Financial Instruments

12 Months Ended

Dec. 31, 2011

Investments, All Other Investments [Abstract]

Financial Instruments Disclosure [Text Block]

16. Financial Instruments

The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers and to reduce its own exposure to fluctuations in interest rates. These financial instruments include commitments to extend credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the balance sheet.

The following table summarizes these financial instruments and other commitments and contingent liabilities as of December 31, 2011 and 2010:

(In thousands)	2011		2010
Commitments to extend credit:
Loan commitments	$	8,782	$	12,233
Unused lines of credit		19,424		19,751
Amounts due mortgagors on construction loans		15,476		17,867
Amounts due on commercial loans		21,213		19,788
Commercial letters of credit		5,683		4,198

At December 31, 2011, included in the commitments to extend credit were commitments to fund loans in the amount of $5.7 million with fixed interest rates ranging from 3.25% to 17.0%.

The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual notional amount of those instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments.

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments are principally collateralized by mortgages on real estate, generally have fixed expiration dates or other termination clauses and may require payment of fees. Since some of the commitments may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements.