Note 3 - Loans

(Table amounts in $ 000s)

Year-end loan and leases were as follows:

	2011			2010
Commercial	$	15,827		$	20,927
Real estate-construction		28,504			29,776
Real estate-mortgage 1-4 family		35,758			41,228
Real estate-mortgage 5+ family		35,977			44,021
Real estate-mortgage commercial		183,881			223,546
Home equity		21,266			23,392
Leases		295			442
Installment		1,476			1,807
Total loans and leases		322,984			385,139
Less:
Deferred loan fees		(271	)		(350	)
Loans and leases, net of unearned income and deferred loan fees		322,713			384,789
Allowance for loan and lease losses		(18,984	)		(18,336	)

Loans and leases, net	$	303,729		$	366,453

Impaired loans and leases were as follows:

	2011		2010		2009
Year-end impaired loans and leases with no allowance for loan and lease losses allocated	$	19,039	$	24,294	$	20,755
Year-end impaired loans and leases with allowance for loan and lease losses allocated		52,159		56,258		35,499
Total impaired loans and leases impaired at year-end	$	71,198	$	80,552	$	56,254
Amount of the allowance allocated to impaired loans and leases	$	11,415	$	10,469	$	10,052
Average of impaired loans and leases during the year		90,935		73,591		49,061
Interest income recognized on impaired
loans and leases during impairment		2,553		1,596		98

Related parties are directors of the Company of officers of the Company or Bank with the title of Vice President or above and their related interests. Related party loans were as follows:

	2011

Total loans at beginning of year	$	218
New loans		57
Repayments		(37	)
Other changes		0

Total loans at end of year	$	238

The Company had pledged loans with a carrying value of $28,828,000 to the Federal Home Loan Bank of Chicago at December 31, 2011.

Real estate-mortgage commercial loans with a carrying value of $46,970,000 and $68,495,000 were made to borrowers in the hotel industry at December 31, 2011 and 2010, respectively.

At December 31, 2011 and 2010, there were approximately $96,132,000 and $103,050,000, respectively, of loans that had payment schedules where only interest is collected until the loans mature. Of these loans, $20,427,000 and $23,068,000 consisted of home equity loans at December 31, 2011 and 2010, respectively.

There were no loans held for sale at year-end 2011.