PEOPLES FINANCIAL SERVICES CORP.
FORM 10-K
For the Year Ended December 31, 2011
TABLE OF CONTENTS
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Page
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Part I
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Number
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Item 1.
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Business
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3
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Item 1A.
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Risk Factors
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12
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Item 1B.
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Unresolved Staff Comments
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15
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Item 2.
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Properties
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15
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Item 3.
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Legal Proceedings
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15
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Item 4.
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Mine Safety Disclosures
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15
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Part II
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||
Item 5.
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Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
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15
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Item 6.
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Selected Financial Data
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18
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Item 7.
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Management's Discussion and Analysis of Financial Condition and
Results of Operations
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19
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Item 7A.
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Quantitative and Qualitative Disclosures About Market Risk
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52
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Item 8.
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Financial Statements and Supplementary Data
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53
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Item 9
.
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
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97
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Item 9A.
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Controls and Procedures
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97
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Item 9B.
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Other Information
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100
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Part III
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Item 10.
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Directors, Executive Officers and Corporate Governance
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100
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Item 11.
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Executive Compensation
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100
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Item 12
.
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Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters
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100
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Item 13.
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Certain Relationships and Related Transactions, and Director Independence
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100
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Item 14.
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Principal Accountant Fees and Services
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100
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Part IV
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Item 15
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Exhibits and Financial Statement Schedules
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101
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SIGNATURES
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102
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·
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the city of Binghamton, Broome County, New York, located to the north;
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·
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the city of Scranton, Lackawanna County, Pennsylvania, to the south; and
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Wilkes-Barre, Luzerne County, Pennsylvania, to the southwest.
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·
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the appointment of a conservator or receiver;
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·
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the issuance of a cease and desist order;
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·
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the termination of deposit insurance, the imposition of civil money penalties on the institution, its directors, officers, employees and institution affiliated parties;
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·
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the issuance of directives to increase capital;
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·
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the issuance of formal and informal agreements;
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·
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the removal of or restrictions on directors, officers, employees and institution-affiliated parties; and
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·
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the enforcement of any such mechanisms through restraining orders or any other court actions.
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·
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The first tier provides for civil penalties of up to $5 thousand per day for any violation of law or regulation
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The second tier provides for civil penalties of up to $25 thousand per day if more than a minimal loss or a pattern is involved.
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·
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Finally, civil penalties of up to $1 million per day may be assessed for knowingly or recklessly causing a substantial loss to an institution or taking action that results in a substantial pecuniary gain or other benefit.
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·
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publicly available annual financial condition and management reports for financial institutions, including audits by independent accountants;
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·
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the establishment of uniform accounting standards by federal banking agencies;
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·
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the establishment of a “prompt corrective action” system of regulatory supervision and intervention, based on capitalization levels, with more scrutiny and restrictions placed on depository institutions with lower levels of capital;
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·
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additional grounds for the appointment of a conservator or receiver; and
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·
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restrictions or prohibitions on accepting brokered deposits, except for institutions which significantly exceed minimum capital requirements.
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"well capitalized";
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"adequately capitalized";
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"under capitalized";
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"significantly undercapitalized"; and
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·
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"critically undercapitalized".
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·
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internal controls;
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·
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information systems and internal audit systems;
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·
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loan documentation;
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·
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credit underwriting;
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·
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interest rate exposure;
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·
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asset growth; and
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·
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compensation fees and benefits.
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·
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"Tier 1", or core capital, includes common equity, perpetual preferred stock and minority interest in equity accounts of consolidated subsidiaries, less goodwill and other intangibles, subject to certain exceptions.
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·
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"Tier 2", or supplementary capital, includes, among other things, limited life preferred stock, hybrid capital instruments, mandatory convertible securities, qualifying subordinated debt, and the allowance for loan and lease losses, subject to certain limitations and less restricted deductions. The inclusion of elements of Tier 2 capital is subject to certain other requirements and limitations of the federal banking agencies.
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·
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limitations on its ability to pay dividends;
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·
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the issuance by the applicable regulatory authority of a capital directive to increase capital, and in the case of depository institutions, the termination of deposit insurance by the FDIC, as well as to the measures described under FDICIA as applicable to undercapitalized institutions.
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2011
|
2010
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|||||||||||||||||||||||
Low
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High
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Dividends Declared
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Low
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High
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Dividends Declared
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|||||||||||||||||||
First Quarter
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$ | 26.31 | $ | 28.00 | $ | 0.20 | $ | 18.05 | $ | 22.75 | $ | 0.19 | ||||||||||||
Second Quarter
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25.50 | 27.50 | 0.20 | 21.65 | 29.00 | 0.20 | ||||||||||||||||||
Third Quarter
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26.90 | 28.25 | 0.20 | 26.00 | 28.00 | 0.20 | ||||||||||||||||||
Fourth Quarter
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$ | 27.05 | $ | 28.25 | $ | 0.20 | $ | 26.60 | $ | 28.00 | $ | 0.20 |
Number of securities to be issued upon exercise of outstanding options, warrants and rights
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Weighted-average exercise price of outstanding options, warrants and rights
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Number of securities remaining available for future issuance under equity compensation plans
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Equity compensation plans approved
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13,399 | $ | 26.59 | 35,451 | ||||||||
Equity compensation plans not approved
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Total
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13,399 | $ | 26.59 | 35,451 |
Month Ending
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Total Number of Shares Purchased
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Average Price Paid Per Share
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Total Number of Shares Purchased as Part of Publicly Announced Programs(1)
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Maximum Number of Shares that may yet be Purchased Under the Programs(1)
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||||||||||||
October 31, 2011
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8,000 | 27.35 | 8,000 | 37,651 | ||||||||||||
November 30, 2011
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37,651 | |||||||||||||||
December 31, 2011
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2,200 | 27.80 | 2,200 | 35,451 | ||||||||||||
Total
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10,200 | 27.45 | 10,200 |
Period Ending
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||||||||||||||||||||||||
Index
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12/31/06
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12/31/07
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12/31/08
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12/31/09
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12/31/10
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12/31/11
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Peoples Financial Services Corp.
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$ | 100.00 | $ | 104.01 | $ | 75.66 | $ | 77.18 | $ | 117.50 | $ | 128.54 | ||||||||||||
NASDAQ Bank
|
100.00 | 80.09 | 62.84 | 52.60 | 60.04 | 53.74 | ||||||||||||||||||
S&P 500
|
$ | 100.00 | $ | 105.49 | $ | 66.46 | $ | 84.05 | $ | 96.71 | $ | 98.76 |
Year Ended December 31
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2011
|
2010
|
2009
|
2008
|
2007
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Condensed statements of financial performance:
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||||||||||||||||||||
Interest income
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$ | 27,350 | $ | 25,577 | $ | 24,273 | $ | 25,479 | $ | 24,611 | ||||||||||
Interest expense
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5,639 | 6,498 | 7,258 | 9,154 | 11,105 | |||||||||||||||
Net interest income
|
21,711 | 19,079 | 17,015 | 16,325 | 13,506 | |||||||||||||||
Provision for loan losses
|
1,794 | 2,202 | 1,735 | 713 | 280 | |||||||||||||||
Net interest income after provision for loan losses
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19,917 | 16,877 | 15,280 | 15,612 | 13,226 | |||||||||||||||
Noninterest income (loss)
|
5,567 | 4,290 | 3,082 | (1,809 | ) | 3,308 | ||||||||||||||
Noninterest expense
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15,310 | 13,245 | 12,390 | 10,677 | 10,566 | |||||||||||||||
Income before income taxes
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10,174 | 7,922 | 5,972 | 3,126 | 5,968 | |||||||||||||||
Provision for income tax expense
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2,357 | 1,437 | 923 | 87 | 1,097 | |||||||||||||||
Net income
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$ | 7,817 | $ | 6,485 | $ | 5,049 | $ | 3,039 | $ | 4,871 | ||||||||||
Condensed statements of financial position:
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Investment securities
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$ | 139,899 | $ | 121,772 | $ | 130,506 | $ | 107,589 | $ | 109,471 | ||||||||||
Net loans
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439,754 | 386,672 | 332,196 | 313,606 | 288,524 | |||||||||||||||
Other assets
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41,751 | 50,143 | 53,781 | 51,181 | 36,439 | |||||||||||||||
Total assets
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$ | 621,404 | $ | 558,587 | $ | 516,483 | $ | 472,376 | $ | 434,434 | ||||||||||
Deposits
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$ | 494,283 | $ | 438,734 | $ | 410,038 | $ | 371,268 | $ | 327,430 | ||||||||||
Short-term borrowings
|
43,791 | 38,724 | 20,439 | 18,432 | 22,848 | |||||||||||||||
Long-term debt
|
18,927 | 27,336 | 38,750 | 39,691 | 38,534 | |||||||||||||||
Other liabilities
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4,790 | 3,277 | 2,286 | 3,265 | 2,817 | |||||||||||||||
Stockholders’ equity
|
59,613 | 50,516 | 44,970 | 39,720 | 42,805 | |||||||||||||||
Total liabilities and stockholders’ equity
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$ | 621,404 | $ | 558,587 | $ | 516,483 | $ | 472,376 | $ | 434,434 | ||||||||||
Per share data:
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||||||||||||||||||||
Net income
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$ | 2.49 | $ | 2.07 | $ | 1.61 | $ | 0.97 | $ | 1.55 | ||||||||||
Cash dividends declared
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0.80 | 0.79 | 0.76 | 0.76 | 0.76 | |||||||||||||||
Stockholders’ equity
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$ | 19.11 | $ | 16.07 | $ | 14.34 | $ | 12.69 | $ | 13.64 | ||||||||||
Cash dividends declared as a percentage of net income
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32.28 | % | 38.24 | % | 47.15 | % | 79.53 | % | 48.92 | % | ||||||||||
Average common shares outstanding
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3,136,663 | 3,139,606 | 3,133,518 | 3,128,170 | 3,135,889 | |||||||||||||||
Selected ratios (based on average balances):
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||||||||||||||||||||
Net income as a percentage of total assets
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1.33 | % | 1.18 | % | 1.07 | % | 0.68 | % | 1.17 | % | ||||||||||
Net income as a percentage of stockholders’ equity
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14.80 | 13.87 | 12.62 | 7.53 | 11.85 | |||||||||||||||
Stockholders’ equity as a percentage of total assets
|
8.99 | 8.53 | 8.50 | 9.01 | 9.86 | |||||||||||||||
Tier I capital as a percentage of adjusted total assets
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9.42 | 9.19 | 9.92 | 9.31 | 10.14 | |||||||||||||||
Net interest income as a percentage of earning assets
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4.18 | 4.00 | 4.23 | 4.25 | 3.82 | |||||||||||||||
Loans, net, as a percentage of deposits
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89.70 | % | 84.67 | % | 87.33 | % | 86.38 | % | 86.13 | % | ||||||||||
Selected ratios and data (based on period end balances):
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Tier I capital as a percentage of risk-weighted assets
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11.57 | % | 11.72 | % | 12.30 | % | 12.26 | % | 13.64 | % | ||||||||||
Total capital as a percentage of risk-weighted assets
|
12.69 | 12.68 | 13.18 | 13.10 | 14.42 | |||||||||||||||
Allowance for loan losses as a percentage of loans, net
|
1.20 | 1.05 | 0.99 | 0.95 | 0.84 | |||||||||||||||
Nonperforming loans as a percentage of loans, net
|
2.30 | % | 1.77 | % | 0.99 | % | 1.63 | % | 0.17 | % |
December 31
|
2011
|
2010
|
||||||
United States
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8.5 | % | 9.4 | % | ||||
Pennsylvania
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7.2 | % | 8.1 | % | ||||
New York
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8.0 | % | 8.0 | % | ||||
Lackawanna County
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8.1 | % | 8.8 | % | ||||
Susquehanna County
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7.0 | % | 7.8 | % | ||||
Wyoming County
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8.2 | % | 9.9 | % | ||||
Broome County
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8.2 | % | 8.7 | % |
2011
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2010
|
2009
|
||||||||||||||||||||||
December 31
|
Amount
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%
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Amount
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%
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Amount
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%
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||||||||||||||||||
U.S. Government-sponsored enterprises
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$ | 32,776 | 23.43 | % | $ | 38,785 | 31.85 | % | $ | 60,086 | 46.04 | % | ||||||||||||
State and municipals:
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Taxable
|
19,728 | 14.10 | 18,374 | 15.09 | 2,156 | 1.65 | ||||||||||||||||||
Tax-exempt
|
39,686 | 28.37 | 50,309 | 41.31 | 51,544 | 39.50 | ||||||||||||||||||
Corporate debt securities
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3,850 | 2.75 | 4,020 | 3.30 | 10,334 | 7.92 | ||||||||||||||||||
Mortgage-backed securities:
|
||||||||||||||||||||||||
U.S. Government agencies
|
16,912 | 12.09 | 4,476 | 3.68 | 1,427 | 1.09 | ||||||||||||||||||
U.S. Government-sponsored enterprises
|
26,263 | 18.77 | 4,527 | 3.72 | 3,792 | 2.91 | ||||||||||||||||||
Equity securities:
|
||||||||||||||||||||||||
Preferred
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117 | 0.08 | 54 | 0.04 | 85 | 0.07 | ||||||||||||||||||
Common
|
567 | 0.41 | 1,227 | 1.01 | 1,082 | 0.83 | ||||||||||||||||||
Total
|
$ | 139,899 | 100.00 | % | $ | 121,772 | 100.00 | % | $ | 130,506 | 100.00 | % |
Within one year
|
After one but within five years
|
After five but within ten years
|
After ten years
|
Total
|
||||||||||||||||||||||||||||||||||||
December 31, 2011
|
Amount
|
Yield
|
Amount
|
Yield
|
Amount
|
Yield
|
Amount
|
Yield
|
Amount
|
Yield
|
||||||||||||||||||||||||||||||
Amortized cost:
|
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U.S. Government-sponsored
enterprises
|
$ | 8,349 | 2.88 | % | $ | 20,289 | 3.62 | % | $ | 1,033 | 4.92 | % | $ | 29,671 | 3.46 | % | ||||||||||||||||||||||||
State and municipals:
|
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Taxable
|
$ | 480 | 2.17 | % | 241 | 2.72 | 3,836 | 4.83 | 13,563 | 5.07 | 18,120 | 4.91 | ||||||||||||||||||||||||||||
Tax-exempt
|
251 | 2.66 | 1,571 | 4.22 | 6,366 | 5.61 | 30,029 | 6.31 | 38,217 | 6.09 | ||||||||||||||||||||||||||||||
Corporate debt securities
|
1,980 | 6.09 | 2,202 | 5.79 | 280 | 4,462 | 5.56 | |||||||||||||||||||||||||||||||||
Mortgage-backed securities:
|
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U.S. Government agencies
|
4,902 | 1.01 | 8,219 | 1.19 | 3,706 | 3.34 | 16,827 | 1.61 | ||||||||||||||||||||||||||||||||
U.S. Government-sponsored
enterprises
|
16,462 | 1.07 | 6,551 | 1.07 | 3,383 | 2.93 | 26,396 | 1.31 | ||||||||||||||||||||||||||||||||
Equity securities:
|
||||||||||||||||||||||||||||||||||||||||
Preferred
|
54 | 54 | ||||||||||||||||||||||||||||||||||||||
Common
|
629 | 4.43 | 629 | 4.43 | ||||||||||||||||||||||||||||||||||||
Total
|
$ | 731 | 2.34 | % | $ | 33,505 | 1.97 | % | $ | 47,463 | 3.31 | % | $ | 52,677 | 5.47 | % | $ | 134,376 | 3.82 | % | ||||||||||||||||||||
Fair value:
|
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U.S. Government-sponsored
enterprises
|
$ | 8,971 | $ | 22,564 | $ | 1,241 | $ | 32,776 | ||||||||||||||||||||||||||||||||
State and municipals:
|
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Taxable
|
$ | 481 | 246 | 4,204 | 14,797 | 19,728 | ||||||||||||||||||||||||||||||||||
Tax-exempt
|
251 | 1,654 | 6,754 | 31,027 | 39,686 | |||||||||||||||||||||||||||||||||||
Corporate debt securities
|
1,410 | 1,928 | 512 | 3,850 | ||||||||||||||||||||||||||||||||||||
Mortgage-backed securities:
|
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U.S. Government agencies
|
4,847 | 8,187 | 3,878 | 16,912 | ||||||||||||||||||||||||||||||||||||
U.S. Government-sponsored
enterprises
|
16,292 | 6,528 | 3,443 | 26,263 | ||||||||||||||||||||||||||||||||||||
Equity securities:
|
||||||||||||||||||||||||||||||||||||||||
Preferred
|
117 | 117 | ||||||||||||||||||||||||||||||||||||||
Common
|
567 | 567 | ||||||||||||||||||||||||||||||||||||||
Total
|
$ | 732 | $ | 33,420 | $ | 50,165 | $ | 55,582 | $ | 139,899 |
2011
|
2010
|
2009
|
2008
|
2007
|
||||||||||||||||||||||||||||||||||||
December 31
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
||||||||||||||||||||||||||||||
Commercial
|
$ | 160,828 | 36.13 | % | $ | 112,526 | 28.80 | % | $ | 82,287 | 24.52 | % | $ | 71,723 | 22.65 | % | $ | 63,536 | 21.84 | % | ||||||||||||||||||||
Real estate:
|
||||||||||||||||||||||||||||||||||||||||
Commercial
|
145,554 | 32.70 | 136,910 | 35.04 | 116,294 | 34.66 | 107,084 | 33.82 | 92,705 | 31.86 | ||||||||||||||||||||||||||||||
Residential
|
118,125 | 26.54 | 119,424 | 30.56 | 116,150 | 34.62 | 120,813 | 38.16 | 116,845 | 40.16 | ||||||||||||||||||||||||||||||
Consumer
|
20,596 | 4.63 | 21,912 | 5.60 | 20,802 | 6.20 | 16,988 | 5.37 | 17,889 | 6.14 | ||||||||||||||||||||||||||||||
Loans, net
|
445,103 | 100.00 | % | 390,772 | 100.00 | % | 335,533 | 100.00 | % | 316,608 | 100.00 | % | 290,975 | 100.00 | % | |||||||||||||||||||||||||
Less: allowance for loan loss
|
5,349 | 4,100 | 3,337 | 3,002 | 2,451 | |||||||||||||||||||||||||||||||||||
Net loans
|
$ | 439,754 | $ | 386,672 | $ | 332,196 | $ | 313,606 | $ | 288,524 |
December 31
|
Within one year
|
After one but within five years
|
After five years
|
Total
|
||||||||||||
Maturity schedule:
|
||||||||||||||||
Commercial
|
$ | 28,917 | $ | 38,147 | $ | 93,764 | $ | 160,828 | ||||||||
Real estate:
|
||||||||||||||||
Commercial
|
8,319 | 33,487 | 103,748 | 145,554 | ||||||||||||
Residential
|
5,352 | 21,729 | 91,044 | 118,125 | ||||||||||||
Consumer
|
4,481 | 9,501 | 6,614 | 20,596 | ||||||||||||
Total
|
$ | 47,069 | $ | 102,864 | $ | 295,170 | $ | 445,103 | ||||||||
Predetermined interest rates
|
$ | 21,653 | $ | 34,526 | $ | 40,408 | $ | 96,587 | ||||||||
Floating or adjustable interest rates
|
25,416 | 68,338 | 254,762 | 348,516 | ||||||||||||
Total
|
$ | 47,069 | $ | 102,864 | $ | 295,170 | $ | 445,103 |
December 31
|
2011
|
2010
|
2009
|
|||||||||
Commitments to extend credit
|
$ | 7,429 | $ | 5,617 | $ | 5,714 | ||||||
Unused portions of lines of credit
|
45,320 | 32,225 | 32,990 | |||||||||
Commercial letters of credit
|
17,051 | 18,170 | 15,691 | |||||||||
Total
|
$ | 69,800 | $ | 56,012 | $ | 54,395 |
December 31
|
2011
|
2010
|
2009
|
2008
|
2007
|
|||||||||||||||
Nonaccrual loans:
|
||||||||||||||||||||
Commercial
|
$ | 5,871 | $ | 5,490 | $ | 59 | $ | 244 | ||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
1,170 | 371 | 2,469 | 358 | $ | 395 | ||||||||||||||
Residential
|
889 | 630 | 227 | |||||||||||||||||
Consumer
|
22 | |||||||||||||||||||
Total nonaccrual loans
|
7,930 | 6,513 | 2,528 | 829 | 395 | |||||||||||||||
Restructured loans:
|
||||||||||||||||||||
Commercial
|
1,667 | 559 | ||||||||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
4,042 | |||||||||||||||||||
Residential
|
||||||||||||||||||||
Consumer
|
||||||||||||||||||||
Total restructured loans
|
1,667 | 559 | 4,042 | |||||||||||||||||
Accruing loans past due 90 days or more:
|
||||||||||||||||||||
Commercial
|
12 | 123 | 21 | 177 | ||||||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
218 | 68 | 91 | |||||||||||||||||
Residential
|
337 | |||||||||||||||||||
Consumer
|
311 | 269 | ||||||||||||||||||
Total accruing loans past due 90 days or more
|
660 | 392 | 239 | 245 | 91 | |||||||||||||||
Total nonperforming loans
|
10,257 | 6,905 | 3,326 | 5,116 | 486 | |||||||||||||||
Foreclosed assets
|
399 | 3,387 | 5,534 | 5,171 | 4,675 | |||||||||||||||
Total nonperforming assets
|
$ | 10,656 | $ | 10,292 | $ | 8,860 | $ | 10,287 | $ | 5,161 | ||||||||||
Nonperforming loans as a percentage of loans, net
|
2.30 | % | 1.77 | % | 0.99 | % | 1.63 | % | 0.17 | % | ||||||||||
Nonperforming assets as a percentage of loans, net and foreclosed assets
|
2.39 | % | 2.61 | % | 2.60 | % | 3.23 | % | 1.76 | % |
·
|
Hiring an independent loan review company to provide a independent review of existing credits and assist us with our credit risk management practices, including the review of and recommendations for enhancing the allowance for loan loss policy, loan review function and credit related processes such as underwriting, approval and monitoring of loans;
|
·
|
Enhancing the oversight and workout of classified assets and adding staff to the workout and loan review functions;
|
·
|
Initiating the formation of a problem loan committee for the purpose of monitoring the status of problem assets and devising action plans for the timely workout or liquidation of these assets;
|
·
|
Overhauling the appraisal process by requiring new appraisals on all impaired loans subject to evaluation under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 310, “Receivables,” and any loan that is delinquent over 60 days; and
|
·
|
Tightening underwriting standards to ensure a more rigorous review of potential loans and more conservative lending standards.
|
December 31
|
2011
|
2010
|
2009
|
2008
|
2007
|
|||||||||||||||
Allowance for loan losses at beginning of period
|
$ | 4,100 | $ | 3,337 | $ | 3,002 | $ | 2,451 | $ | 1,792 | ||||||||||
Loans charged-off:
|
||||||||||||||||||||
Commercial
|
374 | 1,360 | 419 | 49 | ||||||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
77 | 948 | 93 | |||||||||||||||||
Residential
|
9 | 25 | 46 | 4 | 3 | |||||||||||||||
Consumer
|
139 | 104 | 134 | 100 | 71 | |||||||||||||||
Total
|
599 | 1,489 | 1,547 | 246 | 74 | |||||||||||||||
Loans recovered:
|
||||||||||||||||||||
Commercial
|
1 | 19 | 48 | 11 | 422 | |||||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
2 | 50 | ||||||||||||||||||
Residential
|
1 | 3 | 34 | 4 | ||||||||||||||||
Consumer
|
50 | 31 | 46 | 39 | 27 | |||||||||||||||
Total
|
54 | 50 | 147 | 84 | 453 | |||||||||||||||
Net loans charged-off (recovered)
|
545 | 1,439 | 1,400 | 162 | (379 | ) | ||||||||||||||
Provision for loan losses
|
1,794 | 2,202 | 1,735 | 713 | 280 | |||||||||||||||
Allowance for loan losses at end of period
|
$ | 5,349 | $ | 4,100 | $ | 3,337 | $ | 3,002 | $ | 2,451 | ||||||||||
Ratios:
|
||||||||||||||||||||
Net loans charged-off as a percentage of average loans outstanding
|
0.13 | % | 0.40 | % | 0.43 | % | 0.05 | % | (0.14 | )% | ||||||||||
Allowance for loan losses as a percentage of period end loans
|
1.20 | % | 1.05 | % | 0.99 | % | 0.95 | % | 0.84 | % |
2011
|
2010
|
2009
|
2008
|
2007
|
||||||||||||||||||||||||||||||||||||
December 31
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
Amount
|
%
|
||||||||||||||||||||||||||||||
Allocated allowance:
|
||||||||||||||||||||||||||||||||||||||||
Specific:
|
||||||||||||||||||||||||||||||||||||||||
Commercial
|
$ | 698 | 1.89 | % | $ | 663 | 1.51 | % | $ | 108 | 2.58 | % | $ | 243 | 0.38 | % | ||||||||||||||||||||||||
Real Estate:
|
||||||||||||||||||||||||||||||||||||||||
Commercial
|
40 | 1.76 | 122 | 2.28 | 578 | 0.31 | 331 | 1.39 | ||||||||||||||||||||||||||||||||
Residential
|
71 | 0.28 | 9 | 0.17 | 18 | 0.11 | 30 | 0.05 | $ | 5 | 0.03 | % | ||||||||||||||||||||||||||||
Consumer
|
1 | 31 | 0.01 | 17 | 0.01 | |||||||||||||||||||||||||||||||||||
Total specific
|
810 | 3.93 | 825 | 3.97 | 721 | 3.01 | 604 | 1.82 | 5 | 0.03 | ||||||||||||||||||||||||||||||
Formula:
|
||||||||||||||||||||||||||||||||||||||||
Commercial
|
1,349 | 34.24 | 1,033 | 27.28 | 178 | 21.94 | 152 | 22.27 | % | 187 | 21.84 | |||||||||||||||||||||||||||||
Real Estate:
|
||||||||||||||||||||||||||||||||||||||||
Commercial
|
1,475 | 30.94 | 1,262 | 32.75 | 1,434 | 34.35 | 1,233 | 32.43 | 1,511 | 31.86 | ||||||||||||||||||||||||||||||
Residential
|
690 | 26.26 | 717 | 30.39 | 728 | 34.51 | 608 | 38.11 | 603 | 40.13 | ||||||||||||||||||||||||||||||
Consumer
|
197 | 4.63 | 212 | 5.61 | 199 | 6.19 | 151 | 5.37 | 145 | 6.14 | ||||||||||||||||||||||||||||||
Total formula
|
3,711 | 96.07 | 3,224 | 96.03 | 2,539 | 96.99 | 2,144 | 98.18 | 2,446 | 99.97 | ||||||||||||||||||||||||||||||
Total allocated allowance
|
4,521 | 100.00 | % | 4,049 | 100.00 | % | 3,260 | 100.00 | % | 2,748 | 100.00 | % | 2,451 | 100.00 | % | |||||||||||||||||||||||||
Unallocated allowance
|
828 | 51 | 77 | 254 | ||||||||||||||||||||||||||||||||||||
Total
|
$ | 5,349 | $ | 4,100 | $ | 3,337 | $ | 3,002 | $ | 2,451 |
2011
|
2010
|
2009
|
||||||||||||||||||||||
Year Ended December 31
|
Average Balance
|
Average Rate
|
Average Balance
|
Average Rate
|
Average Balance
|
Average Rate
|
||||||||||||||||||
Interest-bearing:
|
||||||||||||||||||||||||
Money market accounts
|
$ | 39,927 | 0.63 | % | $ | 36,829 | 0.75 | % | $ | 32,771 | 1.05 | % | ||||||||||||
NOW accounts
|
49,299 | 0.58 | 42,992 | 0.70 | 35,697 | 0.91 | ||||||||||||||||||
Savings accounts
|
194,523 | 0.80 | 187,007 | 1.08 | 130,652 | 1.30 | ||||||||||||||||||
Time deposits less than $100
|
75,216 | 2.31 | 70,269 | 2.44 | 84,233 | 2.83 | ||||||||||||||||||
Time deposits $100 or more
|
28,729 | 2.06 | 20,253 | 1.90 | 22,120 | 2.61 | ||||||||||||||||||
Total interest-bearing
|
387,694 | 1.14 | % | 357,350 | 1.31 | % | 305,473 | 1.74 | % | |||||||||||||||
Noninterest-bearing
|
81,224 | 72,846 | 62,325 | |||||||||||||||||||||
Total deposits
|
$ | 468,918 | $ | 430,196 | $ | 367,798 |
December 31
|
2011
|
2010
|
2009
|
|||||||||
Within three months
|
$ | 6,984 | $ | 7,492 | $ | 4,912 | ||||||
After three months but within six months
|
2,212 | 1,574 | 2,916 | |||||||||
After six months but within twelve months
|
3,552 | 2,223 | 3,480 | |||||||||
After twelve months
|
23,987 | 15,997 | 9,121 | |||||||||
Total
|
$ | 36,735 | $ | 27,286 | $ | 20,429 |
December 31, 2011
|
Due within three months
|
Due after three months but within twelve months
|
Due after one year but within five years
|
Due after five years
|
Total
|
|||||||||||||||
Rate-sensitive assets:
|
||||||||||||||||||||
Interest-bearing deposits in other banks
|
$ | 71 | $ | 1,000 | $ | 1,071 | ||||||||||||||
Investment securities available-for-sale
|
11,000 | $ | 17,296 | 42,249 | $ | 69,354 | 139,899 | |||||||||||||
Loans held for sale
|
569 | 569 | ||||||||||||||||||
Loans, net
|
108,237 | 70,029 | 192,458 | 74,379 | 445,103 | |||||||||||||||
Total rate-sensitive assets
|
$ | 119,877 | $ | 87,325 | $ | 235,707 | $ | 143,733 | $ | 586,642 | ||||||||||
Rate-sensitive liabilities:
|
||||||||||||||||||||
Money market accounts
|
$ | 17,830 | $ | 20,094 | $ | 37,924 | ||||||||||||||
NOW accounts
|
28,615 | $ | 25,741 | 54,356 | ||||||||||||||||
Savings accounts
|
153,615 | 46,804 | 200,419 | |||||||||||||||||
Time deposits less than $100
|
15,966 | 15,608 | 35,015 | $ | 5,275 | 71,864 | ||||||||||||||
Time deposits $100 or more
|
6,984 | 5,764 | 21,968 | 2,019 | 36,735 | |||||||||||||||
Short-term borrowings
|
43,791 | 43,791 | ||||||||||||||||||
Long-term debt
|
196 | 5,601 | 13,061 | 69 | 18,927 | |||||||||||||||
Total rate-sensitive liabilities
|
$ | 266,997 | $ | 52,714 | $ | 136,942 | $ | 7,363 | $ | 464,016 | ||||||||||
Rate-sensitivity gap:
|
||||||||||||||||||||
Period
|
$ | (147,120 | ) | $ | 34,611 | $ | 98,765 | $ | 136,370 | |||||||||||
Cumulative
|
$ | (147,120 | ) | $ | (112,509 | ) | $ | (13,744 | ) | $ | 122,626 | |||||||||
RSA/RSL ratio:
|
||||||||||||||||||||
Period
|
0.45 | 1.66 | 1.72 | 19.52 | ||||||||||||||||
Cumulative
|
0.45 | 0.65 | 0.97 | 1.26 | 1.26 |
·
|
Funding new and existing loan commitments;
|
·
|
Payment of deposits on demand or at their contractual maturity;
|
·
|
Repayment of borrowings as they mature;
|
·
|
Payment of lease obligations; and
|
·
|
Payment of operating expenses.
|
·
|
FHLB-Pgh liquidity contingency line of credit;
|
·
|
Federal Reserve Bank discount window;
|
·
|
Internet certificates of deposit;
|
·
|
Brokered deposits;
|
·
|
Institutional Deposit Corporation deposits;
|
·
|
Repurchase agreements; and
|
·
|
Federal funds purchased.
|
·
|
The current and expected capital requirements, including the maintenance of capital ratios in excess of minimum regulatory guidelines;
|
·
|
The market value of our securities and the resulting effect on capital;
|
·
|
Nonperforming asset levels and the effect deterioration in asset quality will have on capital;
|
·
|
Any planned asset growth;
|
·
|
The anticipated level of net earnings and capital position, taking into account the projected asset/liability position and exposure to changes in interest rates; and
|
·
|
The source and timing of additional funds to fulfill future capital requirements.
|
·
|
Variations in the volume, rate and composition of earning assets and interest-bearing liabilities;
|
·
|
Changes in general market interest rates; and
|
·
|
The level of nonperforming assets.
|
2011 vs 2010
Increase (decrease)
attributable to
|
2010 vs 2009
Increase (decrease)
attributable to
|
|||||||||||||||||||||||
Total
|
Rate
|
Volume
|
Total
|
Rate
|
Volume
|
|||||||||||||||||||
Interest income:
|
||||||||||||||||||||||||
Loans:
|
||||||||||||||||||||||||
Taxable
|
$ | 2,222 | $ | (443 | ) | $ | 2,665 | $ | 933 | $ | (1,229 | ) | $ | 2,162 | ||||||||||
Tax-exempt
|
373 | (105 | ) | 478 | 233 | (36 | ) | 269 | ||||||||||||||||
Investments:
|
||||||||||||||||||||||||
Taxable
|
(344 | ) | (227 | ) | (117 | ) | 312 | (731 | ) | 1,043 | ||||||||||||||
Tax-exempt
|
(556 | ) | (41 | ) | (515 | ) | (138 | ) | 5 | (143 | ) | |||||||||||||
Interest-bearing deposits
|
8 | 3 | 5 | (13 | ) | (9 | ) | (4 | ) | |||||||||||||||
Federal funds sold
|
8 | 23 | (15 | ) | 9 | (3 | ) | 12 | ||||||||||||||||
Total interest income
|
1,711 | (790 | ) | 2,501 | 1,336 | (2,003 | ) | 3,339 | ||||||||||||||||
Interest expense:
|
||||||||||||||||||||||||
Money market accounts
|
(27 | ) | (49 | ) | 22 | (66 | ) | (96 | ) | 30 | ||||||||||||||
NOW accounts
|
(16 | ) | (56 | ) | 40 | (23 | ) | (73 | ) | 50 | ||||||||||||||
Savings accounts
|
(460 | ) | (538 | ) | 78 | 321 | (286 | ) | 607 | |||||||||||||||
Time deposits less than $100
|
24 | (93 | ) | 117 | (671 | ) | (397 | ) | (274 | ) | ||||||||||||||
Time deposits $100 or more
|
206 | 34 | 172 | (193 | ) | (99 | ) | (94 | ) | |||||||||||||||
Short-term borrowings
|
(79 | ) | (137 | ) | 58 | 74 | (233 | ) | 307 | |||||||||||||||
Long-term debt
|
(507 | ) | (80 | ) | (427 | ) | (202 | ) | (117 | ) | (85 | ) | ||||||||||||
Total interest expense
|
(859 | ) | (919 | ) | 60 | (760 | ) | (1,301 | ) | 541 | ||||||||||||||
Net interest income
|
$ | 2,570 | $ | 129 | $ | 2,441 | $ | 2,096 | $ | (702 | ) | $ | 2,798 |
2011
|
2010
|
|||||||||||||||||||||||
Average Balance
|
Interest Income/ Expense
|
Average Interest Rate
|
Average Balance
|
Interest Income/ Expense
|
Average Interest Rate
|
|||||||||||||||||||
Assets:
|
||||||||||||||||||||||||
Earning assets:
|
||||||||||||||||||||||||
Loans:
|
||||||||||||||||||||||||
Taxable
|
$ | 384,839 | $ | 21,639 | 5.62 | % | $ | 337,511 | $ | 19,417 | 5.75 | % | ||||||||||||
Tax-exempt
|
35,790 | 2,064 | 5.77 | 26,757 | 1,691 | 6.32 | ||||||||||||||||||
Investments:
|
||||||||||||||||||||||||
Taxable
|
79,797 | 2,643 | 3.31 | 82,923 | 2,987 | 3.60 | ||||||||||||||||||
Tax-exempt
|
41,781 | 2,515 | 6.02 | 50,033 | 3,071 | 6.14 | ||||||||||||||||||
Interest-bearing deposits
|
1,177 | 12 | 1.02 | 654 | 4 | 0.61 | ||||||||||||||||||
Federal funds sold
|
13,832 | 34 | 0.25 | 19,181 | 26 | 0.14 | ||||||||||||||||||
Total earning assets
|
557,216 | 28,907 | 5.19 | % | 517,059 | 27,196 | 5.26 | % | ||||||||||||||||
Less: allowance for loan losses
|
4,757 | 3,882 | ||||||||||||||||||||||
Other assets
|
35,143 | 35,306 | ||||||||||||||||||||||
Total assets
|
$ | 587,602 | $ | 548,483 | ||||||||||||||||||||
Liabilities and Stockholders’ Equity:
|
||||||||||||||||||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||
Money market accounts
|
$ | 39,927 | 250 | 0.63 | % | $ | 36,829 | 277 | 0.75 | % | ||||||||||||||
NOW accounts
|
49,299 | 285 | 0.58 | 42,992 | 301 | 0.70 | ||||||||||||||||||
Savings accounts
|
194,523 | 1,557 | 0.80 | 187,007 | 2,017 | 1.08 | ||||||||||||||||||
Time deposits less than $100
|
75,216 | 1,740 | 2.31 | 70,269 | 1,716 | 2.44 | ||||||||||||||||||
Time deposits $100 or more
|
28,729 | 591 | 2.06 | 20,253 | 385 | 1.90 | ||||||||||||||||||
Short-term borrowings
|
38,115 | 310 | 0.81 | 32,615 | 389 | 1.19 | ||||||||||||||||||
Long-term debt
|
23,735 | 906 | 3.82 | 34,866 | 1,413 | 4.05 | ||||||||||||||||||
Total interest-bearing liabilities
|
449,544 | 5,639 | 1.25 | % | 424,831 | 6,498 | 1.53 | % | ||||||||||||||||
Noninterest-bearing deposits
|
81,224 | 72,846 | ||||||||||||||||||||||
Other liabilities
|
3,997 | 4,037 | ||||||||||||||||||||||
Stockholders’ equity
|
52,837 | 46,769 | ||||||||||||||||||||||
Total liabilities and stockholders’ equity
|
$ | 587,602 | $ | 548,483 | ||||||||||||||||||||
Net interest income/spread
|
$ | 23,268 | 3.94 | % | $ | 20,698 | 3.73 | % | ||||||||||||||||
Net interest margin
|
4.18 | % | 4.00 | % | ||||||||||||||||||||
Tax-equivalent adjustments:
|
||||||||||||||||||||||||
Loans
|
$ | 702 | $ | 575 | ||||||||||||||||||||
Investments
|
855 | 1,044 | ||||||||||||||||||||||
Total adjustments
|
$ | 1,557 | $ | 1,619 |
2009
|
||||||||||||
Average Balance
|
Interest Income/ Expense
|
Average Interest Rate
|
||||||||||
Assets:
|
||||||||||||
Earning assets:
|
||||||||||||
Loans:
|
||||||||||||
Taxable
|
$ | 299,566 | $ | 18,484 | 6.17 | % | ||||||
Tax-exempt
|
22,516 | 1,458 | 6.48 | |||||||||
Investments:
|
||||||||||||
Taxable
|
53,945 | 2,675 | 4.95 | |||||||||
Tax-exempt
|
52,326 | 3,209 | 6.13 | |||||||||
Interest-bearing deposits
|
1,408 | 17 | 1.21 | |||||||||
Federal funds sold
|
9,617 | 17 | 0.18 | |||||||||
Total earning assets
|
439,378 | 25,860 | 5.89 | % | ||||||||
Less: allowance for loan losses
|
2,969 | |||||||||||
Other assets
|
34,451 | |||||||||||
Total assets
|
$ | 470,860 | ||||||||||
Liabilities and Stockholders’ Equity:
|
||||||||||||
Interest-bearing liabilities:
|
||||||||||||
Money market accounts
|
$ | 32,771 | 343 | 1.05 | % | |||||||
NOW accounts
|
35,697 | 324 | 0.91 | |||||||||
Savings accounts
|
130,652 | 1,696 | 1.30 | |||||||||
Time deposits less than $100
|
84,233 | 2,387 | 2.83 | |||||||||
Time deposits $100 or more
|
22,120 | 578 | 2.61 | |||||||||
Short-term borrowings
|
19,940 | 315 | 1.58 | |||||||||
Long-term debt
|
39,201 | 1,615 | 4.12 | |||||||||
Total interest-bearing liabilities
|
364,614 | 7,258 | 1.99 | % | ||||||||
Noninterest-bearing deposits
|
63,325 | |||||||||||
Other liabilities
|
2,916 | |||||||||||
Stockholders’ equity
|
40,005 | |||||||||||
Total liabilities and stockholders’ equity
|
$ | 470,860 | ||||||||||
Net interest income/spread
|
$ | 18,602 | 3.90 | % | ||||||||
Net interest margin
|
4.23 | % | ||||||||||
Tax-equivalent adjustments:
|
||||||||||||
Loans
|
$ | 496 | ||||||||||
Investments
|
1,091 | |||||||||||
Total adjustments
|
$ | 1,587 |
Year Ended December 31
|
2011
|
2010
|
2009
|
|||||||||
Salaries and employee benefits expense:
|
||||||||||||
Salaries and payroll taxes
|
$ | 5,350 | $ | 4,744 | $ | 4,522 | ||||||
Employee benefits
|
1,085 | 754 | 1,010 | |||||||||
Salaries and employee benefits expense
|
6,435 | 5,498 | 5,532 | |||||||||
Occupancy and equipment expenses:
|
||||||||||||
Occupancy expense
|
907 | 858 | 814 | |||||||||
Equipment expense
|
1,972 | 1,643 | 1,599 | |||||||||
Occupancy and equipment expenses
|
2,879 | 2,501 | 2,413 | |||||||||
Other expenses:
|
||||||||||||
FDIC insurance and assessments
|
755 | 787 | 900 | |||||||||
Professional fees and outside services
|
879 | 640 | 588 | |||||||||
Other taxes
|
431 | 389 | 346 | |||||||||
Stationery and supplies
|
416 | 379 | 357 | |||||||||
Advertising
|
495 | 403 | 297 | |||||||||
Penalty assessed on prepayment of long-term debt
|
509 | 718 | ||||||||||
Other
|
2,511 | 1,930 | 1,957 | |||||||||
Other expenses
|
5,996 | 5,246 | 4,445 | |||||||||
Total noniterest expense
|
$ | 15,310 | $ | 13,245 | $ | 12,390 |
Year Ended December 31
|
2011
|
2010
|
||||||
Assets:
|
||||||||
Cash and due from banks
|
$ | 9,488 | $ | 6,731 | ||||
Interest-bearing deposits in other banks
|
1,071 | 107 | ||||||
Federal funds sold
|
11,003 | |||||||
Investment securities available-for-sale
|
139,899 | 121,772 | ||||||
Loans held for sale
|
569 | 30 | ||||||
Loans, net
|
445,103 | 390,772 | ||||||
Less: allowance for loan losses
|
5,349 | 4,100 | ||||||
Net loans
|
439,754 | 386,672 | ||||||
Premises and equipment, net
|
7,916 | 8,238 | ||||||
Accrued interest receivable
|
3,448 | 3,003 | ||||||
Other assets
|
19,259 | 21,031 | ||||||
Total assets
|
$ | 621,404 | $ | 558,587 | ||||
Liabilities:
|
||||||||
Deposits:
|
||||||||
Non interest-bearing
|
$ | 92,985 | $ | 73,663 | ||||
Interest-bearing
|
401,298 | 365,071 | ||||||
Total deposits
|
494,283 | 438,734 | ||||||
Short-term borrowings
|
43,791 | 38,724 | ||||||
Long-term debt
|
18,927 | 27,336 | ||||||
Accrued interest payable
|
284 | 311 | ||||||
Other liabilities
|
4,506 | 2,966 | ||||||
Total liabilities
|
561,791 | 508,071 | ||||||
Stockholders’ equity:
|
||||||||
Common stock, par value $2.00; authorized 12,500,000 shares; issued 3,341,251 shares
|
6,683 | 6,683 | ||||||
Capital surplus
|
3,141 | 3,118 | ||||||
Retained earnings
|
51,342 | 46,048 | ||||||
Accumulated other comprehensive income (loss)
|
3,645 | (834 | ) | |||||
Less: treasury stock, at cost: 2011, 222,395 shares; 2010, 199,520 shares
|
5,198 | 4,499 | ||||||
Total stockholders’ equity
|
59,613 | 50,516 | ||||||
Total liabilities and stockholders’ equity
|
$ | 621,404 | $ | 558,587 |
Year Ended December 31
|
2011
|
2010
|
2009
|
|||||||||
Interest income:
|
||||||||||||
Interest and fees on loans:
|
||||||||||||
Taxable
|
$ | 21,639 | $ | 19,417 | $ | 18,484 | ||||||
Tax-exempt
|
1,362 | 1,116 | 962 | |||||||||
Interest and dividends on investment securities available-for-sale
|
||||||||||||
Taxable
|
2,610 | 2,943 | 2,611 | |||||||||
Tax-exempt
|
1,660 | 2,027 | 2,118 | |||||||||
Dividends
|
33 | 44 | 64 | |||||||||
Interest on interest-bearing deposits in other banks
|
12 | 4 | 17 | |||||||||
Interest on federal funds sold
|
34 | 26 | 17 | |||||||||
Total interest income
|
27,350 | 25,577 | 24,273 | |||||||||
Interest expense:
|
||||||||||||
Interest on deposits
|
4,423 | 4,696 | 5,328 | |||||||||
Interest on short-term borrowings
|
310 | 389 | 315 | |||||||||
Interest on long-term debt
|
906 | 1,413 | 1,615 | |||||||||
Total interest expense
|
5,639 | 6,498 | 7,258 | |||||||||
Net interest income
|
21,711 | 19,079 | 17,015 | |||||||||
Provision for loan losses
|
1,794 | 2,202 | 1,735 | |||||||||
Net interest income after provision for loan losses
|
19,917 | 16,877 | 15,280 | |||||||||
Noninterest income:
|
||||||||||||
Service charges, fees, commissions and other
|
2,955 | 3,442 | 3,014 | |||||||||
Wealth management income
|
657 | 305 | 341 | |||||||||
Mortgage banking income
|
346 | 417 | 438 | |||||||||
Net gain (loss) on sale of investment securities available-for-sale
|
25 | 346 | (492 | ) | ||||||||
Other-than-temporary impairment of investment equity securities
|
(87 | ) | (164 | ) | (206 | ) | ||||||
Net gain (loss) on sale of other real estate
|
1,671 | (56 | ) | (13 | ) | |||||||
Total noninterest income
|
5,567 | 4,290 | 3,082 | |||||||||
Noninterest expense:
|
||||||||||||
Salaries and employee benefits expense
|
6,435 | 5,498 | 5,532 | |||||||||
Net occupancy and equipment expense
|
2,879 | 2,501 | 2,413 | |||||||||
Other expenses
|
5,996 | 5,246 | 4,445 | |||||||||
Total noninterest expense
|
15,310 | 13,245 | 12,390 | |||||||||
Income before income taxes
|
10,174 | 7,922 | 5,972 | |||||||||
Provision for income taxes
|
2,357 | 1,437 | 923 | |||||||||
Net income
|
7,817 | 6,485 | 5,049 | |||||||||
Other comprehensive income:
|
||||||||||||
Unrealized gain on investment securities available-for-sale
|
6,725 | 2,339 | 3,084 | |||||||||
Reclassification adjustment for (gain) loss on sales included in net income
|
(25 | ) | (346 | ) | 492 | |||||||
Reclassification adjustment for other-than-temporary impairment
|
87 | 164 | 206 | |||||||||
Income taxes related to other comprehensive income
|
2,308 | 733 | 1,285 | |||||||||
Other comprehensive income, net of income taxes
|
4,479 | 1,424 | 2,497 | |||||||||
Comprehensive income
|
$ | 12,296 | $ | 7,909 | $ | 7,546 | ||||||
Per share data:
|
||||||||||||
Net income:
|
||||||||||||
Basic
|
$ | 2.49 | $ | 2.07 | $ | 1.61 | ||||||
Diluted
|
$ | 2.49 | $ | 2.06 | $ | 1.61 | ||||||
Average common shares outstanding:
|
||||||||||||
Basic
|
3,136,663 | 3,139,606 | 3,133,518 | |||||||||
Diluted
|
3,138,167 | 3,141,468 | 3,133,764 | |||||||||
Dividends declared
|
$ | 0.80 | $ | 0.79 | $ | 0.76 | ||||||
For the Three Years Ended December 31, 2011
|
Common Stock
|
Capital Surplus
|
Retained Earnings
|
Accumulated Other Comprehensive Income (Loss)
|
Treasury Stock
|
Total
|
||||||||||||||||||
Balance, January 1, 2009
|
$ | 6,683 | $ | 3,100 | $ | 39,375 | $ | (4,755 | ) | $ | (4,683 | ) | $ | 39,720 | ||||||||||
Net income
|
5,049 | 5,049 | ||||||||||||||||||||||
Other comprehensive income, net of income taxes
|
2,497 | 2,497 | ||||||||||||||||||||||
Dividends declared: $0.76 per share
|
(2,381 | ) | (2,381 | ) | ||||||||||||||||||||
Reissuance under option plan: 4,975 shares
|
(2 | ) | 87 | 85 | ||||||||||||||||||||
Balance, December 31, 2009
|
6,683 | 3,098 | 42,043 | (2,258 | ) | (4,596 | ) | 44,970 | ||||||||||||||||
Net income
|
6,485 | 6,485 | ||||||||||||||||||||||
Other comprehensive income, net of income taxes
|
1,424 | 1,424 | ||||||||||||||||||||||
Dividends declared: $0.79 per share
|
(2,480 | ) | (2,480 | ) | ||||||||||||||||||||
Reissuance under option plan : 5,575 shares
|
20 | 97 | 117 | |||||||||||||||||||||
Balance, December 31, 2010
|
6,683 | 3,118 | 46,048 | (834 | ) | (4,499 | ) | 50,516 | ||||||||||||||||
Net income
|
7,817 | 7,817 | ||||||||||||||||||||||
Other comprehensive income, net of income taxes
|
4,479 | 4,479 | ||||||||||||||||||||||
Dividends declared: $0.80 per share
|
(2,523 | ) | (2,523 | ) | ||||||||||||||||||||
Reissuance under option plan: 7,425 shares
|
23 | 136 | 159 | |||||||||||||||||||||
Repurchase and held: 30,300 shares
|
(835 | ) | (835 | ) | ||||||||||||||||||||
Balance, December 31, 2011
|
$ | 6,683 | $ | 3,141 | $ | 51,342 | $ | 3,645 | $ | (5,198 | ) | $ | 59,613 | |||||||||||
Year Ended December 31,
|
2011
|
2010
|
2009
|
|||||||||
Cash flows from operating activities:
|
||||||||||||
Net income
|
$ | 7,817 | $ | 6,485 | $ | 5,049 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||||||
Depreciation and amortization of premises and equipment
|
837 | 719 | 696 | |||||||||
Amortization of intangibles
|
366 | 258 | 258 | |||||||||
Provision for loan losses
|
1,794 | 2,202 | 1,735 | |||||||||
(Gain) loss on sale of other real estate
|
(1,671 | ) | 56 | 13 | ||||||||
(Gain) loss on disposal of equipment
|
88 | (5 | ) | |||||||||
Net amortization of investment securities available-for-sale
|
761 | 290 | 227 | |||||||||
Amortization of deferred loan costs
|
222 | 261 | 261 | |||||||||
Net loss (gain) on sale of investment securities available-for-sale
|
(25 | ) | (346 | ) | 492 | |||||||
Other-than-temporary impairment of investment equity securities
|
87 | 164 | 206 | |||||||||
Net income from investment in life insurance
|
(378 | ) | (322 | ) | (342 | ) | ||||||
Life insurance proceeds
|
(320 | ) | ||||||||||
Deferred income tax expense (benefit)
|
(183 | ) | (188 | ) | 1,514 | |||||||
Net change in:
|
||||||||||||
Loans held for sale
|
(539 | ) | 740 | (1,338 | ) | |||||||
Accrued interest receivable
|
(445 | ) | (423 | ) | (54 | ) | ||||||
Other assets
|
(1,597 | ) | 641 | (3,568 | ) | |||||||
Accrued interest payable
|
(27 | ) | (135 | ) | (1,203 | ) | ||||||
Other liabilities
|
1,540 | 1,126 | 224 | |||||||||
Net cash provided by operating activities
|
8,647 | 11,208 | 4,165 | |||||||||
Cash flows from investing activities:
|
||||||||||||
Proceeds from sale of investment securities available-for-sale
|
22,497 | 64,439 | 62,172 | |||||||||
Proceeds from repayment on investment securities available-for-sale
|
3,459 | 19,605 | 8,274 | |||||||||
Purchases of investment securities available-for-sale
|
(38,119 | ) | (73,261 | ) | (90,505 | ) | ||||||
Net (increase) decrease in restricted stock
|
268 | 228 | (212 | ) | ||||||||
Net increase in loans
|
(52,693 | ) | (57,118 | ) | (20,510 | ) | ||||||
Purchases of premises and equipment
|
(603 | ) | (1,448 | ) | (658 | ) | ||||||
Proceeds from investment in life insurance
|
549 | |||||||||||
Purchases of investment in life insurance
|
(2,000 | ) | ||||||||||
Proceeds from sale of other real estate
|
2,254 | 2,270 | 116 | |||||||||
Purchase premium on investment advisory service
|
(750 | ) | ||||||||||
Net cash used in investing activities
|
(64,937 | ) | (45,486 | ) | (41,323 | ) | ||||||
Cash flows from financing activities:
|
||||||||||||
Net increase in deposits
|
55,549 | 28,696 | 38,770 | |||||||||
Repayment of long-term debt
|
(8,409 | ) | (11,414 | ) | (941 | ) | ||||||
Net increase in short-term borrowings
|
5,067 | 18,285 | 2,007 | |||||||||
Repurchase of common shares
|
(835 | ) | ||||||||||
Reissuance of common shares
|
159 | 117 | 85 | |||||||||
Cash dividends paid
|
(2,523 | ) | (2,480 | ) | (2,381 | ) | ||||||
Net cash provided by financing activities
|
49,008 | 33,204 | 37,540 | |||||||||
Net increase (decrease) in cash and cash equivalents
|
(7,282 | ) | (1,074 | ) | 382 | |||||||
Cash and cash equivalents at beginning of year
|
17,841 | 18,915 | 18,533 | |||||||||
Cash and cash equivalents at end of year
|
$ | 10,559 | $ | 17,841 | $ | 18,915 | ||||||
Supplemental disclosures:
|
||||||||||||
Cash paid during the period for:
|
||||||||||||
Interest
|
$ | 5,666 | $ | 6,633 | $ | 8,461 | ||||||
Income taxes
|
$ | 2,575 | $ | 354 | $ | 815 | ||||||
Noncash items:
|
||||||||||||
Transfers of loans to other real estate
|
$ | 595 | $ | 179 | $ | 492 | ||||||
Loans to facilitate sale of other real estate
|
$ | 3,000 |
·
|
Rate Modification - A modification in which the interest rate is changed to a below market rate.
|
·
|
Term Modification - A modification in which the maturity date, timing of payments or frequency of payments is changed.
|
·
|
Interest Only Modification - A modification in which the loan is converted to interest only payments for a period of time.
|
·
|
Payment Modification - A modification in which the dollar amount of the payment is changed, other than an interest only modification described above.
|
·
|
Combination Modification - Any other type of modification, including the use of multiple categories above.
|
·
|
Pass- A loan to borrowers with acceptable credit quality and risk that is not adversely classified as Substandard, Doubtful, Loss nor designated as Special Mention.
|
·
|
Special Mention- A loan that has potential weaknesses that deserves management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution's credit position at some future date. Special Mention loans are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification.
|
·
|
Substandard- A loan that is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the bank will sustain some loss if the deficiencies are not corrected.
|
·
|
Doubtful – A loan classified as Doubtful has all the weakness inherent in one classified Substandard with the added characteristic that the weaknesses make the collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.
|
·
|
Loss-A loan classified as Loss is considered uncollectible and of such little value that their continuance as bankable loans is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be effected in the future.
|
·
|
residential real estate;
|
·
|
automobiles;
|
·
|
manufactured housing;
|
·
|
personal;
|
·
|
student;
|
·
|
home equity; and
|
·
|
credit card.
|
·
|
commercial real estate;
|
·
|
working capital;
|
·
|
equipment and other commercial needs;
|
·
|
construction;
|
·
|
Small Business Administration; and
|
·
|
agricultural and mineral rights.
|
Premises and leasehold improvements
|
7 – 40 years
|
Furniture, fixtures and equipment
|
3 – 10 years
|
·
|
Level 1: Unadjusted quoted prices of identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.
|
·
|
Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
|
·
|
Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.
|
December
31, 2011
|
Amortized Cost
|
Gross Unrealized Gains
|
Gross Unrealized Losses
|
Fair
Value
|
||||||||||||
U.S. Government-sponsored enterprises
|
$ | 29,671 | $ | 3,105 | $ | 32,776 | ||||||||||
State and municipals:
|
||||||||||||||||
Taxable
|
18,120 | 1,608 | 19,728 | |||||||||||||
Tax-exempt
|
38,217 | 1,693 | $ | 224 | 39,686 | |||||||||||
Corporate debt securities
|
4,462 | 330 | 942 | 3,850 | ||||||||||||
Mortgage-backed securities:
|
||||||||||||||||
U.S. Government agencies
|
16,827 | 185 | 100 | 16,912 | ||||||||||||
U.S. Government-sponsored enterprises
|
26,396 | 66 | 199 | 26,263 | ||||||||||||
Equity securities:
|
||||||||||||||||
Preferred
|
54 | 63 | 117 | |||||||||||||
Common
|
629 | 22 | 84 | 567 | ||||||||||||
Total
|
$ | 134,376 | $ | 7,072 | $ | 1,549 | $ | 139,899 | ||||||||
December
31, 2010
|
Amortized Cost
|
Gross Unrealized Gains
|
Gross Unrealized Losses
|
Fair
Value
|
||||||||||||
U.S. Government-sponsored enterprises
|
$ | 37,828 | $ | 1,066 | $ | 109 | $ | 38,785 | ||||||||
State and municipals:
|
||||||||||||||||
Taxable
|
18,634 | 127 | 387 | 18,374 | ||||||||||||
Tax-exempt
|
51,789 | 146 | 1,626 | 50,309 | ||||||||||||
Corporate debt securities
|
4,467 | 208 | 655 | 4,020 | ||||||||||||
Mortgage-backed securities:
|
||||||||||||||||
U.S. Government agencies
|
4,389 | 87 | 4,476 | |||||||||||||
U.S. Government-sponsored enterprises
|
4,598 | 26 | 97 | 4,527 | ||||||||||||
Equity securities:
|
||||||||||||||||
Preferred
|
54 | 54 | ||||||||||||||
Common
|
1,277 | 114 | 164 | 1,227 | ||||||||||||
Total
|
$ | 123,036 | $ | 1,774 | $ | 3,038 | $ | 121,772 |
December 31, 2011
|
Fair Value
|
|||
Within one year
|
$ | 732 | ||
After one but within five years
|
12,281 | |||
After five but within ten years
|
35,450 | |||
After ten years
|
47,577 | |||
96,040 | ||||
Mortgage-backed securities
|
43,175 | |||
Total
|
$ | 139,215 |
Less Than 12 Months
|
12 Months or More
|
Total
|
||||||||||||||||||||||
December 31, 2011
|
Fair Value
|
Unrealized Losses
|
Fair Value
|
Unrealized Losses
|
Fair Value
|
Unrealized Losses
|
||||||||||||||||||
U.S. Government-sponsored enterprises
|
||||||||||||||||||||||||
State and municipals:
|
||||||||||||||||||||||||
Taxable
|
||||||||||||||||||||||||
Tax-exempt
|
$ | 1,142 | $ | 39 | $ | 2,859 | $ | 185 | $ | 4,001 | $ | 224 | ||||||||||||
Corporate debt securities
|
970 | 61 | 2,130 | 881 | 3,100 | 942 | ||||||||||||||||||
Mortgage-backed securities:
|
||||||||||||||||||||||||
U.S. Government agencies
|
10,785 | 100 | 10,785 | 100 | ||||||||||||||||||||
U.S. Government-sponsored enterprises
|
21,825 | 199 | 21,825 | 199 | ||||||||||||||||||||
Equity securities:
|
||||||||||||||||||||||||
Preferred
|
||||||||||||||||||||||||
Common
|
195 | 84 | 195 | 84 | ||||||||||||||||||||
Total
|
$ | 34,722 | $ | 399 | $ | 5,184 | $ | 1,150 | $ | 39,906 | $ | 1,549 |
Less Than 12 Months
|
12 Months or More
|
Total
|
||||||||||||||||||||||
December 31, 2010
|
Fair Value
|
Unrealized Losses
|
Fair Value
|
Unrealized Losses
|
Fair Value
|
Unrealized Losses
|
||||||||||||||||||
U.S. Government-sponsored enterprises
|
$ | 4,414 | $ | 109 | $ | 4,414 | $ | 109 | ||||||||||||||||
State and municipals:
|
||||||||||||||||||||||||
Taxable
|
12,576 | 324 | $ | 430 | $ | 63 | 13,006 | 387 | ||||||||||||||||
Tax-exempt
|
33,643 | 977 | 2,645 | 649 | 36,288 | 1,626 | ||||||||||||||||||
Corporate debt securities
|
2,358 | 655 | 2,358 | 655 | ||||||||||||||||||||
Mortgage-backed securities:
|
||||||||||||||||||||||||
U.S. Government agencies
|
||||||||||||||||||||||||
U.S. Government-sponsored enterprises
|
3,562 | 97 | 3,562 | 97 | ||||||||||||||||||||
Equity securities:
|
||||||||||||||||||||||||
Preferred
|
||||||||||||||||||||||||
Common
|
374 | 164 | 374 | 164 | ||||||||||||||||||||
Total
|
$ | 54,195 | $ | 1,507 | $ | 5,807 | $ | 1,531 | $ | 60,002 | $ | 3,038 |
December 31
|
2011
|
2010
|
||||||
Commercial
|
$ | 160,828 | $ | 112,526 | ||||
Real estate:
|
||||||||
Commercial
|
145,554 | 136,910 | ||||||
Residential
|
118,125 | 119,424 | ||||||
Consumer
|
20,596 | 21,912 | ||||||
Total
|
$ | 445,103 | $ | 390,772 |
2011
|
2010
|
2009
|
||||||||||
Beginning balance, January 1
|
$ | 4,100 | $ | 3,337 | $ | 3,002 | ||||||
Charge-offs
|
(599 | ) | (1,489 | ) | (1,547 | ) | ||||||
Recoveries
|
54 | 50 | 147 | |||||||||
Provisions
|
1,794 | 2,202 | 1,735 | |||||||||
Ending balance, December 31
|
$ | 5,349 | $ | 4,100 | $ | 3,337 |
December 31, 2011:
|
Pass
|
Special Mention
|
Substandard
|
Doubtful
|
Total
|
|||||||||||||||
Commercial
|
$ | 145,145 | $ | 7,262 | $ | 2,550 | $ | 5,871 | $ | 160,828 | ||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
136,166 | 3,223 | 4,995 | 1,170 | 145,554 | |||||||||||||||
Residential
|
117,236 | 889 | 118,125 | |||||||||||||||||
Consumer
|
20,587 | 9 | 20,596 | |||||||||||||||||
Total
|
$ | 419,134 | $ | 10,494 | $ | 7,545 | $ | 7,930 | $ | 445,103 |
December 31, 2010:
|
Pass
|
Special Mention
|
Substandard
|
Doubtful
|
Total
|
|||||||||||||||
Commercial
|
$ | 105,869 | $ | 986 | $ | 181 | $ | 5,490 | $ | 112,526 | ||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
118,972 | 8,836 | 8,731 | 371 | 136,910 | |||||||||||||||
Residential
|
118,794 | 630 | 119,424 | |||||||||||||||||
Consumer
|
21,890 | 22 | 21,912 | |||||||||||||||||
Total
|
$ | 365,525 | $ | 9,822 | $ | 8,912 | $ | 6,513 | $ | 390,772 |
December 31,
|
2011
|
2010
|
||||||
Commercial
|
$ | 5,871 | $ | 5,490 | ||||
Real estate:
|
||||||||
Commercial
|
1,170 | 371 | ||||||
Residential
|
889 | 630 | ||||||
Consumer
|
22 | |||||||
Total
|
$ | 7,930 | $ | 6,513 |
December 31, 2011
|
30-59 Days
Past Due
|
60-89 Days
Past Due
|
Greater than
90 Days
|
Total Past Due
|
Current
|
Total Loans
|
Loans > 90 Days and Accruing
|
|||||||||||||||||||||
Commercial
|
$ | 408 | $ | 324 | $ | 12 | $ | 744 | $ | 160,084 | $ | 160,828 | $ | 12 | ||||||||||||||
Real estate:
|
||||||||||||||||||||||||||||
Commercial
|
2,177 | 2,177 | 143,377 | 145,554 | ||||||||||||||||||||||||
Residential
|
976 | 217 | 362 | 1,555 | 116,570 | 118,125 | 337 | |||||||||||||||||||||
Consumer
|
335 | 98 | 311 | 744 | 19,852 | 20,596 | 311 | |||||||||||||||||||||
Total
|
$ | 3,896 | $ | 639 | $ | 685 | $ | 5,220 | $ | 439,883 | $ | 445,103 | $ | 660 |
December 31, 2010
|
30-59 Days
Past Due
|
60-89 Days
Past Due
|
Greater than
90 Days
|
Total Past Due
|
Current
|
Total Loans
|
Loans > 90 Days and Accruing
|
|||||||||||||||||||||
Commercial
|
$ | 192 | $ | 81 | $ | 754 | $ | 1,027 | $ | 111,499 | $ | 112,526 | $ | 123 | ||||||||||||||
Real estate:
|
||||||||||||||||||||||||||||
Commercial
|
1,431 | 1,049 | 2,480 | 134,430 | 136,910 | |||||||||||||||||||||||
Residential
|
1,260 | 358 | 626 | 2,244 | 117,180 | 119,424 | ||||||||||||||||||||||
Consumer
|
293 | 133 | 291 | 717 | 21,195 | 21,912 | 269 | |||||||||||||||||||||
Total
|
$ | 3,176 | $ | 572 | $ | 2,720 | $ | 6,468 | $ | 384,304 | $ | 390,772 | $ | 392 |
For the Year Ended
|
||||||||||||||||||||
December 31, 2011
|
Recorded Investment
|
Unpaid Principal Balance
|
Related Allowance
|
Average Recorded Investment
|
Interest Income Recognized
|
|||||||||||||||
With no related allowance:
|
||||||||||||||||||||
Commercial
|
$ | 4,316 | $ | 4,316 | $ | 5,759 | $ | 198 | ||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
4,136 | 4,136 | 4,123 | 187 | ||||||||||||||||
Residential
|
889 | 889 | 948 | |||||||||||||||||
Consumer
|
10 | 1 | ||||||||||||||||||
Total
|
9,341 | 9,341 | 10,840 | 386 | ||||||||||||||||
With an allowance recorded:
|
||||||||||||||||||||
Commercial
|
4,117 | 4,117 | $ | 698 | 3,504 | 46 | ||||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
3,696 | 3,696 | 40 | 2,940 | 233 | |||||||||||||||
Residential
|
337 | 337 | 71 | 108 | 11 | |||||||||||||||
Consumer
|
1 | 1 | 1 | 8 | ||||||||||||||||
Total
|
8,151 | 8,151 | 810 | 6,560 | 290 | |||||||||||||||
Commercial
|
8,433 | 8,433 | 698 | 9,263 | 244 | |||||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
7,832 | 7,832 | 40 | 7,063 | 420 | |||||||||||||||
Residential
|
1,226 | 1,226 | 71 | 1,056 | 11 | |||||||||||||||
Consumer
|
1 | 1 | 1 | 18 | 1 | |||||||||||||||
Total
|
$ | 17,492 | $ | 17,492 | $ | 810 | $ | 17,400 | $ | 676 |
For the Year Ended
|
||||||||||||||||||||
December 31, 2010
|
Recorded Investment
|
Unpaid Principal Balance
|
Related Allowance
|
Average Recorded Investment
|
Interest Income Recognized
|
|||||||||||||||
With no related allowance:
|
||||||||||||||||||||
Commercial
|
$ | 304 | $ | 304 | $ | 264 | $ | 12 | ||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
6,263 | 6,263 | 6,394 | 392 | ||||||||||||||||
Residential
|
383 | 383 | 384 | 2 | ||||||||||||||||
Consumer
|
16 | 16 | 20 | 2 | ||||||||||||||||
Total
|
6,966 | 6,966 | 7,062 | 408 | ||||||||||||||||
With an allowance recorded:
|
||||||||||||||||||||
Commercial
|
5,612 | 5,612 | $ | 663 | 5,629 | 165 | ||||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
2,660 | 2,660 | 122 | 2,714 | 166 | |||||||||||||||
Residential
|
291 | 291 | 9 | 292 | 5 | |||||||||||||||
Consumer
|
31 | 31 | 31 | 31 | ||||||||||||||||
Total
|
8,594 | 8,594 | 825 | 8,666 | 336 | |||||||||||||||
Commercial
|
5,916 | 5,916 | 663 | 5,893 | 177 | |||||||||||||||
Real estate:
|
||||||||||||||||||||
Commercial
|
8,923 | 8,923 | 122 | 9,108 | 558 | |||||||||||||||
Residential
|
674 | 674 | 9 | 676 | 7 | |||||||||||||||
Consumer
|
47 | 47 | 31 | 51 | 2 | |||||||||||||||
Total
|
$ | 15,560 | $ | 15,560 | $ | 825 | $ | 15,728 | $ | 744 |
December 31, 2011
|
Number of Contracts
|
Accrual Status
|
Nonaccrual Status
|
Total Modifications
|
||||||||||||
Commercial
|
2 | $ | 2,294 | $ | 2,294 | |||||||||||
Real estate:
|
||||||||||||||||
Commercial
|
1 | $ | 1,667 | 1,667 | ||||||||||||
Residential
|
||||||||||||||||
Consumer
|
||||||||||||||||
Total
|
3 | $ | 1,667 | $ | 2,294 | $ | 3,961 |
December 31, 2011
|
Number of Loans
|
Pre-Modification Outstanding Recorded Investment
|
Post-Modification Outstanding Recorded Investment
|
||||||||
Commercial
|
|||||||||||
Real estate:
|
|||||||||||
Commercial
|
1 | $ | 1,682 | $ | 1,682 | ||||||
Residential
|
|||||||||||
Consumer
|
|||||||||||
Total
|
1 | $ | 1,682 | $ | 1,682 |
December 31
|
2011
|
2010
|
||||||
Commitments to extend credit
|
$ | 7,429 | $ | 5,617 | ||||
Unused portions of lines of credit
|
45,320 | 32,225 | ||||||
Standby letters of credit
|
17,051 | 18,170 | ||||||
$ | 69,800 | $ | 56,012 |
December 31
|
2011
|
2010
|
|||||
Land
|
$ | 900 | $ | 900 | |||
Premises and leasehold improvements
|
8,691 | 8,649 | |||||
Furniture, fixtures and equipment
|
7,761 | 7,480 | |||||
17,352 | 17,029 | ||||||
Less: accumulated depreciation
|
9,436 | 8,791 | |||||
$ | 7,916 | $ | 8,238 |
2012
|
$ | 107 | ||
2013
|
81 | |||
2014
|
73 | |||
2015
|
66 | |||
2016
|
34 | |||
Thereafter
|
370 | |||
$ | 731 |
December 31
|
2011
|
2010
|
||||||
Interest-bearing deposits:
|
||||||||
Money market accounts
|
$ | 37,924 | $ | 36,032 | ||||
Now accounts
|
54,356 | 41,471 | ||||||
Savings accounts
|
200,419 | 195,121 | ||||||
Time deposits less than $100
|
71,864 | 65,161 | ||||||
Time deposits $100 or more
|
36,735 | 27,286 | ||||||
Total interest-bearing deposits
|
401,298 | 365,071 | ||||||
Noninterest-bearing deposits
|
92,985 | 73,663 | ||||||
Total deposits
|
$ | 494,283 | $ | 438,734 |
2012
|
$ | 44,322 | ||
2013
|
12,875 | |||
2014
|
19,724 | |||
2015
|
14,676 | |||
2016
|
9,708 | |||
Thereafter
|
7,294 | |||
$ | 108,599 |
December 31
|
2011
|
2010
|
||||||
Intangible assets
|
$ | 686 | $ | 1,052 | ||||
Deferred income taxes
|
2,101 | |||||||
Other real estate owned
|
399 | 3,387 | ||||||
Prepaid deposit insurance
|
929 | 1,605 | ||||||
Investment in residential housing program
|
707 | |||||||
Bank owned life insurance
|
10,724 | 8,346 | ||||||
Restricted equity securities
|
2,374 | 2,642 | ||||||
Other assets
|
3,440 | 1,898 | ||||||
Total
|
$ | 19,259 | $ | 21,031 |
At and for the year ended December 31, 2011
|
||||||||||||||||||||
Ending Balance
|
Average Balance
|
Maximum Month-End Balance
|
Weighted Average Rate for the Year
|
Weighted Average Rate at End of the Year
|
||||||||||||||||
Repurchase agreements
|
$ | 38,316 | $ | 37,210 | $ | 42,551 | 0.82 | % | 0.80 | % | ||||||||||
FHLB advances
|
5,475 | 790 | 5,475 | 0.37 | % | 0.05 | % | |||||||||||||
$ | 43,791 | $ | 38,000 | $ | 48,026 | 0.81 | % | 0.71 | % |
At and for the year ended December 31, 2010
|
||||||||||||||||||||
Ending Balance
|
Average Balance
|
Maximum Month-End Balance
|
Weighted Average Rate for the Year
|
Weighted Average Rate at End of the Year
|
||||||||||||||||
Repurchase agreements
|
$ | 37,912 | $ | 32,077 | $ | 41,678 | 1.22 | % | 1.02 | % | ||||||||||
FHLB advances
|
34 | 0.73 | % | |||||||||||||||||
U.S. Treasury tax and loan
|
812 | 503 | 1,018 | |||||||||||||||||
|
$ | 38,724 | $ | 32,614 | $ | 42,696 | 1.20 | % | 1.00 | % |
Due
|
Convertible
|
Strike Rate
|
Current Interest Rate
|
2011
|
2010
|
|||||||||||||||
September 2011
|
N/A | N/A | 5.05 | % | $ | 150 | ||||||||||||||
October 2011
|
N/A | N/A | 4.47 | % | 2,500 | |||||||||||||||
September 2012
|
March 2012
|
8.0 | % | 3.69 | % | $ | 5,000 | 5,000 | ||||||||||||
January 2013
|
January 2012
|
N/A | 2.67 | % | 5,000 | 5,000 | ||||||||||||||
February 2013
|
February 2012
|
8.0 | % | 3.59 | % | 5,000 | 5,000 | |||||||||||||
January 2015
|
N/A | 8.0 | % | 4.31 | % | 5,000 | ||||||||||||||
November 2015
|
N/A | N/A | 4.67 | % | 985 | 1,209 | ||||||||||||||
February 2016
|
N/A | N/A | 4.86 | % | 524 | 634 | ||||||||||||||
February 2016
|
N/A | N/A | 4.86 | % | 524 | 635 | ||||||||||||||
February 2017
|
N/A | N/A | 4.99 | % | 1,894 | 2,208 | ||||||||||||||
$ | 18,927 | $ | 27,336 | |||||||||||||||||
2012
|
$ | 5,797 | ||
2013
|
10,836 | |||
2014
|
878 | |||
2015
|
899 | |||
2016
|
448 | |||
Thereafter
|
69 | |||
$ | 18,927 |
Fair Value Measurement Using
|
|||||||||||||
December 31, 2011
|
Amount
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
Significant Other Observable Inputs
(Level 2)
|
Significant Unobservable Inputs
(Level 3)
|
|||||||||
U.S. Government-sponsored enterprises
|
$ | 32,776 | $ | 32,776 | |||||||||
State and Municipals:
|
|||||||||||||
Taxable
|
19,728 | 19,728 | |||||||||||
Tax-exempt
|
39,686 | 39,686 | |||||||||||
Corporate debt securities
|
3,850 | 3,850 | |||||||||||
Mortgage-backed securities:
|
|||||||||||||
U.S. Government agencies
|
16,912 | 16,912 | |||||||||||
U.S. Government-sponsored enterprises
|
26,263 | 26,263 | |||||||||||
Equity securities:
|
|||||||||||||
Preferred
|
117 | 117 | |||||||||||
Common
|
567 | $ | 567 | ||||||||||
Total
|
$ | 139,899 | $ | 567 | $ | 139,332 | |||||||
Fair Value Measurement Using
|
|||||||||||||
December 31, 2010
|
Amount
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
Significant Other Observable Inputs
(Level 2)
|
Significant Unobservable Inputs
(Level 3)
|
|||||||||
U.S. Government-sponsored enterprises
|
$ | 38,785 | $ | 38,785 | |||||||||
State and Municipals:
|
|||||||||||||
Taxable
|
18,374 | 18,374 | |||||||||||
Tax-exempt
|
50,309 | 50,309 | |||||||||||
Corporate debt securities
|
4,020 | 4,020 | |||||||||||
Mortgage-backed securities:
|
|||||||||||||
U.S. Government agencies
|
4,476 | 4,476 | |||||||||||
U.S. Government-sponsored enterprises
|
4,527 | 4,527 | |||||||||||
Equity securities:
|
|||||||||||||
Preferred
|
54 | 54 | |||||||||||
Common
|
1,227 | $ | 1,227 | ||||||||||
Total
|
$ | 121,772 | $ | 1,227 | $ | 120,545 |
Fair Value Measurement Using
|
|||||||||||
December 31, 2011
|
Amount
|
Quoted Prices in Active Markets for Identical Assets (Level 1)
|
Significant
Other Observable Inputs
(Level 2)
|
Significant Unobservable
Inputs
(Level 3)
|
|||||||
Impaired loans
|
$ | 7,341 | $ | 7,341 | |||||||
Fair Value Measurement Using
|
|||||||||||
December 31, 2010
|
Amount
|
Quoted Prices in Active Markets for Identical Assets (Level 1)
|
Significant
Other Observable
Inputs
(Level 2)
|
Significant Unobservable
Inputs
(Level 3)
|
|||||||
Impaired loans
|
$ | 7,769 | $ | 7,769 |
2011
|
2010
|
|||||||||||||||
December 31
|
Carrying Value
|
Fair
Value
|
Carrying Value
|
Fair
Value
|
||||||||||||
Financial assets:
|
||||||||||||||||
Cash and cash equivalents
|
$ | 10,559 | $ | 10,559 | $ | 17,841 | $ | 17,841 | ||||||||
Investment securities available-for-sale
|
139,899 | 139,899 | 121,772 | 121,772 | ||||||||||||
Loans held for sale
|
569 | 569 | 30 | 30 | ||||||||||||
Net loans
|
439,754 | 447,717 | 386,672 | 393,033 | ||||||||||||
Accrued interest receivable
|
3,448 | 3,448 | 3,003 | 3,003 | ||||||||||||
Restricted equity securities
|
2,374 | 2,374 | 2,642 | 2,642 | ||||||||||||
Total
|
$ | 596,603 | $ | 604,566 | $ | 531,960 | $ | 538,321 | ||||||||
Financial liabilities:
|
||||||||||||||||
Deposits
|
$ | 494,283 | $ | 497,680 | $ | 438,734 | $ | 440,529 | ||||||||
Short-term borrowings
|
43,791 | 43,791 | 38,724 | 38,724 | ||||||||||||
Long-term debt
|
18,927 | 19,300 | 27,336 | 27,872 | ||||||||||||
Accrued interest payable
|
284 | 284 | 311 | 311 | ||||||||||||
Total
|
$ | 557,285 | $ | 561,055 | $ | 505,105 | $ | 507,436 |
2011
|
2010
|
2009
|
||||||||||||||||||||||
December 31
|
Options
|
Weighted Average Price
|
Options
|
Weighted Average Price
|
Options
|
Weighted Average Price
|
||||||||||||||||||
Outstanding, beginning of year
|
21,574 | 23.34 | 27,449 | $ | 22.43 | 33,549 | $ | 21.78 | ||||||||||||||||
Granted
|
||||||||||||||||||||||||
Exercised
|
(7,425 | ) | 16.71 | (5,575 | ) | 18.50 | (4,975 | ) | 17.10 | |||||||||||||||
Forfeited
|
(750 | ) | 30.78 | (300 | ) | 30.78 | (1,125 | ) | 26.63 | |||||||||||||||
Outstanding, end of year
|
13,399 | 26.59 | 21,574 | $ | 23.34 | 27,449 | $ | 22.43 | ||||||||||||||||
Exercisable, end of year
|
13,399 | 26.59 | 21,574 | $ | 23.34 | 27,449 | $ | 22.43 |
Year Ended December 31
|
2011
|
2010
|
2009
|
|||||||||
Current
|
$ | 2,540 | $ | 1,625 | $ | (591 | ) | |||||
Deferred
|
(183 | ) | (188 | ) | 1,514 | |||||||
$ | 2,357 | $ | 1,437 | $ | 923 |
December 31
|
2011
|
2010
|
||||||
Deferred tax asset:
|
||||||||
Allowance for loan losses
|
$ | 1,464 | $ | 1,018 | ||||
Deferred loan fees
|
2 | 2 | ||||||
Deferred compensation
|
344 | 345 | ||||||
Other-than-temporary impairment on securities
|
425 | 449 | ||||||
Alternative minimum tax
|
387 | 387 | ||||||
Impairment charge on other real estate owned
|
195 | |||||||
Unrealized loss on investment securities available-for-sale
|
430 | |||||||
Other
|
90 | 43 | ||||||
Total
|
2,712 | 2,869 | ||||||
Deferred tax liabilities:
|
||||||||
Depreciation
|
447 | 399 | ||||||
Interest on preferred equity securities
|
16 | 16 | ||||||
Prepaid expenses
|
121 | 88 | ||||||
Deferred loan costs
|
274 | 265 | ||||||
Unrealized gains on investment securities available-for-sale
|
1,878 | |||||||
Total
|
2,736 | 768 | ||||||
Net Deferred Tax Asset (Liability)
|
$ | (24 | ) | $ | 2,101 |
Year Ended December 31
|
2011
|
2010
|
2009
|
|||||||||
Federal income tax at statutory rate
|
$ | 3,459 | $ | 2,693 | $ | 2,030 | ||||||
Tax exempt interest, net
|
(975 | ) | (1,001 | ) | (957 | ) | ||||||
Officers’ life insurance income
|
(129 | ) | (217 | ) | (115 | ) | ||||||
Other, net
|
2 | (38 | ) | (35 | ) | |||||||
Total
|
$ | 2,357 | $ | 1,437 | $ | 923 |
December 31
|
2011
|
2010
|
||||||
Assets:
|
||||||||
Cash
|
$ | 67 | $ | 617 | ||||
Investment in bank subsidiary
|
56,684 | 40,665 | ||||||
Investment in non-bank subsidiary
|
5,528 | 5,500 | ||||||
Due from subsidiaries
|
2,633 | |||||||
Investment securities available-for-sale
|
567 | 1,227 | ||||||
Other assets
|
21 | 75 | ||||||
Total assets
|
$ | 62,867 | $ | 50,717 | ||||
Liabilities and Stockholders’ Equity:
|
||||||||
Due to subsidiaries
|
$ | 2,981 | ||||||
Other liabilities
|
273 | $ | 201 | |||||
Stockholders’ equity:
|
59,613 | 50,516 | ||||||
Total liabilities and stockholders’ equity
|
$ | 62,867 | $ | 50,717 |
Years Ended December 31
|
2011
|
2010
|
2009
|
|||||||||
Income:
|
||||||||||||
Dividends from subsidiaries
|
$ | 2,523 | $ | 2,480 | $ | 2,381 | ||||||
Other income
|
715 | 349 | 663 | |||||||||
Total income
|
3,238 | 2,829 | 3,044 | |||||||||
Expense:
|
||||||||||||
Other expenses
|
539 | 523 | 606 | |||||||||
Total expenses
|
539 | 523 | 606 | |||||||||
Income before taxes and undistributed income
|
2,699 | 2,306 | 2,438 | |||||||||
Income tax expense
|
45 | |||||||||||
Income before undistributed income of subsidiaries
|
2,699 | 2,306 | 2,393 | |||||||||
Equity in undistributed net income of subsidiaries
|
5,118 | 4,179 | 2,656 | |||||||||
Net income
|
$ | 7,817 | $ | 6,485 | $ | 5,049 |
Years Ended December 31
|
2011
|
2010
|
2009
|
|||||||||
Cash flows from operating activities:
|
||||||||||||
Net income
|
$ | 7,817 | $ | 6,485 | $ | 5,049 | ||||||
Adjustments:
|
||||||||||||
Net realized losses (gains) on sales of securities
|
(42 | ) | 1 | (263 | ) | |||||||
Other than temporary security impairment
|
87 | 140 | 206 | |||||||||
Undistributed net income of subsidiaries
|
(5,118 | ) | (4,179 | ) | (2,656 | ) | ||||||
Increase in other assets
|
(572 | ) | (24 | ) | ||||||||
Decrease in due from subsidiaries
|
(83 | ) | (711 | ) | (716 | ) | ||||||
Net cash provided by operating activities
|
2,089 | 1,712 | 1,620 | |||||||||
Cash flows from investing activities:
|
||||||||||||
Proceeds from sale of available-for-sale securities
|
560 | 24 | 1,043 | |||||||||
Purchase of premises and equipment
|
(41 | ) | ||||||||||
Net cash provided by (used in) investing activities
|
560 | (17 | ) | 1,043 | ||||||||
Cash flows from financing activities:
|
||||||||||||
Cash dividends paid
|
(2,523 | ) | (2,480 | ) | (2,381 | ) | ||||||
Proceeds from sale of treasury stock
|
159 | 117 | 85 | |||||||||
Purchase of treasury stock
|
(835 | ) | ||||||||||
Net cash used in financing activities
|
(3,199 | ) | (2,363 | ) | (2,296 | ) | ||||||
Increase (decrease) in cash
|
(550 | ) | (668 | ) | 367 | |||||||
Cash at beginning of year
|
617 | 1,285 | 918 | |||||||||
Cash at end of year
|
$ | 67 | $ | 617 | $ | 1,285 | ||||||
Actual
|
Minimum For Capital Adequacy Purposes
|
Minimum to be Well Capitalized under Prompt Corrective Action Provisions
|
||||||||||||||||||||||
December 31, 2011
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||||||||
Tier 1 capital to risk-weighted assets:
|
||||||||||||||||||||||||
Consolidated
|
$ | 55,282 | 11.57 | % | $ | 19,115 | 4.00 | % | ||||||||||||||||
Peoples Bank
|
52,242 | 10.95 | 19,090 | 4.00 | $ | 28,635 | 6.00 | % | ||||||||||||||||
Total capital to risk-weighted assets:
|
||||||||||||||||||||||||
Consolidated
|
60,659 | 12.69 | 38,231 | 8.00 | ||||||||||||||||||||
Peoples Bank
|
57,619 | 12.07 | 38,180 | 8.00 | 47,726 | 10.00 | ||||||||||||||||||
Tier 1 capital to average assets:
|
||||||||||||||||||||||||
Consolidated
|
55,282 | 9.42 | 23,477 | 4.00 | ||||||||||||||||||||
Peoples Bank
|
$ | 52,242 | 8.92 | % | $ | 23,429 | 4.00 | % | $ | 29,286 | 5.00 | % | ||||||||||||
Actual
|
Minimum For Capital Adequacy Purposes
|
Minimum to be Well Capitalized under Prompt Corrective Action Provisions
|
||||||||||||||||||||||
December 31, 2010
|
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
||||||||||||||||||
Tier 1 capital to risk-weighted assets:
|
||||||||||||||||||||||||
Consolidated
|
$ | 50,298 | 11.72 | % | $ | 17,160 | 4.00 | % | ||||||||||||||||
Peoples Bank
|
46,617 | 10.90 | 17,107 | 4.00 | $ | 25,660 | 6.00 | % | ||||||||||||||||
Total capital to risk-weighted assets:
|
||||||||||||||||||||||||
Consolidated
|
54,398 | 12.68 | 34,320 | 8.00 | ||||||||||||||||||||
Peoples Bank
|
50,717 | 11.86 | 34,214 | 8.00 | 42,767 | 10.00 | ||||||||||||||||||
Tier 1 capital to average assets:
|
||||||||||||||||||||||||
Consolidated
|
50,298 | 9.19 | 21,897 | 4.00 | ||||||||||||||||||||
Peoples Bank
|
$ | 46,617 | 8.53 | % | $ | 21,860 | 4.00 | % | $ | 27,324 | 5.00 | % | ||||||||||||
2011
|
||||||||||||||||
Quarter Ended
|
March 31
|
June 30
|
Sept. 30
|
Dec. 31
|
||||||||||||
Interest income:
|
||||||||||||||||
Interest and fees on loans:
|
||||||||||||||||
Taxable
|
$ | 5,136 | $ | 5,413 | $ | 5,505 | $ | 5,585 | ||||||||
Tax-exempt
|
357 | 346 | 331 | 328 | ||||||||||||
Interest and dividends on investment securities available-for-sale:
|
||||||||||||||||
Taxable
|
666 | 633 | 639 | 672 | ||||||||||||
Tax-exempt
|
475 | 411 | 397 | 377 | ||||||||||||
Dividends
|
9 | 8 | 9 | 7 | ||||||||||||
Interest on interest-bearing balances with banks
|
2 | 3 | 3 | 4 | ||||||||||||
Interest on federal funds sold
|
2 | 11 | 13 | 8 | ||||||||||||
Total interest income
|
6,647 | 6,825 | 6,897 | 6,981 | ||||||||||||
Interest expense:
|
||||||||||||||||
Interest on deposits
|
1,044 | 1,132 | 1,168 | 1,079 | ||||||||||||
Interest on short-term borrowings
|
86 | 76 | 76 | 72 | ||||||||||||
Interest on long-term debt
|
257 | 263 | 208 | 178 | ||||||||||||
Total interest expense
|
1,387 | 1,471 | 1,452 | 1,329 | ||||||||||||
Net interest income
|
5,260 | 5,354 | 5,445 | 5,652 | ||||||||||||
Provision for loan losses
|
421 | 804 | 269 | 300 | ||||||||||||
Net interest income after provision for loan losses
|
4,839 | 4,550 | 5,176 | 5,352 | ||||||||||||
Noninterest income:
|
||||||||||||||||
Service charges, fees and commissions
|
709 | 711 | 736 | 799 | ||||||||||||
Wealth management income
|
139 | 236 | 142 | 140 | ||||||||||||
Mortgage banking income
|
48 | 98 | 32 | 168 | ||||||||||||
Net gain (loss) on sale of investment securities available-for-sale
|
10 | 2 | 25 | (12 | ) | |||||||||||
Other-than-temporary investment equity securities impairment
|
(84 | ) | (3 | ) | ||||||||||||
Net gain (loss) loss on sale of other real estate
|
1,583 | 90 | (2 | ) | ||||||||||||
Total noninterest income
|
822 | 2,630 | 1,022 | 1,093 | ||||||||||||
Noninterest expense:
|
||||||||||||||||
Salaries and employee benefits expense
|
1,446 | 1,628 | 1,648 | 1,713 | ||||||||||||
Net occupancy and equipment expense
|
676 | 699 | 738 | 766 | ||||||||||||
Other expenses
|
1,273 | 1,743 | 1,371 | 1,609 | ||||||||||||
Total noninterest expense
|
3,395 | 4,070 | 3,757 | 4,088 | ||||||||||||
Income before income taxes
|
2,266 | 3,110 | 2,441 | 2,357 | ||||||||||||
Provision for income tax expense
|
467 | 751 | 582 | 557 | ||||||||||||
Net income
|
1,799 | 2,359 | 1,859 | 1,800 | ||||||||||||
Other comprehensive income (loss):
|
||||||||||||||||
Unrealized gain (loss) on investment securities available-for-sale
|
1,100 | 3,183 | 2,908 | (466 | ) | |||||||||||
Reclassification adjustment for (gain) loss included in net income
|
(10 | ) | (2 | ) | (25 | ) | 12 | |||||||||
Reclassification adjustment for other-than-temporary impairment charges
|
84 | 3 | ||||||||||||||
Income tax expense (benefit) related to other comprehensive income
|
399 | 1,082 | 981 | (154 | ) | |||||||||||
Other comprehensive income (loss), net of income taxes
|
775 | 2,099 | 1,905 | (300 | ) | |||||||||||
Comprehensive income
|
$ | 2,574 | $ | 4,458 | $ | 3,764 | $ | 1,500 | ||||||||
Per share data:
|
||||||||||||||||
Net income:
|
||||||||||||||||
Basic
|
$ | 0.57 | $ | 0.75 | $ | 0.60 | $ | 0.57 | ||||||||
Diluted
|
0.57 | 0.75 | 0.60 | 0.57 | ||||||||||||
Dividends declared
|
$ | 0.20 | $ | 0.20 | $ | 0.20 | $ | 0.20 |
2010
|
||||||||||||||||
Quarter Ended
|
March 31
|
June 30
|
Sept. 30
|
Dec. 31
|
||||||||||||
Interest income:
|
||||||||||||||||
Interest and fees on loans:
|
||||||||||||||||
Taxable
|
$ | 4,717 | $ | 4,952 | $ | 4,787 | $ | 4,961 | ||||||||
Tax-exempt
|
270 | 274 | 279 | 293 | ||||||||||||
Interest and dividends on investment securities available-for-sale:
|
||||||||||||||||
Taxable
|
751 | 745 | 731 | 716 | ||||||||||||
Tax-exempt
|
494 | 488 | 525 | 520 | ||||||||||||
Dividends
|
13 | 13 | 9 | 9 | ||||||||||||
Interest on interest-bearing balances with banks
|
1 | 1 | 1 | 1 | ||||||||||||
Interest on federal funds sold
|
4 | 8 | 8 | 6 | ||||||||||||
Total interest income
|
6,250 | 6,481 | 6,340 | 6,506 | ||||||||||||
Interest expense:
|
||||||||||||||||
Interest on deposits
|
1,252 | 1,221 | 1,165 | 1,058 | ||||||||||||
Interest on short-term borrowings
|
71 | 101 | 115 | 102 | ||||||||||||
Interest on long-term debt
|
392 | 393 | 355 | 273 | ||||||||||||
Total interest expense
|
1,715 | 1,715 | 1,635 | 1,433 | ||||||||||||
Net interest income
|
4,535 | 4,766 | 4,705 | 5,073 | ||||||||||||
Provision for loan losses
|
895 | 682 | 445 | 180 | ||||||||||||
Net interest income after provision for loan losses
|
3,640 | 4,084 | 4,260 | 4,893 | ||||||||||||
Noninterest income:
|
||||||||||||||||
Service charges, fees and commissions
|
953 | 1,017 | 782 | 690 | ||||||||||||
Wealth management income
|
60 | 99 | 81 | 65 | ||||||||||||
Mortgage banking income
|
77 | 63 | 168 | 109 | ||||||||||||
Net gain (loss) on sale of investment securities available-for-sale
|
22 | 179 | 22 | 123 | ||||||||||||
Other-than-temporary investment equity securities impairment
|
(140 | ) | (24 | ) | ||||||||||||
Net gain (loss) on sale of other real estate
|
(47 | ) | 2 | (11 | ) | |||||||||||
Total noninterest income
|
1,112 | 1,311 | 915 | 952 | ||||||||||||
Noninterest expense:
|
||||||||||||||||
Salaries and employee benefits expense
|
1,311 | 1,395 | 1,490 | 1,302 | ||||||||||||
Net occupancy and equipment expense
|
622 | 614 | 641 | 624 | ||||||||||||
Other expenses
|
1,104 | 1,501 | 1,372 | 1,269 | ||||||||||||
Total noninterest expense
|
3,037 | 3,510 | 3,503 | 3,195 | ||||||||||||
Income before income taxes
|
1,715 | 1,885 | 1,672 | 2,650 | ||||||||||||
Provision for income tax expense
|
197 | 361 | 272 | 607 | ||||||||||||
Net income
|
1,518 | 1,524 | 1,400 | 2,043 | ||||||||||||
Other comprehensive income (loss):
|
||||||||||||||||
Unrealized gain (loss) on investment securities available-for-sale
|
1,172 | 2,418 | 4,525 | (5,776 | ) | |||||||||||
Reclassification adjustment for (gain) loss included in net income
|
(22 | ) | (179 | ) | (22 | ) | (123 | ) | ||||||||
Reclassification adjustment for other-than-temporary impairment charges
|
140 | 24 | ||||||||||||||
Income tax expense (benefit) related to other comprehensive income
|
391 | 761 | 1,579 | (1,998 | ) | |||||||||||
Other comprehensive income (loss), net of income taxes
|
759 | 1,478 | 3,064 | (3,877 | ) | |||||||||||
Comprehensive income (loss)
|
$ | 2,277 | $ | 3,002 | $ | 4,464 | $ | (1,834 | ) | |||||||
Per share data:
|
||||||||||||||||
Net income:
|
||||||||||||||||
Basic
|
$ | 0.48 | $ | 0.49 | $ | 0.45 | $ | 0.65 | ||||||||
Diluted
|
0.48 | 0.48 | 0.45 | 0.65 | ||||||||||||
Dividends declared
|
$ | 0.19 | $ | 0.20 | $ | 0.20 | $ | 0.20 |
NONE.
|
/s/Alan W. Dakey
|
|
Alan W. Dakey
|
|
President and Chief Executive Officer
|
|
(Principal Executive Officer)
|
|
/s/Scott A. Seasock
|
|
Senior Vice President and
|
|
Chief Financial Officer
|
|
(Principal Financial Officer)
|
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
Peoples Financial Services Corp.
Hallstead, Pennsylvania
We have audited Peoples Financial Services Corp. and subsidiaries' (the “Company”) internal control over financial reporting as of December 31, 2011, based on criteria established in
Internal Control—Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2011, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Peoples Financial Services Corp. and subsidiaries as of December 31, 2011 and 2010 and the related consolidated statements of income and comprehensive income, stockholders’ equity, and cash flows for each of the years in the three year period ended December 31, 2011, and our report dated March 15, 2012, expressed an unqualified opinion.
/s/ PARENTEBEARD LLC
ParenteBeard LLC
Allentown, Pennsylvania
March 15, 2012
|
NONE.
|
The information required by this Item 10 is incorporated herein by reference to the section entitled “Governance of the Company” in the Company’s 2012 Proxy Statement.
|
The information required by this Item 11 is incorporated herein by reference to the section entitled “Compensation Discussion and Analysis” in the Company’s 2012 Proxy Statement.
|
The information required by this Item 12 is incorporated herein by reference to the section entitled “Beneficial Ownership of Peoples Financial Services Corp. Held by Principal Shareholders and Management” in the Company’s 2012 Proxy statement.
|
The information required by this Item 13 is incorporated herein by reference to the section entitled “Compensation Discussion and Analysis” in the Company’s 2012 Proxy Statement.
|
The information required by this Item 14 is incorporated herein by reference to the section entitled “Report of the Audit Committee” in the Company’s 2012 Proxy Statement.
|
BY:
|
/s/Alan W. Dakey
Alan W. Dakey, President/CEO
(Principal Executive Officer)
|
March 15, 2012
|
Pursuant to the requirements of the Exchange Act, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
|
||
/s/William E. Aubrey II
William E Aubrey II
Chairman, Board of Directors
|
March 15, 2012
|
|
/s/Alan W. Dakey
Alan W. Dakey, President/CEO
Member, Board of Directors
(Principal Executive Officer)
|
March 15, 2012
|
|
/s/Debra E. Dissinger
Debra E. Dissinger
Executive Vice President
|
March 15, 2012
|
|
/s/Ronald G. Kukuchka
Ronald G. Kukuchka
Member, Board of Directors
|
March 15, 2012
|
|
/s/Richard S. Lochen, Jr.
Richard S. Lochen, Jr.
Member, Board of Directors
|
March 15, 2012
|
|
/s/Frederick J. Malloy
Frederick J. Malloy
VP/Controller
(Principal Accounting Officer)
|
March 15, 2012
|
|
/s/Scott A. Seasock
Scott A. Seasock
Senior Vice President
(Principal Financial Officer)
|
March 15, 2012
|
|
/s/George H. Stover, Jr.
George H. Stover, Jr.
Member, Board of Directors
|
March 15, 2012
|
|
/s/Earle A. Wootton
Earle A. Wootton
Member, Board of Directors
|
March 15, 2012
|
|
/s/Joseph T. Wright, Jr.
Joseph T. Wright, Jr.
Member, Board of Directors
|
March 15, 2012
|
(i)
|
the specific reason or reasons for the denial;
|
(ii)
|
specific reference to pertinent Plan provisions on which the denial is based;
|
(iii)
|
a description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary; and
|
(iv)
|
an explanation of the Plan’s claim review procedure.
|
1.
|
I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2011, of Peoples Financial Services Corp.;
|
2.
|
Based on my knowledge, this Annual Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Annual Report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this Annual Report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this Annual Report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13A-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Annual Report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in the Annual Report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an Annual Report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s Board of Directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/Alan W. Dakey
Chief Executive Officer and President
(Principal Executive Officer)
|
1.
|
I have reviewed this Annual Report on Form l0-K for the year ended December 31, 2011, of Peoples Financial Services Corp.;
|
2.
|
Based on my knowledge, this Annual Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Annual Report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this Annual Report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this Annual Report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Annual Report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in the Annual Report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an Annual Report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/Scott A. Seasock
Senior Vice President
(Principal Financial Officer)
|
CERTIFICATION PURSUANT TO SECTION 1350
|
/s/ Alan W. Dakey
Chief Executive Officer/President
(Principal Executive Officer)
|
CERTIFICATION PURSUANT TO SECTION 1350
|
/s/ Scott A. Seasock
Senior Vice President
(Principal Financial Officer)
|