
2,019 | 51 | 10.09 | - | - | - | ||||||||||||||||||
Total
interest-bearing liabilities
|
1,149,361 | 2,963 | 1.03 | 1,123,572 | 4,543 | 1.62 | ||||||||||||||||||
Noninterest
bearing liabilities
|
||||||||||||||||||||||||
Demand
deposits
|
214,198 | 197,565 | ||||||||||||||||||||||
Accrued
expenses and
|
||||||||||||||||||||||||
other
liabilities
|
5,667 | 5,438 | ||||||||||||||||||||||
Total
noninterest-bearing
|
||||||||||||||||||||||||
liabilities
|
219,865 | 203,003 | ||||||||||||||||||||||
Shareholders’
equity
|
115,152 | 116,191 | ||||||||||||||||||||||
Total
liabilities and
|
||||||||||||||||||||||||
shareholders’
equity
|
$ | 1,484,378 | $ | 1,442,766 | ||||||||||||||||||||
Net
Interest income
|
||||||||||||||||||||||||
(tax-equivalent
basis)
|
12,663 | 12,417 | ||||||||||||||||||||||
Net
interest spread
|
3.47 | % | 3.45 | % | ||||||||||||||||||||
Net
interest margin (4)
|
3.64 | % | 3.71 | % | ||||||||||||||||||||
Tax
equivalent adjustment
|
(176 | ) | (251 | ) | ||||||||||||||||||||
Net
interest income
|
$ | 12,487 | $ | 12,166 |
|
(1)
|
Average
balances for available-for sale securities are based on amortized
cost.
|
|
(2)
|
Interest
income is presented on a tax-equivalent basis using a 35 percent federal
tax rate.
|
|
(3)
|
Loans
are stated net of unearned income and include nonaccrual
loans.
|
|
(4)
|
Net
interest income on a tax-equivalent basis as a percentage of total average
interest-earning assets.
|
June 30, 2010
|
June 30, 2009
|
|||||||||||||||||||||||
Average
|
Income/
|
Average
|
Income/
|
|||||||||||||||||||||
Balance
|
Expense
|
Yield
|
Balance
|
Expense
|
Yield
|
|||||||||||||||||||
ASSETS:
|
||||||||||||||||||||||||
Interest-earnings
assets:
|
||||||||||||||||||||||||
Investments:
|
||||||||||||||||||||||||
Taxable
(1)
|
$ | 323,623 | $ | 4,914 | 3.04 | % | $ | 204,487 | $ | 4,426 | 4.33 | % | ||||||||||||
Tax-exempt
(1) (2)
|
36,448 | 869 | 4.77 | 49,501 | 1,272 | 5.14 | ||||||||||||||||||
Loans
(2) (3)
|
971,231 | 25,768 | 5.31 | 1,040,246 | 28,304 | 5.44 | ||||||||||||||||||
Federal
funds sold
|
201 | - | 0.21 | 200 | - | 0.20 | ||||||||||||||||||
Interest-earning
deposits
|
56,986 | 52 | 0.18 | 27,813 | 18 | 0.13 | ||||||||||||||||||
Total
interest-earning assets
|
1,388,489 | $ | 31,603 | 4.55 | % | 1,322,247 | $ | 34,020 | 5.15 | % | ||||||||||||||
Noninterest
-earning assets:
|
||||||||||||||||||||||||
Cash
and due from banks
|
8,406 | 25,571 | ||||||||||||||||||||||
Allowance
for loan losses
|
(13,925 | ) | (9,733 | ) | ||||||||||||||||||||
Premises
and equipment
|
29,341 | 26,872 | ||||||||||||||||||||||
Other
assets
|
68,817 | 54,945 | ||||||||||||||||||||||
Total
noninterest-earning assets
|
92,639 | 97,655 | ||||||||||||||||||||||
Total
assets
|
$ | 1,481,128 | $ | 1,419,902 | ||||||||||||||||||||
LIABILITIES:
|
||||||||||||||||||||||||
Interest-bearing
deposits:
|
||||||||||||||||||||||||
Checking
|
$ | 246,195 | $ | 826 | 0.67 | % | $ | 180,712 | $ | 646 | 0.71 | % | ||||||||||||
Money
markets
|
502,673 | 2,138 | 0.85 | 397,898 | 2,298 | 1.16 | ||||||||||||||||||
Savings
|
75,642 | 156 | 0.41 | 69,452 | 159 | 0.46 | ||||||||||||||||||
Certificates
of deposit
|
289,860 | 2,420 | 1.67 | 416,708 | 5,728 | 2.75 | ||||||||||||||||||
Total
interest-bearing deposits
|
1,114,370 | 5,540 | 0.99 | 1,064,770 | 8,831 | 1.66 | ||||||||||||||||||
Borrowings
|
34,336 | 615 | 3.58 | 40,278 | 699 | 3.47 | ||||||||||||||||||
Capital
lease obligation
|
1,015 | 51 | 10.03 | - | - | - | ||||||||||||||||||
Total
interest-bearing liabilities
|
1,149,721 | 6,206 | 1.08 | 1,105,048 | 9,530 | 1.72 | ||||||||||||||||||
Noninterest
bearing liabilities
|
||||||||||||||||||||||||
Demand
deposits
|
211,138 | 194,880 | ||||||||||||||||||||||
Accrued
expenses and
|
||||||||||||||||||||||||
other
liabilities
|
5,877 | 5,954 | ||||||||||||||||||||||
Total
noninterest-bearing
|
||||||||||||||||||||||||
liabilities
|
217,015 | 200,834 | ||||||||||||||||||||||
Shareholders’
equity
|
114,392 | 114,020 | ||||||||||||||||||||||
Total
liabilities and
|
||||||||||||||||||||||||
shareholders’
equity
|
$ | 1,481,128 | $ | 1,419,902 | ||||||||||||||||||||
Net
Interest income
|
||||||||||||||||||||||||
(tax-equivalent
basis)
|
25,397 | 24,490 | ||||||||||||||||||||||
Net
interest spread
|
3.47 | % | 3.43 | % | ||||||||||||||||||||
Net
interest margin (4)
|
3.66 | % | 3.70 | % | ||||||||||||||||||||
Tax
equivalent adjustment
|
(363 | ) | (516 | ) | ||||||||||||||||||||
Net
interest income
|
$ | 25,034 | $ | 23,974 |
|
(1)
|
Average
balances for available-for sale securities are based on amortized
cost.
|
|
(2)
|
Interest
income is presented on a tax-equivalent basis using a 35 percent federal
tax rate.
|
|
(3)
|
Loans
are stated net of unearned income and include non-accrual
loans.
|
|
(4)
|
Net
interest income on a tax-equivalent basis as a percentage of total average
interest-earning assets.
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
(In
thousands)
|
2010
|
2009
|
2010
|
2009
|
||||||||||||
Salaries
and employee benefits
|
$ | 5,704 | $ | 5,430 | $ | 11,413 | $ | 10,964 | ||||||||
Premises
and equipment
|
2,588 | 2,171 | 4,960 | 4,259 | ||||||||||||
FDIC
assessment
|
552 | 1,378 | 1,138 | 1,750 | ||||||||||||
Professional
and legal fees
|
377 | 398 | 701 | 694 | ||||||||||||
Trust
department expense
|
367 | 226 | 563 | 362 | ||||||||||||
Advertising
|
221 | 255 | 388 | 411 | ||||||||||||
Telephone
|
165 | 140 | 301 | 250 | ||||||||||||
Stationery
and supplies
|
113 | 130 | 204 | 230 | ||||||||||||
Postage
|
84 | 98 | 192 | 198 | ||||||||||||
Loan
Expense
|
39 | - | 153 | 17 | ||||||||||||
Provision
for OREO losses
|
- | 265 | - | 265 | ||||||||||||
Other
expense
|
795 | 704 | 1,522 | 1,319 | ||||||||||||
Total
other expense
|
$ | 11,005 | $ | 11,195 | $ | 21,535 | $ | 20,719 |
June
30,
|
March
31,
|
December
31,
|
September
30,
|
June
30,
|
||||||||||||||||
2010
|
2010
|
2009
|
2009
|
2009
|
||||||||||||||||
Loans
past due over 90 days
|
||||||||||||||||||||
and
still accruing
|
$ | 736 | $ | 638 | $ | 496 | $ | 1,118 | $ | 104 | ||||||||||
Non-accrual
loans
|
20,361 | 12,200 | 11,256 | 13,082 | 12,998 | |||||||||||||||
Other
real estate owned
|
210 | 40 | 360 | 680 | 700 | |||||||||||||||
Total
non-performing assets
|
$ | 21,307 | $ | 12,878 | $ | 12,112 | $ | 14,880 | $ | 13,802 | ||||||||||
Troubled
debt restructured loans
|
$ | 10,613 | $ | 11,817 | $ | 11,123 | $ | 18,671 | $ | 7,766 | ||||||||||
Loans
past due 30 through 89 days
|
||||||||||||||||||||
and
still accruing
|
$ | 9,444 | $ | 10,056 | $ | 6,015 | $ | 7,362 | $ | 5,524 | ||||||||||
Non-performing
loans as a % of
|
||||||||||||||||||||
total
loans
|
2.20 | % | 1.32 | % | 1.19 | % | 1.41 | % | 1.28 | % | ||||||||||
Non-performing
assets as a % of
|
||||||||||||||||||||
total
assets
|
1.44 | % | 0.87 | % | 0.80 | % | 1.00 | % | 0.95 | % | ||||||||||
Non-performing
assets as a % of
|
||||||||||||||||||||
total
loans plus other real
|
||||||||||||||||||||
estate
owned
|
2.22 | % | 1.33 | % | 1.23 | % | 1.48 | % | 1.35 | % | ||||||||||
Allowance
for loan losses as a %
|
||||||||||||||||||||
of
total loans
|
1.44 | % | 1.41 | % | 1.34 | % | 1.28 | % | 1.08 | % | ||||||||||
Allowance
for loan losses as a %
|
||||||||||||||||||||
of
non-performing loans
|
65.68 | % | 106.87 | % | 112.25 | % | 91.18 | % | 84.37 | % |
(In
thousands)
|
2010
|
2009
|
||||||
Balance,
January 1,
|
$ | 13,192 | $ | 9,688 | ||||
Provision
charged to expense
|
5,150 | 4,000 | ||||||
Charge-offs
|
(4,542 | ) | (2,639 | ) | ||||
Recoveries
|
56 | 5 | ||||||
Balance,
June 30,
|
$ | 13,856 | $ | 11,054 |
June
30,
|
March
31,
|
December
31,
|
September
30,
|
June
30,
|
||||||||||||||||
2010
|
2010
|
2009
|
2009
|
2009
|
||||||||||||||||
Allowance
for loan losses:
|
||||||||||||||||||||
Beginning
of period
|
$ | 13,720 | $ | 13,192 | $ | 12,947 | $ | 11,054 | $ | 9,762 | ||||||||||
Provision
for loan losses
|
2,750 | 2,400 | 2,950 | 2,750 | 2,000 | |||||||||||||||
Charge-offs,
net
|
(2,614 | ) | (1,872 | ) | (2,705 | ) | (857 | ) | (708 | ) | ||||||||||
End
of period
|
$ | 13,856 | $ | 13,720 | $ | 13,192 | $ | 12,947 | $ | 11,054 |
3
|
Articles
of Incorporation and By-Laws:
|
|
A. Certificate
of Incorporation of the Registrant, as amended.
|
||
B. By-Laws
of the Registrant, incorporated herein by reference to the Registrant’s
Current Report on Form 8-K filed on April 23, 2007.
|
||
10.1
|
Change
in Control Agreement by and between Jeffrey J. Carfora and the Corporation
dated April 7, 2010, incorporated herein by reference to the Registrant’s
Current Report on Form 8-K as filed on April 12, 2010.
|
|
10.2
|
Employment
Agreement by and between Jeffrey J. Carfora and the Corporation dated
April 7, 2010, incorporated herein by reference to the Registrant’s
Current Report on Form 8-K as filed on April 12, 2010.
|
|
10.3
|
Executive
officer compensation limitation in connection with the Securities Purchase
Agreement that provides for the Registrant’s participation in the Capital
Purchase Program under the Treasury’s Troubled Assets Relief Program,
incorporated herein by reference to the Registrant’s Quarterly Report on
Form 10-Q as filed on May 7, 2010.
|
|
31.1
|
Certification
of Frank A. Kissel, Chief Executive Officer of the Corporation, pursuant
to Securities Exchange Act Rule 13a-14(a).
|
|
31.2
|
Certification
of Jeffrey J. Carfora, Chief Financial Officer of the Corporation,
pursuant to Securities Exchange Act Rule 13a-14(a).
|
|
32
|
Certification
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act Of 2002, signed by Frank A. Kissel, Chief Executive
Officer of the Corporation, and Jeffrey J. Carfora, Chief Financial
Officer of the Corporation.
|
PEAPACK-GLADSTONE
FINANCIAL CORPORATION
|
|
(Registrant)
|
|
DATE: August
9, 2010
|
By: /s/
Frank A. Kissel
|
Frank
A. Kissel
|
|
Chairman
of the Board and Chief Executive Officer
|
|
DATE: August
9, 2010
|
By: /s/
Jeffrey J. Carfora
|
Jeffrey
J. Carfora
|
|
Executive
Vice President and Chief Financial Officer and
|
|
Chief
Accounting Officer
|
Number
|
Description
|
|
3
|
Articles
of Incorporation and By-Laws:
|
|
A.
Certificate of Incorporation of the Registrant, as amended, incorporated
herein by reference to the Registrant’s Quarterly Report on Form 10Q as
filed on November 9, 2009.
|
||
B. By-Laws
of the Registrant, incorporated herein by reference to the Registrant’s
Current Report on Form 8-K filed on April 23, 2007.
|
||
|
||
10.1
|
Change
in Control Agreement by and between Jeffrey J. Carfora and the Corporation
dated April 7, 2010, incorporated herein by reference to the Registrant’s
Current Report on Form 8-K as filed on April 12, 2010.
|
|
10.2
|
Employment
Agreement by and between Jeffrey J. Carfora and the Corporation dated
April 7, 2010, incorporated herein by reference to the Registrant’s
Current Report on Form 8-K as filed on April 12, 2010.
|
|
10.3
|
Executive
officer compensation limitation in connection with the Securities Purchase
Agreement that provides for the Registrant’s participation in the Capital
Purchase Program under the Treasury’s Troubled Assets Relief Program,
incorporated herein by reference to the Registrant’s Quarterly Report on
Form 10-Q as filed on May 7, 2010.
|
|
31.1
|
Certification
of Frank A. Kissel, Chief Executive Officer of the Corporation, pursuant
to Securities Exchange Act Rule 13a-14(a).
|
|
31.2
|
Certification
of Jeffrey J. Carfora, Chief Financial Officer of the Corporation,
pursuant to Securities Exchange Act Rule 13a-14(a).
|
|
32
|
Certification
Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act Of 2002, signed by Frank A. Kissel, Chief Executive
Officer of the Corporation, and Jeffrey J. Carfora, Chief Financial
Officer of the Corporation.
|