EMPLOYEE BENEFIT PLANS

12 Months Ended

Dec. 31, 2011

EMPLOYEE BENEFIT PLANS

15.   EMPLOYEE BENEFIT PLANS

Employee Retirement Plan - The Bank sponsors the Employee Retirement Plan, a tax-qualified, noncontributory, defined-benefit retirement plan.  Prior to April 1, 2000, substantially all full-time employees of at least 21 years of age were eligible for participation after one year of service.  Effective April 1, 2000, the Bank froze all participant benefits under the Employee Retirement Plan.

The net periodic (credit)cost for the Employee Retirement Plan included the following components:

	Year Ended December 31,
	2011			2010			2009
Interest cost	$	1,012		$	1,072		$	1,040
Expected return on plan assets		(1,442	)		(1,386	)		(1,187	)
Actuarial adjustment		-			156			-
Net amortization and deferral		1,004			1,005			1,162
Net periodic cost	$	574		$	847		$	1,015

The funded status of the Employee Retirement Plan was as follows:

	At December 31,
	2011			2010
Accumulated benefit obligation at end of period	$	22,907		$	19,870
Reconciliation of Projected benefit obligation:
Projected benefit obligation at beginning of period	$	19,870		$	17,732
Actuarial adjustment		-			767
Interest cost		1,012			1,072
Actuarial loss		3,136			1,520
Benefit payments		(1,058	)		(1,073	)
Settlements		(53	)		(148	)
Projected benefit obligation at end of period		22,907			19,870
Plan assets at fair value (investments in trust funds managed by trustee)
Balance at beginning of period		18,089			15,431
Return on plan assets		(304	)		1,775
Contributions		3,356			2,104
Benefit payments		(1,058	)		(1,073	)
Settlements		(53	)		(148	)
Balance at end of period		20,030			18,089
Funded status:
Deficiency of plan assets over projected benefit obligation		(2,877	)		(1,781	)
Unrecognized loss from experience different from that assumed		N/A			N/A
Accrued retirement expense included in other liabilities	$	(2,877	)	$	(1,781	)

The change in accumulated other comprehensive income (loss) that resulted from the Employee Retirement Plan is summarized as follows:

	At December 31,
	2011			2010
Balance at beginning of period	$	(11,315	)	$	(10,577	)
Adjustment for change in actuarial calculation		-			(623	)
Amortization of loss		1,004			1,005
Loss recognized during the year		(4,883	)		(1,120	)
Balance at the end of the period	$	(15,193	)	$	(11,315	)
Period end component of accumulated other comprehensive loss (net of tax)		8,333			6,206

For the years ended December 31, 2011 and 2010, the Bank used December 31st as its measurement date for the Employee Retirement Plan.  The Bank contributed $3,356 to the Employee Retirement Plan during the year ended December 31, 2011.  The Bank expects to make a contributions of $51 to the Employee Retirement Plan during the year ending December 31, 2012.  During the year ending December 31, 2012, $1,792 in actuarial losses are anticipated to be recognized as a component of net periodic cost.

Major assumptions utilized to determine the net periodic cost (credit) of the benefit obligations were as follows:

	At or for the Year Ended December 31,
	2011			2010
Discount rate used for net periodic cost (credit)		5.26	%		6.00	%
Discount rate used to determine benefit obligation at period end		4.15			5.26
Expected long-term return on plan assets used for net periodic cost (credit)		8.25			8.75
Expected long-term return on plan assets used to determine benefit obligation at period end		7.50			8.25

Employee Retirement Plan assets are invested in five common collective investment funds, four of which are equity-based, and one of which is fixed-income based.  These common collective investment funds are privately offered, and the Employee Retirement Plan's investment in these common collective investment funds is therefore valued by the fund managers of each respective fund based on the Employee Retirement Plan's proportionate share of units of beneficial interest in the respective funds.  All of the common collective investment funds are audited, and the overwhelming majority of assets held in these funds (which derive the unit value of the common collective investment funds) are actively traded in established marketplaces.  The Employee Retirement Plan also owned an investment in two registered mutual funds at December 31, 2011.  These mutual funds are actively traded on national securities exchanges and are valued at their quoted market prices.

The following table sets forth by level within the fair value hierarchy a summary of the Employee Retirement Plan's investments measured at fair value on a recurring basis at December 31, 2011 (See Note 17 for a discussion of the fair value hierarchy).

	Fair Value Measurements Using
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Mutual Funds (all registered and publicly traded) :
Domestic Large Cap	$	1,793		-		-	$	1,793
Domestic Small Cap		2,366		-		-		2,366
Common collective investment funds
Domestic Large Cap		-		6,045		-		6,045
International Equity		-		2,207		-		2,207
Fixed Income		-		7,619		-		7,619
Total Plan Assets							$	20,030

The following table sets forth by level within the fair value hierarchy a summary of the Employee Retirement Plan's investments measured at fair value on a recurring basis at December 31, 2010.

	Fair Value Measurements Using
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Mutual Funds (all registered and publicly traded) :
Domestic Large Cap	$	1,633		-		-	$	1,633
Domestic Small Cap		2,169		-		-		2,169
Common collective investment funds
Domestic Large Cap		-		5,471		-		5,471
International Equity		-		2,486		-		2,486
Fixed Income		-		6,330		-		6,330
Total Plan Assets							$	18,089

The long-term investment objective of the Employee Retirement Plan is to be invested 65% in equity mutual funds and 35% in bond mutual funds.  If the Employee Retirement Plan is underfunded under its guidelines, the bond fund portion will be temporarily increased to 50% in the manner prescribed under its guidelines, in order to lessen asset value volatility.  When the Employee Retirement Plan is no longer underfunded, the bond fund portion will be returned to 35%.  Asset rebalancing is performed at least annually, with interim adjustments when the investment mix varies in excess of 10% from the target.

The investment goal is to achieve investment results that will contribute to the proper funding of the Employee Retirement Plan by exceeding the rate of inflation over the long-term.  In addition, investment managers for the trust function managing the assets of the Employee Retirement Plan are expected to provide above average performance when compared to their peer managers.  Performance volatility is also monitored.  Risk and volatility are further managed by the distinct investment objectives of each of the trust funds and the diversification within each fund.

The weighted average allocation by asset category of the assets of the Employee Retirement Plan were summarized as follows:

	At December 31,
	2011			2010
Asset Category
Equity securities		62	%		65	%
Debt securities (bond mutual funds)		38			35
Total		100	%		100	%

The allocation percentages in the above table were consistent with future planned allocation percentages as of December 31, 2011 and 2010, respectively.

The expected long-term rate of return assumptions on Employee Retirement Plan assets were established based upon historical returns earned by equities and fixed income securities, adjusted to reflect expectations of future returns as applied to the Employee Retirement Plan's target allocation of asset classes.  Equities and fixed income securities were assumed to earn real rates of return in the ranges of 5% to 9% and 2% to 6%, respectively.  The long-term inflation rate was estimated to be 3%.  When these overall return expectations were applied to the Employee Retirement Plan's target allocation, the expected rate of return was determined to be 7.50% at December 31, 2011 and 8.25% at December 31, 2010.

Benefit payments, which reflect expected future service (as appropriate), are anticipated to be made as follows:

Year Ending December 31,
2012	$	1,416
2013		1,414
2014		1,396
2015		1,403
2016		1,399
2017 to 2021		6,733

BMP - The Holding Company and Bank maintain the BMP, which exists in order to compensate executive officers for any curtailments in benefits due to statutory limitations on benefit plans.  As of December 31, 2011 and 2010, the BMP had investments in the Holding Company's common stock of $9,799 and $10,689, respectively.  Benefit accruals under the defined benefit portion of the BMP were suspended on April 1, 2000, when they were suspended under the Employee Retirement Plan.

Director Retirement Plan - Effective July 1, 1996, the Company established the Director Retirement Plan to provide benefits to each eligible outside director commencing upon the earlier of termination of Board service or at age 75.  The Director Retirement Plan was frozen on March 31, 2005, and only outside directors serving prior to that date are eligible for benefits.

The combined net periodic cost for the defined benefit portions of the BMP and the Director Retirement Plan included the following components:

	Year Ended December 31,
	2011		2010		2009
Service cost	$	-	$	-	$	-
Interest cost		346		358		321
Actuarial adjustment		-		198		-
Unrecognized gain		242		46		-
Net periodic cost	$	588	$	602	$	321

The combined funded status of the defined benefit portions of the BMP and Director Retirement Plan was as follows:

	At December 31,
	2011			2010
Accumulated benefit obligation at end of period	$	8,112		$	7,186
Reconciliation of projected benefit obligation:
Projected benefit obligation at beginning of period	$	7,186		$	5,412
Adjustment for change in measurement date		-			-
Service cost		-			-
Interest cost		346			358
Benefit payments		(129	)		(129	)
Actuarial loss		709			1,545
Projected benefit obligation at end of period		8,112			7,186
Plan assets at fair value:
Balance at beginning of period		-			-
Contributions		129			129
Benefit payments		(129	)		(129	)
Balance at end of period		-			-
Funded status:
Deficiency of plan assets over projected benefit obligation		(8,112	)		(7,186	)
Contributions by employer		N/A			N/A
Unrecognized (gain) loss from experience different from that assumed		N/A			N/A
Unrecognized net past service liability		N/A			N/A
Accrued expense included in other liabilities	$	(8,112	)	$	(7,186	)

The combined change in accumulated other comprehensive income that resulted from the BMP and Director Retirement Plan is summarized as follows:

	At December 31,
	2011			2010
Balance at beginning of period	$	(1,242	)	$	59
Adjustment for change in actuarial calculation		-			(563	)
Amortization of loss		242			47
Loss recognized during the year		(710	)		(785	)
Balance at the end of the period	$	(1,710	)	$	(1,242	)
Period end component of accumulated other comprehensive loss (net of tax)		938			681

At December 31, 2011, an unfunded pension liability of $938 was recognized as a component of accumulated other comprehensive loss related to the $1,710 pre-tax actuarial loss component of the aggregate unfunded pension obligations of the BMP and Director Retirement Plan.

Major assumptions utilized to determine the net periodic cost and benefit obligation for both the BMP and Director Retirement Plan were as follows:

	At or For the Year Ended December 31,
	2011			2010
Discount rate used for net periodic cost (credit) - BMP		4.82	%		6.00	%
Discount rate used for net periodic cost (credit) - Director Retirement Plan		4.92			6.00
Discount rate used to determine BMP benefit obligation at period end		3.77			4.82
Discount rate used to determine Director Retirement Plan benefit obligation at period end		3.84			4.92

As of December 31, 2011 and 2010, the Bank used December 31st as its measurement date for both the BMP and Director Retirement Plan.  Both the BMP and Director Retirement Plan are unfunded non-qualified benefit plans that are not anticipated to ever hold assets for investment.  Any contributions made to either the BMP or Director Retirement Plan are expected to be used immediately to pay benefits that accrue.

The Bank expects to contribute $435 to the BMP and $213 to the Director Retirement Plan during the year ending December 31, 2012 in order to pay benefits due under the respective plans.  During the year ending December 31, 2012, $371 in aggregate actuarial losses related to the BMP and Director Retirement Plan are anticipated to be recognized as a component of net periodic cost.

Combined benefit payments under the BMP and Director Retirement Plan, which reflect expected future service (as appropriate), are anticipated to be made as follows:

Year Ending December 31,
2012	$	648
2013		641
2014		636
2015		627
2016		647
2017 to 2021		2,961

There is no defined contribution cost incurred by the Holding Company or Bank under the Director Retirement Plan, and there were no defined contribution costs incurred by the Company related to the BMP during the year ended December 31, 2009.  Defined contribution costs incurred by the Company related to the BMP were $1,577 and $1,539 for the years ended December 31, 2011 and 2010, respectively.  Of the total defined contribution expense recognized during the year ended December 31, 2010, $977 related to a reinstatement of benefits that had previously been frozen from January 2005 through December 2010.

As a result of modifications made to the BMP early in 2010, the Company reclassified $8,007 from other liabilities to stockholders' equity related to the ESOP benefit component of the BMP during the year ended December 31, 2010.

Postretirement Benefit Plan - The Bank offers the Postretirement Benefit Plan to its retired employees who provided at least five consecutive years of credited service and were active employees prior to April 1, 1991, as follows:

(1)   Qualified employees who retired prior to April 1, 1991 receive the full medical coverage in effect at the time of retirement until their death at no cost to such retirees;

(2)   Qualified employees retiring on or after April 1, 1991 are eligible for continuation of the medical coverage in effect at the time of retirement until their death. Throughout retirement, the Bank will continue to pay the premiums for the coverage not to exceed the premium amount paid for the first year of retirement coverage. Should the premiums increase, the employee is required to pay the differential to maintain full medical coverage.

Postretirement Benefit Plan benefits are available only to full-time employees who commenced collecting retirement benefits immediately upon termination of service from the Bank. The Bank reserves the right at any time, to the extent permitted by law, to change, terminate or discontinue any of the group benefits, and can exercise the maximum discretion permitted by law in administering, interpreting, modifying or taking any other action with respect to the plan or benefits.

The Postretirement Benefit Plan net periodic cost included the following components:

	Year Ended December 31,
	2011		2010		2009
Service cost	$	133	$	114	$	115
Interest cost		345		316		302
Unrecognized past service liability		-		-		-
Amortization of unrealized loss		116		55		57
Net periodic cost	$	594	$	485	$	474

Major assumptions utilized to determine the net periodic cost were as follows:

	At or for the Year Ended December 31,
	2011			2010
Discount rate used for net periodic cost (credit)		5.48	%		6.00	%
Rate of increase in compensation levels used for net periodic cost (credit)		3.50			3.50
Discount rate used to determine benefit obligation at period end		4.28			5.48
Rate of increase in compensation levels used to determine benefit obligation at period end		3.50			3.50

As of December 31, 2011, an escalation in the assumed medical care cost trend rates by 1% in each year would increase the net periodic cost by approximately $27.  A decline in the assumed medical care cost trend rates by 1% in each year would decrease the net periodic cost by approximately $25.

The funded status of the Postretirement Benefit Plan was as follows:

	At December 31,			At December 31,
	2011			2010
Accumulated benefit obligation at end of period	$	8,988		$	6,372
Reconciliation of projected benefit obligation:
Projected benefit obligation at beginning of period	$	6,372		$	5,347
Adjustment for change in measurement date		-			-
Service cost		133			114
Interest cost		345			316
Actuarial loss		2,316			733
Benefit payments		(178	)		(138	)
Projected benefit obligation at end of period		8,988			6,372
Plan assets at fair value:
Balance at beginning of period		-			-
Contributions		178			138
Benefit payments		(178	)		(138	)
Balance at end of period		-			-
Funded status:
(Deficiency) of plan assets over projected benefit obligation		(8,988	)		(6,372	)
Unrecognized loss from experience different from that assumed		N/A			N/A
Unrecognized net past service liability		N/A			N/A
Accrued expense included in other liabilities	$	(8,988	)	$	(6,372	)

The change in accumulated other comprehensive income (loss) that resulted from the Postretirement Benefit Plan is summarized as follows:

	At December 31,
	2011			2010
Balance at beginning of period	$	(1,806	)	$	(1,129	)
Amortization of loss		116			55
Loss recognized during the year		(2,317	)		(732	)
Balance at the end of the period	$	(4,007	)	$	(1,806	)
Period end component of accumulated other comprehensive loss (net of tax)		2,198			991

As of December 31, 2011 and 2010, the Bank used December 31st as its measurement date for the Postretirement Benefit Plan.  The assumed medical care cost trend rate used in computing the accumulated Postretirement Benefit Plan obligation was 9.0% in 2011 and was assumed to decrease gradually to 5.00% in 2016 and remain at that level thereafter.  An escalation in the assumed medical care cost trend rates by 1% in each year would reduce the accumulated Postretirement Benefit Plan obligation by approximately $20.  A decline in the assumed medical care cost trend rates by 1% in each year would increase the accumulated Postretirement Benefit Plan obligation by approximately $6.

GAAP provides guidance on both accounting for the effects of the Medicare Prescription Drug Improvement and Modernization Act of 2003 (the "Act") to employers that sponsor postretirement health care plans which provide prescription drug benefits, and measuring the accumulated postretirement benefit obligation ("APBO") and net periodic postretirement benefit cost, and the effects of the Act on the APBO.  The Company determined that the benefits provided by the Postretirement Benefit Plan are actuarially equivalent to Medicare Part D under the Act.  The effects of an expected subsidy on payments made under the Postretirement Benefit Plan were treated as an actuarial gain for purposes of calculating the APBO as of December 31, 2011 and 2010. The Company remains in the process of claiming this subsidy from the government, and, as a result, the Bank cannot determine the amount of subsidy it will ultimately receive.

The Postretirement Benefit Plan is an unfunded non-qualified benefit plan that is not anticipated to ever hold assets for investment.  Any contributions made to the Postretirement Benefit Plan are expected to be used immediately to pay benefits that accrue.

The Bank expects to contribute $200 to the Postretirement Benefit Plan during the year ending December 31, 2012 in order to pay benefits due under the plan.  During the year ending December 31, 2012, $358 of actuarial losses are anticipated to be recognized as components of net periodic cost.

Benefit payments under the Postretirement Benefit Plan, which reflect expected future service (as appropriate), are expected to be made as follows:

Year Ending December 31,
2012	$	200
2013		213
2014		239
2015		262
2016		284
2017 to 2021		1,755

401(k) Plan - The Bank also maintains the 401(k) Plan, which covers substantially all of its employees.  During the years ended December 31, 2011, 2010 and 2009, an employer contribution equal to 3% of "covered compensation" [as defined in the 401(k) Plan] up to applicable Internal Revenue Service limits, was awarded to all employees who were eligible to participate in the 401(k) Plan regardless of whether or not they participated in the 401(k) Plan during 2011, 2010 or 2009.  401(k) Plan participants possess the ability to invest this contribution in any of the investment options offered under the 401(k) Plan.  The Bank makes no other contributions to the 401(k) Plan.  Expenses associated with this contribution totaled $641, $563 and $592 during the years ended December 31, 2011, 2010 and 2009, respectively.

The 401(k) Plan owned participant investments in the Holding Company's common stock for the accounts of participants totaling $8,041 and $7,606 at December 31, 2011 and 2010, respectively.

ESOP - The Holding Company adopted the ESOP in connection with the Bank's June 26, 1996 conversion to stock ownership.  The ESOP borrowed $11,638 from the Holding Company and used the funds to purchase 3,927,825 shares of the Holding Company's common stock.  The loan was originally to be repaid principally from the Bank's discretionary contributions to the ESOP over a period of time not to exceed 10 years from the date of the conversion.  Effective July 1, 2000, the loan agreement was amended to extend the repayment period to thirty years from the date of the conversion, with the right of optional prepayment.  In exchange for the extension of the loan repayment period, various benefits were offered to participants, including the addition of pre-tax employee contributions to the 401(k) Plan, a 3% annual employer contribution to the ESOP [which is automatically transferred to the 401(k) Plan] through December 31, 2006 (which has been voluntary continued by the Bank annually through 2011), and the pass-through of cash dividends received by the ESOP to the individual participants for the duration of the ESOP.  The loan had an outstanding balance of $3,721 and $3,863 at December 31, 2011 and December 31, 2010, respectively, and a fixed rate of 8.0%.

Shares purchased with the loan proceeds are held in a suspense account for allocation among participants as the loan is repaid.  Shares released from the ESOP suspense account are allocated among participants on the basis of compensation, as defined in the plan, in the year of allocation.  ESOP distributions vest at a rate of 25% per year of service, beginning after two years, with full vesting after five years or upon attainment of age 65, death, disability, retirement or a "change of control" of the Holding Company as defined in the ESOP.  Common stock allocated to participating employees totaled 78,155 shares during each of the years ended December 31, 2011, 2010 and 2009.The ESOP benefit expense is recorded based upon the fair value of the award shares, and totaled $1,640, $1,700 and $1,534, respectively, for the years ended December 31, 2011, 2010 and 2009.  Included in ESOP expense were dividends on unallocated common stock that were paid to participants.  These dividends totaled $656, $700 and $744 during the years ended December 31, 2011, 2010 and 2009, respectively.

Stock Option Activity

2001 Stock Option Plan - The Compensation Committee of the Board of Directors of the Holding Company administered the 2001 Stock Option Plan and authorized all option grants.  During the year ended December 31, 2011, 3,624 options were granted to outside directors of the Company under the 2001 Stock Option Plan, all of which have an exercise price of $15.46 per share, vest to the respective recipients as of May 1, 2012 and expire on April 29, 2021.  During the year ended December 31, 2011, 14,522 options were additionally granted to certain officers of the Company under the 2001 Stock Option Plan, all of which have an exercise price of $15.46 per share and expire on April 29, 2021. One-fourth of the options under this grant vest in installments on May 1, 2012, 2013, 2014 and 2015, respectively.  During the year ended December 31, 2010, 24,462 options were granted to outside directors of the Company under the 2001 Stock Option Plan, all of which have an exercise price of $12.75 per share, vested to the respective recipients as of May 1, 2011 and expire on April 30, 2020.  During the year ended December 31, 2010, 33,562 stock options were additionally granted to certain executive officers under the 2001 Stock Option Plan.  All of these stock options have an exercise price of $12.75 per share and will expire on April 30, 2020.  One-fourth of the options under this grant vested on May 1, 2011, with the remaining shares vesting in equal annual installments on May 1, 2012, 2013 and 2014 respectively.  During the year ended December 31, 2009, the Company granted 36,451 options to certain officers under the 2001 Stock Option Plan.  All of these options have an exercise price of $8.34 per share and expire on April 30, 2019.  One-fourth of these awards vested on each of May 1, 2010 and 2011, with the remaining shares vesting in equal annual installments on May 1, 2012 and 2013 respectively.

2004 Stock Incentive Plan - The Compensation Committee of the Board of Directors of the Holding Company administers the 2004 Stock Incentive Plan and authorizes all equity grants.

During the year ended December 31, 2011, 10,872 options were granted to outside directors of the Company under the 2004 Stock Incentive Plan, all of which have an exercise price of $15.46 per share, vest to the respective recipients as of May 1, 2012 and expire on April 29, 2021. During the year ended December 31, 2011, 62,565 options were additionally granted to certain officers of the Company under the 2004 Stock Incentive Plan, all of which have an exercise price of $15.46 per share and expire on April 29, 2021.  One-fourth of the options under this grant vest in installments on May 1, 2012, 2013, 2014 and 2015, respectively.

During the year ended December 31, 2010, a grant of 8,154 options was made to outside directors of the Company under the 2004 Stock Incentive Plan, all of which have an exercise price of $12.75 per share, vested to the respective recipients as of May 1, 2011 and expire on April 30, 2020.  During the year ended December 31, 2010, 31,116 stock options were additionally granted to certain officers under the 2004 Stock Incentive Plan.  All of these stock options have an exercise price of $12.75 per share and will expire on April 30, 2020.  One-fourth of the options under this grant vested on May 1, 2011, with the remaining shares vesting in equal annual installments on May 1, 2012, 2013 and 2014 respectively.

During the year ended December 31, 2009, a grant of 70,952 options was made to outside directors of the Company under the 2004 Stock Incentive Plan.  All of these options have an exercise price of $8.34 per share, vested to the respective recipients on May 1, 2010, and expire on April 30, 2019.  During the year ended December 31, 2009, 98,230 stock options were additionally granted to certain officers under the 2004 Stock Incentive Plan.  All of these stock options have an exercise price of $8.34 per share, and will expire on April 30, 2019.  One-fourth of the options under this grant vested on each of May 1, 2010 and 2011, with the remaining options vesting in equal annual installments on May 1, 2012 and 2013, respectively.

Combined stock option activity related to the Stock Plans was as follows:

	At or for the Year Ended December 31,
	2011		2010		2009
Options outstanding - beginning of period		3,213,007		3,266,920		3,116,564
Options granted		91,583		97,294		205,633
Weighted average exercise price of grants	$	15.46	$	12.75	$	8.34
Options exercised		385,758		87,825		9,465
Weighted average exercise price of exercised options	$	10.93	$	11.53	$	4.56
Options forfeited		25,072		63,382		45,812
Weighted average exercise price of forfeited options	$	15.76	$	12.66	$	16.74
Options outstanding - end of period		2,893,760		3,213,007		3,266,920
Weighted average exercise price of outstanding options - end of period	$	15.13	$	14.63	$	14.56
Remaining options available for grant		412,588		623,304		747,040
Vested options at end of period		2,682,156		2,792,434		2,538,915
Weighted average exercise price of vested options - end of period	$	15.30	$	14.92	$	15.17
Cash received for option exercise cost		3,669		1,012		43
Income tax benefit recognized		371		27		-
Compensation expense recognized		528		967		1,083
Remaining unrecognized compensation expense		543		567		1,341
Weighted average remaining years for which compensation expense is to be recognized		2.7		1.7		1.8

The range of exercise prices and weighted-average remaining contractual lives of both outstanding and vested options (by option exercise cost) as of December 31, 2011 were as follows:

		Outstanding Options				Vested Options
Exercise Prices		Amount		Weighted Average Contractual Years Remaining		Amount		Weighted Average Contractual Years Remaining
$	8.34		149,909		7.3		92,679		7.3
$	12.75		87,541		8.3		46,345		8.3
$	13.16		510,328		1.1		510,328		1.1
$	13.74		863,375		5.3		863,375		5.3
$	14.92		34,425		6.2		25,818		6.2
$	15.10		318,492		3.4		318,492		3.4
$	15.46		91,583		9.3		-		9.3
$	16.45		76,320		3.1		76,320		3.1
$	16.73		51,943		6.6		38,955		6.6
$	18.18		80,000		6.4		80,000		6.4
$	19.90		629,844		2.1		629,844		2.1
Total			2,893,760		4.0		2,682,156		3.7

The weighted average fair value per option at the date of grant for stock options granted was estimated as follows:

	Year Ended December 31,
	2011			2010			2009
Total options granted		91,583			97,294			205,633
Estimated fair value on date of grant	$	4.82		$	3.70		$	1.73
Pricing methodology utilized	Black- Scholes			Black- Scholes			Black- Scholes
Expected life (in years)		6.80			5.99			5.99
Interest rate		2.59	%		2.76	%		2.39	%
Volatility		42.35			43.69			41.34
Dividend yield		3.62			4.39			6.72

Restricted Stock Awards

On April 29, 2011, a grant of 13,584 restricted stock awards was made to outside Directors of the Holding Company under the 2004 Stock Incentive Plan, all of which vest on May 1, 2012.  On April 29, 2011, a grant of 112,720 restricted stock awards was additionally made to certain officers of the Company under the 2004 Stock Incentive Plan.  These awards will fully vest to the respective recipients in equal installments on May 1, 2012, 2013, 2014, and 2015 respectively.  The fair value of the Holding Company's common stock on April 29, 2011 was $15.46.  On April 30, 2010, a grant of 9,408 restricted stock awards was made to outside Directors of the Holding Company under the 2004 Stock Incentive Plan, all of which vested on May 1, 2011.  On April 30, 2010, a grant of 133,675 restricted stock awards was made to certain officers of the Company under the 2004 Stock Incentive Plan.  One fourth of these awards vested to the respective recipients on May 1, 2011, with the remaining awards vesting in equal annual installments on May 1, 2012, 2013, and 2014 respectively.  The fair value of the Holding Company's common stock on April 30, 2010 was $12.75.  On April 30, 2009, a grant of 14,392 restricted stock awards was made to outside Directors of the Holding Company under the 2004 Stock Incentive Plan, all of which vested on May 1, 2010.  On April 30, 2009, a grant of 192,805 restricted stock awards was made to certain officers of the Company under the 2004 Stock Incentive Plan.  One-fourth of these awards vested on each of May 1, 2010 and 2011, with the remaining awards vesting in equal annual installments on May 1, 2012 and 2013, respectively.  The fair value of the Holding Company's common stock on April 30, 2009 was $8.34.

Compensation expense on all restricted stock awards was recorded during the years ended December 31, 2011, 2010 and 2009 based upon the fair value of the shares on the respective dates of grant for all periods presented.

The following is a summary of activity related to the restricted stock awards granted under the 2004 Stock Incentive Plan:

	At or for the Year Ended December 31,
	2011		2010		2009
Unvested allocated shares - beginning of period		309,783		295,066		141,710
Shares granted		126,304		143,083		207,197
Shares vested		109,649		95,107		52,810
Shares forfeited		1,984		33,259		1,031
Unvested allocated shares - end of period		324,454		309,783		295,066
Unallocated shares - end of period		-		-		-
Compensation recorded to expense	$	1,578	$	1,228	$	775
Income tax (expense) benefit recognized		60		85		(131	)

Long Term Cash Incentive Payment Plan - On October 16, 2008, pursuant to authority granted under the Dime Community Bancshares, Inc. Annual Incentive Plan (the "AIP"), the Compensation Committee made an incentive award to the Holding Company's Chief Executive Officer.  The threshold, target and maximum award opportunities were $214, $428 and $643, respectively, and were earned based on performance relative to three performance goals measured over the period beginning August 1, 2008 and ended December 31, 2010.  The three performance measures and their relative weights were as follows:

Goal	Weight			Threshold			Target			Maximum
Total Shareholder Return Relative to Compensation Peer Group		50	%	40th Percentile			50th Percentile			74th Percentile
Cumulative Core EPS		25	%	$	2.23		$	2.48		$	2.73
GAAP Return on Equity		25	%		10.3	%		12.1	%		13.9	%

In accordance with the provisions of this award, a payment of $470 was made during the year ended December 31, 2011.

On March 19, 2009, pursuant to authority granted under the AIP, the Compensation Committee made an additional incentive award to the Holding Company's Chief Executive Officer.  The threshold, target and maximum award opportunities were $214, $428 and $643, respectively, and were earned based on performance relative to three performance goals measured over the period beginning January 1, 2009 and ending December 31, 2011.  The award will be paid in full on or before March 31, 2012.  The three performance measures and their relative weights were as follows:

Goal	Weight			Threshold			Target			Maximum
Total Shareholder Return Relative to Compensation Peer Group		50	%	40th Percentile			50th Percentile			74th Percentile
Cumulative Core EPS		25	%	$	2.36		$	2.62		$	2.88
GAAP Return on Equity		25	%		8.4	%		9.85	%		11.3	%

On March 18, 2010, pursuant to authority granted under the AIP, the Compensation Committee made an additional incentive award to the Holding Company's Chief Executive Officer.  The threshold, target and maximum award opportunities are $214, $428 and $643, respectively, and are earned based on performance relative to three performance goals measured over the period beginning January 1, 2010 and ending December 31, 2012.  The award will be paid in full on or before March 31, 2013.  The three performance measures and their relative weights were as follows:

Goal	Weight			Threshold			Target			Maximum
Total Shareholder Return Relative to Compensation Peer Group		50	%	40th Percentile			50th Percentile			74th Percentile
Cumulative Core EPS		25	%	$	3.07		$	3.41		$	3.75
GAAP Return on Equity		25	%		9.8	%		11.6	%		13.3	%

On March 17, 2011, pursuant to authority granted under the AIP, the Compensation Committee made an additional incentive award to the Holding Company's Chief Executive Officer.  The threshold, target and maximum award opportunities are $224, $447 and $671, respectively, and are earned based on performance relative to three performance goals measured over the period beginning January 1, 2011 and ending December 31, 2013.  The award will be paid in full on or before March 31, 2014.  The three performance measures and their relative weights were as follows:

Goal	Weight			Threshold			Target			Maximum
Total Shareholder Return Relative to Compensation Peer Group		50	%	40th Percentile			50th Percentile			74th Percentile
Cumulative Core EPS		25	%	$	3.19		$	3.54		$	3.89
GAAP Return on Equity		25	%		9.2	%		10.8	%		12.4	%

At December 31, 2011, based upon actual results for the period January 1, 2009 through December 31, 2011, the Company had a liability totaling $1,105 recorded for expected future payments under the long-term cash incentive payment plan.  This liability reflects the expectation of the most likely payment outcome determined for each individual incentive award (based upon both period-to-date actual and estimated future results for each award period).  During the years ended December 31, 2011, 2010 and 2009, total expense recognized related to cash incentive payment plan awards were $595, $587 and $318, respectively.