UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

x Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2012.

¨ Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from                     to                    

Commission File Number 0-24948

PVF Capital Corp.

(Exact name of registrant as specified in its charter)

Ohio	34-1659805
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
30000 Aurora Road, Solon, Ohio	44139
(Address of principal executive offices)	(Zip Code)

(440) 248-7171

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report.)

Indicate by check mark 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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    YES  x    NO  ¨

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

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, $0.01 Par Value	26,392,195
(Class)	(Outstanding at November 14, 2012)

PVF CAPITAL CORP.

INDEX

		Page
PART I FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Statements of Financial Condition, September 30, 2012 (unaudited) and June 30, 2012		1
	Consolidated Statements of Operations for the three months ended September 30, 2012 and 2011 (unaudited)		2
	Consolidated Statements of Comprehensive Income for the three months ended September 30, 2012 and 2011 (unaudited)		3
	Consolidated Statements of Cash Flows for the three months ended September 30, 2012 and 2011 (unaudited)		4
	Notes to Consolidated Financial Statements (unaudited)		5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		37
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		48
Item 4.	Controls and Procedures		49
PART II OTHER INFORMATION
Item 1.	Legal Proceedings		49
Item 1A.	Risk Factors		49
Item 2.	Unregistered Sale of Equity Securities and Use of Proceeds		49
Item 3.	Defaults Upon Senior Securities		49
Item 4.	Mine Safety Disclosures		50
Item 5.	Other Information		50
Item 6.	Exhibits		50
SIGNATURES

Part I — FINANCIAL INFORMATION

PVF CAPITAL CORP.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Unaudited)

	September 30,			June 30,
	2012			2012
ASSETS
Cash and amounts due from financial institutions	$	16,903,187		$	5,840,608
Interest-bearing deposits		97,672,255			114,269,532
Total cash and cash equivalents		114,575,442			120,110,140
Securities available for sale		38,280,551			38,658,044
Loans receivable held for sale, net		19,765,946			25,062,786
Loans receivable, net of allowance of $16,135,640 and $16,052,865		543,186,276			541,627,515
Office properties and equipment, net		7,286,062			7,237,165
Real estate owned, net		7,232,119			7,733,578
Federal Home Loan Bank stock		12,811,100			12,811,100
Bank-owned life insurance		23,696,129			23,648,663
Prepaid expenses and other assets		12,289,670			14,560,882
Total assets	$	779,123,295		$	791,449,873
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
Non-interest bearing deposits	$	57,769,225		$	51,786,588
Interest bearing deposits		588,381,234			604,192,552
Total deposits		646,150,459			655,979,140
Note payable		1,019,445			1,046,111
Long-term advances from the Federal Home Loan Bank		35,000,000			35,000,000
Advances from borrowers for taxes and insurance		6,955,246			4,469,292
Accrued expenses and other liabilities		17,167,776			24,224,709
Total liabilities		706,292,926			720,719,252
Stockholders’ equity
Serial preferred stock, $.01 par value, 1,000,000 shares authorized; none issued		—			—
Common stock, $.01 par value, 65,000,000 shares authorized; 26,392,195 and 26,217,796 shares issued, respectively		263,922			262,178
Additional paid-in capital		101,297,166			100,897,561
Retained earnings (accumulated deficit)		(24,568,768	)		(26,119,855	)
Accumulated other comprehensive income (loss)		(324,804	)		(472,116	)
Treasury stock at cost, 472,725 shares		(3,837,147	)		(3,837,147	)
Total stockholders’ equity		72,830,369			70,730,621
Total liabilities and stockholders’ equity	$	779,123,295		$	791,449,873

See Notes to the Consolidated Financial Statements

1

Part I — FINANCIAL INFORMATION

PVF CAPITAL CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three months ended
	September 30,
	2012			2011
Interest and dividends income
Loans	$	6,986,437		$	7,104,267
Mortgage-backed securities		80,231			49,721
Federal Home Loan Bank stock dividends		135,374			127,760
Securities		141,238			24,217
Federal funds sold and interest-bearing deposits		68,295			92,498
Total interest and dividends income		7,411,575			7,398,463
Interest expense
Deposits		1,325,728			1,949,047
Long-term borrowings		270,706			272,440
Total interest expense		1,596,434			2,221,487
Net interest income		5,815,141			5,176,976
Provision for loan losses		1,050,000			1,500,000
Net interest income after provision for loan losses		4,765,141			3,676,976
Non-interest income
Service charges and other fees		180,392			178,818
Mortgage banking activities, net		3,126,247			1,010,165
Gain (loss) on sale of SBA loans		(3,686	)		221,218
Increase in cash surrender value of bank-owned life insurance		47,466			62,699
Gain (loss) on real estate owned		(17,881	)		140,112
Provision for real estate owned losses		(233,719	)		(69,400	)
Other, net		192,200			127,507
Total non-interest income		3,291,019			1,671,119
Non-interest expense
Compensation and benefits		3,109,759			2,894,698
Office occupancy and equipment		569,589			598,910
FDIC insurance		432,239			428,699
Professional and legal		120,000			115,000
Outside services		774,845			495,667
Franchise tax		196,707			225,428
Real estate owned and collection expense		385,504			613,859
Other		916,430			821,609
Total non-interest expense		6,505,073			6,193,870
Income (loss) before federal income taxes		1,551,087			(845,775	)
Federal income tax provision (benefit)		—			(25,178	)
Net income (loss)	$	1,551,087		$	(820,597	)
Basic earnings (loss) per share	$	0.06		$	(0.03	)
Diluted earnings (loss) per share	$	0.06		$	(0.03	)
Dividend declared per common share	$	—		$	—

See Notes to the Consolidated Financial Statements

2

Part I — FINANCIAL INFORMATION

PVF CAPITAL CORP.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Three months ended
	September 30,
	2012		2011
Net income (loss)	$	1,551,087	$	(820,597	)
Other comprehensive income (loss), net of tax
Unrealized holding gains (loss) on available for sale securities		147,312		48,874
Reclassification adjustment for (gains) included in net income		—		—
Tax effect		—		—
Total other comprehensive income (loss)		147,312		48,874
Total comprehensive income (loss)	$	1,698,399	$	(771,723	)

See Notes to the Consolidated Financial Statements

3

Part I — FINANCIAL INFORMATION

PVF CAPITAL CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three months ended
	September 30,
	2012			2011
Operating activities:
Net income (loss)	$	1,551,087		$	(820,597	)
Adjustments to reconcile net income to net cash flow from operating activities
Accretion of discount on available for sale securities		(6,180	)		(8,940	)
Depreciation and amortization		176,153			177,621
Provision for loan losses		1,050,000			1,500,000
Gain on the sale of loans receivable held for sale		(3,550,824	)		(847,607	)
(Gain) loss on the sale of SBA loans		3,686			(221,218	)
Provision for real estate owned losses		233,719			69,400
Accretion (defferral) of loan origination fees, net		(95,144	)		633,032
(Gain) loss on disposal of real estate owned, net		17,881			(140,112	)
Market adjustment for loans held for sale		87,634			(231,052	)
Change in fair value of mortgage banking derivatives		(567,931	)		(748,776	)
Stock compensation		399,606			61,005
Proceeds from loans receivable held for sale		112,540,431			44,937,267
Origination of loans receivable held for sale, net		(105,332,333	)		(47,622,223	)
Increase in cash surrender value of bank-owned life insurance		(47,466	)		(62,700	)
Net change in other assets and other liabilities		(2,745,430	)		2,482,067
Net cash from (used in) operating activities		3,714,889			(842,833	)
Investing activities:
Loan repayments and originations, net		(3,323,245	)		2,899,216
Principal repayments on securities available for sale		1,881,562			246,328
Calls of securities available for sale		5,750,000			8,950,000
Purchase of securities available for sale		(7,024,690	)		(3,000,000	)
Additions to office properties and equipment, net		(225,050	)		(146,920	)
Proceeds from sale of real estate owned		1,059,485			657,264
Net cash from (used in) investing activities		(1,881,938	)		9,605,888
Financing activities:
Net increase in demand deposits, NOW and passbook savings		12,928,106			(1,518,884	)
Net decrease in time deposits		(22,756,787	)		(2,530,726	)
Repayment of note payable		(26,666	)		(26,667	)
Net increase (decrease) in advances from borrowers for taxes and insurance		2,485,954			(3,705,833	)
Proceeds from the issuance of common shares		1,744			—
Net cash from (used in) financing activities		(7,367,649	)		(7,782,110	)
Net increase (decrease) in cash and cash equivalents		(5,534,698	)		980,945
Cash and cash equivalents at beginning of year		120,110,140			149,291,405
Cash and cash equivalents at end of year	$	114,575,442		$	150,272,350
Supplemental disclosures of cash flow information:
Cash payments of interest	$	1,589,416		$	2,221,594
Cash payments of income taxes	$	—		$	—
Supplemental noncash investing activity:
Transfer of loans to real estate owned	$	809,626		$	538,978

See Notes to the Consolidated Financial Statements

4

Part I — FINANCIAL INFORMATION

PVF CAPITAL CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended

September 30, 2012 and 2011

(Unaudited)

NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED MATTERS

The accounting and reporting policies of PVF Capital Corp. (the “Company”) conform to U.S. generally accepted accounting principles (“U.S. GAAP”) and general industry practice. The Company’s principal subsidiary, Park View Federal Savings Bank (the “Bank”) is primarily engaged in the business of offering deposits through the issuance of savings accounts, money market accounts, and certificates of deposit and lending funds primarily for the purchase, construction, and improvement of real estate in Cuyahoga, Summit, Geauga, Lake, Medina, Lorain and Portage Counties, Ohio. The deposit accounts of the Bank are insured up to applicable limits by the Federal Deposit Insurance Corporation (the “FDIC”). The following is a description of the significant policies which the Company follows in preparing and presenting its consolidated financial statements.

Basis of Presentation: The accompanying Unaudited Consolidated Financial Statements of PVF Capital Corp. have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, these financial statements do not contain all of the information and footnotes required by U.S. GAAP for annual financial statements and should be read in conjunction with PVF Capital Corp.’s Annual Report on Form 10-K for the fiscal year ended June 30, 2012. These consolidated financial statements are prepared without audit and reflect all adjustments that, in the opinion of management, are necessary to present fairly the financial position of the Company at September 30, 2012, and its results of operations and cash flows for the periods presented. All such adjustments are normal and recurring in nature. The accounting principles used to prepare the consolidated financial statements are in compliance with U.S. GAAP. However, the financial statements were prepared in accordance with the instructions of Form 10-Q and, therefore, do not purport to contain all necessary financial and note disclosures required by U.S. GAAP.

Principles of Consolidation: The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, the Bank, PVF Service Corporation (“PVFSC”), Mid Pines Land Company, PVF Holdings, Inc., PVF Mortgage Corp. and PVF Community Development Corp. PVFSC owns certain premises and leases them to the Bank. Mid Pines Land Company, PVF Holdings, Inc., PVF Mortgage Corp. and PVF Community Development Corp. did not have any significant assets or activity as of or for the periods presented. All significant intercompany transactions and balances are eliminated in consolidation. In the period ended September 30, 2012, the Company reclassified certain loans between the loan portfolio segments and reclassified certain deposits between interest bearing and non-interest bearing as presented previously in the Company’s Annual Report on Form 10-K to conform to the current period presentation.

PVFSC and the Bank have entered into various nonconsolidated joint ventures that own real estate, including properties leased to the Bank. The Bank has created various limited liability companies that have taken title to property acquired through or in lieu of foreclosure.

Use of Estimates: The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets

5

Part I — FINANCIAL INFORMATION

and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. The allowance for loan losses, valuation of mortgage servicing rights, fair value of mortgage banking derivatives, valuation of loans held for sale, fair value of securities, valuation of other real estate owned, and the realizability of deferred tax assets are particularly susceptible to change.

NOTE 2 — SECURITIES

As of September 30, 2012 and June 30, 2012, respectively, the amortized cost and fair value of securities available for sale and the related gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) were as follows:

	September 30, 2012
			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
FNMA structured notes	$	2,000,000	$	3,600	$	0		$	2,003,600
Trust preferred and corporate securities		18,210,212		460,346		(13,562	)		18,656,997
Mortgage-backed GSE securities		17,247,156		387,506		(14,708	)		17,619,954
Total	$	37,457,369	$	851,452	$	(28,270	)	$	38,280,551
	June 30, 2012
			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
FNMA structured notes	$	2,000,000	$	9,320	$	0		$	2,009,320
Trust preferred and corporate securities		20,964,197		344,230		(46,665	)		21,261,762
Mortgage-backed GSE securities		15,093,864		293,098					15,386,962
Total	$	38,058,061	$	646,648	$	(46,665	)	$	38,658,044

Management performs a quarterly evaluation of investment securities for other-than-temporary impairment. At September 30, 2012 and June 30, 2012, respectively, the gross unrealized losses were in a loss position for less than 12 months. Management does not believe that any of these losses at September 30, 2012 or June 30, 2012 represent an other-than-temporary impairment. Should the impairment of any of these securities become other-than-temporary, the cost basis of the investment will be reduced and the resulting loss recognized within net income in the period the other-then-temporary impairment is identified.

The amortized cost and fair value of securities available-for-sale, by contractual maturity, are shown below:

6

Part I — FINANCIAL INFORMATION

	September 30, 2012
	Amortized
	Cost		Fair Value
One to five years	$	2,000,000	$	2,003,600
Five to ten years		5,037,865		5,102,220
Greater than 10 years		13,172,347		13,554,827
Mortgage-backed GSE securities		17,225,615		17,619,954
Total	$	37,435,828	$	38,280,551

The Fannie Mae (“FNMA”) structured note held at September 30, 2012 is callable on November 9, 2012 and quarterly thereafter, has multiple coupon resets and matures on November 9, 2016. These mortgage-backed securities are backed by residential mortgage loans and do not mature on a single maturity date.

Securities pledged as collateral for contingent funding at the Federal Home Loan Bank of Cincinnati were approximately $14.6 million.

7

Part I — FINANCIAL INFORMATION

NOTE 3 — LOANS RECEIVABLE

Loans receivable at September 30, 2012, and June 30, 2012 consisted of the following:

	September 30,			June 30,
	2012			2012
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	59,297,788		$	58,743,933
1-4 Family Non-Owner Occupied		34,303,456			34,368,320
1-4 Family Second Mortgage		28,729,779			29,202,145
Home Equity Lines of Credit		64,933,215			65,908,899
Home Equity Investment Lines of Credit		5,267,763			5,645,851
One-to-Four Family Construction Loans:
1-4 Family Construction		1,341,302			514,052
1-4 Family Construction Models/Speculative		621,042			1,608,137
Multi-Family Loans:
Multi-Family		62,638,057			53,959,459
Multi-Family Second Mortgage		144,754			145,642
Multi-Family Construction		108,428			5,375,000
Commercial Real Estate Loans:
Commercial		198,023,597			198,287,457
Commercial Second Mortgage		4,799,704			5,750,283
Commercial Lines of Credit		22,656,803			22,335,619
Commercial Construction		9,126,892			7,732,736
Commercial and Industrial Loans		37,556,592			35,443,184
Land Loans:
Lot Loans		9,346,567			12,091,093
Acquisition and Development Loans		18,968,781			19,093,006
Consumer Loans		2,101,434			2,112,708
Total loans receivable		559,965,954			558,317,524
Net deferred loan origination fees		(644,038	)		(637,144	)
Allowance for loan losses		(16,135,640	)		(16,052,865	)
Total loans receivable, net	$	543,186,276		$	541,627,515

8

Part I — FINANCIAL INFORMATION

The following table presents activity in the allowance for loan losses by portfolio segment for the three months ended September 30, 2012:

				One-to-Four						Commercial			Commercial
	One-to-Four			Family			Multi-			Real			and
	Family			Construction			Family			Estate			Industrial			Land			Consumer			Total
Beginning balance at June 30, 2012	$	5,765,276		$	305,312		$	1,903,138		$	5,084,179		$	928,043		$	2,057,301		$	9,616		$	16,052,865
Provision for loan losses		623,779			43,601			(766,960	)		943,294			312,966			(120,627	)		13,947			1,050,000
Charge-offs		(741,685	)		(45,959	)		—			(248,493	)		(12,500	)		(20,078	)		(13,000	)		(1,081,715	)
Recoveries		42,569			10,000			—			17,614			1,585			42,480			242			114,490
Ending balance at September 30, 2012	$	5,689,939		$	312,954		$	1,136,178		$	5,796,594		$	1,230,094		$	1,959,076		$	10,805		$	16,135,640

The following table presents activity in the allowance for loan losses by portfolio segment for the three months ended September 30, 2011:

				One-to-Four						Commercial			Commercial
	One-to-Four			Family			Multi-			Real			and
	Family			Construction			Family			Estate			Industrial			Land			Consumer		Total
Beginning balance at June 30, 2011	$	8,841,454		$	1,266,740		$	1,767,335		$	8,458,943		$	1,663,894		$	7,891,305		$	107,222	$	29,996,893
Provision for loan losses		(511,394	)		39,566			(360,444	)		949,896			493,657			728,029			160,690		1,500,000
Charge-offs		(476,158	)		(109,322	)		(236,663	)		(1,089,347	)		(29,609	)		(28,421	)		—		(1,969,520	)
Recoveries		4,765			—			—			19,271			1,755			—			—		25,791
Ending balance at September 30, 2011	$	7,858,667		$	1,196,984		$	1,170,228		$	8,338,763		$	2,129,697		$	8,590,913		$	267,912	$	29,553,164

9

Part I — FINANCIAL INFORMATION

The following table presents the allowance for loan losses and the recorded investment in loans by portfolio segment and based on the impairment method as of September 30, 2012. The recorded investment in loans includes the unpaid principal balance and unamortized loan origination fees, but excludes accrued interest receivable which is not considered to be material.

			One-to-Four				Commercial		Commercial
	One-to-Four		Family		Multi-		Real		and
	Family		Construction		Family		Estate		Industrial		Land		Consumer		Total
Allowance for loan losses
Ending allowance balance attributable to loans
Individually evaluated for impairment	$	699,204	$	101,716	$	—	$	98,725	$	300,860	$	252,000	$	—	$	1,452,505
Collectively evaluated for impairment		4,990,735		211,238		1,136,178		5,697,869		929,234		1,707,076		10,805		14,683,135
Total ending allowance balance	$	5,689,939	$	312,954	$	1,136,178	$	5,796,594	$	1,230,094	$	1,959,076	$	10,805	$	16,135,640
Loans
Loans individually evaluated for impairment	$	12,208,532	$	833,904	$	300,254	$	11,851,912	$	540,441	$	6,763,662	$	—	$	32,498,705
Loans collectively evaluated for impairment		180,102,030		1,126,183		62,518,652		222,485,254		36,972,956		21,519,119		2,099,017		526,823,211
Total ending loans balance	$	192,310,562	$	1,960,087	$	62,818,906	$	234,337,166	$	37,513,397	$	28,282,781	$	2,099,017	$	559,321,916

10

Part I — FINANCIAL INFORMATION

The following table presents the allowance for loan losses and the recorded investment in loans by portfolio segment and based on the impairment method as of June 30, 2012. The recorded investment in loans includes the unpaid principal balance and unamortized loan origination fees, but excludes accrued interest receivable which is not considered to be material.

			One-to-Four				Commercial		Commercial
	One-to-Four		Family		Multi-		Real		and
	Family		Construction		Family		Estate		Industrial		Land		Consumer		Total
Allowance for loan losses
Ending allowance balance attributable to loans
Individually evaluated for impairment	$	665,033	$	101,716	$	—	$	98,725	$	300,860	$	252,000	$	—	$	1,418,334
Collectively evaluated for impairment		5,100,243		203,596		1,903,138		4,985,454		627,183		1,805,301		9,616		14,634,531
Total ending allowance balance	$	5,765,276	$	305,312	$	1,903,138	$	5,084,179	$	928,043	$	2,057,301	$	9,616	$	16,052,865
Loans
Loans individually evaluated for impairment	$	13,243,350	$	880,749	$	622,228	$	11,902,730	$	740,297	$	7,189,109	$	—	$	34,578,463
Loans collectively evaluated for impairment		180,404,558		1,239,018		58,789,996		221,936,205		34,662,439		23,959,404		2,110,297		523,101,917
Total ending loans balance	$	193,647,908	$	2,119,767	$	59,412,224	$	233,838,935	$	35,402,736	$	31,148,513	$	2,110,297	$	557,680,380

11

Part I — FINANCIAL INFORMATION

The following table presents loans individually evaluated for impairment by class of loan as of September 30, 2012 and the average recorded investment and interest income recognized by class for the three months ended September 30, 2012:

	September 30, 2012
	Unpaid				Allowance for		Average		Interest		Cash Basis
	Principal		Recorded		Loan Losses		Recorded		Income		Interest
	Balance (1)		Investment		Allocated		Investment		Recognized		Recognized
With no related allowance recorded
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	5,878,741	$	5,075,565	$	0	$	5,373,322	$	0	$	0
1-4 Family Non-Owner Occupied		3,487,465		2,130,102		0		2,291,842		164		164
1-4 Family Second Mortgage		1,405,390		1,142,585		0		1,186,435		0		0
Home Equity Lines of Credit		1,751,282		1,749,268		0		1,790,931		0		0
Home Equity Investment Lines of Credit		157,122		156,941		0		156,942		0		0
One-to-Four Family Construction Loans:
1-4 Family Construction		0		0		0				0		0
1-4 Family Construction Models/Speculative		678,779		308,146		0		331,566		0		0
Multi-Family Loans:
Multi-Family		312,714		300,254		0		461,241		0		0
Multi-Family Second Mortgage		0		0		0		0		0		0
Multi-Family Construction		0		0		0		0		0		0
Commercial Real Estate Loans:
Commercial		10,366,525		9,239,212		0		9,262,945		43,972		43,972
Commercial Second Mortgage		0		0		0				0		0
Commercial Lines of Credit		613,910		613,204		0		614,870		0		0
Commercial Construction		828,491		643,855		0		643,859		0		0
Commercial and Industrial Loans		484,799		239,927		0		339,854		0		0
Land Loans:
Lot Loans		5,379,609		4,254,141		0		3,966,345		11,569		11,569
Acquisition and Development Loans		4,990,178		2,374,790		0		2,874,945		0		0
Consumer Loans		0		0		0		0		0		0
Total with no related allowance recorded	$	36,335,005	$	28,227,990	$	0	$	29,295,097	$	55,705	$	55,705
With an allowance recorded
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	231,051	$	230,786	$	39,982	$	231,635	$	0	$	0
1-4 Family Non-Owner Occupied		116,463		116,329		8,286		116,778		0		0
1-4 Family Second Mortgage		246,621		246,337		14,685		246,674		592		592
Home Equity Lines of Credit		963,762		962,653		338,080		928,753		0		0
Home Equity Investment Lines of Credit		398,424		397,966		298,171		402,629		0		0
One-to-Four Family Construction Loans:
1-4 Family Construction		0		0		0		0		0		0
1-4 Family Construction Models/Speculative		526,363		525,758		101,716		525,760		7,062		7,062
Multi-Family Loans:
Multi-Family		0		0		0		0		0		0
Multi-Family Second Mortgage		0		0		0		0		0		0
Multi-Family Construction		0		0		0		0		0		0
Commercial Real Estate Loans:
Commercial		1,357,202		1,355,641		98,725		1,355,647		0		0
Commercial Second Mortgage		0		0		0		0		0		0
Commercial Lines of Credit		0		0		0				0		0
Commercial Construction		0		0		0		0		0		0
Commercial and Industrial Loans		300,860		300,514		300,860		300,515		0		0
Land Loans:
Lot Loans		134,886		134,731		252,000		135,095		2,031		2,031
Acquisition and Development Loans		0		0		0		0		0		0
Consumer Loans		0		0		0		0		0		0
Total with an allowance recorded	$	4,275,632	$	4,270,715	$	1,452,505	$	4,243,486	$	9,685	$	9,685
Total loans evaluated for impairment	$	40,610,637	$	32,498,705	$	1,452,505	$	33,538,583	$	65,390	$	65,390

(1) There are $14.5 million of loans individually identified for impairment accruing interest.

12

Part I — FINANCIAL INFORMATION

The following table presents loans individually evaluated for impairment by class of loans as of June 30, 2012:

	June 30, 2012
	Unpaid				Allowance for		Average		Interest		Cash Basis
	Principal		Recorded		Loan Losses		Recorded		Income		Interest
	Balance (1)		Investment		Allocated		Investment		Recognized		Recognized
With no related allowance recorded
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	6,380,803	$	5,671,079	$	0	$	5,437,834	$	30,882	$	30,882
1-4 Family Non-Owner Occupied		4,597,708		2,453,581		0		3,503,049		48,828		48,828
1-4 Family Second Mortgage		1,455,914		1,230,284		0		1,374,161		3,958		3,958
Home Equity Lines of Credit		1,834,685		1,832,595		0		1,344,562		0		0
Home Equity Investment Lines of Credit		157,120		156,943		0		204,703		0		0
One-to-Four Family Construction Loans:
1-4 Family Construction		0		0		0		52,573		4,821		4,821
1-4 Family Construction Models/Speculative		678,779		354,986		0		475,027		0		0
Multi-Family Loans:
Multi-Family		635,053		622,228		0		550,760		4,081		4,081
Multi-Family Second Mortgage		0		0		0		0		0		0
Multi-Family Construction		0		0		0		0		0		0
Commercial Real Estate Loans:
Commercial		10,902,253		9,286,679		0		8,005,131		147,148		147,148
Commercial Second Mortgage		0		0		0		192,399		1,660		1,660
Commercial Lines of Credit		617,240		616,536		0		2,413,942		0		0
Commercial Construction		828,490		643,863		0		575,159		0		0
Commercial and Industrial Loans		801,075		439,781		0		2,335,961		662		662
Land Loans:
Lot Loans		5,235,050		3,678,550		0		2,955,360		5,519		5,519
Acquisition and Development Loans		5,986,575		3,375,100		0		2,258,295		19,132		19,132
Consumer Loans		0		0		0		0		0		0
Total with no related allowance recorded	$	40,110,745	$	30,362,205	$	0	$	31,678,916	$	266,691	$	266,691
With an allowance recorded
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	232,751	$	232,485	$	39,981	$	526,956	$	0	$	0
1-4 Family Non-Owner Occupied		117,360		117,226		8,286		1,243,154		10,112		10,112
1-4 Family Second Mortgage		247,293		247,011		14,685		175,881		0		0
Home Equity Lines of Credit		895,875		894,852		299,759		1,629,256		0		0
Home Equity Investment Lines of Credit		407,757		407,293		302,322		470,382		0		0
One-to-Four Family Construction Loans:
1-4 Family Construction		0		0		0		0
1-4 Family Construction Models/Speculative		526,363		525,762		101,716		1,064,520		14,047		14,047
Multi-Family Loans:
Multi-Family		0		0		0		92,056		0		0
Multi-Family Second Mortgage		0		0		0		0		0		0
Multi-Family Construction		0		0		0		0		0		0
Commercial Real Estate Loans:
Commercial		1,357,202		1,355,653		98,725		3,796,149		37,340		37,340
Commercial Second Mortgage		0		0		0		34,220		0		0
Commercial Lines of Credit		0		0		0		48,854		0		0
Commercial Construction		0		0		0		711,804		0		0
Commercial and Industrial Loans		300,860		300,517		300,860		1,404,807		0		0
Land Loans:
Lot Loans		135,614		135,459		252,000		962,537		0		0
Acquisition and Development Loans		0		0		0		2,397,176		0		0
Consumer Loans		0		0		0		0		0		0
Total with an allowance recorded	$	4,221,075	$	4,216,258	$	1,418,334	$	14,557,752	$	61,499	$	61,499
Total loans evaluated for impairment	$	44,331,820	$	34,578,463	$	1,418,334	$	46,236,668	$	328,190	$	328,190

(1) There are $13.9 million of loans individually identified for impairment accruing interest.

13

Part I — FINANCIAL INFORMATION

The following table presents loans individually evaluated for impairment by class of loans as of September 30, 2011:

	September 30, 2011
	Unpaid				Allowance for		Average		Interest		Cash Basis
	Principal		Recorded		Loan Losses		Recorded		Income		Interest
	Balance (1)		Investment		Allocated		Investment		Recognized		Recognized
With no related allowance recorded
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	6,101,095	$	6,091,111	$	—	$	6,605,736	$	47,473	$	47,473
1-4 Family Non-Owner Occupied		2,845,537		2,840,881		—		1,998,029		7,295		7,295
1-4 Family Second Mortgage		1,517,563		1,515,080		—		1,279,294		107		107
Home Equity Lines of Credit		796,506		795,203		—		867,519		582		582
Home Equity Investment Lines of Credit		310,121		309,614		—		221,646		317		317
One-to-Four Family Construction Loans:
1-4 Family Construction		—		—		—		—		—		—
1-4 Family Construction Models/Speculative		176,887		176,598		—		176,753		1,322		1,322
Multi-Family Loans:
Multi-Family		305,904		305,404		—		1,224,791		—		—
Multi-Family Second Mortgage		—		—		—		—		—		—
Multi-Family Construction		—		—		—		—		—		—
Commercial Real Estate Loans:
Commercial		7,266,866		7,254,974		—		6,842,586		25,577		25,577
Commercial Second Mortgage		571,473		570,538		—		570,519		—		—
Commercial Lines of Credit		2,623,140		2,618,848		—		2,758,567		2,186		2,186
Commercial Construction		370,000		369,395		—		369,382		—		—
Commercial and Industrial Loans		2,559,945		2,555,755		—		2,057,142		—		—
Land Loans:
Lot Loans		1,344,192		1,341,993		—		1,153,055		807		807
Acquisition and Development Loans		109,818		109,638		—		274,431		—		—
Consumer Loans		—		—		—				—		—
Total with no related allowance recorded	$	26,899,047	$	26,855,032	$	—	$	26,399,450	$	85,666	$	85,666
With an allowance recorded
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	1,631,018	$	1,628,349	$	405,552	$	1,158,082	$	719	$	719
1-4 Family Non-Owner Occupied		4,625,921		4,618,352		1,924,308		4,747,990		3,565		3,565
1-4 Family Second Mortgage		457,261		456,513		224,653		361,465		—		—
Home Equity Lines of Credit		2,329,197		2,325,385		987,669		2,298,073		—		—
Home Equity Investment Lines of Credit		345,735		345,170		102,008		345,158		1,286		1,286
One-to-Four Family Construction Loans:
1-4 Family Construction		—		—		—		—		—		—
1-4 Family Construction Models/Speculative		2,685,405		2,681,011		862,554		2,838,155		—		—
Multi-Family Loans:
Multi-Family		368,828		368,224		226,067		368,212		—		—
Multi-Family Second Mortgage		—		—		—		—		1,660		1,660
Multi-Family Construction		—		—		—		—		—		—
Commercial Real Estate Loans:
Commercial		6,378,282		6,367,846		929,808		7,485,402		6,936		6,936
Commercial Second Mortgage		137,105		136,881		3,553		68,440		—		—
Commercial Lines of Credit		—		—		—		—		—		—
Commercial Construction		2,851,883		2,847,217		751,178		3,146,613		—		—
Commercial and Industrial Loans		3,279,788		3,274,422		1,041,066		2,456,243		2,920		2,920
Land Loans:
Lot Loans		3,202,019		3,196,779		1,291,302		3,084,307		6,742		6,742
Acquisition and Development Loans		9,604,420		9,588,705		4,810,417		9,826,391		24,176		24,176
Consumer Loans		—		—		—		—		—		—
Total with an allowance recorded	$	37,896,862	$	37,834,854	$	13,560,135	$	38,184,531	$	48,004	$	48,004
Total loans evaluated for impairment	$	64,795,909	$	64,689,886	$	13,560,135	$	64,583,981	$	133,670	$	133,670

(1) There are $17.0 million of loans individually identified for impairment accruing interest.

14

Part I — FINANCIAL INFORMATION

Past Due and Non-Accrual Loans

The following table presents the recorded investment in non-accrual loans and loans past due over 90 days still on accrual by class of loan as of September 30, 2012 and June 30, 2012. Non-accrual loans and loans past due over 90 days still on accrual include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans.

	September 30, 2012				June 30, 2012
			Loans Past Due				Loans Past Due
			Over 90 Days				Over 90 Days
	Nonaccrual(1)		Still Accruing(2)		Nonaccrual(1)		Still Accruing(2)
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	2,293,702	$	—	$	2,871,746	$	—
1-4 Family Non-Owner Occupied		2,084,520		0		2,461,281		0
1-4 Family Second Mortgage		481,843		0		566,444		0
Home Equity Lines of Credit		2,715,044		0		2,727,447		0
Home Equity Investment Lines of Credit		555,545		0		564,235		0
One-to-Four Family Construction Loans:
1-4 Family Construction		—		0		0		0
1-4 Family Construction Models/Speculative		308,927		0		355,355		0
Multi-Family Loans:
Multi-Family		5,720		0		324,602		0
Multi-Family Second Mortgage		—		0		0		0
Multi-Family Construction		—		0		0		0
Commercial Real Estate Loans:
Commercial		3,146,513		0		3,310,170		0
Commercial Second Mortgage		—		0		0		0
Commercial Lines of Credit		613,910		0		616,537		0
Commercial Construction		644,808		0		644,072		0
Commercial and Industrial Loans		238,229		0		437,729		0
Land Loans:
Lot Loans		3,578,542		0		3,815,778		0
Acquisition and Development Loans		1,197,045		0		1,380,199		0
Consumer Loans		—		0		0		0
Total	$	17,864,348	$	—	$	20,075,595	$	—

(1) Non-accrual status denotes loans on which, in the opinion of management, the collection of additional interest is unlikely, or loans that meet the non-accrual criteria established by regulatory authorities. Payments received on a non-accrual loan are either applied to the outstanding principal balance or recorded as interest income, depending on an assessment of the collectibility of the principal balance of the loan.

(2) At September 30, 2012 and June 30, 2012, the Company had balances of approximately $6.1 million and $6.3 million, respectively, in loans that have matured and continue to make current payments. These loans are not considered past due as a result of their payment status being current.

15

Part I — FINANCIAL INFORMATION

The following table presents the aging of the recorded investment in past due loans as of September 30, 2012 by class of loan. Performing loans are accruing loans less than 90 days past due. Nonperforming loans are all loans not accruing or greater than 90 days past due and accruing. At September 30, 2012, the Company had a balance of approximately $6.1 million in loans that were contractually past maturity but were not considered past due as a result of the payment status being current.

					Greater Than
	30-59 Days		60-89 Days		90 Days		Total		Loans Not
	Past Due		Past Due		Past Due		Past Due		Past Due		Total
Performing Loans
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	2,050,531	$	247,273	$	—	$	2,297,804	$	54,638,081	$	56,935,885
1-4 Family Non-Owner Occupied		16,284		—		—		16,284		32,163,198		32,179,482
1-4 Family Second Mortgage		273,583		—		—		273,583		27,941,310		28,214,893
Home Equity Lines of Credit		777,134		19,991		—		797,125		61,346,364		62,143,489
Home Equity Investment Lines of Credit		235,512		—		—		235,512		4,470,647		4,706,159
One-to-Four Family Construction Loans:
1-4 Family Construction		—		—		—		—		1,339,759		1,339,759
1-4 Family Construction Models/Speculative		—		—		—		—		311,401		311,401
Multi-Family Loans:
Multi-Family		235,540		—		—		235,540		62,324,755		62,560,295
Multi-Family Second Mortgage		—		—		—		—		144,588		144,588
Multi-Family Construction		—		—		—		—		108,303		108,303
Commercial Real Estate Loans:
Commercial		405,037		616,238		—		1,021,275		193,628,054		194,649,329
Commercial Second Mortgage		—		—		—		—		4,794,184		4,794,184
Commercial Lines of Credit		587,524		1,183,484		—		1,771,008		20,245,827		22,016,835
Commercial Construction		—		—		—		—		8,471,587		8,471,587
Commercial and Industrial Loans										37,275,168		37,275,168
Land Loans:
Lot Loans		14,622		95,903		—		110,525		5,646,750		5,757,275
Acquisition and Development Loans		—		—		—		—		17,749,919		17,749,919
Consumer Loans		—		—		—		—		2,099,017		2,099,017
Total Performing Loans	$	4,595,767	$	2,162,889	$	—	$	6,758,656	$	534,698,912	$	541,457,568
Nonperforming Loans
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	—	$	—	$	2,036,669	$	2,036,669	$	257,033	$	2,293,702
1-4 Family Non-Owner Occupied		57,235		58,470		1,870,021		1,985,726		98,794		2,084,520
1-4 Family Second Mortgage		—		41,014		393,349		434,363		47,480		481,843
Home Equity Lines of Credit		119,966		—		2,249,808		2,369,774		345,270		2,715,044
Home Equity Investment Lines of Credit		84,536		—		471,009		555,545		—		555,545
One-to-Four Family Construction Loans:
1-4 Family Construction		—		—		—		—		—		—
1-4 Family Construction Models/Speculative		—		—		190,256		190,256		118,671		308,927
Multi-Family Loans:
Multi-Family		—		—		5,720		5,720		—		5,720
Multi-Family Second Mortgage		—		—		—		—		—		—
Multi-Family Construction		—		—		—		—		—		—
Commercial Real Estate Loans:
Commercial		—		—		3,013,679		3,013,679		132,834		3,146,513
Commercial Second Mortgage		—		—		—		—		—		—
Commercial Lines of Credit		—		—		494,972		494,972		118,938		613,910
Commercial Construction		—		—		644,808		644,808		—		644,808
Commercial and Industrial Loans		—		—		38,229		38,229		200,000		238,229
Land Loans:
Lot Loans		—		—		3,096,352		3,096,352		482,190		3,578,542
Acquisition and Development Loans		—		—		1,197,045		1,197,045		—		1,197,045
Consumer Loans		—		—		—		—		—		—
Total Nonperforming Loans	$	261,737	$	99,484	$	15,701,917	$	16,063,138	$	1,801,210	$	17,864,348
Total Loans	$	4,857,504	$	2,262,373	$	15,701,917	$	22,821,794	$	536,500,122	$	559,321,916

16

Part I — FINANCIAL INFORMATION

The following table presents the aging of the recorded investment in past due loans as of June 30, 2012 by class of loan. Performing loans are accruing loans less than 90 days past due. Nonperforming loans are all loans not accruing. At June 30, 2012, the Company had a balance of approximately $6.3 million in loans that were contractually past maturity but were not considered past due as a result of the payment status being current.

					Greater Than
	30-59 Days		60-89 Days		90 Days		Total		Loans Not
	Past Due		Past Due		Past Due		Past Due		Past Due		Total
Performing Loans
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	584,430	$	—	$	—	$	584,430	$	55,220,719	$	55,805,149
1-4 Family Non-Owner Occupied		375,660		303,667		—		679,327		31,188,492		31,867,819
1-4 Family Second Mortgage		14,221		—		—		14,221		28,588,155		28,602,376
Home Equity Lines of Credit		114,558		23,230		—		137,788		62,968,449		63,106,237
Home Equity Investment Lines of Credit		200,657		—		—		200,657		4,874,516		5,075,173
One-to-Four Family Construction Loans:
1-4 Family Construction		—		145,771		—		145,771		367,695		513,466
1-4 Family Construction Models/Speculative		—		—		—		—		1,250,946		1,250,946
Multi-Family Loans:
Multi-Family		—		—		—		—		53,573,280		53,573,280
Multi-Family Second Mortgage		—		—		—		—		145,476		145,476
Multi-Family Construction		—		—		—		—		5,368,866		5,368,866
Commercial Real Estate Loans:
Commercial		744,536		—		—		744,536		194,006,468		194,751,004
Commercial Second Mortgage		—		—		—		—		5,743,721		5,743,721
Commercial Lines of Credit		—		—		—		—		21,693,593		21,693,593
Commercial Construction		—		—		—		—		7,079,839		7,079,839
Commercial and Industrial Loans		—		—		—		—		34,965,008		34,965,007
Land Loans:
Lot Loans		—		—		—		—		8,261,518		8,261,518
Acquisition and Development Loans		—		—		—		—		17,691,018		17,691,018
Consumer Loans		—		58,394		—		58,394		2,051,903		2,110,297
Total Performing Loans	$	2,034,062	$	531,062	$	—	$	2,565,124	$	535,039,662	$	537,604,785
Nonperforming Loans
One-to-Four Family Loans:
1-4 Family Owner Occupied	$	105,333	$	—	$	2,124,062	$	2,229,395	$	642,351	$	2,871,746
1-4 Family Non-Owner Occupied		—		—		2,405,774		2,405,774		55,507		2,461,281
1-4 Family Second Mortgage		—		—		499,154		499,154		67,290		566,444
Home Equity Lines of Credit		14,607		—		2,371,962		2,386,569		340,878		2,727,447
Home Equity Investment Lines of Credit		—		134,195		430,041		564,236		—		564,236
One-to-Four Family Construction Loans:
1-4 Family Construction		—		—		—		—		—		—
1-4 Family Construction Models/Speculative		—		—		235,945		235,945		119,410		355,355
Multi-Family Loans:
Multi-Family		—		—		324,602		324,602		—		324,602
Multi-Family Second Mortgage		—		—		—		—		—		—
Multi-Family Construction		—		—		—		—		—		—
Commercial Real Estate Loans:
Commercial		—		—		3,166,992		3,166,992		143,178		3,310,170
Commercial Second Mortgage		—		—		—		—		—		—
Commercial Lines of Credit		—		122,129		494,407		616,536		—		616,536
Commercial Construction		—		—		644,072		644,072		—		644,072
Commercial and Industrial Loans		—		—		237,957		237,957		199,772		437,729
Land Loans:
Lot Loans		—		—		3,144,721		3,144,721		671,057		3,815,778
Acquisition and Development Loans		—		—		1,380,199		1,380,199		—		1,380,199
Consumer Loans		—		—		—		—		—		—
Total Nonperforming Loans	$	119,940	$	256,324	$	17,459,888	$	17,836,152	$	2,239,443	$	20,075,595
Total Loans	$	2,154,002	$	787,386	$	17,459,888	$	20,401,276	$	537,279,105	$	557,680,380

17

Part I — FINANCIAL INFORMATION

Troubled Debt Restructurings:

Included in loans individually impaired are loans with recorded investment of $15,345,654 and $15,590,705 for which the Company has allocated $153,391 of specific reserves to customers whose terms have been modified in troubled debt restructurings as of both September 30, 2012 and June 30, 2012, respectively. Included in troubled debt restructurings are $1,608,276 and $1,805,855 of restructured loans on non-accrual at September 30, 2012 and June 30, 2012, respectively. Of the restructured loans, both performing and non-accrual, one loan totaling $111,944 was not performing in accordance with its modified terms. There are no commitments to lend additional amounts at September 30, 2012 and June 30, 2012.

The following table presents the aggregate balance of loans by loan class whose terms have been modified in troubled debt restructurings as of September 30, 2012 and June 30, 2012:

			Outstanding				Outstanding
			Recorded				Recorded
	Number		Investment		Number		Investment
	of Loans		9/30/2012		of Loans		6/30/2012
Troubled Debt Restructurings:
One-to-Four Family Loans:
1-4 Family Owner Occupied		20	$	3,756,859		20	$	3,775,715
1-4 Family Non-Owner Occupied		1		49,594		1		53,993
1-4 Family Second Mortgage		5		908,979		5		912,147
Home Equity Lines of Credit		1		63,782		1		63,782
Home Equity Investment Lines of Credit		0		—		0		0
One-to-Four Family Construction Loans:
1-4 Family Construction		0		—		0		0
1-4 Family Construction Models/Speculative		0		—		0		0
Multi-Family Loans:
Multi-Family		1		294,893		1		297,979
Multi-Family Second Mortgage		0		—		0		0
Multi-Family Construction		0		—		0		0
Commercial Real Estate Loans:
Commercial		12		8,230,906		12		8,264,020
Commercial Second Mortgage		0		—		0		0
Commercial Lines of Credit		0		—		0		0
Commercial Construction		0		—		0		0
Commercial and Industrial Loans		2		40,485		2		40,696
Land Loans:
Lot Loans		0		—		0		0
Acquisition and Development Loans		2		2,000,156		2		2,182,373
Consumer Loans		0		—		0		0
Total		44	$	15,345,654		44	$	15,590,705

The summary of activity for troubled debt restructured loans for the three months ending September 30, 2012 was as follows:

	Three months ended
	September 30, 2012
Troubled Debt Restructurings:
Beginning Balance	$	15,590,705
Additions		—
Charge-offs		(3,688	)
Payoffs or pay downs		(241,363	)
Ending Balance	$	15,345,654

18

Part I — FINANCIAL INFORMATION

During the periods ended September 30, 2012 and September 30, 2011, the terms of certain loans to borrowers experiencing financial difficulty were modified as troubled debt restructurings. The modification of the terms of such loans included one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; or a permanent reduction of the recorded investment in the loan. In order to determine whether a borrower is experiencing financial difficulty, an evaluation is performed of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under the Company’s internal underwriting policy.

The following table presents loans, by classes, which were modified during the three months ended September 30, 2012. All modifications during the three months ended September 30, 2012 were limited to loans which were already classified as troubled debt restructurings and involved an extension of the maturity dates and were for periods ranging from 12 months to 24 months.

	September 30, 2012
			Pre-Modification		Post-Modification
	Number		Outstanding Recorded		Outstanding Recorded
	of Loans		Investment		Investment
Troubled Debt Restructurings:
1-4 Family Owner Occupied		0		0		0
1-4 Family Non-Owner Occupied		0		0		0
Commercial Real Estate		1	$	1,283,869	$	1,283,869
Commercial Second Mortgage		0		0		0
Acquisition and Development		1		816,672		816,672
Total		2	$	2,100,541	$	2,100,541

The troubled debt restructurings described above did not result in an increase in the allowance for loan losses for the three months ended September 30, 2012, and did not result in charge offs during the three months ended September 30, 2012.

The following table presents loans by class modified as troubled debt restructurings that occurred during the three-month period ended September 30, 2011:

	September 30, 2011
			Pre-Modification		Post-Modification
	Number		Outstanding Recorded		Outstanding Recorded
	of Loans		Investment		Investment
Troubled Debt Restructurings:
Commercial Real Estate		1	$	295,362	$	295,362
Commercial and Industrial		1		44,149		44,149
Total		2	$	339,511	$	339,511

The troubled debt restructurings described above increased the allowance for loan losses by $36,395 and did not result in charge offs during the period ended September 30, 2011.

19

Part I — FINANCIAL INFORMATION

During the three months ended September 30, 2012, one loan modified as a troubled debt restructure had a payment default within twelve months following the modification.

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 ended September 30, 2011:

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			Pre-Modification		Post-Modification
	Number		Outstanding Recorded		Outstanding Recorded
	of Loans		Investment		Investment
Troubled Debt Restructurings:
1-4 Family Non-Owner Occupied		13	$	1,050,206	$	1,050,206