U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------------

FORM 10-Q

[x] QUARTERLY REPORT UNDER SECTION 13 OF 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2011

OR

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


GREENE COUNTY BANCORP, INC.

(Exact name of issuer as specified in its charter)

Commission file number  0-25165


                                                                                              United States                                                                                                           14-1809721
                                              (State or other jurisdiction of incorporation or organization)                                                (I.R.S. Employer  Identification Number)

                                                                                        302 Main Street, Catskill, New York                                                                12414
                                                                                     (Address of principal executive office)                                                          (Zip code)


                                                                                                      Registrant's telephone number, including area code:    (518) 943-2600

Check whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    Yes:       X            No:  ____

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes:            No:  ___

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company.  See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer   _____                                                                           Accelerated filer _____
Non-accelerated filer     _____                                                                           Smaller reporting company      X    

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes: ___    No:     X     

As of May 13, 2011, the registrant had 4,145,828 shares of common stock outstanding at $ .10 par value per share.

 
 

 


 
GREENE COUNTY BANCORP, INC.
     
         
         
         
 
INDEX
     
         
         
         
PART I.
FINANCIAL INFORMATION
     
     
Page
 
Item 1.
Financial Statements (unaudited)
     
 
*   Consolidated Statements of Financial Condition
   
 
*   Consolidated Statements of Income
   
 
*   Consolidated Statements of Comprehensive Income
   
 
*   Consolidated Statements of Changes in Shareholders’ Equity
   
 
*   Consolidated Statements of Cash Flows
   
 
*   Notes to Consolidated Financial Statements
   
         
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operation
   
         
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
   
         
Item 4.
Controls and Procedures
   
         
PART II.
OTHER INFORMATION
     
         
Item 1.
Legal Proceedings
   
         
Item 1A.
Risk Factors
   
         
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
   
         
Item 3.
Defaults Upon Senior Securities
   
         
Item 4.
[Removed and Reserved]
   
         
Item 5.
Other Information
   
         
Item 6.
Exhibits
   
         
 
Signatures
   
 
   Exhibit 31.1 302 Certification of Chief Executive Officer
   Exhibit 31.2 302 Certification of Chief Financial Officer
   Exhibit 32.1 906 Statement of Chief Executive Officer
   Exhibit 32.2 906 Statement of Chief Financial Officer
   

 
 









Consolidated Statements of Financial Condition
As of March 31, 2011 and June 30, 2010
(Unaudited)
(In thousands, except share and per share amounts)

ASSETS
 
March 31, 2011
   
June 30, 2010
 
Cash and due from banks
  $ 24,761     $ 9,253  
Federal funds sold
    3,835       390  
    Total cash and cash equivalents
    28,596       9,643  
                 
Long term certificate of deposit
    ---       1,000  
Securities available for sale, at fair value
    94,938       89,805  
Securities held to maturity, at amortized cost
    117,634       77,520  
Federal Home Loan Bank stock, at cost
    1,232       1,866  
                 
Loans
    301,071       299,200  
  Allowance for loan losses
    (4,876 )     (4,024 )
  Unearned origination fees and costs, net
    456       406  
    Net loans receivable
    296,651       295,582  
                 
Premises and equipment
    15,515       14,804  
Accrued interest receivable
    2,828       2,731  
Foreclosed real estate
    563       ---  
Prepaid expenses and other assets
    2,487       2,372  
               Total assets
  $ 560,444     $ 495,323  
                 
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
Noninterest bearing deposits
  $ 48,959     $ 44,239  
Interest bearing deposits
    449,890       377,493  
    Total deposits
    498,849       421,732  
                 
Borrowings from FHLB, short-term
    ---       9,100  
Borrowings from FHLB, long-term
    12,000       17,000  
Accrued expenses and other liabilities
    2,864       2,988  
                Total liabilities
    513,713       450,820  
                 
Shareholders’ equity:
               
Preferred stock,
               
  Authorized   -   1,000,000 shares; Issued - None
    ---       ---  
Common stock, par value $.10 per share;
               
   Authorized  - 12,000,000 shares
               
   Issued          -   4,305,670 shares
               
   Outstanding -   4,145,828 shares at March 31, 2011
               
                            4,118,912 shares at June 30, 2010;
    431       431  
Additional paid-in capital
    10,945       10,666  
Retained earnings
    36,282       33,692  
Accumulated other comprehensive income
    279       1,123  
Treasury stock, at cost 159,842 shares at March 31, 2011
               
                                     186,758 shares at June 30, 2010
    (1,206 )     (1,409 )
               Total shareholders’ equity
    46,731       44,503  
               Total liabilities and shareholders’ equity
  $ 560,444     $ 495,323  
See notes to consolidated financial statements.

 
 

 

Consolidated Statements of Income
For the Nine Months Ended March 31, 2011 and 2010
(Unaudited)
 (In thousands, except share and per share amounts)
Interest income:
 
2011
   
2010
 
    Loans
  $ 13,434     $ 12,830  
    Investment securities - taxable
    875       852  
    Mortgage-backed securities
    2,821       2,805  
    Investment securities - tax exempt
    879       783  
    Interest bearing deposits and federal funds sold
    32       13  
Total interest income
    18,041       17,283  
                 
Interest expense:
               
    Interest on deposits
    3,007       3,596  
    Interest on borrowings
    422       486  
Total interest expense
    3,429       4,082  
                 
Net interest income
    14,612       13,201  
Provision for loan losses
    1,179       984  
Net interest income after provision for loan losses
    13,433       12,217  
                 
Non-interest income:
               
    Service charges on deposit accounts
    1,733       2,105  
    Debit card fees
    925       784  
    Investment services
    199       207  
    E-commerce fees
    83       78  
    Net gain (loss) on sale of available-for-sale securities
    233       (5 )
    Other operating income
    390       355  
Total non-interest income
    3,563       3,524  
                 
Non-interest expense:
               
    Salaries and employee benefits
    6,025       5,353  
    Occupancy expense
    973       945  
    Equipment and furniture expense
    401       487  
    Service and data processing fees
    1,111       999  
    Computer software, supplies and support
    207       258  
    Advertising and promotion
    245       192  
    FDIC insurance premiums
    468       422  
    Legal and professional fees
    273       315  
    Other
    1,358       1,245  
Total non-interest expense
    11,061       10,216  
                 
Income before provision for income taxes
    5,935       5,525  
Provision for income taxes
    2,020       1,899  
Net income
  $ 3,915     $ 3,626  
                 
Basic EPS
  $ 0.95     $ 0.88  
Basic average shares outstanding
    4,131,052       4,110,014  
Diluted EPS
  $ 0.94     $ 0.88  
Diluted average shares outstanding
    4,162,716       4,135,000  
Dividends per share
  $ 0.725     $ 0.51  
See notes to consolidated financial statements.

 Greene County Bancorp, Inc.
Consolidated Statements of Income
For the Three Months Ended March 31, 2011 and 2010
(Unaudited)
(In thousands, except share and per share amounts)
Interest income:
 
2011
   
2010
 
    Loans
  $ 4,388     $ 4,374  
    Investment securities - taxable
    298       260  
    Mortgage-backed securities
    998       993  
    Investment securities - tax exempt
    303       267  
    Interest bearing deposits and federal funds sold
    12       3  
Total interest income
    5,999       5,897  
                 
Interest expense:
               
    Interest on deposits
    962       1,130  
    Interest on borrowings
    117       153  
Total interest expense
    1,079       1,283  
                 
Net interest income
    4,920       4,614  
Provision for loan losses
    343       307  
Net interest income after provision for loan losses
    4,577       4,307  
                 
Non-interest income:
               
    Service charges on deposit accounts
    560       599  
    Debit card fees
    306       257  
    Investment services
    51       73  
    E-commerce fees
    28       25  
    Net gain on sale of available-for-sale securities
    21       ---  
    Other operating income
    136       132  
Total non-interest income
    1,102       1,086  
                 
Non-interest expense:
               
    Salaries and employee benefits
    2,054       1,792  
    Occupancy expense
    362       333  
    Equipment and furniture expense
    121       189  
    Service and data processing fees
    413       343  
    Computer software, supplies and support
    72       79  
    Advertising and promotion
    55       77  
    FDIC insurance premiums
    187       151  
    Legal and professional fees
    92       130  
    Other
    460       437  
Total non-interest expense
    3,816       3,531  
                 
Income before provision for income taxes
    1,863       1,862  
Provision for income taxes
    624       636  
Net income
  $ 1,239     $ 1,226  
                 
Basic EPS
  $ 0.30     $ 0.30  
Basic average shares outstanding
    4,142,160       4,116,779  
Diluted EPS
  $ 0.30     $ 0.30  
Diluted average shares outstanding
    4,172,127       4,137,447  
Dividends per share
  $ 0.175     $ 0.17  
See notes to consolidated financial statements.


Consolidated Statements of Comprehensive Income
For the Nine Months Ended March 31, 2011 and 2010
(Unaudited)
(In thousands)
 
2011
 
2010
Net income
$3,915
 
$3,626
       
Other comprehensive (loss) income:
     
Securities:
     
Unrealized holding (losses) gains on available for sale securities, arising
     
  during the nine months ended March 31, 2011 and 2010,
     
  net of income taxes of ($469) and $173, respectively.
(742)
 
274
       
Accretion of unrealized loss on securities transferred to held-to-maturity,
     
  net of income taxes of $21 and $31, respectively
34
 
50
       
Reclassification adjustment for (gain) loss on sale of available-for-sale
     
  securities realized in net income, net of income taxes
     
  of ($90), and $2, respectively
(143)
 
3
       
Pension actuarial gain, net of tax
7
 
---
       
Other comprehensive (loss) income
(844)
 
327
       
Comprehensive income
$3,071
 
$3,953
       


Greene County Bancorp, Inc.
Consolidated Statements of Comprehensive Income
For the Three Months Ended March 31, 2011 and 2010
(Unaudited)
(In thousands)
 
2011
 
2010
Net income
$1,239
 
$1,226
       
Other comprehensive loss:
     
Securities:
     
Unrealized holding losses on available for sale securities, arising
     
  during the three months ended March 31, 2011 and 2010,
     
  net of income taxes of ($172) and ($75), respectively.
(272)
 
(119)
       
Accretion of unrealized loss on securities transferred to held-to-maturity,
     
  net of income taxes of $7 and $13, respectively
11
 
21
       
Reclassification adjustment for (gain) loss on sale of available-for-sale
     
  securities realized in net income, net of income taxes
     
  of ($8), and $0, respectively
(13)
 
---
       
Pension actuarial gain, net of tax
2
 
---
Other comprehensive loss
(272)
 
(98)
       
Comprehensive income
$967
 
$1,128
See notes to consolidated financial statements.

 
 

 


Consolidated Statements of Changes in Shareholders’ Equity
For the Nine Months Ended March 31, 2011 and 2010
(Unaudited)
(In thousands)


       
Accumulated
   
   
Additional
 
Other
 
Total
 
Common
Paid – In
Retained
Comprehensive
Treasury
Shareholders’
 
Stock
Capital
Earnings
Income
Stock
Equity
             
Balance at
           
June 30, 2009
$431    
     $10,508    
          $30,045    
          $792    
              ($1,512)    
          $40,264    
             
Stock options exercised
 
           (66)    
   
                    103    
                   37    
               
Stock options compensation
 
           168    
     
                 168    
             
Dividends declared
   
          (921)    
   
                  (921)    
             
Net income
   
          3,626    
   
               3,626    
             
Total other comprehensive income, net of taxes
     
          327    
 
                   327    
Balance at
           
March 31, 2010
$431    
     $10,610    
          $32,750    
          $1,119    
             ($1,409)    
             $43,501    

Balance at
June 30, 2010
$431  
     $10,666   
          $33,692  
          $1,123  
               ($1,409) 
$44,503    
             
Stock options exercised
 
           109   
   
                    203 
312    
             
Tax effect of stock options
 
              3   
     
3    
              
Stock options compensation
 
          167   
     
167    
             
Dividends declared
   
          (1,325)  
   
(1,325)    
             
Net income
   
           3,915  
   
3,915    
             
Total other comprehensive (loss), net of taxes
     
          (844)  
 
(844)    
Balance at
           
March 31, 2011
$431  
     $10,945   
          $36,282  
          $279  
                 ($1,206) 
$46,731    
             

See notes to consolidated financial statements.

 
 

 

Consolidated Statements of Cash Flows
For the Nine Months Ended March 31, 2011 and 2010
(Unaudited)
                                                                              (In thousands)
 
2011
   
2010
 
Cash flows from operating activities:
           
Net Income
  $ 3,915     $ 3,626  
Adjustments to reconcile net income to net cash provided by operating activities:
               
     Depreciation
    536       700  
     Net amortization of premiums and discounts
    767       616  
     Net amortization of deferred loan costs and fees
    175       135  
     Provision for loan losses
    1,179       984  
     Stock option compensation
    167       168  
     Net (gain) loss on sale of available-for-sale securities
    (233 )     5  
     Net loss on sale of foreclosed real estate
    ---       8  
     Net (decrease) increase in accrued income taxes
    (432 )     1,007  
     Net increase in accrued interest receivable
    (97 )     (285 )
     Net decrease (increase) decrease in prepaid and other assets
    320       (1,863 )
     Net increase (decrease) in other liabilities
    421       (646 )
          Net cash provided by operating activities
    6,718       4,455  
                 
Cash flows from investing activities:
               
   Securities available-for-sale:
               
     Proceeds from maturities
    7,411       7,000  
     Proceeds from sale of securities
    7,729       1,820  
     Purchases of securities
    (30,308 )     (1,069 )
     Principal payments on securities
    8,497       7,272  
   Securities held-to-maturity:
               
     Proceeds from maturities
    13,827       7,327  
     Purchases of securities
    (58,412 )     (9,403 )
     Principal payments on securities
    4,086       4,523  
   Net redemption of Federal Home Loan Bank Stock
    634       90  
   Maturity of long term certificate of deposit
    1,000       ---  
   Net increase in loans receivable
    (2,986 )     (21,253 )
   Proceeds from sale of foreclosed real estate
    ---       207  
   Purchases of premises and equipment
    (1,247 )     (358 )
          Net cash used in investing activities
    (49,769 )     (3,844 )
                 
Cash flows from financing activities:
               
   Net decrease in short-term borrowings
    (9,100 )     (2,000 )
   Repayment of long-term borrowings
    (5,000 )     ---  
   Payment of cash dividends
    (1,325 )     (921 )
   Proceeds from stock options exercised
    312       37  
   Net increase in deposits
    77,117       17,198  
          Net cash provided by financing activities
    62,004       14,314  
                 
Net increase in cash and cash equivalents
    18,953       14,925  
Cash and cash equivalents at beginning of period
    9,643       9,443  
Cash and cash equivalents at end of period
  $ 28,596     $ 24,368  
Non-cash investing activities:
               
   Foreclosed loans transferred to foreclosed real estate
  $ 563     $ 65  
Cash paid during the period:
               
   Interest
  $ 3,434     $ 4,082  
   Income taxes
    2,453       943  
See notes to consolidated financial statements.

 
 

 

Greene County Bancorp, Inc.
As of and for the Three and Nine Months Ended March 31, 2011 and 2010


(1)  Basis of Presentation

The accompanying consolidated statement of financial condition as of June 30, 2010 was derived from the audited consolidated financial statements of Greene County Bancorp, Inc. (the “Company”) and its wholly owned subsidiary, The Bank of Greene County (the “Bank”) and the Bank’s wholly owned subsidiary, Greene County Commercial Bank.  The consolidated financial statements at and for the three and nine months ended March 31, 2011 and 2010 are unaudited.

The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.  To the extent that information and footnotes required by GAAP for complete financial statements are contained in or are consistent with the audited financial statements incorporated by reference to Greene County Bancorp, Inc.’s Annual Report on Form 10-K for the year ended June 30, 2010, such information and footnotes have not been duplicated herein.  In the opinion of management, all adjustments (consisting of only normal recurring items) necessary for a fair presentation of the financial position and results of operations and cash flows at and for the periods presented have been included.   Amounts in the prior year’s consolidated financial statements have been reclassified whenever necessary to conform to the current year’s presentation.  These reclassifications had no effect on net income or retained earnings as previously reported.  All material inter-company accounts and transactions have been eliminated in the consolidation. The results of operations and other data for the three and nine months ended March 31, 2011 are not necessarily indicative of results that may be expected for the entire fiscal year ending June 30, 2011.   These consolidated financial statements consider events that occurred through the date the consolidated financial statements were issued.

CRITICAL ACCOUNTING POLICIES

Greene County Bancorp, Inc.’s critical accounting policies relate to the allowance for loan losses and the evaluation of securities for other-than-temporary impairment.  The allowance for loan losses is based on management’s estimation of an amount that is intended to absorb losses in the existing portfolio.  The allowance for loan losses is established through a provision for losses based on management’s evaluation of the risk inherent in the loan portfolio, the composition of the portfolio, specific impaired loans and current economic conditions.  Such evaluation, which includes a review of all loans for which full collectibility may not be reasonably assured, considers among other matters, the estimated net realizable value or the fair value of the underlying collateral, economic conditions, historical loan loss experience, management’s estimate of probable credit losses and other factors that warrant recognition in providing for the allowance of loan losses.  However, this evaluation involves a high degree of complexity and requires management to make subjective judgments that often require assumptions or estimates about highly uncertain matters.  This critical accounting policy and its application are periodically reviewed with the Audit Committee and the Board of Directors.

Securities are evaluated for other-than-temporary impairment by performing periodic reviews of individual securities in the investment portfolio.  Greene County Bancorp, Inc. makes an assessment to determine whether there have been any events or economic circumstances to indicate that a security on which there is an unrealized loss is impaired on an other-than-temporary basis.  The Company considers many factors, including the severity and duration of the impairment; the intent and ability of the Company to hold the equity security for a period of time sufficient for a recovery in value; recent events specific to the issuer or industry; and for debt securities, intent to sell the security, the likelihood to be required to sell the security before it recovers the entire amortized cost, external credit ratings and recent downgrades.  The Company is required to record other-than-temporary impairment charges through earnings, if it has the intent to sell, or will more likely than not be required to sell an impaired debt security before a recovery of its amortized cost basis.  In addition, the Company is required to record other-than-temporary impairment charges through earnings for the amount of credit losses, regardless of the intent or requirement to sell.  Credit loss is measured as the difference between the present value of an impaired debt security’s cash flows and its amortized cost basis.  Non-credit related write-downs to fair value must be recorded as decreases to accumulated other comprehensive income as long as the Company has no intent or requirement to sell an impaired security before a recovery of amortized cost basis.
 
(2)      Nature of Operations

Greene County Bancorp, Inc.’s primary business is the ownership and operation of its subsidiaries.  The Bank of Greene County has twelve full-service offices and an operations center located in its market area consisting of Greene County, Columbia County and southern Albany County, New York.    The Bank of Greene County is primarily engaged in the business of attracting deposits from the general public in The Bank of Greene County’s market area, and investing such deposits, together with other sources of funds, in loans and investment securities.  Greene County Commercial Bank’s primary business is to attract deposits from and provide banking services to local municipalities.
 
(3)      Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.  Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses and the assessment of other-than-temporary security impairment.

While management uses available information to recognize losses on loans, future additions to the allowance for loan losses (the “Allowance”) may be necessary, based on changes in economic conditions, asset quality or other factors.  In addition, various regulatory authorities, as an integral part of their examination process, periodically review our Allowance.  Such authorities may require us to recognize additions to the Allowance based on their judgments of information available to them at the time of their examination.

Greene County Bancorp, Inc. makes an assessment to determine whether there have been any events or economic circumstances to indicate that a security on which there is an unrealized loss is impaired on an other-than-temporary basis.  The Company considers many factors including the severity and duration of the impairment; the intent and ability of the Company to hold the security for a period of time sufficient for a recovery in value; recent events specific to the issuer or industry; and for debt securities, intent to sell the security, whether it is more likely than not we will be required to sell the security before recovery, whether loss of the entire amortized cost is expected, external credit ratings and recent downgrades.  Securities on which there is an unrealized loss that is deemed to be other-than-temporary are written down to fair value.


 
 

 
 
(4)      Securities

Securities at March 31, 2011 consisted of the following:
   
 
   
Gross
   
Gross
   
Estimated
 
   
Amortized
   
Unrealized
   
Unrealized
   
Fair
 
   
Cost
   
Gains
   
Losses
   
Value
 
(In thousands)
                       
Securities available-for-sale:
                       
  U.S. government sponsored enterprises
  $ 28,441     $ 105     $ 771     $ 27,775  
  State and political subdivisions
    6,820       246       ---       7,066  
  Mortgage-backed securities-residential
    29,338       800       174       29,964  
  Mortgage-backed securities-multi-family
    21,798       991       ---       22,789  
  Asset-backed securities
    27       ---       1       26  
  Corporate debt securities
    6,887       322       ---       7,209  
Total debt securities
    93,311       2,464       946       94,829  
  Equity securities and other
    68       41       ---       109  
Total securities available-for-sale
    93,379       2,505       946       94,938  
Securities held-to-maturity:
                               
  U.S. treasury securities
    11,070       ---       20       11,050  
  U.S. government sponsored enterprises
    4,997       23       ---       5,020  
  State and political subdivisions
    35,522       74       24       35,572  
  Mortgage-backed securities-residential
    58,801       1,428       95       60,134  
  Mortgage-backed securities-multi-family
    6,826       26       4       6,848  
  Other securities
    418       ---       ---       418  
Total securities held-to-maturity
    117,634       1,551       143       119,042  
Total securities
  $ 211,013     $ 4,056     $ 1,089     $ 213,980  


Securities at June 30, 2010 consisted of the following:
   
 
   
Gross
   
Gross
   
Estimated
 
   
Amortized
   
Unrealized
   
Unrealized
   
Fair
 
   
Cost
   
Gains
   
Losses
   
Value
 
(In thousands)
                       
Securities available-for-sale:
                       
  U.S. government sponsored enterprises
  $ 21,942     $ 234     $ ---     $ 22,176  
  State and political subdivisions
    8,392       357       ---       8,749  
  Mortgage-backed securities-residential
    24,838       1,045       ---       25,883  
  Mortgage-backed securities-multi-family
    24,623       1,309       ---       25,932  
  Asset-backed securities
    33       ---       1       32  
  Corporate debt securities
    6,907       97       73       6,931  
Total debt securities
    86,735       3,042       74       89,703  
  Equity securities and other
    67       35       ---       102  
Total securities available-for-sale
    86,802       3,077       74       89,805  
Securities held-to-maturity:
                               
  U.S. government sponsored enterprises
    7,004       64       ---       7,068  
  State and political subdivisions
    29,821       25       ---       29,846  
  Mortgage-backed securities-residential
    36,277       1,362       ---       37,639  
  Mortgage-backed securities-multi-family
    4,058       11       ---       4,069  
  Other securities
    360       ---       ---       360  
Total securities held-to-maturity
    77,520       1,462       ---       78,982  
Total securities
  $ 164,322     $ 4,539     $ 74     $ 168,787  


 
 

 

The following table shows fair value and gross unrealized losses, aggregated by security category and length of time that individual securities have been in a continuous unrealized loss position, at March 31, 2011.

   
Less Than 12 Months
   
More Than 12 Months
   
Total
 
   
Fair
   
Unrealized
   
Fair
   
Unrealized
   
Fair
   
Unrealized
 
   
Value
   
Losses
   
Value
   
Losses
   
Value
   
Losses
 
(in thousands)
                                   
Securities available-for-sale:
                                   
  U.S. government sponsored enterprises
  $ 18,076     $ 771     $ ---     $ ---     $ 18,076     $ 771  
  Mortgage-backed securities-residential
    6,788       174       ---       ---       6,788       174  
  Asset-backed securities
    ---       ---       26       1       26       1  
Total available-for-sale securities
    24,864       945       26       1       24,890       946  
Securities held-to-maturity:
                                               
  U.S. treasury securities
    9,053       20                       9,053       20  
  State and political subdivisions
    2,674       24       ---       ---       2,674       24  
  Mortgage-backed securities-residential
    13,698       95       ---       ---       13,698       95  
  Mortgage-backed securities-multi-family
    3,981       4       ---       ---       3,981       4  
Total held-to-maturity securities
    29,406       143       ---       ---       29,406       143  
Total securities
  $ 54,270     $ 1,088     $ 26     $ 1     $ 54,296     $ 1,089  

The following table shows fair value and gross unrealized losses, aggregated by security category and length of time that individual securities have been in a continuous unrealized loss position, at June 30, 2010.

   
Less Than 12 Months
   
More Than 12 Months
   
Total
 
   
Fair
   
Unrealized
   
Fair
   
Unrealized
   
Fair
   
Unrealized
 
   
Value
   
Losses
   
Value
   
Losses
   
Value
   
Losses
 
(in thousands)
                                   
Securities available-for-sale:
                                   
  Asset-backed securities
  $ ---     $ ---     $ 32     $ 1     $ 32     $ 1  
  Corporate debt securities
    ---       ---       2,492       73       2,492       73  
Total securities
  $ ---     $ ---     $ 2,524     $ 74     $ 2,524     $ 74  

At March 31, 2011, there was one security which has been in a continuous unrealized loss position for more than 12 months and 48 securities that had been in a continuous unrealized loss position for less than 12 months.    When the fair value of a held to maturity or available for sale security is less than its amortized cost basis, an assessment is made as to whether other-than-temporary impairment (“OTTI”) is present.  The Company considers numerous factors when determining whether a potential OTTI exists and the period over which the debt security is expected to recover.  The principal factors considered are (1) the length of time and the extent to which the fair value has been less than the amortized cost basis, (2) the financial condition of the issuer (and guarantor, if any) and adverse conditions specifically related to the security, industry or geographic area, (3) failure of the issuer of the security to make scheduled interest or principal payments, (4) any changes to the rating of the security by a rating agency, and (5) the presence of credit enhancements, if any, including the guarantee of the federal government or any of its agencies.

For debt securities, OTTI is considered to have occurred if (1) the Company intends to sell the security, (2) it is more likely than not the Company will be required to sell the security before recovery of its amortized cost basis, or (3) if the present value of expected cash flows is not sufficient to recover the entire amortized cost basis.  In determining the present value of expected cash flows, the Company discounts the expected cash flows at the effective interest rate implicit in the security at the date of acquisition.  In estimating cash flows expected to be collected, the Company uses available information with respect to security prepayment speeds, default rates and severity.  In determining whether OTTI has occurred for equity securities, the Company considers the applicable factors described above and the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.

For debt securities, credit-related OTTI is recognized in income while noncredit related OTTI on securities not expected to be sold is recognized in other comprehensive income (“OCI”).  Credit-related OTTI is measured as the difference between the present value of an impaired security’s expected cash flows and its amortized cost basis.  Noncredit-related OTTI is measured as the difference between the fair value of the security and its amortized cost less any credit-related losses recognized.  For securities classified as held to maturity, the amount of OTTI recognized in OCI is accreted to the credit-adjusted expected cash flow amounts of the securities over future periods.  For equity securities, the entire amount of OTTI is recognized in income.  Management evaluated securities considering the factors as outlined above, and based on this evaluation the Company does not consider these investments to be other-than-temporarily impaired at March 31, 2011.  Management believes that the reasons for the decline in fair value were due to interest rates and widening credit spreads at the end of the quarter.

Gross realized gains and losses on sales of securities or other-than-temporary impairment of securities recognized in income during the nine months ended March 31, 2011 and 2010 are as follows:

   
Nine months ended March 31,
 
(in thousands)
 
2011
   
2010
 
Gross realized gains
  $ 233     $ 32  
Gross realized losses
    ---       (37 )
Other-than-temporary impairment losses
    ---       ---  
Net gains (losses) recognized
  $ 233     $ (5 )

During the nine months ended March 31, 2011, the Company sold $6.6 million of securities issued by U.S. Government sponsored enterprises, and $1.1 million of mortgage-backed securities, which resulted in the recognition of a net gain of $233,000.  During the nine months ended March 31, 2010, the Company sold $1.8 million of corporate debt securities which resulted in the recognition of a net loss of $5,000.  There were no other-than-temporary impairment losses recognized during the three and nine months ended March 31, 2011 and 2010.


 
 

 

The estimated fair value of debt securities at March 31, 2011, by contractual maturity are shown below.  Expected maturities may differ from contractual maturities, because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

         
            After
   
           After
             
   
             In
   
            One Year
   
           Five Years
             
   
             One Year
   
            Through
   
           Through
   
                 After
       
(Dollars in thousands)
 
             Or Less
   
            Five Years
   
           Ten Years
   
             Ten Years
   
                    Total
 
Securities available-for-sale:
                             
  U.S. Government sponsored enterprises
  $ 1,006     $ 19,631     $ 4,353     $ 2,785     $ 27,775  
  State and political subdivisions
    443       6,274       349       ---       7,066  
  Mortgage-backed securities-residential
    357       1,866       6,214       21,527       29,964  
  Mortgage-backed securities-multi-family
    ---       19,895       2,894       ---       22,789  
  Asset-backed securities
    ---       ---       ---       26       26  
  Corporate debt securities
    ---       2,920       4,007       282       7,209  
Total debt securities
    1,806       50,586       17,817       24,620       94,829  
  Equity securities
    ---       ---       ---       109       109  
Total securities available-for-sale
    1,806       50,586       17,817       24,729       94,938  
Securities held-to-maturity:
                                       
  U.S. treasury securities
    ---       11,050       ---       ---       11,050  
  U.S. government sponsored enterprises
    ---       3,014       2,006       ---       5,020  
  State and political subdivisions
    8,788       15,581       5,723       5,480       35,572  
  Mortgage-backed securities-residential
    ---       2,613       16,319       41,202       60,134  
  Mortgage-backed securities-multi-family
    ---       1,489       5,359       ---       6,848  
  Other securities
    20       3       ---       395       418  
Total securities held-to-maturity
    8,808       33,750       29,407       47,077       119,042  
Total securities
  $ 10,614     $ 84,336     $ 47,224     $ 71,806     $ 213,980  

As of March 31, 2011, securities with an aggregate fair value of $164.4 million were pledged as collateral for deposits in excess of FDIC insurance limits for various municipalities placing deposits with Greene County Commercial Bank.  Greene County Bancorp, Inc. did not participate in any securities lending programs during the quarters or nine months ended March 31, 2011 or 2010.

Federal Home Loan Bank Stock

Federal law requires a member institution of the Federal Home Loan Bank (“FHLB”) system to hold stock of its district FHLB according to a predetermined formula.  This stock is restricted in that it can only be sold to the FHLB or to another member institution, and all sales of FHLB stock must be at par.  As a result of these restrictions, FHLB stock is carried at cost.  FHLB stock is held as a long-term investment and its value is determined based on the ultimate recoverability of the par value.  Impairment of this investment is evaluated quarterly and is a matter of judgment that reflects management’s view of the FHLB’s long-term performance, which includes factors such as the following:   its operating performance; the severity and duration of declines in the fair value of its net assets related to its capital stock amount; its commitment to make payments required by law or regulation and the level of such payments in relation to its operating performance; the impact of legislative and regulatory changes on the FHLB, and accordingly, on the members of the FHLB; and its liquidity and funding position.  After evaluating these considerations, Greene County Bancorp, Inc. concluded that the par value of its investment in FHLB stock will be recovered and, therefore, no other-than-temporary impairment charge was recorded during the quarter and nine months ended March 31, 2011.
 
(5)      Credit Quality of Loans and Allowance for Loan Losses

Management closely monitors the quality of the loan portfolio and has established a loan review process designed to help grade the quality and profitability of the Company’s loan portfolio.  The credit quality grade helps management make a consistent assessment of each loan relationship’s credit risk.     Consistent with regulatory guidelines, The Bank of Greene County provides for the classification of loans considered being of lesser quality.  Such ratings coincide with the "Substandard," "Doubtful" and "Loss" classifications used by federal regulators in their examination of financial institutions. Generally, an asset is considered Substandard if it is inadequately protected by the current net worth and paying capacity of the obligors and/or the collateral pledged. Substandard assets include those characterized by the distinct possibility that the insured financial institution will sustain some loss if the deficiencies are not corrected. Assets classified as Doubtful have all the weaknesses inherent in assets classified Substandard with the added characteristic that the weaknesses present make collection or liquidation in full, on the basis of currently existing facts, highly questionable and improbable. Assets classified as Loss are those considered uncollectible and of such little value that their continuance as assets without the establishment of a full loss reserve and/or charge-off is not warranted. Assets that do not currently expose the insured financial institutions to sufficient risk to warrant classification in one of the aforementioned categories but otherwise possess weaknesses are designated "Special Mention."   Management also maintains a listing of loans designated “Watch.” These loans represent borrowers with declining earnings, strained cash flow, increasing leverage and/or weakening market fundamentals that indicate above average risk.

When The Bank of Greene County classifies problem assets as either Substandard or Doubtful, it generally establishes a valuation allowance or "loss reserve" in an amount deemed prudent by management.  General allowances represent loss allowances that have been established to recognize the inherent risk associated with lending activities, but which, unlike specific allowances, have not been allocated to particular problem assets.  When The Bank of Greene County identifies problem assets as being impaired, it is required either to establish a specific allowance for losses equal to the amount of impairment of the assets, or to charge-off such amount.  The Bank of Greene County's determination as to the classification of its assets and the amount of its valuation allowance is subject to review by its regulatory agencies, which can order the establishment of additional general or specific loss allowances.  The Bank of Greene County reviews its portfolio monthly to determine whether any assets require classification in accordance with applicable regulations.

The inherent risk within the loan portfolio varies depending upon the loan type.   The Bank of Greene County’s primary lending activity is the origination of residential mortgage loans, including home equity loans, which are collateralized by residences.   Generally, residential mortgage loans are made in amounts up to 85.0% of the appraised value of the property.  However, The Bank of Greene County will originate residential mortgage loans with loan-to-value ratios of up to 95.0%, with private mortgage insurance.  In the event of default by the borrower, The Bank of Greene County will acquire and liquidate the underlying collateral.    By originating the loan at a loan-to-value ratio of 85% or less, The Bank of Greene County limits its risk of loss in the even of default.  However, the market values of the collateral may be adversely impacted by declines in the economy.  Home equity loans may have an additional inherent risk if The Bank of Greene County does not hold the first mortgage.  The Bank of Greene County may stand in a secondary position in the event of collateral liquidation resulting in a greater chance of insufficiency to meet all obligations.

Construction lending generally involves a greater degree of risk than other residential mortgage lending.  The repayment of the construction loan is, to a great degree, dependent upon the successful and timely completion of the construction of the subject property.  The Bank of Greene County completes inspections during the construction phase prior to any disbursements.  The Bank of Greene County limits its risk during the construction as disbursements are not made until the required work for each advance has been completed.  Construction delays may further impair the borrower's ability to repay the loan.

Loans collateralized by commercial real estate, and multi-family loans, such as apartment buildings generally are larger than residential loans and involve a greater degree of risk. Commercial mortgage loans often involve large loan balances to single borrowers or groups of related borrowers. Payments on these loans depend to a large degree on the results of operations and management of the properties or underlying businesses, and may be affected to a greater extent by adverse conditions in the real estate market or the economy in general. Accordingly, the nature of commercial real estate loans makes them more difficult for management to monitor and evaluate.

Consumer loans generally have shorter terms and higher interest rates than residential mortgage loans. In addition, consumer loans expand the products and services offered by The Bank of Greene County to better meet the financial services needs of its customers.  Consumer loans generally involve greater credit risk than residential mortgage loans because of the difference in the underlying collateral.  Repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment of the outstanding loan balance because of the greater likelihood of damage, loss or depreciation in the underlying collateral. The remaining deficiency often does not warrant further substantial collection efforts against the borrower beyond obtaining a deficiency judgment. In addition, consumer loan collections depend on the borrower's personal financial stability.  Furthermore, the application of various federal and state laws, including federal and state bankruptcy and insolvency laws, may limit the amount that can be recovered on such loans.

Commercial lending generally involves greater risk than residential mortgage lending and involves risks that are different from those associated with residential and commercial real estate lending. Real estate lending is generally considered to be collateral based, with loan amounts based on fixed-rate loan-to-collateral values, and liquidation of the underlying real estate collateral is viewed as the primary source of repayment in the event of borrower default. Although commercial loans may be collateralized by equipment or other business assets, the liquidation of collateral in the event of a borrower default is often an insufficient source of repayment because equipment and other business assets may be obsolete or of limited use, among other things. Accordingly, the repayment of a commercial loan depends primarily on the creditworthiness of the borrower (and any guarantors), while liquidation of collateral is a secondary and often insufficient source of repayment.


Loan balances by internal credit quality indicator as of March 31, 2011 are shown below.

(in thousands)
 
Performing
   
Watch
   
Special Mention
   
Substandard
   
Total
 
Residential mortgage
  $ 174,824     $ 483     $ 95     $ 3,214     $ 178,616  
Commercial Real Estate
    58,826       339       1,047       2,070       62,282  
Residential Construction & Land
    3,431       ---       ---       13       3,444  
Commercial Construction
    1,666       ---       ---       ---       1,666  
Multi-family
    5,792       ---       ---       581       6,373  
Home Equity
    25,392       117       ---       311       25,820  
Commercial Business
    17,717       233       698       148       18,796  
Consumer Installment
    4,029       4       ---       41       4,074  
Total Gross Loans
  $ 291,677     $ 1,176     $ 1,840     $ 6,378     $ 301,071  

Loan balances by internal credit quality indicator as of June 30, 2010 are shown below.

(in thousands)
 
Performing
   
Watch
   
Special Mention
   
Substandard
   
Total
 
Residential mortgage
  $ 178,851     $ 1,591     $ 97     $ 1,986     $ 182,525  
Commercial Real Estate
    50,343       740       2,408       1,095       54,586  
Residential Construction & Land
    6,688       ---       ---       13       6,701  
Commercial Construction
    2,656       ---       ---       ---       2,656  
Multi-family
    5,441       ---       ---       594       6,035  
Home Equity
    26,300       105       ---       197       26,602  
Commercial Business
    14,253       717       837       3       15,810  
Consumer Installment
    4,249       18       ---       18       4,285  
Total Gross Loans
  $ 288,781     $ 3,171     $ 3,342     $ 3,906     $ 299,200  

The Company had no loans classified Doubtful or Loss at March 31, 2011 or June 30, 2010.

Management places loans on nonaccrual status once the loans have become 90 days or more delinquent.  Nonaccrual is defined as a loan in which collectibility is questionable and therefore interest on the loan will no longer be recognized on an accrual basis.  A loan is not placed back on accrual status until the borrower has demonstrated the ability and willingness to make timely payments on the loan.    A loan does not have to be 90 days delinquent in order to be classified as nonaccrual.   Nonaccrual loans consisted primarily of loans secured by real estate at March 31, 2011.  While the Bank makes every reasonable effort to work with the borrowers to collect amounts due, the number of loans in process of foreclosure has grown substantially over the past several years.  This growth has been the result of adverse changes within the economy and increases in local unemployment.   The growth is also due in part to the extended length of time required to meet all of the legal requirements mandated by New York State law prior to a foreclosure sale, which may be in excess of two years.   Loans on nonaccrual status totaled $6.3 million at March 31, 2011 of which $2.7 million were in the process of foreclosure and an additional $889,000 were making payments pursuant to a forbearance agreement.  Under the forbearance agreement, the customer has made arrangements with the Bank to bring the loan current over a specified period of time (resulting in an insignificant delay in repayment).  During this period, the Bank has agreed not to continue foreclosure proceedings.  Of the remaining $2.7 million in nonaccrual loans, $1.9 million were less than 90 days past due, or were current at March 31, 2011, but have a recent history of delinquency greater than 90 days past due.   These loans will be returned to accrual status once they have demonstrated a history of timely payments.

The following table sets forth information regarding delinquent and/or nonaccrual loans as of March 31, 2011:

(in thousands)
            30-59  
            days   
            past due
          60-89  
          days  
          past due
      More than
     90 days  
     past due
        Total   
         past due
                  Current
                    Total
                     Loans
      Loans     
      on       
      Non-accrual
Residential mortgage
$4,955
$1,225
$2,165
$8,345
$170,271
$178,616
$3,214
Commercial Real Estate
2,306
441
1,498
4,245
58,037
62,282
2,041
Residential Construction & Land
30
---
13
43
3,401
3,444
13
Commercial Construction
---
---
---
---
1,666
1,666
---
Multi-family
426
---
155
581
5,792
6,373
581
Home Equity
496
21
195
712
25,108
25,820
311
Commercial Business
1,011
---
83
1,094
17,702
18,796
148
Consumer Installment
83
22
7
112
3,962
4,074
41
Total Gross Loans
$9,307
$1,709
$4,116
$15,132
$285,939
$301,071
$6,349

The following table sets forth information regarding delinquent and/or nonaccrual loans as of June 30, 2010:

(in thousands)
               30-59  
               days   
             past due
         60-89   
         days   
         past due
                More than
                  90 days  
                past due
            Total   
            past due
                   Current
                 Total
                  Loans
    Loans   
     on      
    Non-accrual
Residential mortgage
$1,058
$1,093
$2,001
$4,152
$178,373
$182,525
$2,001
Commercial Real Estate
701
377
1,095
2,173
52,413
54,586
1,095
Residential Construction & Land
---
---
13
13
6,688
6,701
13
Commercial Construction
---
---
---
---
2,656
2,656
---
Multi-family
---
---
594
594
5,441
6,035
594
Home Equity
17
9
197
223
26,379
26,602
197
Commercial Business
28
271
3
302
15,508
15,810
3
Consumer Installment
147
18
18
183
4,102
4,285
18
Total Gross Loans
$1,951
$1,768
$3,921
$7,640
$291,560
$299,200
$3,921

The Bank of Greene County had no accruing loans delinquent more than 90 days as of March 31, 2011 or June 30, 2010.

The Company identifies impaired loans and measures the impairment in accordance with FASB ASC subtopic “Receivables – Loan Impairment.”  Management may consider a loan impaired once it is classified as nonaccrual and when it is probable that the borrower will be unable to repay the loan according to the original contractual terms of the loan agreement or the loan is restructured in a troubled debt restructuring.  It should be noted that management does not evaluate all loans individually for impairment.  The Bank of Greene County considers residential mortgages, home equity loans and installment loans as small, homogeneous loans, which are evaluated for impairment collectively based on historical loan experience and other factors.  In contrast, large commercial mortgage, construction, multi-family and business loans are viewed individually and considered impaired if it is probable that The Bank of Greene County will not be able to collect scheduled payments of principal and interest when due, according to the contractual terms of the loan agreement.  The measurement of impaired loans is generally based on the fair value of the underlying collateral.  The majority of The Bank of Greene County loans, including most nonaccrual loans, are small homogenous loan types adequately supported by collateral.  As a result, the level of impaired loans may only be a portion of nonaccrual loans.  Loans that are delinquent or slow paying may not be impaired, especially small homogenous loan types, due to collateral adequacy.  Management considers the payment status of loans in the process of evaluating the adequacy of the allowance for loan losses among other factors.  Loans that are either delinquent a minimum of 60 days or are on nonaccrual status, and are not individually considered impaired, are either designated as Special Mention or Substandard, and the allocation of the allowance for loan loss is based upon the risk associated with such designation.

The tables below detail additional information on impaired loans for the periods indicated:

   
As of March 31, 2011
   
For the nine months ended March 31, 2011
 
(in thousands)
 
Recorded Investment
   
Unpaid Principal
   
Related Allowance
   
Average Recorded Investment
   
Interest Income Recognized
 
With no related allowance recorded:
                             
   Residential mortgage
  $ 212     $ 276     $ ---     $ 394     $ 4  
With an allowance recorded:
                                       
  Commercial real estate
    373       373       93       374       6  

   
As of June 30, 2010
   
For the nine months ended March 31, 2010
 
(in thousands)
 
Recorded Investment
   
Unpaid Principal
   
Related Allowance
   
Average Recorded Investment
   
Interest Income Recognized
 
With no related allowance recorded:
                             
   Residential mortgage
  $ 212     $ 276     $ ---     $ ---     $ ---  
With an allowance recorded:
                                       
   Residential mortgage
    ---       ---       ---       98       3  
 
 
The allowance for loan losses is established through a provision for loan losses based on management’s evaluation of the losses inherent in the loan portfolio, the composition of the loan portfolio, specific impaired loans and current economic conditions.  Such evaluation, which includes a review of all loans on which full collectibility may not be reasonably assured, considers among other matters, the estimated net realizable value or the fair value of the underlying collateral, economic conditions, payment status of the loan, historical loan loss experience and other factors that warrant recognition in providing for the loan loss allowance.  In addition, various regulatory agencies, as an integral part of their examination process, periodically review The Bank of Greene County’s allowance for loan losses.  Such agencies may require The Bank of Greene County to recognize additions to the allowance based on their judgment about information available to them at the time of their examination.  The Bank of Greene County charges loans off against the allowance for credit losses when it becomes evident that a loan cannot be collected within a reasonable amount of time or that it will cost the Bank more than it will receive, and all possible avenues of repayment have been analyzed, including the potential of future cash flow, the value of the underlying collateral, and strength of any guarantors or co-borrowers.  Generally, consumer loans and smaller business loans (not secured by real estate) in excess of 90 days are charged-off against the allowance for loan losses, unless equitable arrangements are made.   For loans secured by real estate, a charge-off is recorded when it is determined that the collection of all or a portion of a loan may not be collected and the amount of that loss can be reasonably estimated.

The following tables set forth the activity and allocation of the allowance for loan losses by loan category during and at the periods indicated.  The allowance is allocated to each loan category based on historical loss experience and economic conditions.

   
        Balance
         June 30, 2010
   
           Charge-offs
   
            Recoveries
   
              Provision
   
      Balance
    March 31, 2011
 
Residential mortgage
  $ 1,427     $ 140     $ ---     $   443     $ 1,730  
Commercial Real Estate
    1,517         78       ---         461       1,900  
Residential Construction & Land
        48         ---       ---           (23)           25  
Commercial Construction
        49         ---       ---           (18)           31  
Multi-family
      223         ---       ---           18          241  
Home Equity
      205         ---       ---             6          211  
Consumer Installment
      120        185       77         188          200  
Commercial Business
      435           9         8          104          538  
Total
  $ 4,024     $ 412     $ 85     $ 1,179     $ 4,876  

 
 Allowance for Loan Loss
Loans Receivable
 
Ending Balance March 31, 2011
Impairment Analysis
Ending Balance March 31, 2011
Impairment Analysis
 
 
                    Individually
                    Evaluated
                                               Collectively
                                                Evaluated
Individually
Evaluated
                   Collectively
                     Evaluated
 
Residential mortgage
$---
$1,730
$---
$178,616
 
Commercial Real Estate
93
1,807
373
61,909
 
Residential Construction & Land
---
25
---
3,444
 
Commercial Construction
---
31
---
1,666
 
Multi-family
---
241
---
6,373
 
Home Equity
---
211
---
25,820
 
Consumer Installment
---
200
---
18,796
 
Commercial Business
---
538
---
4,074
 
Total
$93
$4,783
$373
$300,698
 

   
         Balance
         June 30, 2009
   
           Charge-offs
   
           Recoveries
   
             Provision
   
          Balance
     March 31, 2010
 
Residential mortgage
  $ 1,439     $   84     $ ---     $ 114     $ 1,469  
Commercial Real Estate
    1,226       230       ---       495       1,491  
Residential Construction & Land
        44       ---       ---           1           45  
Commercial Construction
        31       ---       ---           6           37  
Multi-family
        15         57       ---         96           54  
Home Equity
        221       ---       ---         (16)         205