SUBORDINATED NOTES PAYABLE AND TRUST PREFERRED SECURITIES PAYABLE

12 Months Ended

Dec. 31, 2011

SUBORDINATED NOTES PAYABLE AND TRUST PREFERRED SECURITIES PAYABLE [Abstract]

SUBORDINATED NOTES PAYABLE AND TRUST PREFERRED SECURITIES PAYABLE

13.   SUBORDINATED NOTES PAYABLE AND TRUST PREFERRED SECURITIES PAYABLE

On April 12, 2000, the Holding Company issued subordinated notes in the aggregate amount of $25,000. The notes had a 9.25% fixed rate of interest and matured on May 1, 2010.  The notes were satisfied on May 1, 2010.  Interest expense recorded on the notes, inclusive of amortization of related issuance costs, was $799 during the year ended December 31, 2010 and $2,396 during the year ended December 31, 2009.

On March 19, 2004, the Holding Company completed an offering of an aggregate amount of $72,165 of trust preferred securities through Dime Community Capital Trust I, an unconsolidated special purpose entity formed for the purpose of the offering.  Of the total amount offered, the Holding Company retained ownership of $2,165 of the securities.  The trust preferred securities bear a fixed interest rate of 7.0%, mature on April 14, 2034, and are callable without penalty at any time on or after April 15, 2009.  The Holding Company currently does not intend to call this debt.  During the year ended December 31, 2009, the Company re-acquired $1,485 of the outstanding trust preferred securities at a discount, recognizing a gain of $505 on the transaction.  As a result, the outstanding balance of the trust preferred securities was $70,680 at both December 31, 2011 and 2010.

Interest expense recorded on the trust preferred securities totaled $5,024, $5,008 and $5,129 during the years ended December 31, 2011, 2010 and 2009, respectively.  Of the total interest payments, $152 was paid to the Holding Company in each of the years ended December 31, 2011, 2010 and 2009 related to its $2,165 investment in the securities, and was recorded in other non-interest income.