11-K 1 metrobank11k.htm METRO BANCORP, INC. FORM 11-K metrobank11k.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 11-K


           (Mark One)
 
[x]
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the fiscal year ended December 31, 2008

OR

 
[  ]
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from _____to_____.


Commission file number 000-50961


A. Full title of the plan and address of the plan, if different from that of the issuer named below:

Commerce Bank/Harrisburg Retirement Savings Plan



B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office:

Metro Bancorp, Inc.
3801 Paxton Street
Harrisburg, PA 17111





 
 
Commerce Bank/Harrisburg Retirement Savings Plan
 


Financial Report

December 31, 2008







 


Commerce Bank/Harrisburg Retirement Savings Plan


TABLE OF CONTENTS



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM……………………
FINANCIAL STATEMENTS
  
Statements of Net Assets Available for Benefits…………………………………
Statements of Changes in Net Assets Available for Benefits……………………
Notes to Financial Statements………………………………………………….…
   
SUPPLEMENTARY SCHEDULES
  
Schedule of Assets (Held at End of Year)…………………………………………
                Schedule of Delinquent Participant Contributions………………………………
   
SIGNATURES
  
   







 
To the Trustees and Plan Administrator
Commerce Bank/Harrisburg Retirement Savings Plan
 
We have audited the accompanying statements of net assets available for benefits of the Commerce Bank/Harrisburg Retirement Savings Plan (the Plan) as of December 31, 2008 and 2007, and the related statements of changes in net assets available for benefits for the years then ended.  The Plan’s management is responsible for these financial statements.  Our responsibility is to express an opinion on these financial statements based on our audits.
 
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  The Plan is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting.  Accordingly, we express no such opinion.  An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.
 
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 2008 and 2007, and the changes in net assets available for benefits for the years then ended, in conformity with accounting principles generally accepted in the United States of America.
 
Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole.  The supplementary schedules of (1) assets (held at end of year) as of December 31, 2008, and (2) delinquent participant contributions for the year ended December 31, 2008, are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974.  The supplementary schedules are the responsibility of the Plan’s management.  The supplementary schedules have been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole.
 

/s/ Beard Miller Company LLP

Beard Miller Company LLP
Harrisburg, Pennsylvania
June 29, 2009

 


 
 
 
Commerce Bank/ Harrisburg Retirement Savings Plan

December 31, 2008 and 2007
 
   
December 31,
  
   
2008
    
2007
  
Assets
            
   Investments, at fair value:
            
     Money market funds
   $ 376,182     $ 289,136  
     Mutual funds
     3,896,903       5,103,164  
     Metro Bancorp, Inc. common stock
     416,136       460,611  
      4,689,221       5,852,911  
   Receivables:
                
     Participants’ contributions
     62       32  
     Employer’s contributions
     355,422       315,916  
      355,484       315,948  
  Net assets available for benefits
   $ 5,044,705     $ 6,168,859  
See notes to financial statements.




2

Commerce Bank/ Harrisburg Retirement Savings Plan
 
Years Ended December 31, 2008 and 2007
 
   
2008
    
2007
  
Investment income (loss)
            
   Net (depreciation)/appreciation in
   fair value of investments
   $ (2,258,225 )   $ 89,015  
   Interest and dividends
     132,294       373,861  
      (2,125,931 )     462,876  
Contributions
                
   Participants
     982,022       916,282  
   Rollovers
     135,021       10,048  
   Employer
     355,422       315,928  
      1,472,465       1,242,258  
Benefits paid to participants
     (470,688 )     (666,950 )
   Net (decrease)/increase
     (1,124,154 )     1,038,184  
Net assets available for benefits –
beginning of year
     6,168,859       5,130,675  
Net assets available for benefits –
end of year
   $ 5,044,705     $ 6,168,859  
See notes to financial statements.



3

Commerce Bank/ Harrisburg Retirement Savings Plan
 
December 31, 2008 and 2007
 
Note 1 - Description of the Plan
 
The following brief description of the Commerce Bank/Harrisburg Retirement Savings Plan (Plan) is provided for general information purposes only. Participants should refer to the Summary Plan Description for a more complete description of the Plan’s provisions.
 
General
 
The Plan was established February 15, 1993.  The Plan is a contributory defined contribution plan.  Under the Plan, all employees who are 21 years of age and have completed six months of service are eligible to participate in the Plan.  The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). The Plan sponsor is Commerce Bank/Harrisburg t/d/b/a Metro Bank. On June 15, 2009, the parent company of the Plan sponsor, changed its name from Pennsylvania Commerce Bancorp, Inc. to Metro Bancorp, Inc. At the same time of the name change, the ticker symbol changed from COBH to METR. Collectively, the parent company and the Plan sponsor are referred to as the Company. There is no impact to the Plan or its sponsor due to this name change.
 
Participation
 
An employee becomes a participant in the Plan on the earlier of the first day of the Plan year or the first day of the seventh month of the Plan year coinciding with or next following the date eligibility requirements are met.
 
Service Rules
 
Employees are credited with a year of service for each Plan year during which they have at least 1,000 hours of service.
 
Contributions
 
There are three recurring types of contributions that can be added to a participant’s account:  an employee salary deferral contribution, an employer matching contribution, and an employer profit sharing contribution.  Participants may also contribute amounts representing distributions from other qualified defined benefit or contribution plans.  Participants may contribute up to 15% of their annual pre-tax compensation by way of a salary deferral contribution.  The employer contributes an amount equal to 50% of the participant’s salary deferral contributions, up to a maximum of 6% of the participant’s compensation. Annually the Board of Directors approves the employer contribution match.  Each year, the employer, at the sole discretion of its Board of Directors, determines the amount, if any, of the employer profit sharing contribution to be made from current or accumulated net earnings.  There were no profit sharing contributions approved by the Board of Directors or made to the Plan during the years ended December 31, 2008 and 2007.  The participants may direct the balances in their accounts into various investment options.  Participants are only able to contribute, withdraw or modify their investment in Metro Bancorp, Inc.’s stock quarterly during an open
 
 
 
4
 
Commerce Bank/ Harrisburg Retirement Savings Plan
 
Note 1 - Description of the Plan (Continued)
 
election which occurs the last week of the month following each quarter end. Employees must meet certain eligibility requirements to receive an allocation of the employer matching and profit sharing contributions.  Contributions are subject to certain limitations.
 
Participants’ Accounts
 
Each participant’s account is credited with direct contributions and allocations of Plan earnings (including unrealized appreciation or depreciation of Plan assets) and forfeitures of the non-vested portion of terminated participants’ employer profit sharing contributions.  Allocations of Plan earnings and forfeitures are based on participants’ account balances during the valuation period.  The benefit to which a participant is entitled is the amount that can be provided from the participant’s vested account balance.
 
Vesting
 
A participant is 100% vested at all times in the participant’s salary deferral account and rollover account regardless of the number of years of service.  If participants cease participation, other than by retirement, disability, or death, the vested interest in the remainder of their accounts is dependent upon the years of credited service, as follows:
 
Years of Service
Percent Vested
0-1
0%
2
20%
3
40%
4
60%
5
80%
6 or more
100%

 
Payment of Benefits
 
Upon retirement, disability, or death, distributions will be paid as soon as administratively possible in a lump sum or as an annuity.  Upon termination of service other than by retirement, disability, or death, a participant will receive a lump sum payment if the total of their vested balance derived from employee and employer contributions does not exceed $1,000. However, terminated participants may elect to receive their salary deferral accounts following termination.  If the funds exceed $1,000 and the employee does not elect distribution, the interest of the participant remains in the Plan until an election is made or the balance is required to be distributed under regulation of the Internal Revenue Service Code.
 
Administrative Costs
 
Administrative costs of the Plan are absorbed by the Company.
 
 
5
 
Commerce Bank/ Harrisburg Retirement Savings Plan
 
 
Note 1 - Description of the Plan (Continued)
 
Forfeitures
 
Forfeitures of employer matching non-vested accounts are used to reduce the employer’s matching 401(k) contribution.  During the years ended December 31, 2008 and 2007, forfeitures applied against employer contributions amounted to $24,000 and $27,400, respectively.  Forfeited profit sharing non-vested accounts, if any, are allocated to all eligible participants in accordance with the Plan document.
 
Note 2 – Summary of Significant Accounting Policies
 
A summary of the significant accounting policies consistently applied in the preparation of the accompanying financial statements follows:
 
Basis of Accounting
 
The financial statements of the Plan are prepared on the accrual basis of accounting.
 
Valuation of Investments and Recognition of Interest and Dividends
 
Investments in money market funds, mutual funds, and common stock are stated at fair value by reference to quoted market prices on the last business day of the reporting period.
 
Purchases and sales of securities are recorded on a trade-date basis.  Interest income is recorded and allocated on a daily valuation basis.  Dividends are recorded on the ex-dividend date.
 
Risks
 
Investments of the Plan are exposed to various risks, such as interest rate, market and credit.  Due to the level of risk associated with certain investments and the level of uncertainty related to changes in the value of investments, it is at least reasonably possible that changes in risk in the near term would materially affect investment assets reported in participant account balances in the statements of net assets available for benefits and the statements of changes in net assets available for benefits.
 
Payment of Benefits
 
Benefit payments to participants are recorded when paid.
 
Estimates
 
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Plan administrator to make estimates and assumptions that affect certain reported amounts and disclosures. Significant estimates include the determination of the fair value of Plan assets. Accordingly, actual results could differ from those estimates.
 

6
 
Commerce Bank/ Harrisburg Retirement Savings Plan
 
Note 2 – Summary of Significant Accounting Policies (continued)
 
Investment Fees
 
Net investment returns reflect certain fees paid by the investment funds to their affiliated investment advisors, transfer agents, and others as further described in each fund prospectus or other published documents.  These fees are deducted prior to allocation of the Plan's investment earnings activity and thus are not separately identifiable as an expense. 
 
Note 3 - Investments
 
The Plan’s investments are held in certain money market funds and mutual funds under the administration of the Fidelity Investment Advisory Group and in Metro Bancorp, Inc. common stock. The following table presents the fair value of the investments as determined by quoted market prices as of December 31:
 
   
2008
    
2007
  
Money market funds:
            
   Fidelity Spartan Money Market Fund
   $ 376,141 *   $ 255,084  
   Fidelity Cash Reserves Fund
     33       36  
   Fidelity Prime Fund Daily Money Class
     8       34,016  
      376,182       289,136  
Mutual funds:
                
   Fidelity U.S. Bond Index Fund
     575,013 *     466,561 *
   Fidelity Convertible Securities Fund
     339,353 *     558,589 *
   Fidelity Spartan U.S. Equity Index Fund
     530,081 *     723,720 *
   Fidelity Mid-Cap Stock Fund
     493,901 *     710,700 *
   Sound Shore Fund
     460,561 *     626,900 *
   White Oak Select Growth Fund
     139,965       171,055  
   Oakmark Fund
     211,461       308,897 *
   Fidelity Spartan Extended Market Index
     160,102       177,763  
   Fidelity Contrafund
     513,564 *     643,415 *
   Artisan International Fund
     472,902 *     715,564 *
      3,896,903       5,103,164  
Common Stock:
                
   Metro Bancorp, Inc., Common Stock
     416,136 *     460,611 *
    $ 4,689,221     $ 5,852,911  
  * Represents 5% or more of the net assets available for benefits.


7
 
Commerce Bank/ Harrisburg Retirement Savings Plan

 
Note 3 - Investments (Continued)
 
The net appreciation (depreciation) in fair value of investments (including realized gains and losses on investments bought, sold, and held during the year) for each significant class of investments consists of the following for the years ended December 31:
 
   
2008
    
2007
  
Investments at fair value as determined by quoted market prices:
        
Mutual funds
   $ (2,237,817 )   $ 57,834  
Common stock, Metro Bancorp, Inc.
     (20,408 )     31,181  
    $ (2,258,225 )   $ 89,015  

 
Note 4 – Plan Termination
 
Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA.  In the event of Plan termination, participants will become 100% vested in their accounts.
 
Note 5 - Income Tax Status
 
The Plan obtained its latest determination letter on December 2, 2003, in which the Internal Revenue Service stated that the Plan, as then designed, was in compliance with the applicable requirements of the Internal Revenue Code.   The Plan has been amended since receiving the determination letter.  However, the Plan administrator and the Plan’s tax counsel believe that the Plan is currently designed and being operated in compliance with the applicable requirements of the Internal Revenue Code.  Therefore, they believe that the Plan is qualified and the related trust is tax-exempt.
 
Note 6 - Related Party Transactions
 
Certain Plan investments are shares of common stock that are issued by Metro Bancorp, Inc. of which its wholly-owned subsidiary Commerce Bank/Harrisburg t/d/b/a Metro Bank is the Plan sponsor.  Therefore, related transactions qualify as related party transactions. Purchases made by the Plan for the investment in the Company’s common stock amounted to $45,488 (1,677 shares) and $21,931 (778 shares) for the years ended December 31, 2008 and 2007, respectively.  Sales made by the Plan of an investment in the Company’s common stock amounted to $69,555 (2,607 shares) and $89,782 (3,147 shares) for the years ended December 31, 2008 and 2007, respectively.
 
Note 7 - Parties-in-Interest Transactions
 
Certain Plan investments are shares of money market and mutual funds that are managed by the custodian.  Therefore, related transactions qualify as party-in-interest transactions.  All other transactions which may be considered parties-in-interest transactions relate to normal plan management and administrative services and the related payment of fees.
 
8
 
Commerce Bank/ Harrisburg Retirement Savings Plan
 
Note 8 – Fair Value Disclosure
 
Effective January 1, 2008, the Plan adopted the provisions of SFAS 157 for its financial assets and liabilities. SFAS 157 defines fair value as an exit price that would be received for an asset in an orderly transaction between market participants at the measurement date. SFAS 157 establishes a three-tier fair value input hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the priority to unadjusted quoted prices in active markets for identical assets (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurements).  The three levels of the fair value hierarchy under SFAS 157 are described below:
 
Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
 
Level 2 – Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;
 
Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable.
 
The following is a description of the valuation methodologies used for assets measured at fair value.
 
 
Money market funds: Investments in money market funds are stated at fair value by reference to quoted market prices on the last business day of the reporting period.
 
     Mutual funds: Valued using quoted market prices.
 
     Common stock: Valued using quoted market prices.
 
The following table sets forth the Company’s financial assets and liabilities that were measured at fair value on a recurring basis at December 31, 2008 by level within the fair value hierarchy.  As required by SFAS 157, financial assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.
 
 
December 31, 2008
 
   
Investments at
fair value as
determined by
quoted prices in
active markets
(Level 1)
    
Valuation
techniques
based on
observable
market data
(Level II)
    
Valuation
techniques
incorporating
information
other than
observable
market data
(Level III)
    
Total assets
measured at
fair value at
December 31,
2008
  
Money market funds
   $ 376,182     $ -     $ -     $ 376,182  
Mutual funds
     3,896,903       -       -       3,896,903  
Common stock
     416,136       -       -       416,136  
Total Investments
   $ 4,689,221     $ -     $ -     $ 4,689,221  

 
9
 
Commerce Bank/ Harrisburg Retirement Savings Plan

 
Schedule of Assets (Held at End of Year)
December 31, 2008
Form 5500 – Schedule H – Part IV – Line 4i
EIN: 23-2324730
PN: 001



(a)
  
 
Identity of Issue (b)
Description of Investment (c)
  
***
Cost (d)
    
Current Value
(e)
  
**
  
Fidelity Prime Fund Daily Money Class
Money Market Fund
    
N/A
     $ 8  
**
  
Fidelity Spartan Money Market Fund
Money Market Fund
    
N/A
       376,141  
**
  
Fidelity Cash Reserves Fund
Money Market Fund
    
N/A
       33  
**
  
Fidelity U.S. Bond Index Fund
Mutual Fund
    
N/A
       575,013  
**
  
Fidelity Convertible Securities Fund
Mutual Fund
    
N/A
       339,353  
**
  
Fidelity Spartan U.S. Equity Index Fund
Mutual Fund
    
N/A
       530,081  
**
  
Fidelity Mid-Cap Stock Fund
Mutual Fund
    
N/A
       493,901  
     
Sound Shore Fund
Mutual Fund
    
N/A
       460,561  
     
White Oak Select Growth Fund
Mutual Fund
    
N/A
       139,965  
     
Oakmark Fund
Mutual Fund
    
N/A
       211,461  
**
  
Fidelity Spartan Extended Market Index
Mutual Fund
    
N/A
       160,102  
**
  
Fidelity Contrafund
Mutual Fund
    
N/A
       513,564  
     
Artisan International Fund
Mutual Fund
    
N/A
       472,902  
*
  
Metro Bancorp, Inc.
Common Stock
    
N/A
       416,136  
                    $ 4,689,221  
 
*     Related Party. 
**   Party-in-interest.
*** Historical cost has not been presented as all investments are participant directed.



10


Commerce Bank/Harrisburg Retirement Savings Plan
Schedule of Delinquent Participant Contributions
For the year ended December 31, 2008
Form 5500 – Schedule H – Line 4a
EIN: 23-2324730
PN: 001



     
Total that Constitute Nonexempt Prohibited
Transactions
        
Participant
Contributions
Transferred
Late to the Plan
    
Contributions
not Corrected
    
Contributions
Corrected
Outside VFCP
    
Contributions
Pending
Correction in
VFCP
    
Total Fully
Corrected Under
VFCP and PTE
2002-51
  
$
19,557
     $
0
     $
19,557
     $
-
     $
-
  

 


 
11
 

SIGNATURES



Pursuant to the requirements of the Securities and Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.



 
 

  Commerce Bank/Harrisburg Retirement Savings Plan
 
Dated: June 29, 2009
 
   
 
/s/ Gary L. Nalbandian
   
By: Gary L. Nalbandian, Trustee
   
 
/s/ Mark A. Zody
   
By: Mark A. Zody, Trustee
 

 
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