HispanicBusiness

The average commercial mortgage and commercial loan portfolio for the third quarter of 2012 increased $53 million from the third quarter of 2011. The increase was attributable to commercial mortgage demand, principally from high quality borrowers looking to refinance multifamily and other commercial mortgages held by other institutions.

From December 31, 2011 to September 30, 2012, total loans grew $58 million or 7.5% annualized. Total loan originations were $281 million for the first nine months of 2012, up from $206 million for the same nine month period of 2011. Included in the total were commercial mortgage/commercial loan originations of $95 million for the 2012 nine month period, up from $76 million for the 2011 nine month period.

Douglas L. Kennedy, CEO said, "I am pleased to have joined a Company that has been so successful in generating new solid lending opportunities. I look forward to continuing to grow our loan book as we move into 2013."

As of September 30, 2012, the residential first mortgage loan pipeline (loans approved, but not closed and funded) stood at $49 million and the commercial mortgage/commercial loan pipeline stood at a record $81 million, with many other lending opportunities in the discussion stage.

Deposits
Average total deposits (interest-bearing and noninterest-bearing) increased $57 million for the September 2012 quarter from the same quarter last year.

Average noninterest-bearing checking balances grew $59 million for the third quarter of 2012 when compared to the third quarter of 2011. Average interest-bearing checking balances for the quarter ended September 30, 2012 grew $14 million from the same quarter in 2011. Average savings accounts increased $16 million from the third quarter of 2011 to the third quarter of 2012.

Overall checking and savings growth continues to be attributable to the Company's relationship orientation. The Company has successfully focused on:

•Business and personal core deposit generation, particularly checking; •Establishing municipal relationships within its market territory; and •Growth in deposits associated with its commercial mortgage/commercial loan growth.

Average certificates of deposit (CDs) declined $15 million for the September 2012 quarter from the September 2011 quarter. These higher-cost CDs were replaced with lower cost, more stable core deposits.

From December 31, 2011 to September 30, 2012, total deposits declined slightly, as various municipalities utilized funds in 2012 that were held on deposit at year end.

Mr. Kennedy commented, "This is a strong and valuable deposit franchise, as evidenced by our high level of lower-cost, more stable core deposits. Additionally, I see lots of opportunities in our core markets."

PGB Trust & Investments
PGB Trust & Investments generated $2.92 million in fee income in the third quarter of 2012 compared to $2.56 million for the third quarter of 2011, reflecting 14 percent growth. The market value of the assets under administration of the wealth management division stood at $2.15 billion at September 30, 2012, up from $1.96 billion reported at December 31, 2011 and up from $1.86 billion reported at September 30, 2011.

Mr. Kennedy noted, "The Wealth Management business adds significant value to the Company. I look forward to our Company continuing to grow and provide personalized service to this valued client base."