Loan balances were as follows (in thousands):

	6/30/2012			12/31/2011
Commercial	$	181,932		$	193,176
Residential real estate		280,135			266,268
Nonresidential real estate		539,748			523,485
Construction		100,094			104,788
Consumer		16,307			16,618
Municipal obligations		27,014			27,066
Gross loans		1,145,230			1,131,401
Less: Deferred loan origination fees and discount		(1,497	)		(1,447	)
Allowance for loan losses		(18,346	)		(18,288	)

Net loans	$	1,125,387		$	1,111,666

The following tables present the activity in the allowance for loan losses for the three months ending June 30, 2012 and the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of June 30, 2012 and December 31, 2011 (in thousands):

							Non
				Residential			Residential									Municipal
June 30, 2012	Commercial			Real estate			Real estate			Construction			Consumer			Obligations			Total
Allowance for loan losses
Beginning balance	$	2,581		$	2,916		$	6,768		$	5,694		$	166		$	237		$	18,362
Provision for loan losses		(406	)		995			163			688			321			(61	)		1,700
Loans charged off		(16	)		(148	)		(269	)		(1,219	)		(156	)		0			(1,808	)
Recoveries		0			23			4			4			61			0			92

Total ending allowance balance	$	2,159		$	3,786		$	6,666		$	5,167		$	392		$	176		$	18,346

Ending allowance balance attributable to loans
Individually evaluated for impairment	$	138		$	870		$	2,279		$	4,229		$	0		$	0		$	7,516
Collectively evaluated for impairment		2,021			2,916			4,387			938			392			176			10,830

Total ending allowance balance	$	2,159		$	3,786		$	6,666		$	5,167		$	392		$	176		$	18,346

Loans
Loans individually evaluated for impairment	$	865		$	7,670		$	19,913		$	8,077		$	0		$	0		$	36,525
Loans collectively evaluated for impairment		181,067			272,465			519,835			92,017			16,307			27,014			1,108,705

Total ending loans balance	$	181,932		$	280,135		$	539,748		$	100,094		$	16,307		$	27,014		$	1,145,230

The following tables present the activity in the allowance for loan losses for the six months ending June 30, 2012 and the balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method as of June 30, 2012 and December 31, 2011 (in thousands):

							Non
				Residential			Residential									Municipal
June 30, 2012	Commercial			Real estate			Real estate			Construction			Consumer			Obligations		Total
Allowance for loan losses
Beginning balance	$	3,207		$	2,591		$	7,614		$	4,701		$	162		$	13	$	18,288
Provision for loan losses		(677	)		1,687			220			1,706			401			163		3,500
Loans charged off		(372	)		(522	)		(1,173	)		(1,246	)		(325	)		0		(3,638	)
Recoveries		1			30			5			6			154			0		196

Total ending allowance balance	$	2,159		$	3,786		$	6,666		$	5,167		$	392		$	176	$	18,346

Ending allowance balance attributable to loans
Individually evaluated for impairment	$	138		$	870		$	2,279		$	4,229		$	0		$	0	$	7,516
Collectively evaluated for impairment		2,021			2,916			4,387			938			392			176		10,830

Total ending allowance balance	$	2,159		$	3,786		$	6,666		$	5,167		$	392		$	176	$	18,346

Loans
Loans individually evaluated for impairment	$	865		$	7,670		$	19,913		$	8,077		$	0		$	0	$	36,525
Loans collectively evaluated for impairment		181,067			272,465			519,835			92,017			16,307			27,014		1,108,705

Total ending loans balance	$	181,932		$	280,135		$	539,748		$	100,094		$	16,307		$	27,014	$	1,145,230

							Non
				Residential			Residential									Municipal
June 30, 2011	Commercial			Real estate			Real estate			Construction			Consumer			Obligations			Total
Allowance for loan losses
Beginning balance	$	3,440		$	2,431		$	8,126		$	3,150		$	166		$	55		$	17,368
Provision for loan losses		1,387			396			1,138			2,844			253			(18	)		6,000
Loans charged off		(920	)		(464	)		(2,484	)		(1,499	)		(462	)		0			(5,829	)
Recoveries		24			40			2			1			210			0			277

Total ending allowance balance	$	3,931		$	2,403		$	6,782		$	4,496		$	167		$	37		$	17,816

					Non
			Residential		Residential						Municipal
December 31, 2011	Commercial		Real estate		Real estate		Construction		Consumer		Obligations		Total
Ending allowance balance attributable to loans
Individually evaluated for impairment	$	224	$	477	$	2,994	$	3,748	$	0	$	0	$	7,443
Collectively evaluated for impairment		2,983		2,114		4,620		953		162		13		10,845

	$	3,207	$	2,591	$	7,614	$	4,701	$	162	$	13	$	18,288
Loans
Loans individually evaluated for impairment	$	917	$	6,100	$	20,390	$	7,854	$	0	$	0	$	35,261
Loans collectively evaluated for impairment		192,259		260,168		503,095		96,934		16,618		27,066		1,096,140


Total ending loans balance	$	193,176	$	266,268	$	523,485	$	104,788	$	16,618	$	27,066	$	1,131,401

The following table presents individually impaired loans by class of loans as of and for the three months ended June 30, 2012 (in thousands):

	Unpaid				Allowance for		Average		Interest
	Principal		Recorded		Loan Losses		Recorded		Income		Interest
	Balance		Investment		Allocated		Investment		Recognized		Received

With no related allowance recorded
Commercial	$	349	$	309	$	0	$	309	$	0	$	0

Residential real estate
Home equity lines of credit		50		50		0		50		0		0
Multifamily properties		0		0		0		264		0		0
Other		2,060		2,045		0		2,059		0		0

Nonresidential real estate
Owner occupied properties		188		188		0		574		0		0
Non owner occupied properties		1,894		1,892		0		2,317		0		0

Construction		655		355		0		178		0		0

With an allowance recorded
Commercial		557		557		138		1,001		2		1

Residential real estate
Home equity lines of credit		137		137		137		137		0		0
Multifamily properties		2,115		1,784		241		892		11		11
Other		3,729		3,654		492		3,642		21		17

Nonresidential real estate
Owner occupied properties		9,009		9,008		1,124		9,037		78		77
Non owner occupied properties		9,644		8,824		1,155		8,246		47		22

Construction		8,834		7,722		4,229		8,824		46		41

Total	$	39,221	$	36,525	$	7,516	$	37,530	$	205	$	169

The following table presents individually impaired loans by class of loans as of and for the six months ended June 30, 2012 (in thousands):

	Unpaid				Allowance for		Average		Interest
	Principal		Recorded		Loan Losses		Recorded		Income		Interest
	Balance		Investment		Allocated		Investment		Recognized		Received

With no related allowance recorded
Commercial	$	349	$	309	$	0	$	309	$	0	$	0

Residential real estate
Home equity lines of credit		50		50		0		50		0		0
Multifamily properties		0		0		0		398		0		0
Other		2,060		2,045		0		1,973		0		0

Nonresidential real estate
Owner occupied properties		188		188		0		802		0		0
Non owner occupied properties		1,894		1,892		0		2,373		0		0

Construction		655		355		0		169		0		0

With an allowance recorded
Commercial		557		557		138		1,013		3		1

Residential real estate
Home equity lines of credit		137		137		137		103		0		0
Multifamily properties		2,115		1,784		241		446		11		11
Other		3,729		3,654		492		3,681		45		40

Nonresidential real estate
Owner occupied properties		9,009		9,008		1,124		9,235		158		156
Non owner occupied properties		9,644		8,824		1,155		7,884		109		72

Construction		8,834		7,722		4,229		8,778		118		110

Total	$	39,221	$	36,525	$	7,516	$	37,214	$	444	$	390

The following table presents individually impaired loans by class of loans as of and for the six months ended June 30, 2011 (in thousands):

	Unpaid				Allowance for		Average		Interest
	Principal		Recorded		Loan Losses		Recorded		Income		Interest
	Balance		Investment		Allocated		Investment		Recognized		Received

With no related allowance recorded
Commercial	$	722	$	432	$	0	$	371	$	0	$	0

Residential real estate
Home equity lines of credit		0		0		0		0		0		0
Multifamily properties		0		0		0		17		0		0
Other		2,529		2,529		0		1,337		0		0

Nonresidential real estate
Owner occupied properties		341		218		0		143		0		0
Non owner occupied properties		1,196		1,190		0		867		0		0

Construction		1,757		928		0		464		0		0

With an allowance recorded
Commercial		3,616		3,361		1,320		2,230		7		4

Residential real estate
Home equity lines of credit		0		0		0		0		0		0
Multifamily properties		870		870		247		871		28		19
Other		2,679		2,660		581		2,610		36		34

Nonresidential real estate
Owner occupied properties		897		897		178		1,503		1		1
Non owner occupied properties		9,332		7,915		1,753		9,252		125		120

Construction		10,432		9,191		3,587		8,829		127		108

Total	$	34,371	$	30,191	$	7,666	$	28,494	$	324	$	286

The following table presents loans individually evaluated for impairment by class of loans as of December 31, 2011 (in thousands):

	Unpaid				Allowance for
	Principal		Recorded		Loan Losses
	Balance		Investment		Allocated

With no related allowance recorded
Commercial	$	350	$	310	$	0

Residential real estate
Home equity lines of credit		50		50		0
Multifamily properties		538		538		0
Other		1,703		1,703		0

Nonresidential real estate
Owner occupied properties		1,101		1,101		0
Non owner occupied properties		2,122		2,116		0

Construction		356		319		0

With an allowance recorded
Commercial		733		607		224

Residential real estate
Home equity lines of credit		0		0		0
Multifamily properties		0		0		0
Other		3,859		3,809		477

Nonresidential real estate
Owner occupied properties		10,771		9,798		1,477
Non owner occupied properties		8,476		7,375		1,517

Construction		8,267		7,535		3,748

Total	$	38,326	$	35,261	$	7,443

The following table presents the aging of the recorded investment in past due loans by class of loans as of June 30, 2012 and December 31, 2011 (in thousands):

	Loans		Loans over
	30-90 days		90 days				Loans not
	past due		past due		Nonaccrual		past due		Total
June 30, 2012
Commercial	$	498	$	0	$	1,074	$	180,360	$	181,932
Residential real estate
Home equity lines of credit		241		0		1,095		100,244		101,580
Multifamily properties		0		0		448		42,908		43,356
Other residential real estate		1,055		0		4,388		129,756		135,199

Nonresidential real estate
Owner occupied properties		1,747		0		1,653		263,562		266,962
Non owner occupied properties		3,369		126		3,583		265,708		272,786
Construction		78		0		3,798		96,218		100,094

Consumer
Credit card balances		20		68		0		6,239		6,327
Other consumer		43		1		226		9,710		9,980

Municipal obligations		0		0		0		27,014		27,014

Total	$	7,051	$	195	$	16,265	$	1,121,719	$	1,145,230

	Loans		Loans over
	30-90 days		90 days				Loans not
	past due		past due		Nonaccrual		past due		Total
December 31, 2011
Commercial	$	692	$	74	$	1,175	$	191,235	$	193,176
Residential real estate
Home equity lines of credit		1,094		0		910		92,676		94,680
Multifamily properties		0		0		0		36,756		36,756
Other residential real estate		5,854		112		4,415		124,451		134,832

Nonresidential real estate
Owner occupied properties		2,623		0		2,270		247,875		252,768
Non owner occupied properties		3,942		0		4,358		262,417		270,717
Construction		265		0		1,897		102,626		104,788

Consumer
Credit card balances		60		32		0		6,400		6,492
Other consumer		37		1		626		9,462		10,126

Municipal obligations		0		0		0		27,066		27,066

Total	$	14,567	$	219	$	15,651	$	1,100,964	$	1,131,401

The following table presents loans by class modified as troubled debt restructurings that occurred during the six months ending June 30, 2012:

			Pre-Modification		Post-Modification
			Outstanding Recorded		Outstanding Recorded
	Number of Loans		Investment		Investment
Troubled Debt Restructurings:

Commercial		3	$	508,281	$	467,796
Residential real estate
Home equity lines of credit		0		0		0
Multifamily properties
Other residential real estate		6		4,170,926		4,049,039
Nonresidential real estate
Owner occupied properties		3		8,137,536		7,857,519
Non owner occupied properties		4		3,661,111		3,152,428
Construction		6		5,463,376		5,210,624
Consumer
Credit card balances		0		0		0
Other consumer		0		0		0

Municipal obligations				0		0

Total		22	$	21,941,230	$	20,737,406

The following table presents loans by class modified as troubled debt restructurings for which there was a payment default within twelve months following the modification during the period ending June 30, 2012:

Troubled Debt Restructurings
That Subsequently Defaulted:	Number of Loans		Recorded Investment

Commercial		3	$	467,796
Residential real estate
Home equity lines of credit
Multifamily properties
Other residential real estate		3		3,195,080
Nonresidential real estate
Owner occupied properties		1		7,647,784
Non owner occupied properties		3		1,472,171
Construction		2		3,168,504
Consumer
Credit card balances
Other consumer
Municipal obligations		0		0

Total		12	$	15,951,335

Based on the most recent analysis performed, the risk category of loans by class of loans is as follows (in thousands):

			Special
	Pass		Mention		Substandard		Doubtful		Not Rated(1)		Total
June 30, 2012
Commercial	$	161,292	$	16,847	$	3,793	$	0	$	0	$	181,932
Residential real estate
Home equity lines of credit		11,472		965		1,006		90		88,047		101,580
Multifamily properties		41,471		101		1,784		0		0		43,356
Other residential real estate		40,109		1,133		10,844		31		83,082		135,199

Nonresidential real estate
Owner occupied properties		232,488		16,713		17,761		0		0		266,962
Non owner occupied properties		249,678		7,827		15,281		0		0		272,786
Construction		85,966		3,383		10,745		0		0		100,094

Consumer
Credit card balances		0		0		0		2		6,325		6,327
Other consumer		0		0		16		0		9,964		9,980
Municipal obligations		27,014		0		0		0		0		27,014

Total	$	849,490	$	46,969	$	61,230	$	123	$	187,418	$	1,145,230

(1) Not rated loans represent the homogenous pools risk category.

			Special
	Pass		Mention		Substandard		Doubtful		Not Rated(1)		Total
December 31, 2011
Commercial	$	170,394	$	9,684	$	13,098	$	0	$	0	$	193,176
Residential real estate
Home equity lines of credit		0		712		976		84		92,908		94,680
Multifamily properties		36,115		103		538		0		0		36,756
Other residential real estate		38,725		1,357		10,843		0		83,907		134,832

Nonresidential real estate
Owner occupied properties		221,941		7,754		23,073		0		0		252,768
Non owner occupied properties		246,614		8,902		15,201		0		0		270,717
Construction		90,297		3,398		11,093		0		0		104,788

Consumer
Credit card balances		0		0		0		0		6,492		6,492
Other consumer		0		0		22		0		10,104		10,126
Municipal obligations		27,066		0		0		0		0		27,066

Total	$	831,152	$	31,910	$	74,844	$	84	$	193,411	$	1,131,401

(1) Not rated loans represent the homogenous pools risk category.