BUSINESS SEGMENTS

6 Months Ended

Jun. 30, 2011

BUSINESS SEGMENTS [Abstract]

BUSINESS SEGMENTS

6.      BUSINESS SEGMENTS

The Corporation assesses its results among two operating segments, Banking and PGB Trust and Investments. Management uses certain methodologies to allocate income and expense to the business segments. A funds transfer pricing methodology is used to assign interest income and interest expense.  Certain indirect expenses are allocated to segments. These include support unit expenses such as technology and operations and other support functions. Taxes are allocated to each segment based on the effective rate for the period shown.

Banking

The Banking segment includes commercial, commercial real estate, residential and consumer lending activities; deposit generation; operation of ATMs; telephone and internet banking services; merchant credit card services and customer support and sales.

PGB Trust & Investments

PGB Trust & Investments includes asset management services provided for individuals and institutions; personal trust services, including services as executor, trustee, administrator, custodian and guardian; corporate trust services including services as trustee for pension and profit sharing plans; and other financial planning and advisory services.

The following table presents the statements of income and total assets for the Corporation's reportable segments for the three months ended June 30, 2011 and 2010.

	Three Months Ended June 30, 2011
(in thousands)			PGB Trust
	Banking		& Investments		Total
Net interest income	$	11,315	$	868	$	12,183
Noninterest income		1,427		2,897		4,324
Total income		12,742		3,765		16,507
Provision for loan losses		2,000		-		2,000
Salaries and benefits		4,616		1,201		5,817
Premises and equipment expense		2,218		168		2,386
Other noninterest expense		1,796		1,036		2,832
Total noninterest expense		10,630		2,405		13,035
Income before income tax expense		2,112		1,360		3,472
Income tax expense		802		502		1,304
Net income	$	1,310	$	858	$	2,168

	Three Months Ended June 30, 2010
(in thousands)			PGB Trust
	Banking		& Investments		Total
Net interest income	$	11,692	$	795	$	12,487
Noninterest income		1,067		2,719		3,786
Total income		12,759		3,514		16,273
Provision for loan losses		2,750		-		2,750
Salaries and benefits		4,448		1,256		5,704
Premises and equipment expense		2,378		210		2,588
Other noninterest expense		1,723		990		2,713
Total noninterest expense		11,299		2,456		13,755
Income before income tax expense		1,460		1,058		2,518
Income tax expense		440		322		762
Net income	$	1,020	$	736	$	1,756

The following table presents the statements of income and total assets for the Corporation's reportable segments for the six months ended June 30, 2011 and 2010.

	Six Months Ended June 30, 2011
(in thousands)			PGB Trust
	Banking		& Investments		Total
Net interest income	$	22,641	$	1,763	$	24,404
Noninterest income		2,812		5,681		8,493
Total income		25,453		7,444		32,897
Provision for loan losses		4,000		-		4,000
Salaries and benefits		9,381		2,409		11,790
Premises and equipment expense		4,392		344		4,736
Other noninterest expense		3,566		2,186		5,752
Total noninterest expense		21,339		4,939		26,278
Income before income tax expense		4,114		2,505		6,619
Income tax expense		1,436		874		2,310
Net income	$	2,678	$	1,631	$	4,309
Total assets at period end	$	1,509,446	$	1,294	$	1,510,740

	Six Months Ended June 30, 2010
(in thousands)			PGB Trust
	Banking		& Investments		Total
Net interest income	$	23,260	$	1,774	$	25,034
Noninterest income		2,134		5,125		7,259
Total income		25,394		6,899		32,293
Provision for loan losses		5,150		-		5,150
Salaries and benefits		8,854		2,559		11,413
Premises and equipment expense		4,563		397		4,960
Other noninterest expense		3,275		1,887		5,162
Total noninterest expense		21,842		4,843		26,685
Income before income tax expense		3,552		2,056		5,608
Income tax expense		1,094		633		1,727
Net income	$	2,458	$	1,423	$	3,881
Total assets at period end	$	1,475,858	$	1,405	$	1,477,263