Transactions with Affiliates

9 Months Ended

Sep. 30, 2012

Transactions with Affiliates [Abstract]

Transactions with Affiliates

Note 7. Transactions with Affiliates

The Company entered into a sublease for office space in Philadelphia, Pennsylvania with RAIT Financial Trust (RAIT) commencing in October 2000. The former Chief Executive Officer of RAIT (from December 2006 to February 2009), who was also a RAIT trustee, is the Chairman of the Company and a director and Chairman of the Executive Committee of the Bank.  RAIT paid the Company approximately $228,000 and $223,000, for the nine months ended September 30, 2012 and 2011, respectively.

The Company entered into a space sharing agreement for office space in New York, New York with Resource America Inc. commencing in September 2011.  The Chairman of the Board of Resource America, Inc is the father of the Chairman of the Board and the spouse of the Chief Executive Officer of the Company.  The Chief Executive Officer of Resource America is the brother of the Chairman of the Board and the son of the Chief Executive Officer of the Company.  Rent expense for the nine months ended September 30, 2012 was $77,000.

The Company entered into a space sharing agreement for office space in New York, New York with Atlas Energy, L.P. commencing in May 2012.  The Chairman of the Board of Atlas Energy, L.P. is the brother of the Chairman of the Board and the son of the Chief Executive Officer of the Company.  The Chief Executive Officer of Atlas Energy, L.P. is the father of the Chairman of the Board and the spouse of the Chief Executive Officer of the Company.  Rent expense for the nine months ended September 30, 2012 was $14,000.

The Bank maintains deposits for various affiliated companies totaling approximately $47.1 million and $88.8 million as of September 30, 2012 and December 31, 2011, respectively.

The Bank has entered into lending transactions in the ordinary course of business with directors, executive officers, principal stockholders and affiliates of such persons on the same terms as those prevailing for comparable transactions with other borrowers. At September 30, 2012, these loans were current as to principal and interest payments and did not involve more than normal risk of collectability. At September 30, 2012, loans to these related parties amounted to $31.5 million as compared to $32.4 million at December 31, 2011.

The Company executed security transactions through PrinceRidge, a brokerage firm in which the Company's Chairman is a principal.  For the nine months ended September 30, 2012 a total of $35.8 million of securities rated AAA by at least one rating agency were purchased from that firm at market, the market price having been confirmed by an independent security advisor.  All of the securities purchased were commercial mortgage-backed securities.  The Company does not pay a separate fee or commission to PrinceRidge. We do not have information as to PrinceRidge's actual profits or losses. All of the purchases were classified as available for sale.