Loans

Our assessment of the allowance for loan losses is based on an evaluation of the loan portfolio, recent loss experience, current economic conditions and other pertinent factors.

An analysis of the allowance for loan losses by portfolio segment for the three months ended September 30, follows:

	Commercial			Mortgage			Installment			Payment Plan Receivables			Unallocated			Total
	(In thousands)
2011
Balance at beginning of period	$	17,697		$	23,152		$	6,289		$	346		$	13,035		$	60,519
Additions (deductions)
Provision for loan losses		3,335			2,642			693			6			(505	)		6,171
Recoveries credited to allowance		229			247			421			1			-			898
Loans charged against the allowance		(4,330	)		(3,254	)		(1,131	)		(53	)		-			(8,768	)
Balance at end of period	$	16,931		$	22,787		$	6,272		$	300		$	12,530		$	58,820

2010
Balance at beginning of period	$	31,762		$	21,723		$	7,242		$	504		$	14,375		$	75,606
Additions (deductions)
Provision for loan losses		3,829			4,187			1,672			(49	)		(96	)		9,543
Recoveries credited to allowance		143			276			397			1			-			817
Loans charged against the allowance		(7,632	)		(4,697	)		(1,881	)		(12	)		-			(14,222	)
Balance at end of period	$	28,102		$	21,489		$	7,430		$	444		$	14,279		$	71,744

An analysis of the allowance for loan losses by portfolio segment for the nine months ended September 30, follows:

	Commercial			Mortgage			Installment			Payment Plan Receivables			Unallocated			Total
	(In thousands)
2011
Balance at beginning of period	$	23,836		$	22,642		$	6,769		$	389		$	14,279		$	67,915
Additions (deductions)
Provision for loan losses		9,378			10,975			2,374			51			(1,749	)		21,029
Recoveries credited to allowance		960			987			1,128			5			-			3,080
Loans charged against the allowance		(17,243	)		(11,817	)		(3,999	)		(145	)		-			(33,204	)
Balance at end of period	$	16,931		$	22,787		$	6,272		$	300		$	12,530		$	58,820

2010
Balance at beginning of period	$	41,259		$	18,434		$	6,404		$	754		$	14,866		$	81,717
Additions (deductions)
Provision for loan losses		16,123			17,833			6,134			(266	)		(587	)		39,237
Recoveries credited to allowance		647			864			1,133			12			-			2,656
Loans charged against the allowance		(29,927	)		(15,642	)		(6,241	)		(56	)		-			(51,866	)
Balance at end of period	$	28,102		$	21,489		$	7,430		$	444		$	14,279		$	71,744

Allowance for loan losses and recorded investment in loans by portfolio segment follows:

	Commercial		Mortgage		Installment		Payment Plan Receivables		Unallocated		Total
	(In thousands)
September 30, 2011
Allowance for loan losses:
Individually evaluated for impairment	$	7,258	$	10,278	$	1,783	$	-	$	-	$	19,319
Collectively evaluated for impairment		9,673		12,509		4,489		300		12,530		39,501
Total ending allowance balance	$	16,931	$	22,787	$	6,272	$	300	$	12,530	$	58,820

Loans
Individually evaluated for impairment	$	45,014	$	96,636	$	7,933	$	-			$	149,583
Collectively evaluated for impairment		613,432		515,494		219,963		135,042				1,483,931
Total loans recorded investment		658,446		612,130		227,896		135,042				1,633,514
Accrued interest included in recorded investment		2,178		2,957		837		-				5,972
Total loans	$	656,268	$	609,173	$	227,059	$	135,042			$	1,627,542

December 31, 2010
Allowance for loan losses:
Individually evaluated for impairment	$	11,522	$	11,567	$	1,836	$	-	$	-	$	24,925
Collectively evaluated for impairment		12,314		11,075		4,933		389		14,279		42,990
Total ending allowance balance	$	23,836	$	22,642	$	6,769	$	389	$	14,279	$	67,915

Loans
Individually evaluated for impairment	$	53,415	$	107,026	$	6,904	$	-			$	167,345
Collectively evaluated for impairment		656,681		554,534		239,835		201,263				1,652,313
Total loans recorded investment		710,096		661,560		246,739		201,263				1,819,658
Accrued interest included in recorded investment		2,566		2,881		1,095		-				6,542
Total loans	$	707,530	$	658,679	$	245,644	$	201,263			$	1,813,116

Loans on non-accrual status and past due more than 90 days (“Non-performing Loans”) follow:

	90+ and Still Accruing		Non- Accrual		Total Non- Performing Loans
	(In thousands)
September 30, 2011
Commercial
Income producing - real estate	$	135	$	10,040	$	10,175
Land, land development and construction - real estate		-		4,544		4,544
Commercial and industrial		173		7,436		7,609
Mortgage
1-4 family		6		14,302		14,308
Resort lending		-		8,374		8,374
Home equity line of credit - 1st lien		-		471		471
Home equity line of credit - 2nd lien		-		1,033		1,033
Installment
Home equity installment - 1st lien		-		1,640		1,640
Home equity installment - 2nd lien		-		791		791
Loans not secured by real estate		-		604		604
Other		-		8		8
Payment plan receivables
Full refund		-		841		841
Partial refund		-		470		470
Other		-		32		32
Total recorded investment	$	314	$	50,586	$	50,900
Accrued interest included in recorded investment	$	1	$	-	$	1

December 31, 2010
Commercial
Income producing - real estate	$	276	$	11,925	$	12,201
Land, land development and construction - real estate		-		9,672		9,672
Commercial and industrial		675		7,016		7,691
Mortgage
1-4 family		-		19,428		19,428
Resort lending		-		9,206		9,206
Home equity line of credit - 1st lien		-		1,080		1,080
Home equity line of credit - 2nd lien		-		1,153		1,153
Installment
Home equity installment - 1st lien		-		1,916		1,916
Home equity installment - 2nd lien		-		1,373		1,373
Loans not secured by real estate		-		923		923
Other		-		34		34
Payment plan receivables
Full refund		-		2,470		2,470
Partial refund		-		329		329
Other		-		127		127
Total recorded investment	$	951	$	66,652	$	67,603
Accrued interest included in recorded investment	$	23	$	-	$	23

An aging analysis of loans by class follows:

	Loans Past Due
	30-59 days		60-89 days		90+ days		Total		Loans not Past Due		Total Loans
	(In thousands)
September 30, 2011
Commercial
Income producing - real estate	$	1,531	$	2,541	$	5,890	$	9,962	$	269,863	$	279,825
Land, land development and construction - real estate		2,234		105		1,740		4,079		53,229		57,308
Commercial and industrial		1,863		1,648		4,075		7,586		313,727		321,313
Mortgage
1-4 family		6,292		1,688		14,308		22,288		301,986		324,274
Resort lending		952		1,643		8,374		10,969		193,468		204,437
Home equity line of credit - 1st lien		258		165		471		894		24,971		25,865
Home equity line of credit - 2nd lien		607		246		1,033		1,886		55,668		57,554
Installment
Home equity installment - 1st lien		367		243		1,640		2,250		43,640		45,890
Home equity installment - 2nd lien		677		515		791		1,983		54,224		56,207
Loans not secured by real estate		1,160		361		604		2,125		120,470		122,595
Other		27		15		8		50		3,154		3,204
Payment plan receivables
Full refund		4,000		1,842		841		6,683		114,552		121,235
Partial refund		479		247		470		1,196		11,766		12,962
Other		59		33		32		124		721		845
Total recorded investment	$	20,506	$	11,292	$	40,277	$	72,075	$	1,561,439	$	1,633,514
Accrued interest included in recorded investment	$	182	$	157	$	1	$	340	$	5,632	$	5,972

December 31, 2010
Commercial
Income producing - real estate	$	3,269	$	914	$	8,978	$	13,161	$	295,948	$	309,109
Land, land development and construction - real estate		1,923		147		4,919		6,989		55,693		62,682
Commercial and industrial		1,636		2,204		4,665		8,505		329,800		338,305
Mortgage
1-4 family		4,074		2,349		19,428		25,851		319,361		345,212
Resort lending		2,667		1,003		9,206		12,876		215,398		228,274
Home equity line of credit - 1st lien		576		-		1,080		1,656		25,951		27,607
Home equity line of credit - 2nd lien		723		464		1,153		2,340		58,127		60,467
Installment
Home equity installment - 1st lien		472		228		1,916		2,616		50,150		52,766
Home equity installment - 2nd lien		746		529		1,373		2,648		63,345		65,993
Loans not secured by real estate		1,302		348		923		2,573		122,066		124,639
Other		51		16		34		101		3,240		3,341
Payment plan receivables
Full refund		6,475		3,957		2,470		12,902		148,751		161,653
Partial refund		1,134		642		329		2,105		24,170		26,275
Other		583		166		127		876		12,459		13,335
Total recorded investment	$	25,631	$	12,967	$	56,601	$	95,199	$	1,724,459	$	1,819,658
Accrued interest included in recorded investment	$	225	$	133	$	23	$	381	$	6,161	$	6,542

Impaired loans are as follows :

	September 30, 2011		December 31, 2010
	(In thousands)
Impaired loans with no allocated allowance
TDR	$	25,782	$	25,754
Non - TDR		1,369		4,495
Impaired loans with an allocated allowance
TDR - allowance based on collateral		10,552		19,418
TDR - allowance based on present value cash flow		94,622		93,070
Non - TDR - allowance based on collateral		16,744		21,623
Non - TDR - allowance based on present value cash flow		-		2,351
Total impaired loans	$	149,069	$	166,711

Amount of allowance for loan losses allocated
TDR - allowance based on collateral	$	2,436	$	5,462
TDR - allowance based on present value cash flow		11,900		12,086
Non - TDR - allowance based on collateral		4,983		6,644
Non - TDR - allowance based on present value cash flow		-		733
Total amount of allowance for loan losses allocated	$	19,319	$	24,925

Impaired loans by class as of and for the nine months ended September 30, 2011 are as follows (1):

	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:	(In thousands)
Commercial
Income producing - real estate	$	2,837	$	2,832	$	-	$	2,806	$	95
Land, land development & construction-real estate		219		219		-		712		40
Commercial and industrial		1,347		1,344		-		2,694		100
Mortgage
1-4 family		8,569		10,699		-		8,964		296
Resort lending		8,848		8,914		-		7,900		322
Home equity line of credit - 1st lien		-		-		-		-		-
Home equity line of credit - 2nd lien		133		212		-		115		2
Installment
Home equity installment - 1st lien		2,066		2,106		-		1,919		72
Home equity installment - 2nd lien		2,196		2,192		-		2,021		73
Loans not secured by real estate		732		783		-		588		27
Other		25		25		-		13		1
		26,972		29,326		-		27,732		1,028
With an allowance recorded:
Commercial
Income producing - real estate		21,426		21,380		3,137		17,820		152
Land, land development & construction-real estate		7,780		7,771		2,072		9,195		60
Commercial and industrial		11,405		11,392		2,049		10,603		92
Mortgage
1-4 family		61,698		63,760		7,673		63,210		2,019
Resort lending		17,341		19,057		2,574		22,648		505
Home equity line of credit - 1st lien		47		47		31		24		1
Home equity line of credit - 2nd lien		-		-		-		11		-
Consumer
Home equity installment - 1st lien		1,408		1,450		714		1,453		42
Home equity installment - 2nd lien		1,376		1,384		1,028		1,478		46
Loans not secured by real estate		130		132		41		172		3
Other		-		-		-		-		-
		122,611		126,373		19,319		126,614		2,920
Total
Commercial
Income producing - real estate		24,263		24,212		3,137		20,626		247
Land, land development & construction-real estate		7,999		7,990		2,072		9,907		100
Commercial and industrial		12,752		12,736		2,049		13,297		192
Mortgage
1-4 family		70,267		74,459		7,673		72,174		2,315
Resort lending		26,189		27,971		2,574		30,548		827
Home equity line of credit - 1st lien		47		47		31		24		1
Home equity line of credit - 2nd lien		133		212		-		126		2
Consumer
Home equity installment - 1st lien		3,474		3,556		714		3,372		114
Home equity installment - 2nd lien		3,572		3,576		1,028		3,499		119
Loans not secured by real estate		862		915		41		760		30
Other		25		25		-		13		1
Total	$	149,583	$	155,699	$	19,319	$	154,346	$	3,948

Accrued interest included in recorded investment	$	514

(1)	There were no impaired payment plan receivables at September 30, 2011.

Impaired loans by class as of December 31, 2010 are as follows (1):

	Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:	(In thousands)
Commercial
Income producing - real estate	$	4,545	$	4,763	$	-
Land, land development & construction-real estate		1,600		2,810		-
Commercial and industrial		5,830		5,873		-
Mortgage
1-4 family		8,770		10,551		-
Resort lending		5,666		5,670		-
Home equity line of credit - 1st lien		-		-		-
Home equity line of credit - 2nd lien		93		93		-
Installment
Home equity installment - 1st lien		1,772		1,805		-
Home equity installment - 2nd lien		1,891		1,904		-
Loans not secured by real estate		211		220		-
Other		-		-		-
		30,378		33,689		-
With an allowance recorded:
Commercial
Income producing - real estate		16,206		22,748		4,279
Land, land development & construction-real estate		12,735		21,017		3,922
Commercial and industrial		12,499		13,844		3,321
Mortgage
1-4 family		64,157		66,379		8,223
Resort lending		28,315		28,874		3,319
Home equity line of credit - 1st lien		-		-		-
Home equity line of credit - 2nd lien		25		97		25
Consumer
Home equity installment - 1st lien		1,361		1,374		620
Home equity installment - 2nd lien		1,413		1,429		1,110
Loans not secured by real estate		256		258		106
Other		-		-		-
		136,967		156,020		24,925
Total
Commercial
Income producing - real estate		20,751		27,511		4,279
Land, land development & construction-real estate		14,335		23,827		3,922
Commercial and industrial		18,329		19,717		3,321
Mortgage
1-4 family		72,927		76,930		8,223
Resort lending		33,981		34,544		3,319
Home equity line of credit - 1st lien		-		-		-
Home equity line of credit - 2nd lien		118		190		25
Consumer
Home equity installment - 1st lien		3,133		3,179		620
Home equity installment - 2nd lien		3,304		3,333		1,110
Loans not secured by real estate		467		478		106
Other		-		-		-
Total	$	167,345	$	189,709	$	24,925

Accrued interest included in recorded investment	$	634

(1)	There were no impaired payment plan receivables at December 31, 2010.

Our average investment in impaired loans was approximately $154.3 million and $168.3 million for the nine-month periods ended September 30, 2011 and 2010, respectively. Cash receipts on impaired loans on non-accrual status are generally applied to the principal balance. Interest income recognized on impaired loans during the first nine months of 2011 and 2010 was approximately $3.9 million and $4.3 million, respectively.

Troubled debt restructurings follow:

	September 30, 2011
	Commercial		Retail			Total
	(In thousands)
Performing TDR's	$	22,273	$	90,378		$	112,651
Non-performing TDR's(1)		4,552		13,753	(2)		18,305
Total	$	26,825	$	104,131		$	130,956

	December 31, 2010
	Commercial		Retail			Total
	(In thousands)
Performing TDR's	$	16,957	$	96,855		$	113,812
Non-performing TDR's(1)		7,814		16,616	(2)		24,430
Total	$	24,771	$	113,471		$	138,242

(1)	Included in non-performing loans table above.

(2)	Also includes loans on non-accrual at the time of modification until six payments are received on a timely basis.

The Company has allocated $14.3 million and $17.5 million of specific reserves to customers whose loan terms have been modified in troubled debt restructurings as of September 30, 2011 and December 31, 2010, respectively.

During the nine months ending September 30, 2011, the terms of certain loans were modified as troubled debt restructurings. The modification of the terms of such loans generally included one or a combination of the following: a reduction of the stated interest rate of the loan; an extension of the maturity date at a stated rate of interest lower than the current market rate for new debt with similar risk; or a permanent reduction of the recorded investment in the loan.

Modifications involving a reduction of the stated interest rate of the loan have generally been for periods ranging from 3 months to 60 months but have extended to as much as 480 months in certain circumstances. Modifications involving an extension of the maturity date have generally been for periods ranging from 1 month to 60 months but have extended to as much as 248 months in certain circumstances.

Loans that have been classified as troubled debt retructurings during the three-month period ended September 30, 2011 follows:

	Number of Contracts		Pre-modification Recorded Balance		Post-modification Recorded Balance

Commercial
Income producing - real estate		5	$	6,579	$	6,370
Land, land development & construction-real estate		1		1,900		1,804
Commercial and industrial		-		-		-
Mortgage
1-4 family		6		1,603		1,629
Resort lending		4		1,515		1,501
Home equity line of credit - 1st lien		-		-		-
Home equity line of credit - 2nd lien		-		-		-
Installment
Home equity installment - 1st lien		4		98		99
Home equity installment - 2nd lien		-		-		-
Loans not secured by real estate		5		67		68
Other		-		-		-
Total		25	$	11,762	$	11,471

Loans that have been classified as troubled debt retructurings during the nine-month period ended September 30, 2011 follows:

	Number of Contracts		Pre-modification Recorded Balance		Post-modification Recorded Balance
	(Dollars in thousands)
Commercial
Income producing - real estate		16	$	14,793	$	13,928
Land, land development & construction-real estate		3		5,111		1,893
Commercial and industrial		10		1,129		1,111
Mortgage
1-4 family		59		7,663		7,540
Resort lending		27		7,474		7,393
Home equity line of credit - 1st lien		1		45		47
Home equity line of credit - 2nd lien		1		23		19
Installment
Home equity installment - 1st lien		18		475		470
Home equity installment - 2nd lien		14		464		450
Loans not secured by real estate		23		411		404
Other		-		-		-
Total		172	$	37,588	$	33,255

The troubled debt restructurings described above increased the allowance for loan losses by $0.7 million and resulted in charge offs of $0.3 million and $3.8 million during the three and nine months ending September 30, 2011.

Loans that have been classified as troubled debt restructured during the past twelve months and that have subsequently defaulted during the three-month period ended September 30, 2011 follows:

	Number of Contracts		Recorded Balance
	(Dollars in thousands)
Commercial
Income producing - real estate		1	$	136
Land, land development & construction-real estate		-		-
Commercial and industrial		-		-
Mortgage
1-4 family		4		607
Resort lending		1		340
Home equity line of credit - 1st lien		-		-
Home equity line of credit - 2nd lien		-		-
Consumer
Home equity installment - 1st lien		-		-
Home equity installment - 2nd lien		1		46
Loans not secured by real estate		-		-
Other		-		-
		7	$	1,129

Loans that have been classified as troubled debt restructured during the past twelve months and that have subsequently defaulted during the nine-month period ended September 30, 2011 follows:

	Number of Contracts		Recorded Balance
	(Dollars in thousands)
Commercial
Income producing - real estate		3	$	1,042
Land, land development & construction-real estate		1		1,222
Commercial and industrial		-		-
Mortgage
1-4 family		8		1,024
Resort lending		5		1,128
Home equity line of credit - 1st lien		-		-
Home equity line of credit - 2nd lien		-		-
Consumer
Home equity installment - 1st lien		1		19
Home equity installment - 2nd lien		4		264
Loans not secured by real estate		-		-
Other		-		-
		22	$	4,699

A loan is considered to be in payment default generally once it is 90 days contractually past due under the modified terms.

The troubled debt restructurings that subsequently defaulted described above decreased the allowance for loan losses by $0.4 million and resulted in charge offs of $0.1 million and $1.5 million during the three and nine months ending September 30, 2011.

The terms of certain other loans were modified during the nine months ending September 30, 2011 that did not meet the definition of a troubled debt restructuring. The modification of these loans could have included modification of the terms of a loan to borrowers who were not experiencing financial difficulties or a delay in a payment that was considered to be insignificant.

In order to determine whether a borrower is experiencing financial difficulty, we perform an evaluation of the probability that the borrower will be in payment default on any of its debt in the foreseeable future without the modification. This evaluation is performed under our internal underwriting policy.

Credit Quality Indicators – As part of our ongoing monitoring of the credit quality of our loan portfolios, we track certain credit quality indicators including (a) weighted-average risk grade of commercial loans, (b) the level of classified commercial loans (c) credit scores of mortgage and installment loan borrowers (d) investment grade of certain counterparties for payment plan receivables and (e) delinquency history and non-performing loans.

For commercial loans we use a loan rating system that is similar to those employed by state and federal banking regulators. Loans are graded on a scale of 1 to 12. A description of the general characteristics of the ratings follows:

Ratings 1 through 6: These loans are generally referred to as our “non-watch” commercial credits that include very high or exceptional credit fundamentals through acceptable credit fundamentals.

Ratings 7 and 8: These loans are generally referred to as our “watch” commercial credits. These ratings include loans to borrowers that exhibit potential credit weakness or downward trends. If not checked or cured these trends could weaken our asset or credit position. While potentially weak, no loss of principal or interest is envisioned with these ratings.

Rating 9: These loans are generally referred to as our “substandard accruing” commercial credits. This rating includes loans to borrowers that exhibit a well-defined weakness where payment default is probable and loss is possible if deficiencies are not corrected. Generally, loans with this rating are considered collectible as to both principal and interest primarily due to collateral coverage.

Ratings 10 and 11: These loans are generally referred to as our “substandard - non-accrual” and “Doubtful” commercial credits. These ratings include loans to borrowers with weaknesses that make collection of debt in full, on the basis of current facts, conditions and values at best questionable and at worst improbable. All of these loans are placed in non-accrual.

Rating 12: These loans are generally referred to as our “loss” commercial credits. This rating includes loans to borrowers that are deemed incapable of repayment and are charged-off.

The following table summarizes loan ratings by loan class for our commercial loan segment:

	Commercial
	Non-watch 1-6		Watch 7-8		Substandard Accrual 9		Non- Accrual 10-11		Total
					(In thousands)
September 30, 2011
Income producing - real estate	$	211,598	$	48,133	$	10,054	$	10,040	$	279,825
Land, land development and construction - real estate		34,799		11,406		6,559		4,544		57,308
Commercial and industrial		267,358		32,614		13,905		7,436		321,313
Total	$	513,755	$	92,153	$	30,518	$	22,020	$	658,446
Accrued interest included in total	$	1,701	$	350	$	127	$	-	$	2,178

December 31, 2010
Income producing - real estate	$	225,167	$	57,536	$	14,482	$	11,925	$	309,110
Land, land development and construction - real estate		33,356		14,780		4,873		9,672		62,681
Commercial and industrial		273,138		41,738		16,413		7,016		338,305
Total	$	531,661	$	114,054	$	35,768	$	28,613	$	710,096
Accrued interest included in total	$	1,897	$	469	$	200	$	-	$	2,566

For each of our mortgage and consumer segment classes we generally monitor credit quality based on the credit scores of the borrowers. These credit scores are generally updated at least annually.

The following table summarizes credit scores by loan class for our mortgage and installment loan segments:

	Mortgage (1)
	1-4 Family		Resort Lending		Home Equity 1st Lien		Home Equity 2nd Lien		Total
	(In thousands)
September 30, 2011
800 and above	$	27,171	$	19,581	$	4,604	$	6,440	$	57,796
750-799		65,805		85,147		7,973		17,613		176,538
700-749		53,911		49,455		3,919		11,991		119,276
650-699		57,261		26,528		4,305		8,905		96,999
600-649		43,934		9,029		1,730		5,426		60,119
550-599		30,194		6,919		1,752		2,930		41,795
500-549		27,168		6,136		1,036		2,885		37,225
Under 500		13,994		1,063		490		1,152		16,699
Unknown		4,836		579		56		212		5,683
Total	$	324,274	$	204,437	$	25,865	$	57,554	$	612,130
Accrued interest included in total	$	1,530	$	1,001	$	127	$	299	$	2,957

December 31, 2010
800 and above	$	28,308	$	21,385	$	4,433	$	6,386	$	60,512
750-799		66,812		89,695		8,996		17,995		183,498
700-749		66,749		56,425		4,961		14,688		142,823
650-699		57,026		25,911		3,707		8,856		95,500
600-649		41,559		12,832		1,596		3,768		59,755
550-599		31,879		11,647		1,673		4,303		49,502
500-549		30,723		5,040		1,366		2,497		39,626
Under 500		19,005		2,941		742		1,853		24,541
Unknown		3,151		2,398		133		121		5,803
Total	$	345,212	$	228,274	$	27,607	$	60,467	$	661,560
Accrued interest included in total	$	1,413	$	1,012	$	135	$	321	$	2,881

	Installment(1)
	Home Equity 1st Lien		Home Equity 2nd Lien		Loans not Secured by Real Estate		Other		Total
	(In thousands)
September 30, 2011
800 and above	$	5,704	$	5,521	$	17,812	$	58	$	29,095
750-799		12,058		17,397		44,456		586		74,497
700-749		7,212		11,553		23,319		926		43,010
650-699		7,694		8,589		15,912		534		32,729
600-649		5,002		5,381		7,905		525		18,813
550-599		3,878		3,613		4,155		199		11,845
500-549		2,863		2,663		3,340		214		9,080
Under 500		1,342		1,362		1,341		56		4,101
Unknown		137		128		4,355		106		4,726
Total	$	45,890	$	56,207	$	122,595	$	3,204	$	227,896
Accrued interest included in total	$	166	$	202	$	440	$	29	$	837

December 31, 2010
800 and above	$	5,626	$	5,618	$	13,078	$	22	$	24,344
750-799		14,654		19,668		46,228		554		81,104
700-749		8,994		15,015		26,714		828		51,551
650-699		8,225		10,029		15,968		779		35,001
600-649		5,878		5,677		8,520		417		20,492
550-599		4,120		4,812		5,479		255		14,666
500-549		3,350		3,248		4,398		260		11,256
Under 500		1,809		1,848		2,087		163		5,907
Unknown		110		78		2,167		63		2,418
Total	$	52,766	$	65,993	$	124,639	$	3,341	$	246,739
Accrued interest included in total	$	218	$	264	$	579	$	34	$	1,095

(1)	Credit scores have been updated within the last twelve months.

Mepco Finance Corporation ("Mepco") is a wholly-owned subsidiary of our Bank that operates a vehicle service contract payment plan business throughout the United States. See note #15 for more information about Mepco's business. As of September 30, 2011, approximately 89.8% of Mepco's outstanding payment plan receivables relate to programs in which a third party insurer or risk retention group is obligated to pay Mepco the full refund owing upon cancellation of the related service contract (including with respect to both the portion funded to the service contract seller and the portion funded to the administrator). These receivables are shown as “Full Refund” in the table below. Another approximately 9.6% of Mepco's outstanding payment plan receivables as of September 30, 2011, relate to programs in which a third party insurer or risk retention group is obligated to pay Mepco the refund owing upon cancellation only with respect to the unearned portion previously funded by Mepco to the administrator (but not to the service contract seller). These receivables are shown as “Partial Refund” in the table below. The balance of Mepco's outstanding payment plan receivables relate to programs in which there is no insurer or risk retention group that has any contractual liability to Mepco for any portion of the refund amount. These receivables are shown as “Other” in the table below. For each class of our payment plan receivables we monitor credit ratings of the counterparties as we evaluate the credit quality of this portfolio.

The following table summarizes credit ratings of insurer or risk retention group counterparties by class of payment plan receivable:

	Payment Plan Receivables

	Full Refund		Partial Refund		Other		Total
	(In thousands)
September 30, 2011
AM Best rating
A+	$	-	$	128	$	10	$	138
A		32,428		139		308		32,875
A-		34,451		12,695		-		47,146
B+		2,606		-		-		2,606
B		-		-		-		-
Not rated		51,750		-		527		52,277
Total	$	121,235	$	12,962	$	845	$	135,042

December 31, 2010
AM Best rating
A+	$	-	$	255	$	-	$	255
A		40,264		497		341		41,102
A-		48,291		25,523		-		73,814
B+		19,694		-		-		19,694
B		-		-		-		-
Not rated		53,404		-		12,994		66,398
Total	$	161,653	$	26,275	$	13,335	$	201,263

Although Mepco has contractual recourse against various counterparties for refunds owing upon cancellation of vehicle service contracts, please see note #15 below regarding certain risks and difficulties associated with collecting these refunds.