(Dollars in thousands, except per share data) Year ended December 31, _______________________________ 2010 2009 ___________ ___________ Interest income: Loans receivable  Real estate loans .................................................................................................................. $ 19,759 $ 22,046 Commercial loans ............................................................................................................... 4,216 3,822 Consumer loans .................................................................................................................. 76 121 ___________ __________ Total loan interest ............................................................................................................ 24,051 25,989 Securities ................................................................................................................................ 6,006 6,185 Other interest earning assets.................................................................................................... 29 15 ___________ __________ Total interest income ....................................................................................................... 30,086 32,189 ___________ __________ Interest expense: Deposits.................................................................................................................................. 3,914 7,083 Repurchase agreements ........................................................................................................... 178 290 Borrowed funds ...................................................................................................................... 897 1,468 ___________ __________ Total interest expense....................................................................................................... 4,989 8,841 ___________ __________ Net interest income......................................................................................................................... 25,097 23,348 Provision for loan losses .................................................................................................................. 5,570 8,540 ___________ __________ Net interest income after provision for loan losses ........................................................................... 19,527 14,808 ___________ __________ Noninterest income: Fees and service charges .......................................................................................................... 2,538 2,661 Gain on sale of loans, net ........................................................................................................ 1,263 1,139 Wealth management operations.............................................................................................. 1,165 933 Gain on sales of securities, net................................................................................................. 913 736 Increase in cash value of bank owned life insurance ................................................................ 403 407 Loss on sale of foreclosed real estate ........................................................................................ (381) (161)  Other-than-temporary credit loss impairment of debt securities.............................................. (157) (523) Net credit portion of gain recognized in other comprehensive income .................................... 29 387  Other...................................................................................................................................... 17 23 ___________ __________ Total noninterest income ................................................................................................. 5,790 5,602 ___________ __________ Noninterest expense: Compensation and benefits..................................................................................................... 9,599 9,346 Occupancy and equipment ..................................................................................................... 3,010 2,893 Federal deposit insurance premiums ....................................................................................... 950 1,227 Data processing....................................................................................................................... 941 871 Marketing............................................................................................................................... 485 469 Statement and check processing .............................................................................................. 307 325 Professional services ................................................................................................................ 336 338 Other...................................................................................................................................... 3,713 3,266 ___________ __________ Total noninterest expense................................................................................................. 19,341 18,735 ___________ __________ Income before income tax expenses ................................................................................................. 5,976 1,675 Income tax expenses (benefits) ........................................................................................................ 797 (813) ___________ __________ Net income ..................................................................................................................................... $ 5,179 $ 2,488 ___________ __________ Earnings per common share: Basic ....................................................................................................................................... $ 1.83 $ 0.88 Diluted ................................................................................................................................... $ 1.83 $ 0.88 Dividends declared per common share ............................................................................................ $ 0.72 $ 1.21 See accompanying notes to consolidated financial statements. 21 Consolidated Statements of Income