10.	INVESTMENT AND MORTGAGE-BACKED SECURITIES

The following is a summary of major categories of securities owned by the Company excluding trading securities at September 30, 2013:

	Unrealized Gains or Losses Recognized in Accumulated Other Comprehensive Loss
	Purchase Amortized / Historical Cost		Recorded Amortized/ Historical Cost⁽¹⁾		Non-Credit OTTI			Unrealized Gains		Unrealized Losses			Book Value		Other Unrecognized Losses		Fair Value
Investment securities held-to-maturity:
Pooled bank trust preferred securities ("TRUPS")	$	$16,316	$	$7,369	$	(609	)		-	$	(1,138	)⁽²⁾	$	5,622	$	516	$	6,138
Investment securities available for sale:
Registered Mutual Funds		2,797		2,691		-			670		(10	)		3,351		-		3,351
Agency notes		15,070		15,070		-			47		-			15,117		-		15,117
Pass-through MBS issued by GSEs		30,727		30,727		-			1,588		(10	)		32,305		-		32,305
Collateralized mortgage obligations ("CMOs") issued by GSEs		531		531		-			4		-			535		-		535
Private issuer pass through MBS		709		709		-			19		-			728		-		728
Private issuer CMOs		647		647		-			11		-			658		-		658

(1)	Amount represents the purchase amortized / historical cost less any credit-related OTTI charges recognized through earnings.

(2)	Amount represents the unamortized portion of the unrealized loss that was recognized in accumulated other comprehensive loss on September 1, 2008 (the day on which these securities were transferred from available-for-sale to held-to-maturity).

The following is a summary of major categories of securities owned by the Company at December 31, 2012:

	Unrealized Gains or Losses Recognized in Accumulated Other Comprehensive Loss
	Purchase Amortized / Historical Cost		Recorded Amortized/ Historical Cost ⁽¹⁾		Non-Credit OTTI			Unrealized Gains		Unrealized Losses			Book Value		Other Unrecognized Gains		Fair Value
Investment securities held-to-maturity:
TRUPS	$	16,774	$	7,829	$	(634	)		-	$	(1,268	)⁽²⁾	$	5,927	$	340	$	6,267
Investment securities available for sale:
Registered Mutual Funds		2,904		2,556		-			449		-			3,005		-		3,005
Agency notes		29,820		29,820		-			125		-			29,945		-		29,945
Pass-through MBS issued by GSEs		43,142		43,142		-			1,561		(25	)		44,678		-		44,678
CMOs issued by GSEs		2,436		2,436		-			26		-			2,462		-		2,462
Private issuer pass through MBS		962		962		-			-		(7	)		955		-		955
Private issuer CMOs		908		908		-			18		-			926		-		926

(1)	Amount represents the purchase amortized / historical cost less any credit-related OTTI charges recognized through earnings.

(2)	Amount represents the unamortized portion of the unrealized loss that was recognized in accumulated other comprehensive loss on September 1, 2008 (the day on which these securities were transferred from available-for-sale to held-to-maturity).

At September 30, 2013, the agency note investments in the table above had contractual maturities as follows:

	Amortized Cost		Estimated Fair Value
Due after one year through three years	$	15,000	$	15,047
Due after three years through five years		70		70
TOTAL	$	15,070	$	15,117

The held-to-maturity TRUPS had a weighted average term to maturity of 21.2 years at September 30, 2013. At September 30, 2013, MBS available-for-sale (which included pass-through MBS issued by GSEs, CMOs issued by GSEs, one private issuer pass through MBS and one private issuer CMO) possessed a weighted average contractual maturity of 16.9 years and a weighted average estimated duration of 1.3 years. There were no sales of either investment securities held-to-maturity or MBS available-for-sale during the nine months ended September 30, 2013 or 2012.

There were no sales of investment securities available-for-sale during the three months ended September 30, 2013 and 2012. Proceeds from the sales of investment securities available-for-sale totaled $366 during the nine months ended September 30, 2013. A net gain of $110 was recognized on these sales. Proceeds from the sales of investment securities available-for-sale totaled $313 during the nine months ended September 30, 2012. A net gain of $44 was recognized on these sales.

As of each reporting period through September 30, 2013, the Company has applied the protocol established by ASC 320-10-65 ("ASC 320-10-65") in order to determine whether OTTI existed for its TRUPS and/or to measure, for TRUPS that have been determined to be other than temporarily impaired, the credit related and non-credit related components of OTTI. As of September 30, 2013,

five TRUPS were determined to meet the criteria for OTTI based upon this analysis. At September 30, 2013, these five securities had credit ratings ranging from "C" to "Caa3."

The following table provides a reconciliation of the pre-tax OTTI charges recognized on the Company's TRUPS:

	At or for the Three Months Ended September 30, 2013								At or for the Three Months Ended September 30, 2012
	Credit Related OTTI Recognized in Earnings		Non-Credit OTTI Recognized in Accumulated Other Comprehensive Loss			Total OTTI			Credit Related OTTI Recognized in Earnings		Non-Credit OTTI Recognized in Accumulated Other Comprehensive Loss			Total OTTI
Cumulative balance at the beginning of the period	$	8,947	$	617		$	9,564		$	8,945	$	655		$	9,600
OTTI recognized on securities with previous OTTI		-		-			-			-		-			-
Reductions and transfers to credit-related OTTI		-		-			-			-		-			-
Amortization of previously recognized OTTI		-		(8	)		(8	)		-		(14	)		(14	)
Cumulative balance at end of the period	$	8,947	$	609		$	9,556		$	8,945	$	641		$	9,586

	At or for the Nine Months Ended September 30, 2013								At or for the Nine Months Ended September 30, 2012
	Credit Related OTTI Recognized in Earnings		Non-Credit OTTI Recognized in Accumulated Other Comprehensive Loss			Total OTTI			Credit Related OTTI Recognized in Earnings			Non-Credit OTTI Recognized in Accumulated Other Comprehensive Loss			Total OTTI
Cumulative balance at the beginning of the period	$	8,945	$	634		$	9,579		$	8,974		$	930		$	9,904
OTTI recognized on securities with previous OTTI		-		-			-			181			6			187
Reductions and transfers to credit-related OTTI		-		-			-			-			(181	)		(181	)
Amortization of previously recognized OTTI		2		(25	)		(23	)		(210	)		(114	)		(324	)
Cumulative balance at end of the period	$	8,947	$	609		$	9,556		$	8,945		$	641		$	9,586

The following table summarizes the gross unrealized losses and fair value of investment securities as of September 30, 2013, aggregated by investment category and the length of time the securities were in a continuous unrealized loss position:

	Less than 12 Months Consecutive Unrealized Losses						12 Months or More Consecutive Unrealized Losses						Total
	Fair Value			Gross Unrecognized/ Unrealized Losses			Fair Value			Gross Unrecognized/ Unrealized Losses			Fair Value			Gross Unrecognized/ Unrealized Losses
Held-to-Maturity Securities:
TRUPS ⁽¹⁾		$	-		$	-		$	4,004		$	974		$	4,004		$	974
Available for Sale Securities
Registered Mutual Funds			539			10			-			-			539			10
Pass-through MBS issued by GSEs			307			10			-			-			307			10

(1) At September 30, 2013, the recorded balance of these securities was $3,840. This balance reflected the remaining unrealized loss of $1,138 that was recognized in accumulated other comprehensive loss on September 1, 2008 (the day these securities were transferred from available-for-sale to held-to-maturity). In accordance with both ASC 320-10-35-17 and 320-10-65, this unrealized loss is currently being amortized over the remaining estimated life of these securities.

TRUPS That Have Maintained an Unrealized Holding Loss for 12 or More Consecutive Months

At September 30, 2013, impairment of two of the TRUPS, with an amortized cost of $5,000, was deemed temporary. These securities remained in an unrealized loss position for 12 or more consecutive months, and their cumulative unrealized loss was $1,315 at September 30, 2013, reflecting both illiquidity in the marketplace and concerns over future bank failures. At September 30, 2013, both of these securities had ratings ranging from "BB-" to "A." Despite both the significant decline in market value and the duration of their impairment, management believed that the unrealized losses on these securities at September 30, 2013 were temporary, and that the full value of the investments would be realized once the market dislocations have been removed, or as the securities continued to make their contractual payments of principal and interest. In making this determination, management considered the following:

• Based upon an internal review of the collateral backing the TRUPS portfolio, which accounted for current and prospective deferrals, the securities could reasonably be expected to continue making all contractual payments

• The Company had the intent and ability to hold these securities until they fully recover their impairment, evidenced by the election to reclassify them as held-to-maturity in 2008

• There were no cash or working capital requirements nor contractual or regulatory obligations that would compel the Company to sell these securities prior to their forecasted recovery or maturity

• Both securities have a pool of underlying issuers comprised primarily of banks
• Neither of the securities have exposure to real estate investment trust issued debt (which has experienced high default

rates)

• Both securities feature either a mandatory auction or a de-leveraging mechanism that could result in principal repayments to the Bank prior to the stated maturity of the security

• Both securities are adequately collateralized

The following table summarizes the gross unrealized losses and fair value of investment securities and MBS as of December 31, 2012, aggregated by investment category and the length of time that the securities were in a continuous unrealized loss position:

	Less than 12 Months Consecutive Unrealized Losses						12 Months or More Consecutive Unrealized Losses						Total
	Fair Value			Gross Unrecognized/ Unrealized Losses			Fair Value			Gross Unrecognized/ Unrealized Losses			Fair Value			Gross Unrecognized/ Unrealized Losses
Held-to-Maturity Securities:
TRUPS ⁽¹⁾		$	-		$	-		$	3,705		$	1,732		$	3,705		$	1,732
Available-for-Sale Securities:
Federal Home Loan Mortgage Corporation pass-through certificates			5,867			25			-			-			5,867			25
Private label MBS			-			-			955			7			955			7

(1) At December 31, 2012, the recorded balance of these securities was $4,170. This balance reflected the remaining unrealized loss of $1,268 that was recognized in accumulated other comprehensive loss on September 1, 2008 (the day these securities were transferred from available-for-sale to held-to-maturity). In accordance with both ASC 320-10-35-17 and 320-10-65, this unrealized loss is currently being amortized over the remaining estimated life of these securities.