Retirement Plans

9 Months Ended

Sep. 30, 2013

Retirement Plans

Retirement Plans

Note 10 — Retirement Plans

The Company and the Bank provide certain retirement benefits to their employees in the form of a non-contributory defined benefit pension plan and an employees’ savings plan.  The non-contributory defined benefit pension plan covers all employees hired on or before December 31, 2005, who have attained age 21, and who have completed a year of eligible service.  Employees hired on or after January 1, 2006 are not eligible to participate in the non-contributory defined benefit pension plan.  On this date, a new benefit formula applies only to participants who have not attained age 45 or who do not have five years of service.

Effective July 1, 2009, the Company suspended the accrual of benefits for pension plan participants under the non-contributory defined benefit plan.  The pension plan remained suspended as of September 30, 2013.

The components of net periodic pension expense recognized during the three and nine months ended September 30, 2013 and 2012 are as follows:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(Dollars in thousands)	2013			2012			2013			2012
Interest cost	$	(250	)	$	(258	)	$	(750	)	$	(774	)
Expected return on plan assets	430			407			1,291			1,222
Recognized net actuarial loss	(301		)	(267		)	(903		)	(801		)
Net periodic pension expense	$	(121	)	$	(118	)	$	(362	)	$	(353	)

The Company contributed $300,000 and $900,000 to the pension plan for the three and nine months ended September 30, 2013, respectively, and anticipates making similar additional contributions during the remainder of the year.

Electing employees are eligible to participate in the employees’ savings plan, under the provisions of Internal Revenue Code Section 401(k), after attaining age 21.  Plan participants elect to contribute portions of their annual base compensation as a before tax contribution.  Employer contributions may be made from current or accumulated net profits. Participants may elect to contribute 1% to 50% of annual base compensation as a before tax contribution. Effective September 1, 2012, employees participating in the plan receive a 100% matching of their 401(k) plan contribution, up to 5% of salary. Prior to September 1, 2012, participating employees received a 50% matching of their 401(k) plan contribution, up to 6% of salary.  The Company expensed $871,000 and $418,000 for the 401(k) plan during the three months ended September 30, 2013 and 2012, respectively.  The Company expensed $2.1 million and $1.1 million for the 401(k) plan during the nine months ended September 30, 2013 and 2012, respectively.

Employees hired on January 1, 2006 or thereafter will not participate in the defined benefit pension plan, but are eligible to participate in the employees’ savings plan.

Employees can enter the savings plan on or after the first day of each month.  The employee may enter into a salary deferral agreement at any time to select an alternative deferral amount or to elect not to defer in the plan.  If the employee does not elect an investment allocation, the plan administrator will select a retirement-based portfolio according to the employee’s number of years until normal retirement age.  The plan’s investment valuations are generally provided on a daily basis.