| [X]                                                                                     | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|-----------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------|
|  For the quarterly period ended:     March 31, 2011  |
| OR                                                                                 |
| [  ]                                                                          | TRANSITION REPORT PURSUANT TO SECTION 13 OF 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934     |

|  Delaware                                                 |                      | 23-3016517                        |
|----------------------------------------------------------------|---------------------------|-----------------------------------|
| (State or other jurisdiction of incorporation or organization) |                      | (IRS Employer Identification No.) |
|                                                           |                      |                              |
|                                                           | 409 Silverside Road       |                              |
|                                                           | Wilmington, DE 19809 |                              |
|                                                           | (Address of principal     |                              |
|                                                           | executive offices)        |                              |
|                                                           | (Zip code)                |                              |

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|                         | Page                                                                                                                 |
|------------------------------|----------------------------------------------------------------------------------------------------------------------|
|                         |                                                                                                                 |
| Part I Financial Information |
| Item 1.                      | Financial Statements:                                                                                                | 3 |
|                         |                                                                                                                 |
|                         | Consolidated Balance Sheets – March 31, 2011 (unaudited) and December 31, 2010                                 | 3 |
|                         |                                                                                                                 |
|                         | Unaudited Consolidated Statements of Operations – Three months ended March 31, 2011 and 2010         | 4 |
|                         |                                                                                                                 |
|                         | Unaudited Consolidated Statements of Changes in Shareholders’ Equity – Three months ended March 31, 2011 | 5 |
|                         |                                                                                                                 |
|                         | Unaudited Consolidated Statements of Cash Flows – Three months ended March 31, 2011 and 2010                   | 6 |
|                         |                                                                                                                 |
|                         | Unaudited Notes to Consolidated Financial Statements                                                                 | 7 |
|                         |                                                                                                                 |
| Item 2.                      | Management’s Discussion and Analysis of Financial Condition and Results of Operations                          | 21 |
|                         |                                                                                                                 |
| Item 3.                      | Quantitative and Qualitative Disclosures About Market Risk                                                           | 35 |
|                         |                                                                                                                 |
| Item 4.                      | Controls and Procedures                                                                                              | 35 |
|                         |                                                                                                                 |
| Part II Other Information    |
|                         |                                                                                                                 |
|                         |                                                                                                                 |
| Item 6.                      | Exhibits                                                                                                             | 36 |
|                         |                                                                                                                 |
| Signatures                   |                                                                                                                 |

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| THE BANCORP, INC. AND SUBSIDIARY                                                           |   |
|--------------------------------------------------------------------------------------------|--------|
| CONSOLIDATED BALANCE SHEET                                                                 |   |
|                                                                                       |   |   |   |   |   |   |
|                                                                                       |   | March 31, |   |   | December 31, |   |
|                                                                                       |   | 2011 |   |   | 2010 |   |
|                                                                                       |   | (unaudited) |   |   |   |
|                                                                                       |   | (in thousands) |   |
| ASSETS                                                                                     |   |   |   |   |   |   |
| Cash and cash equivalents                                                                  |   |   |   |   |   |   |
| Cash and due from banks                                                                    |   | $ | 223,420 |   |   | $ | 157,411 |   |
| Interest bearing deposits                                                                  |   |   | 630,524 |   |   |   | 314,908 |   |
| Total cash and cash equivalents                                                            |   |   | 853,944 |   |   |   | 472,319 |   |
|                                                                                       |   |   |   |   |   |   |   |   |
| Investment securities, available-for-sale, at fair value                                   |   |   | 273,643 |   |   |   | 231,165 |   |
| Investment securities, held-to-maturity (fair value $17,537 and $16,550, respectively)     |   |   | 21,298 |   |   |   | 21,364 |   |
| Loans, net of deferred loan costs                                                          |   |   | 1,636,253 |   |   |   | 1,619,195 |   |
| Allowance for loan and lease losses                                                        |   |   | (25,802 | ) |   |   | (24,063 | ) |
| Loans, net                                                                                 |   |   | 1,610,451 |   |   |   | 1,595,132 |   |
| Premises and equipment, net                                                                |   |   | 8,533 |   |   |   | 8,767 |   |
| Accrued interest receivable                                                                |   |   | 8,807 |   |   |   | 8,878 |   |
| Intangible assets, net                                                                     |   |   | 8,754 |   |   |   | 9,005 |   |
| Other real estate owned                                                                    |   |   | 3,379 |   |   |   | 2,115 |   |
| Deferred tax asset, net                                                                    |   |   | 23,817 |   |   |   | 24,365 |   |
| Other assets                                                                               |   |   | 24,071 |   |   |   | 22,613 |   |
| Total assets                                                                               |   | $ | 2,836,697 |   |   | $ | 2,395,723 |   |
|                                                                                       |   |   |   |   |   |   |   |   |
| LIABILITIES                                                                                |   |   |   |   |   |   |   |   |
| Deposits                                                                                   |   |   |   |   |   |   |   |   |
| Demand (non-interest bearing)                                                              |   | $ | 1,412,656 |   |   | $ | 945,605 |   |
| Savings, money market and interest checking                                                |   |   | 1,105,226 |   |   |   | 975,973 |   |
| Time deposits                                                                              |   |   | 1,397 |   |   |   | 90,862 |   |
| Time deposits, $100,000 and over                                                           |   |   | 11,830 |   |   |   | 11,657 |   |
| Total deposits                                                                             |   |   | 2,531,109 |   |   |   | 2,024,097 |   |
|                                                                                       |   |   |   |   |   |   |   |   |
| Securities sold under agreements to repurchase                                             |   |   | 19,783 |   |   |   | 14,383 |   |
| Short-term borrowings                                                                      |   |   | - |   |   |   | 87,000 |   |
| Federal funds purchased                                                                    |   |   | - |   |   |   | 49,000 |   |
| Accrued interest payable                                                                   |   |   | 149 |   |   |   | 124 |   |
| Subordinated debenture                                                                     |   |   | 13,401 |   |   |   | 13,401 |   |
| Other liabilities                                                                          |   |   | 14,654 |   |   |   | 8,812 |   |
| Total liabilities                                                                          |   |   | 2,579,096 |   |   |   | 2,196,817 |   |
|                                                                                       |   |   |   |   |   |   |   |   |
| SHAREHOLDERS' EQUITY                                                                       |   |   |   |   |   |   |   |   |
| Common stock - authorized, 50,000,000 shares of $1.00 par value; 33,196,281 and 26,181,281 |   |   |   |   |   |   |   |   |
| shares issued and outstanding at March 31, 2011 and December 31, 2010, respectively        |   |   | 33,196 |   |   |   | 26,181 |   |
| Additional paid-in capital                                                                 |   |   | 240,640 |   |   |   | 192,711 |   |
| Accumulated deficit                                                                        |   |   | (15,507 | ) |   |   | (18,195 | ) |
| Accumulated other comprehensive loss                                                       |   |   | (728 | ) |   |   | (1,791 | ) |
| Total shareholders' equity                                                                 |   |   | 257,601 |   |   |   | 198,906 |   |
|                                                                                       |   |   |   |   |   |   |   |   |
| Total liabilities and shareholders' equity                                                 |   | $ | 2,836,697 |   |   | $ | 2,395,723 |   |
|                                                                                       |   |   |   |   |   |   |   |   |
|  The accompanying notes are an integral part of these statements.                     |   |   |   |   |   |   |   |   |

----

| THE BANCORP, INC. AND SUBSIDIARY                                                                                           |   |
|----------------------------------------------------------------------------------------------------------------------------|--------|
| UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS                                                                  |   |
|                                                                                                                       |   |   |   |   |   |   |
|                                                                                                                       |   | For the three months ended March 31, |   |
|                                                                                                                       |   | 2011 |   |   | 2010 |   |
|                                                                                                                       |   | (in thousands, except per share data) |   |
| Interest income                                                                                                            |   |   |   |   |   |   |
| Loans, including fees                                                                                                      |   | $ | 18,293 |   |   | $ | 17,916 |   |
| Interest on investment securities:                                                                                         |   |   |   |   |   |   |   |   |
| Taxable interest                                                                                                           |   |   | 1,557 |   |   |   | 1,308 |   |
| Tax-exempt interest                                                                                                        |   |   | 672 |   |   |   | 390 |   |
| Interest bearing deposits                                                                                                  |   |   | 515 |   |   |   | 351 |   |
|                                                                                                                       |   |   | 21,037 |   |   |   | 19,965 |   |
| Interest expense                                                                                                           |   |   |   |   |   |   |   |   |
| Deposits                                                                                                                   |   |   | 2,605 |   |   |   | 3,458 |   |
| Securities sold under agreements to repurchase                                                                             |   |   | 16 |   |   |   | 7 |   |
| Short-term borrowings                                                                                                      |   |   | 3 |   |   |   | 5 |   |
| Subordinated debt                                                                                                          |   |   | 215 |   |   |   | 215 |   |
|                                                                                                                       |   |   | 2,839 |   |   |   | 3,685 |   |
| Net interest income                                                                                                        |   |   | 18,198 |   |   |   | 16,280 |   |
| Provision for loan and lease losses                                                                                        |   |   | 4,672 |   |   |   | 4,148 |   |
| Net interest income after provision for loan and lease losses                                                              |   |   | 13,526 |   |   |   | 12,132 |   |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Non-interest income                                                                                                        |   |   |   |   |   |   |   |   |
| Service fees on deposit accounts                                                                                           |   |   | 635 |   |   |   | 381 |   |
| Merchant credit card deposit and ACH fees                                                                                  |   |   | 569 |   |   |   | 486 |   |
| Stored value income                                                                                                        |   |   | 4,755 |   |   |   | 2,815 |   |
| Gain on sales of investment securities                                                                                     |   |   | - |   |   |   | 750 |   |
| Other than temporary impairment on securities available-for-sale (1)                                                       |   |   | (75 | ) |   |   | - |   |
| Leasing income                                                                                                             |   |   | 704 |   |   |   | 664 |   |
| Debit card income                                                                                                          |   |   | 372 |   |   |   | 170 |   |
| Other                                                                                                                      |   |   | 785 |   |   |   | 228 |   |
| Total non-interest income                                                                                                  |   |   | 7,745 |   |   |   | 5,494 |   |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Non-interest expense                                                                                                       |   |   |   |   |   |   |   |   |
| Salaries and employee benefits                                                                                             |   |   | 6,980 |   |   |   | 6,372 |   |
| Depreciation and amortization                                                                                              |   |   | 729 |   |   |   | 722 |   |
| Rent and related occupancy cost                                                                                            |   |   | 699 |   |   |   | 623 |   |
| Data processing expense                                                                                                    |   |   | 2,393 |   |   |   | 1,613 |   |
| Printing and supplies                                                                                                      |   |   | 282 |   |   |   | 414 |   |
| Audit expense                                                                                                              |   |   | 260 |   |   |   | 291 |   |
| Legal expense                                                                                                              |   |   | 500 |   |   |   | 354 |   |
| Amortization of intangible assets                                                                                          |   |   | 250 |   |   |   | 250 |   |
| Loss on sale of other real estate owned                                                                                    |   |   | 52 |   |   |   | 20 |   |
| FDIC Insurance                                                                                                             |   |   | 1,212 |   |   |   | 756 |   |
| Software, maintenance and equipment                                                                                        |   |   | 366 |   |   |   | 258 |   |
| Other                                                                                                                      |   |   | 3,429 |   |   |   | 2,534 |   |
| Total non-interest expense                                                                                                 |   |   | 17,152 |   |   |   | 14,207 |   |
| Net income before income tax                                                                                               |   |   | 4,119 |   |   |   | 3,419 |   |
| Income tax provision                                                                                                       |   |   | 1,431 |   |   |   | 1,233 |   |
| Net income                                                                                                                 |   |   | 2,688 |   |   |   | 2,186 |   |
| Less preferred stock dividends and accretion                                                                               |   |   | - |   |   |   | (6,242 | ) |
| Net income (loss) available to common shareholders                                                                         |   | $ | 2,688 |   |   | $ | (4,056 | ) |
| Net income (loss) per share - basic                                                                                        |   | $ | 0.10 |   |   | $ | (0.15 | ) |
| Net income (loss) per share - diluted                                                                                      |   | $ | 0.10 |   |   | $ | (0.15 | ) |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| (1) Other than temporary impairment was due to credit loss and therefore did not include amounts due to market conditions. |   |
|                                                                                                                       |   |   |   |   |   |   |   |   |
|  The accompanying notes are an integral part of these statements.                                                     |   |   |   |   |   |   |   |   |

----

| THE BANCORP INC. AND SUBSIDIARYUNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITYFor the three months ended March 31, 2011(in thousands, except share data)  |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   | Accumulated |   |   |   |   |   |   |   |
|                                                                                                                                                                               |   | Common |   |   |   |   |   | Additional |   |   |   |   |   | other |   |   |   |   |   |   |   |
|                                                                                                                                                                               |   | stock |   |   | Common |   |   | paid-in |   |   | Accumulated |   |   | comprehensive |   |   | Comprehensive |   |   |   |   |
|                                                                                                                                                                               |   | shares |   |   | stock |   |   | capital |   |   | deficit |   |   | loss |   |   | income |   |   | Total |   |
|                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance at January 1, 2011                                                                                                                                                         |   |   | 26,181,281 |   |   | $ | 26,181 |   |   | $ | 192,711 |   |   | $ | (18,195 | ) |   | $ | (1,791 | ) |   |   |   |   | $ | 198,906 |   |
| Net income                                                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 2,688 |   |   |   |   |   |   | $ | 2,688 |   |   |   | 2,688 |   |
| Issuance of common stock                                                                                                                                                           |   |   | 7,015,000 |   |   |   | 7,015 |   |   |   | 47,513 |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 54,528 |   |
| Stock-based compensation                                                                                                                                                           |   |   | - |   |   |   | - |   |   |   | 416 |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 416 |   |
| Other comprehensive income, net of                                                                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| reclassification adjustments and tax                                                                                                                                               |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 1,063 |   |   |   | 1,063 |   |   |   | 1,063 |   |
|                                                                                                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | $ | 3,751 |   |   |   |   |   |
| Balance at March 31, 2011                                                                                                                                                          |   |   | 33,196,281 |   |   | $ | 33,196 |   |   | $ | 240,640 |   |   | $ | (15,507 | ) |   | $ | (728 | ) |   |   |   |   |   | $ | 257,601 |   |

----

| THE BANCORP, INC. AND SUBSIDIARY                                         |   |
|--------------------------------------------------------------------------|--------|
| UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS                           |   |
| (dollars in thousands)                                                   |   |
|                                                                     |   |   |   |
|                                                                     |   | For the three months ended |   |
|                                                                     |   | March 31, |   |
|                                                                     |   | 2011 |   |   | 2010 |   |
| Operating activities                                                     |   |   |   |   |   |   |
| Net income                                                               |   | $ | 2,688 |   |   | $ | 2,186 |   |
| Adjustments to reconcile net income to net cash                          |   |   |   |   |   |   |   |   |
|   provided by (used in) operating activities                   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                            |   |   | 979 |   |   |   | 972 |   |
| Provision for loan and lease losses                                      |   |   | 4,672 |   |   |   | 4,148 |   |
| Net amortization of investment securities discounts/premiums             |   |   | 105 |   |   |   | 12 |   |
| Stock-based compensation expense                                         |   |   | 416 |   |   |   | 23 |   |
| Mortgage loans originated for sale                                       |   |   | (458 | ) |   |   | - |   |
| Sale of mortgage loans originated for resale                             |   |   | 454 |   |   |   | - |   |
| Gain on sale of mortgage loans originated for resale                     |   |   | (4 | ) |   |   | - |   |
| Deferred income tax benefit                                              |   |   | - |   |   |   | (3 | ) |
| (Gain) loss on sales of fixed assets                                     |   |   | (2 | ) |   |   | 16 |   |
| Other than temporary impairment on securities available-for-sale         |   |   | 75 |   |   |   | - |   |
| Loss on sales of other real estate owned                                 |   |   | 52 |   |   |   | 20 |   |
| Gain on sales of investment securities                                   |   |   | - |   |   |   | 750 |   |
| Decrease in accrued interest receivable                                  |   |   | 71 |   |   |   | 133 |   |
| Increase (decrease) in interest payable                                  |   |   | 25 |   |   |   | (226 | ) |
| (Increase) decrease in other assets                                      |   |   | (1,571 | ) |   |   | 57 |   |
| Increase (decrease) in other liabilities                                 |   |   | 5,842 |   |   |   | (21,070 | ) |
|   Net cash provided by (used in) operating activities          |   |   | 13,344 |   |   |   | (12,982 | ) |
|                                                                     |   |   |   |   |   |   |   |   |
| Investing activities                                                     |   |   |   |   |   |   |   |   |
| Purchase of  investment securities available-for-sale          |   |   | (79,256 | ) |   |   | (99,493 | ) |
| Proceeds from redemptions and repayment on securities available-for-sale |   |   | 38,275 |   |   |   | 25,997 |   |
| Proceeds from sale of other real estate owned                            |   |   | 173 |   |   |   | - |   |
| Proceeds from sales of investment securities available-for-sale          |   |   | - |   |   |   | 10,438 |   |
| Net increase in loans                                                    |   |   | (21,472 | ) |   |   | (6,903 | ) |
| Proceeds from sale of fixed assets                                       |   |   | 39 |   |   |   | - |   |
| Purchases of premises and equipment                                      |   |   | (418 | ) |   |   | (861 | ) |
|   Net cash used in investing activities                        |   |   | (62,659 | ) |   |   | (70,822 | ) |
|                                                                     |   |   |   |   |   |   |   |   |
| Financing activities                                                     |   |   |   |   |   |   |   |   |
| Net increase in deposits                                                 |   |   | 507,012 |   |   |   | 207,774 |   |
| Net increase in securities sold under agreements to repurchase           |   |   | 5,400 |   |   |   | 5,657 |   |
| Repayment of short-term borrowings and federal funds purchased           |   |   | (136,000 | ) |   |   | (100,000 | ) |
| Proceeds from issuance of common stock                                   |   |   | 54,528 |   |   |   | - |   |
| Redemption of preferred stock                                            |   |   | - |   |   |   | (45,220 | ) |
| Dividends paid on Series B preferred stock                               |   |   | - |   |   |   | (433 | ) |
|   Net cash provided by financing activities                    |   |   | 430,940 |   |   |   | 67,778 |   |
|                                                                     |   |   |   |   |   |   |   |   |
|   Net increase (decrease) in cash and cash equivalents         |   |   | 381,625 |   |   |   | (16,026 | ) |
|                                                                     |   |   |   |   |   |   |   |   |
| Cash and cash equivalents, beginning of year                             |   |   | 472,319 |   |   |   | 354,459 |   |
|                                                                     |   |   |   |   |   |   |   |   |
| Cash and cash equivalents, end of period                                 |   | $ | 853,944 |   |   | $ | 338,433 |   |
|                                                                     |   |   |   |   |   |   |   |   |
| Supplemental disclosure:                                                 |   |   |   |   |   |   |   |   |
| Interest paid                                                            |   | $ | 2,814 |   |   | $ | 3,967 |   |
| Taxes paid                                                               |   | $ | 575 |   |   | $ | 26 |   |
| Transfers of loans to other real estate owned                            |   | $ | 1,489 |   |   | $ | 189 |   |

----

THE BANCORP, INC. AND SUBSIDIARY

----

|                           |   |                                  |      |
|--------------------------------|--------|---------------------------------------|-----------|
|                           |   |                                  |      |   |   |   |   |   |   |   |   |   |
| Stock options:                 |   |                                  |      |   |   |   |   | Weighted- |   |   |   |   |
|                           |   |                                  |      |   |   |   |   | average |   |   |   |   |
|                           |   |                                  |      |   | Weighted |   |   | remaining |   |   |   |   |
|                           |   |                                  |      |   | average |   |   | contractual |   |   | Aggregate |   |
|                           |   |                                  |      |   | exercise |   |   | term |   |   | intrinsic |   |
|                           |   | Shares                                |      |   | price |   |   | (years) |   |   | value |   |
|                           |   | (in thousands, except per share data) |      |
|                           |   |                                  |      |   |   |   |   |   |   |   |   |   |
| Outstanding at January 1, 2011 |   |                                  | 2,244,864 |   |   | $ | 10.71 |   |   |   |   |   |   |   |
| Granted                        |   |                                  | -         |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Exercised                      |   |                                  | -         |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Forfeited                      |   |                                  | (3,749    | ) |   |   | 10.87 |   |   |   | - |   |   |   | - |   |
| Outstanding at March 31, 2011  |   |                                  | 2,241,115 |   |   | $ | 10.71 |   |   |   | 6.43 |   |   | $ | - |   |
| Exercisable at March 31, 2011  |   |                                  | 1,105,115 |   |   |   |   |   |   |   | 3.39 |   |   | $ | - |   |

| Stock appreciation rights:                                    |   |   |   |   |      |   |   | Average     |   |
|---------------------------------------------------------------|--------|--------|--------|--------|-----------|--------|--------|-------------|--------|
|                                                          |   |   |   |   |      |   |   | remaining   |   |
|                                                          |   |   |   |   | Weighted- |   |   | contractual |   |
|                                                          |   |   |   |   | average   |   |   | term        |   |
|                                                          |   | Shares |   |   | price     |   |   | (years)     |   |
|                                                          |   |   |   |   |      |   |   |        |   |
| Outstanding at beginning of the year |   |   | 60,000 |   |      | $      | 11.41  |        |   |   |   |
| Granted                                                       |   |   | -      |   |      |   | -      |        |   |   | - |   |
| Exercised                                                     |   |   | -      |   |      |   | -      |        |   |   | - |   |
| Expired/forfeited                                             |   |   | -      |   |      |   | -      |        |   |   | - |   |
| Outstanding at end of period              |   |   | 60,000 |   |      | $      | 11.41  |        |   |   | 6.96 |   |
|                                                          |   |   |   |   |      |   |   |        |   |   |   |   |

|                                        |   | For the three months ended                   |   |
|---------------------------------------------|--------|----------------------------------------------|--------|
|                                        |   | March 31, 2011                               |   |
|                                        |   | Income                                       |   |   | Shares |   |   | Per share |   |
|                                        |   | (numerator)                                  |   |   | (denominator) |   |   | amount |   |
|                                        |   | (dollars in thousands except per share data) |   |
| Basic earnings per share                    |   |                                         |   |   |   |   |   |   |   |
| Net income available to common shareholders |   | $                                            | 2,688  |   |   |   | 28,051,948 |   |   | $ | 0.10 |   |
| Effect of dilutive securities               |   |                                         |   |   |   |   |   |   |   |   |   |   |
| Stock options                               |   |                                         | -      |   |   |   | 6,385 |   |   |   | - |   |
| Diluted earnings per share                  |   |                                         |   |   |   |   |   |   |   |   |   |   |
| Net income available to common shareholders |   | $                                            | 2,688  |   |   |   | 28,058,333 |   |   | $ | 0.10 |   |

----

|                                      |   | For the three months ended                   |   |
|-------------------------------------------|--------|----------------------------------------------|--------|
|                                      |   | March 31, 2010                               |   |
|                                      |   | Income                                       |   |   | Shares |   |   | Per share |   |
|                                      |   | (numerator)                                  |   |   | (denominator) |   |   | amount |   |
|                                      |   | (dollars in thousands except per share data) |   |
| Basic loss per share                      |   |                                         |   |   |   |   |   |   |   |
| Net loss available to common shareholders |   | $                                            | (4,056 | ) |   |   | 26,181,281 |   |   | $ | (0.15 | ) |
| Effect of dilutive securities             |   |                                         |   |   |   |   |   |   |   |   |   |   |
| Stock options                             |   |                                         | -      |   |   |   | - |   |   |   | - |   |
| Diluted loss per share                    |   |                                         |   |   |   |   |   |   |   |   |   |   |
| Net loss available to common shareholders |   | $                                            | (4,056 | ) |   |   | 26,181,281 |   |   | $ | (0.15 | ) |

| Available-for-sale                                          |   | March 31, 2011 |    |
|-------------------------------------------------------------|--------|----------------|---------|
|                                                        |   |           |    |   | Gross |   |   | Gross |   |   |   |   |
|                                                        |   | Amortized      |    |   | unrealized |   |   | unrealized |   |   | Fair |   |
|                                                        |   | cost           |    |   | gains |   |   | losses |   |   | value |   |
| U.S. Government agency securities                           |   | $              | 5,789   |   |   | $ | - |   |   | $ | - |   |   | $ | 5,789 |   |
| Tax-exempt obligations of states and political subdivisions |   |           | 76,620  |   |   |   | 389 |   |   |   | (1,707 | ) |   |   | 75,302 |   |
| Taxable obligations of states and political subdivisions    |   |           | 28,864  |   |   |   | 242 |   |   |   | (367 | ) |   |   | 28,739 |   |
| Mortgage-backed securities                                  |   |           | 127,915 |   |   |   | 903 |   |   |   | (82 | ) |   |   | 128,736 |   |
| Other debt securities                                       |   |           | 27,892  |   |   |   | 1,511 |   |   |   | (254 | ) |   |   | 29,149 |   |
| Federal Home Loan and Atlantic Central                      |   |           |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Bankers Bank stock                              |   |           | 5,928   |   |   |   | - |   |   |   | - |   |   |   | 5,928 |   |
|                                                        |   | $              | 273,008 |   |   | $ | 3,045 |   |   | $ | (2,410 | ) |   | $ | 273,643 |   |
|                                                        |   |           |    |   |   |   |   |   |   |   |   |   |   |   |   |   |

| Held-to-maturity                       |   | March 31, 2011 |   |
|----------------------------------------|--------|----------------|--------|
|                                   |   |           |   |   | Gross |   |   | Gross |   |   |   |   |
|                                   |   | Amortized      |   |   | unrealized |   |   | unrealized |   |   | Fair |   |
|                                   |   | cost           |   |   | gains |   |   | losses |   |   | value |   |
| Other debt securities - single issuers |   | $              | 19,534 |   |   | $ | 927 |   |   | $ | (4,369 | ) |   | $ | 16,092 |   |
| Other debt securities - pooled         |   |           | 1,764  |   |   |   | - |   |   |   | (319 | ) |   |   | 1,445 |   |
|                                   |   | $              | 21,298 |   |   | $ | 927 |   |   | $ | (4,688 | ) |   | $ | 17,537 |   |

----

| Available-for-sale                                          |   | December 31, 2010 |    |
|-------------------------------------------------------------|--------|-------------------|---------|
|                                                        |   |              |    |   | Gross |   |   | Gross |   |   |   |   |
|                                                        |   | Amortized         |    |   | unrealized |   |   | unrealized |   |   | Fair |   |
|                                                        |   | cost              |    |   | gains |   |   | losses |   |   | value |   |
| Tax-exempt obligations of states and political subdivisions |   | $                 | 78,046  |   |   | $ | 335 |   |   | $ | (3,070 | ) |   | $ | 75,311 |   |
| Taxable obligations of states and political subdivisions    |   |              | 28,870  |   |   |   | 261 |   |   |   | (454 | ) |   |   | 28,677 |   |
| Mortgage-backed securities                                  |   |              | 76,275  |   |   |   | 704 |   |   |   | (64 | ) |   |   | 76,915 |   |
| Other debt securities                                       |   |              | 42,700  |   |   |   | 1,510 |   |   |   | (186 | ) |   |   | 44,024 |   |
| Federal Home Loan and Atlantic Central                      |   |              |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Bankers Bank stock                              |   |              | 6,238   |   |   |   | - |   |   |   | - |   |   |   | 6,238 |   |
|                                                        |   | $                 | 232,129 |   |   | $ | 2,810 |   |   | $ | (3,774 | ) |   | $ | 231,165 |   |
|                                                        |   |              |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                        |   |              |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Held-to-maturity                                            |   | December 31, 2010 |    |
|                                                        |   |              |    |   |   | Gross |   |   | Gross |   |   |   |   |   |
|                                                        |   | Amortized         |    |   | unrealized |   |   | unrealized |   |   | Fair |   |
|                                                        |   | cost              |    |   | gains |   |   | losses |   |   | value |   |
| Other debt securities - single issuers                      |   | $                 | 19,526  |   |   | $ | 128 |   |   | $ | (4,632 | ) |   | $ | 15,022 |   |
| Other debt securities - pooled                              |   |              | 1,838   |   |   |   | - |   |   |   | (310 | ) |   |   | 1,528 |   |
|                                                        |   | $                 | 21,364  |   |   | $ | 128 |   |   | $ | (4,942 | ) |   | $ | 16,550 |   |

----

|                                   |   | Available-for-sale |    |   | Held-to-maturity |   |
|----------------------------------------|--------|--------------------|---------|--------|------------------|--------|
|                                   |   | Amortized          |    |   | Fair             |   |   | Amortized |   |   | Fair |   |
|                                   |   | cost               |    |   | value            |   |   | cost |   |   | value |   |
| Due before one year                    |   | $                  | 20,742  |   |             | $      | 20,737 |   |   | $ | - |   |   | $ | - |   |
| Due after one year through five years  |   |               | 41,592  |   |             |   | 43,134 |   |   |   | - |   |   |   | - |   |
| Due after five years through ten years |   |               | 15,597  |   |             |   | 15,390 |   |   |   | 18,008 |   |   |   | 14,702 |   |
| Due after ten years                    |   |               | 189,149 |   |             |   | 188,454 |   |   |   | 3,290 |   |   |   | 2,835 |   |
| Federal Home Loan and Atlantic         |   |               |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
|   Central Bankers Bank stock |   |               | 5,928   |   |             |   | 5,928 |   |   |   | - |   |   |   | - |   |
|                                   |   | $                  | 273,008 |   |             | $      | 273,643 |   |   | $ | 21,298 |   |   | $ | 17,537 |   |

| March 31, 2011                                       |   |                 |   |   |                |   |                |              |   |   |       |
|------------------------------------------------------|--------|----------------------|--------|--------|---------------------|--------|---------------------|-------------------|--------|--------|------------|
| Available-for-sale                                   |   |                 |   |   | Less than 12 months |   | 12 months or longer |              |   | Total  |       |
|                                                 |   | Number of securities |   |   | Fair Value          |   |                | Unrealized losses |   |   | Fair Value |   |   | Unrealized losses |   |   | Fair Value |   |   | Unrealized losses |   |
| Description of Securities                            |   |                 |   |   |                |   |                |              |   |   |       |   |   |   |   |   |   |   |   |   |   |
| Tax-exempt obligations of states and                 |   |                 |   |   |                |   |                |              |   |   |       |   |   |   |   |   |   |   |   |   |   |
|      political subdivisions |   |                 | 51     |   |                | $      | 41,050              |              |   | $      | (1,707     | ) |   | $ | - |   |   | $ | - |   |   | $ | 41,050 |   |   | $ | (1,707 | ) |
| Taxable obligations of states and                    |   |                 |   |   |                |   |                |              |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      political subdivisions |   |                 | 13     |   |                |   | 11,844              |              |   |   | (367       | ) |   |   | - |   |   |   | - |   |   |   | 11,844 |   |   |   | (367 | ) |
| Mortgage-backed securities                           |   |                 | 8      |   |                |   | 13,618              |              |   |   | (82        | ) |   |   | - |   |   |   | - |   |   |   | 13,618 |   |   |   | (82 | ) |
| Other securities                                     |   |                 | 2      |   |                |   | 1,988               |              |   |   | (12        | ) |   |   | 655 |   |   |   | (242 | ) |   |   | 2,643 |   |   |   | (254 | ) |
| Total temporarily impaired                           |   |                 |   |   |                |   |                |              |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      investment securities  |   |                 | 74     |   |                | $      | 68,500              |              |   | $      | (2,168     | ) |   | $ | 655 |   |   | $ | (242 | ) |   | $ | 69,155 |   |   | $ | (2,410 | ) |
|                                                 |   |                 |   |   |                |   |                |              |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                 |   |                 |   |   |                |   |                |              |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| March 31, 2011                                      |   |                 |   |   |                |   |                |              |   |   |       |
|-----------------------------------------------------|--------|----------------------|--------|--------|---------------------|--------|---------------------|-------------------|--------|--------|------------|
| Held-to-maturity                                    |   |                 |   |   | Less than 12 months |   | 12 months or longer |              |   | Total  |       |
|                                                |   | Number of securities |   |   | Fair Value          |   |                | Unrealized losses |   |   | Fair Value |   |   | Unrealized losses |   |   | Fair Value |   |   | Unrealized losses |   |
| Description of Securities                           |   |                 |   |   |                |   |                |              |   |   |       |   |   |   |   |   |   |   |   |   |   |
| Other debt securities - single issuers              |   |                 | 2      |   |                | $      | -                   |              |   | $      | -          |   |   | $ | 1,445 |   |   | $ | (319 | ) |   | $ | 1,445 |   |   | $ | (319 | ) |
| Other debt securities - pooled                      |   |                 | 2      |   |                |   | -                   |              |   |   | -          |   |   |   | 7,691 |   |   |   | (4,369 | ) |   |   | 7,691 |   |   |   | (4,369 | ) |
| Total temporarily impaired                          |   |                 |   |   |                |   |                |              |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      investment securities |   |                 | 4      |   |                | $      | -                   |              |   | $      | -          |   |   | $ | 9,136 |   |   | $ | (4,688 | ) |   | $ | 9,136 |   |   | $ | (4,688 | ) |

| December 31, 2010                                    |   |                 |   |   |                |   |    |                |   |   |       |   |
|------------------------------------------------------|--------|----------------------|--------|--------|---------------------|--------|---------|---------------------|--------|--------|------------|--------|
| Available-for-sale                                   |   |                 |   |   | Less than 12 months |   |    | 12 months or longer |   |   | Total      |   |
|                                                 |   | Number of securities |   |   | Fair Value          |   |    | Unrealized losses   |   |   | Fair Value |   |   | Unrealized losses |   |   | Fair Value |   |   | Unrealized losses |   |
| Description of Securities                            |   |                 |   |   |                |   |    |                |   |   |       |   |   |   |   |   |   |   |   |   |   |
| Tax-exempt obligations of states and                 |   |                 |   |   |                |   |    |                |   |   |       |   |   |   |   |   |   |   |   |   |   |
|      political subdivisions |   |                 | 65     |   |                | $      | 54,685  |                |   | $      | (3,070     | )      |   | $ | - |   |   | $ | - |   |   | $ | 54,685 |   |   | $ | (3,070 | ) |
| Taxable obligations of states and                    |   |                 |   |   |                |   |    |                |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      political subdivisions |   |                 | 15     |   |                |   | 14,060  |                |   |   | (454       | )      |   |   | - |   |   |   | - |   |   |   | 14,060 |   |   |   | (454 | ) |
| Mortgage-backed securities                           |   |                 | 8      |   |                |   | 26,021  |                |   |   | (64        | )      |   |   | - |   |   |   |   |   |   |   | 26,021 |   |   |   | (64 | ) |
| Other securities                                     |   |                 | 11     |   |                |   | 16,771  |                |   |   | (24        | )      |   |   | 748 |   |   |   | (162 | ) |   |   | 17,519 |   |   |   | (186 | ) |
| Total temporarily impaired                           |   |                 |   |   |                |   |    |                |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      investment securities  |   |                 | 99     |   |                | $      | 111,537 |                |   | $      | (3,612     | )      |   | $ | 748 |   |   | $ | (162 | ) |   | $ | 112,285 |   |   | $ | (3,774 | ) |
|                                                 |   |                 |   |   |                |   |    |                |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                 |   |                 |   |   |                |   |    |                |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| December 31, 2010                                   |   |                 |   |   |                |   |   |                |   |   |       |   |
|-----------------------------------------------------|--------|----------------------|--------|--------|---------------------|--------|--------|---------------------|--------|--------|------------|--------|
| Held-to-maturity                                    |   |                 |   |   | Less than 12 months |   |   | 12 months or longer |   |   | Total      |   |
|                                                |   | Number of securities |   |   | Fair Value          |   |   | Unrealized losses   |   |   | Fair Value |   |   | Unrealized losses |   |   | Fair Value |   |   | Unrealized losses |   |
| Description of Securities                           |   |                 |   |   |                |   |   |                |   |   |       |   |   |   |   |   |   |   |   |   |   |
| Other debt securities - single issuers              |   |                 | 3      |   |                | $      | -      |                |   | $      | -          |   |   | $ | 10,606 |   |   | $ | (4,632 | ) |   | $ | 10,606 |   |   | $ | (4,632 | ) |
| Other debt securities - pooled                      |   |                 | 2      |   |                |   | -      |                |   |   | -          |   |   |   | 1,528 |   |   |   | (310 | ) |   |   | 1,528 |   |   |   | (310 | ) |
| Total temporarily impaired                          |   |                 |   |   |                |   |   |                |   |   |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|      investment securities |   |                 | 5      |   |                | $      | -      |                |   | $      | -          |   |   | $ | 12,134 |   |   | $ | (4,942 | ) |   | $ | 12,134 |   |   | $ | (4,942 | ) |

|                                                                                                        |   | March 31, |      |   | December 31, |   |
|-------------------------------------------------------------------------------------------------------------|--------|-----------|-----------|--------|--------------|--------|
|                                                                                                        |   | 2011      |      |   | 2010         |   |
|                                                                                                        |   |      |      |   |         |   |
| Commercial                                                                                                  |   | $         | 430,081   |   |         | $      | 441,799 |   |
| Commercial mortgage (1)                                                                                     |   |      | 601,046   |   |         |   | 580,780 |   |
| Construction                                                                                                |   |      | 202,105   |   |         |   | 203,120 |   |
| Total commercial loans                                                                                      |   |      | 1,233,232 |   |         |   | 1,225,699 |   |
| Direct financing leases, net                                                                                |   |      | 107,624   |   |         |   | 103,289 |   |
| Residential mortgage                                                                                        |   |      | 94,682    |   |         |   | 93,004 |   |
| Consumer loans and others                                                                                   |   |      | 197,876   |   |         |   | 194,320 |   |
|                                                                                                        |   |      | 1,633,414 |   |         |   | 1,616,312 |   |
| Deferred loan costs                                                                                         |   |      | 2,839     |   |         |   | 2,883 |   |
| Total loans, net of deferred loan costs                                                                     |   | $         | 1,636,253 |   |         | $      | 1,619,195 |   |
|                                                                                                        |   |      |      |   |         |   |   |   |
| Supplemental loan data:                                                                                     |   |      |      |   |         |   |   |   |
| Construction 1-4 family                                                                                     |   | $         | 96,240    |   |         | $      | 100,689 |   |
| Construction commercial, acquisition and development                                                        |   |      | 105,865   |   |         |   | 102,431 |   |
|                                                                                                        |   | $         | 202,105   |   |         | $      | 203,120 |   |
|                                                                                                        |   |      |      |   |         |   |   |   |
| (1) At March 31, 2011, our owner occupied loans amounted to $136 million, or 22.7% of commercial mortgages. |   |

----

|                          |   | Recordedinvestment |   |   | Unpaidprincipalbalance |   |   | Relatedallowance |   |
|-------------------------------|--------|--------------------|--------|--------|------------------------|--------|--------|------------------|--------|
| March 31, 2011                |   |               |   |   |                   |   |   |             |   |
| Without an allowance recorded |   |               |   |   |                   |   |   |             |   |
| Construction                  |   | $                  | 251    |   |                   | $      | 1,560  |             |   | $ | - |   |
| Commercial mortgage           |   |               | 774    |   |                   |   | 774    |             |   |   | - |   |
| Commercial                    |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| Consumer                      |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| Residential                   |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| With an allowance recorded    |   |               |   |   |                   |   |   |             |   |   |   |   |
| Construction                  |   |               | 1,444  |   |                   |   | 1,444  |             |   |   | 611 |   |
| Commercial mortgage           |   |               | 2,011  |   |                   |   | 2,011  |             |   |   | 419 |   |
| Commercial                    |   |               | 2,544  |   |                   |   | 2,544  |             |   |   | 1,347 |   |
| Consumer - home equity        |   |               | 633    |   |                   |   | 633    |             |   |   | 428 |   |
| Residential                   |   |               | 6,571  |   |                   |   | 6,544  |             |   |   | 1,340 |   |
| Total                         |   |               |   |   |                   |   |   |             |   |   |   |   |
| Construction                  |   | $                  | 1,695  |   |                   | $      | 3,004  |             |   | $ | 611 |   |
| Commercial                    |   | $                  | 5,329  |   |                   | $      | 5,329  |             |   | $ | 1,766 |   |
| Consumer                      |   | $                  | 633    |   |                   | $      | 633    |             |   | $ | 428 |   |
| Residential                   |   | $                  | 6,571  |   |                   | $      | 6,544  |             |   | $ | 1,340 |   |
|                          |   |               |   |   |                   |   |   |             |   |   |   |   |
| December 31, 2010             |   |               |   |   |                   |   |   |             |   |   |   |   |
| Without an allowance recorded |   |               |   |   |                   |   |   |             |   |   |   |   |
| Commercial mortgage           |   | $                  | -      |   |                   | $      | -      |             |   | $ | - |   |
| Commercial                    |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| Consumer                      |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| Residential                   |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| With an allowance recorded    |   |               |   |   |                   |   |   |             |   |   |   |   |
| Construction                  |   |               | 4,881  |   |                   |   | 4,881  |             |   |   | 2,644 |   |
| Commercial mortgage           |   |               | 1,650  |   |                   |   | 1,650  |             |   |   | 284 |   |
| Commercial                    |   |               | 2,280  |   |                   |   | 2,280  |             |   |   | 1,316 |   |
| Consumer - home equity        |   |               | 960    |   |                   |   | 960    |             |   |   | 117 |   |
| Residential                   |   |               | 5,526  |   |                   |   | 5,622  |             |   |   | 970 |   |
| Total                         |   |               |   |   |                   |   |   |             |   |   |   |   |
| Construction                  |   | $                  | 4,881  |   |                   | $      | 4,881  |             |   | $ | 2,644 |   |
| Commercial                    |   | $                  | 3,930  |   |                   | $      | 3,930  |             |   | $ | 1,600 |   |
| Consumer                      |   | $                  | 960    |   |                   | $      | 960    |             |   | $ | 117 |   |
| Residential                   |   | $                  | 5,526  |   |                   | $      | 5,622  |             |   | $ | 970 |   |

----

|                          |   | Averagerecordedinvestment |   |   | Interestincomerecognized |   |
|-------------------------------|--------|---------------------------|--------|--------|--------------------------|--------|
| March 31, 2011                |   |                      |   |   |                     |   |
| Without an allowance recorded |   |                      |   |   |
| Construction                  |   | $                         | 905    |   |                     | $      | - |   |
| Commercial mortgage           |   |                      | 774    |   |                     |   |   |   |
| Commercial                    |   |                      | -      |   |                     |   | - |   |
| Consumer                      |   |                      | -      |   |                     |   | - |   |
| Residential                   |   |                      | -      |   |                     |   | - |   |
| With an allowance recorded    |   |                      |   |   |                     |
| Construction                  |   |                      | 2,382  |   |                     |   | - |   |
| Commercial mortgage           |   |                      | 1,831  |   |                     |   | - |   |
| Commercial                    |   |                      | 2,412  |   |                     |   | - |   |
| Consumer - home equity        |   |                      | 797    |   |                     |   | - |   |
| Residential                   |   |                      | 6,048  |   |                     |   | - |   |
| Total                         |   |                      |   |   |                     |   |   |   |
| Construction                  |   | $                         | 3,287  |   |                     | $      | - |   |
| Commercial                    |   | $                         | 5,017  |   |                     | $      | - |   |
| Consumer                      |   | $                         | 797    |   |                     | $      | - |   |
| Residential                   |   | $                         | 6,048  |   |                     | $      | - |   |

|                                                                            |   | March 31,      |   |   | December 31, |   |
|---------------------------------------------------------------------------------|--------|----------------|--------|--------|--------------|--------|
|                                                                            |   | 2011           |   |   | 2010         |   |
|                                                                            |   | (in thousands) |   |
|                                                                            |   |           |   |   |         |   |
| Non-accrual loans                                                               |   |           |   |   |         |   |
|           Construction        |   | $              | 1,695  |   |         | $      | 4,881 |   |
|           Commercial mortgage |   |           | 2,785  |   |         |   | 1,650 |   |
|           Commercial          |   |           | 2,544  |   |         |   | 2,280 |   |
|           Consumer            |   |           | 633    |   |         |   | 960 |   |
|           Residential         |   |           | 6,571  |   |         |   | 5,526 |   |
| Total non-accrual loans                                                         |   |           | 14,228 |   |         |   | 15,297 |   |
|                                                                            |   |           |   |   |         |   |   |   |
| Loans past due 90 days or more                                                  |   |           | 3,028  |   |         |   | 2,219 |   |
| Total non-performing loans                                                      |   |           | 17,256 |   |         |   | 17,516 |   |
| Other real estate owned                                                         |   |           | 3,379  |   |         |   | 2,115 |   |
| Total non-performing assets                                                     |   | $              | 20,635 |   |         | $      | 19,631 |   |
|                                                                            |   |           |   |   |         |   |   |   |

----

|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |
|-------------------------------------------------------|--------|------------|---------|--------|------------|--------|---------|--------------|--------|--------|-------------|--------|--------|----------|--------|--------|------------------|--------|---------|-------------|--------|--------|---------|--------|
|                                                  |   |       |    |   | Commercial |   |    |         |   |   | Residential |   |   |     |   |   | Direct financing |   |    |        |   |   |    |   |
|                                                  |   | Commercial |    |   | mortgage   |   |    | Construction |   |   | mortgage    |   |   | Consumer |   |   | leases, net      |   |    | Unallocated |   |   | Total   |   |
| March 31, 2011                                        |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |
| Beginning balance                                     |   | $          | 6,051   |   |       | $      | 9,501   |         |   | $      | 5,030       |   |   | $        | 2,115  |   |             | $      | 578     |        |   | $      | 164     |   |   | $ | 624 |   |   | $ | 24,063 |   |
| Charge-offs                                           |   |       | (4      | )      |       |   | (102    | )            |   |   | (2,143      | )      |   |     | (31    | )      |             |   | (668    | )           |   |   | -       |   |   |   | - |   |   |   | (2,948 | ) |
| Recoveries                                            |   |       | 2       |   |       |   | 12      |         |   |   | 1           |   |   |     | -      |   |             |   | -       |        |   |   | -       |   |   |   | - |   |   |   | 15 |   |
| Provision                                             |   |       | 1,322   |   |       |   | (639    | )            |   |   | 1,737       |   |   |     | 752    |   |             |   | 1,199   |        |   |   | 31      |   |   |   | 270 |   |   |   | 4,672 |   |
| Ending balance                                        |   | $          | 7,371   |   |       | $      | 8,772   |         |   | $      | 4,625       |   |   | $        | 2,836  |   |             | $      | 1,109   |        |   | $      | 195     |   |   | $ | 894 |   |   | $ | 25,802 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Individually evaluated for impairment |   | $          | 1,347   |   |       | $      | 419     |         |   | $      | 611         |   |   | $        | 1,340  |   |             | $      | 428     |        |   | $      | -       |   |   | $ | - |   |   | $ | 4,145 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Collectively evaluated for impairment |   | $          | 6,024   |   |       | $      | 8,353   |         |   | $      | 4,014       |   |   | $        | 1,496  |   |             | $      | 681     |        |   | $      | 195     |   |   | $ | 894 |   |   | $ | 21,657 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Loans:                                                |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance                                        |   | $          | 430,081 |   |       | $      | 601,046 |         |   | $      | 202,105     |   |   | $        | 94,682 |   |             | $      | 197,876 |        |   | $      | 107,624 |   |   | $ | 2,839 |   |   | $ | 1,636,253 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Individually evaluated for impairment |   | $          | 2,544   |   |       | $      | 2,785   |         |   | $      | 1,695       |   |   | $        | 6,571  |   |             | $      | 633     |        |   | $      | -       |   |   | $ | - |   |   | $ | 14,228 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Collectively evaluated for impairment |   | $          | 427,537 |   |       | $      | 598,261 |         |   | $      | 200,410     |   |   | $        | 88,111 |   |             | $      | 197,243 |        |   | $      | 107,624 |   |   | $ | 2,839 |   |   | $ | 1,622,025 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| December 31, 2010                                     |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Beginning balance                                     |   | $          | 5,181   |   |       | $      | 7,041   |         |   | $      | 4,356       |   |   | $        | 1,699  |   |             | $      | 460     |        |   | $      | 151     |   |   | $ | 235 |   |   | $ | 19,123 |   |
| Charge-offs                                           |   |       | (4,453  | )      |       |   | (9,060  | )            |   |   | -           |   |   |     | (1,254 | )      |             |   | (618    | )           |   |   | (3      | )      |   |   | - |   |   |   | (15,388 | ) |
| Recoveries                                            |   |       | 232     |   |       |   | 47      |         |   |   | 4           |   |   |     | 742    |   |             |   | 6       |        |   |   | 10      |   |   |   | - |   |   |   | 1,041 |   |
| Provision                                             |   |       | 5,091   |   |       |   | 11,473  |         |   |   | 670         |   |   |     | 928    |   |             |   | 730     |        |   |   | 6       |   |   |   | 389 |   |   |   | 19,287 |   |
| Ending balance                                        |   | $          | 6,051   |   |       | $      | 9,501   |         |   | $      | 5,030       |   |   | $        | 2,115  |   |             | $      | 578     |        |   | $      | 164     |   |   | $ | 624 |   |   | $ | 24,063 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Individually evaluated for impairment |   |       | 1,316   |   |       |   | 284     |         |   |   | 2,644       |   |   |     | 970    |   |             |   | 117     |        |   |   | -       |   |   |   | - |   |   |   | 5,331 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Collectively evaluated for impairment |   |       | 4,735   |   |       |   | 9,217   |         |   |   | 2,386       |   |   |     | 1,145  |   |             |   | 461     |        |   |   | 164     |   |   |   | 624 |   |   |   | 18,732 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Loans:                                                |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance                                        |   | $          | 444,259 |   |       | $      | 580,780 |         |   | $      | 203,120     |   |   | $        | 93,147 |   |             | $      | 194,600 |        |   | $      | 103,289 |   |   | $ | - |   |   | $ | 1,619,195 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Individually evaluated for impairment |   | $          | 2,280   |   |       | $      | 1,650   |         |   | $      | 4,881       |   |   | $        | 5,526  |   |             | $      | 960     |        |   | $      | -       |   |   | $ | - |   |   | $ | 15,297 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Collectively evaluated for impairment |   | $          | 441,979 |   |       | $      | 579,130 |         |   | $      | 198,239     |   |   | $        | 87,621 |   |             | $      | 193,640 |        |   | $      | 103,289 |   |   | $ | - |   |   | $ | 1,603,898 |   |

----

|                                                  |   | March 31, |   |
|-------------------------------------------------------|--------|-----------|--------|
|                                                  |   | 2010      |   |
|                                                  |   |      |   |
| Balance in the allowance for loan and lease losses at |   |      |   |
| beginning of period                                   |   | $         | 19,123 |   |
|                                                  |   |      |   |   |
| Loans charged-off:                                    |   |      |   |   |
| Commercial                                            |   |      | 2,728  |   |
| Construction                                          |   |      | -      |   |
| Lease financing                                       |   |      | -      |   |
| Residential mortgage                                  |   |      | 223    |   |
| Consumer                                              |   |      | 44     |   |
| Total                                                 |   |      | 2,995  |   |
|                                                  |   |      |   |   |
| Recoveries:                                           |   |      |   |   |
| Commercial                                            |   |      | 79     |   |
| Construction                                          |   |      | 1      |   |
| Lease financing                                       |   |      | -      |   |
| Residential mortgage                                  |   |      | -      |   |
| Consumer                                              |   |      | 1      |   |
| Total                                                 |   |      | 81     |   |
| Net charge-offs                                       |   |      | 2,914  |   |
| Provision charged to operations                       |   |      | 4,148  |   |
| Balance in allowance for loan and lease losses at end |   |      |   |   |
| of period                                             |   | $         | 20,357 |   |
| Net charge-offs/average loans                         |   |      | 0.19   | % |

| Age Analysis of Past Due Loans |   |
|--------------------------------|--------|
|                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                           |   | 30-59 Days |   |   | 60-89 Days |   |   | Greater Than |   |   |   |   |   | Total |   |   |   |   |   | Total |   |
| March 31, 2011                 |   | Past Due |   |   | Past Due |   |   | 90 Days |   |   | Nonaccrual |   |   | Past Due |   |   | Current |   |   | Loans |   |
| Commercial                     |   | $ | 594 |   |   | $ | 7,076 |   |   | $ | 1,612 |   |   | $ | 2,544 |   |   | $ | 11,826 |   |   | $ | 418,255 |   |   | $ | 430,081 |   |
| Commercial mortgage            |   |   | 2,356 |   |   |   | - |   |   |   | 824 |   |   |   | 2,785 |   |   |   | 5,965 |   |   |   | 595,081 |   |   |   | 601,046 |   |
| Construction                   |   |   | - |   |   |   | 1,961 |   |   |   | 391 |   |   |   | 1,695 |   |   |   | 4,047 |   |   |   | 198,058 |   |   |   | 202,105 |   |
| Direct financing leases, net   |   |   | 2,087 |   |   |   | 188 |   |   |   | 193 |   |   |   | - |   |   |   | 2,468 |   |   |   | 105,156 |   |   |   | 107,624 |   |
| Consumer - other               |   |   | 35 |   |   |   | 2 |   |   |   | 8 |   |   |   | - |   |   |   | 45 |   |   |   | 153,554 |   |   |   | 153,599 |   |
| Consumer - home equity         |   |   | 330 |   |   |   | - |   |   |   | - |   |   |   | 633 |   |   |   | 963 |   |   |   | 43,314 |   |   |   | 44,277 |   |
| Residential mortgage           |   |   | - |   |   |   | 3,360 |   |   |   | - |   |   |   | 6,571 |   |   |   | 9,931 |   |   |   | 84,751 |   |   |   | 94,682 |   |
| Unamortized costs              |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 2,839 |   |   |   | 2,839 |   |
|                           |   | $ | 5,402 |   |   | $ | 12,587 |   |   | $ | 3,028 |   |   | $ | 14,228 |   |   | $ | 35,245 |   |   | $ | 1,601,008 |   |   | $ | 1,636,253 |   |
|                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31, 2010              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                     |   | $ | - |   |   | $ | 100 |   |   | $ | 285 |   |   | $ | 2,280 |   |   | $ | 2,665 |   |   | $ | 439,134 |   |   | $ | 441,799 |   |
| Commercial mortgage            |   |   | 774 |   |   |   | - |   |   |   | 824 |   |   |   | 1,650 |   |   |   | 3,248 |   |   |   | 577,532 |   |   |   | 580,780 |   |
| Construction                   |   |   | - |   |   |   | 391 |   |   |   | - |   |   |   | 4,881 |   |   |   | 5,272 |   |   |   | 197,848 |   |   |   | 203,120 |   |
| Direct financing leases, net   |   |   | 816 |   |   |   | 192 |   |   |   | 49 |   |   |   | - |   |   |   | 1,057 |   |   |   | 102,232 |   |   |   | 103,289 |   |
| Consumer - other               |   |   | - |   |   |   | 2 |   |   |   | 12 |   |   |   | - |   |   |   | 14 |   |   |   | 148,715 |   |   |   | 148,729 |   |
| Consumer - home equity         |   |   | 330 |   |   |   | - |   |   |   | - |   |   |   | 960 |   |   |   | 1,290 |   |   |   | 44,301 |   |   |   | 45,591 |   |
| Residential mortgage           |   |   | - |   |   |   | - |   |   |   | 1,050 |   |   |   | 5,526 |   |   |   | 6,576 |   |   |   | 86,428 |   |   |   | 93,004 |   |
| Unamortized costs              |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 2,883 |   |   |   | 2,883 |   |
|                           |   | $ | 1,920 |   |   | $ | 685 |   |   | $ | 2,220 |   |   | $ | 15,297 |   |   | $ | 20,122 |   |   | $ | 1,599,073 |   |   | $ | 1,619,195 |   |

----

|            |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |
|-----------------|--------|------------|---------|--------|--------------|--------|---------|-------------------|--------|------------------|------------|--------|--------|------------|---------|--------|-------------|--------|
|            |   |       |    |   |         |   |    |              |   |             |       |   |   | Commercial |    |   | Residential |   |
|            |   | Commercial |    |   | Construction |   |    | mortgage          |   |             | mortgage   |   |
|            |   | 3/31/2011  |    |   | 12/31/2010   |   |    | 3/31/2011         |   |             | 12/31/2010 |   |   | 3/31/2011  |    |   | 12/31/2010  |   |   | 3/31/2011 |   |   | 12/31/2010 |   |
| Risk Rating     |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |   |   |   |   |   |   |
| Pass            |   | $          | 296,482 |   |         | $      | 291,140 |              |   | $                | 170,813    |   |   | $          | 165,089 |   |        | $      | 473,958 |   |   | $ | 461,378 |   |   | $ | 28,217 |   |   | $ | 30,066 |   |
| Special Mention |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Substandard     |   |       | 15,251  |   |         |   | 6,091   |              |   |             | 6,090      |   |   |       | 5,271   |   |        |   | 3,608 |   |   |   | 3,608 |   |   |   | 9,931 |   |   |   | 6,576 |   |
| Doubtful        |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Loss            |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Unrated         |   |       | 118,348 |   |         |   | 144,568 |              |   |             | 25,202     |   |   |       | 32,760  |   |        |   | 123,480 |   |   |   | 115,794 |   |   |   | 56,534 |   |   |   | 56,362 |   |
| Total           |   | $          | 430,081 |   |         | $      | 441,799 |              |   | $                | 202,105    |   |   | $          | 203,120 |   |        | $      | 601,046 |   |   | $ | 580,780 |   |   | $ | 94,682 |   |   | $ | 93,004 |   |
|            |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|            |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|            |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |   |   |   |   |   |   |   |   |   |
|            |   |       |    |   |         |   |    |              |   | Direct financing |       |   |   |       |    |   |        |   |   |   |   |   |   |   |   |   |   |
|            |   | Consumer   |    |   | leases, net  |   |    | Unamortized costs |   |             | Total      |   |
|            |   | 3/31/2011  |    |   | 12/31/2010   |   |    | 3/31/2011         |   |             | 12/31/2010 |   |   | 3/31/2011  |    |   | 12/31/2010  |   |   | 3/31/2011 |   |   | 12/31/2010 |   |
| Risk Rating     |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Pass            |   | $          | 60,457  |   |         | $      | 59,064  |              |   | $                | -          |   |   | $          | -       |   |        | $      | - |   |   | $ | - |   |   | $ | 1,029,927 |   |   | $ | 1,006,737 |   |
| Special Mention |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Substandard     |   |       | 644     |   |         |   | 1,224   |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | 35,524 |   |   |   | 22,770 |   |
| Doubtful        |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Loss            |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Unrated         |   |       | 136,775 |   |         |   | 134,032 |              |   |             | 107,624    |   |   |       | 103,289 |   |        |   | 2,839 |   |   |   | 2,883 |   |   |   | 570,802 |   |   |   | 589,688 |   |
| Total           |   | $          | 197,876 |   |         | $      | 194,320 |              |   | $                | 107,624    |   |   | $          | 103,289 |   |        | $      | 2,839 |   |   | $ | 2,883 |   |   | $ | 1,636,253 |   |   | $ | 1,619,195 |   |

----

|                                           |   | March 31, 2011 |      |   | December 31, 2010 |   |
|------------------------------------------------|--------|----------------|-----------|--------|-------------------|--------|
|                                           |   | Carrying       |      |   | Estimated         |   |   | Carrying |   |   | Estimated |   |
|                                           |   | amount         |      |   | fair value        |   |   | amount |   |   | fair value |   |
|                                           |   | (in thousands) |      |
| Cash and cash equivalents                      |   | $              | 853,944   |   |              | $      | 853,944 |   |   | $ | 472,319 |   |   | $ | 472,319 |   |
| Investment securities available-for-sale       |   |           | 273,643   |   |              |   | 273,643 |   |   |   | 231,165 |   |   |   | 231,165 |   |
| Investment securities held-to-maturity         |   |           | 21,298    |   |              |   | 17,537 |   |   |   | 21,364 |   |   |   | 16,550 |   |
| Loans receivable, net                          |   |           | 1,636,253 |   |              |   | 1,611,766 |   |   |   | 1,619,195 |   |   |   | 1,597,764 |   |
| Demand deposits (non-interest bearing)         |   |           | 1,412,656 |   |              |   | 1,412,656 |   |   |   | 945,605 |   |   |   | 945,605 |   |
| Savings, money market and interest checking    |   |           | 1,105,226 |   |              |   | 1,105,226 |   |   |   | 975,973 |   |   |   | 975,973 |   |
| Certificates of deposit                        |   |           | 13,227    |   |              |   | 13,339 |   |   |   | 102,519 |   |   |   | 102,587 |   |
| Subordinated debentures and notes              |   |           | 13,401    |   |              |   | 9,195 |   |   |   | 13,401 |   |   |   | 9,185 |   |
| Securities sold under agreements to repurchase |   |           | 19,783    |   |              |   | 19,783 |   |   |   | 14,383 |   |   |   | 14,383 |   |
| Short-term borrowings                          |   |           | -         |   |              |   | - |   |   |   | 136,000 |   |   |   | 136,000 |   |

----

|                                             |   |           |    |   | Fair Value Measurements at Reporting Date Using |   |
|--------------------------------------------------|--------|----------------|---------|--------|-------------------------------------------------|--------|
|                                             |   |           |    |   | Quoted prices in active                         |   |   | Significant other |   |   | Significant |   |
|                                             |   |           |    |   | markets for identical                           |   |   | observable |   |   | unobservable |   |
|                                             |   | Fair value     |    |   | assets                                          |   |   | inputs |   |   | inputs |   |
| Description                                      |   | March 31, 2011 |    |   | (Level 1)                                       |   |   | (Level 2) |   |   | (Level 3) |   |
|                                             |   |           |    |   |                                            |   |   |   |   |   |   |   |
| Investment                                       |   |           |    |   |                                            |   |   |   |   |   |   |   |
| U.S. Government agency securities                |   | $              | 5,789   |   |                                            | $      | - |   |   | $ | 5,789 |   |   | $ | - |   |
| Obligations of states and political subdivisions |   |           | 104,041 |   |                                            |   | - |   |   |   | 104,041 |   |   |   | - |   |
| Mortgage-backed securities                       |   |           | 128,736 |   |                                            |   | - |   |   |   | 128,736 |   |   |   | - |   |
| Other debt securities                            |   |           | 29,149  |   |                                            |   | - |   |   |   | 28,494 |   |   |   | 655 |   |
| Federal Home Loan and Atlantic Central           |   |           |    |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
|   Bankers Bank stock                   |   |           | 5,928   |   |                                            |   | - |   |   |   | - |   |   |   | 5,928 |   |
|                                             |   | $              | 273,643 |   |                                            | $      | - |   |   | $ | 267,060 |   |   | $ | 6,583 |   |

|                                             |   |              |    |   | Fair Value Measurements at Reporting Date Using |   |
|--------------------------------------------------|--------|-------------------|---------|--------|-------------------------------------------------|--------|
|                                             |   |              |    |   | Quoted prices in active                         |   |   | Significant other |   |   | Significant |   |
|                                             |   |              |    |   | markets for identical                           |   |   | observable |   |   | unobservable |   |
|                                             |   | Fair value        |    |   | assets                                          |   |   | inputs |   |   | inputs |   |
| Description                                      |   | December 31, 2010 |    |   | (Level 1)                                       |   |   | (Level 2) |   |   | (Level 3) |   |
|                                             |   |              |    |   |                                            |   |   |   |   |   |   |   |
| Investment                                       |   |              |    |   |                                            |   |   |   |   |   |   |   |
| Obligations of states and political subdivisions |   | $                 | 103,988 |   |                                            | $      | - |   |   | $ | 103,988 |   |   | $ | - |   |
| Mortgage-backed securities                       |   |              | 76,915  |   |                                            |   | - |   |   |   | 76,915 |   |   |   | - |   |
| Other debt securities                            |   |              | 44,024  |   |                                            |   | - |   |   |   | 43,276 |   |   |   | 748 |   |
| Federal Home Loan and Atlantic Central           |   |              |    |   |                                            |   |   |   |   |   |   |   |   |   |   |   |
|   Bankers Bank stock                   |   |              | 6,238   |   |                                            |   | - |   |   |   | - |   |   |   | 6,238 |   |
|                                             |   | $                 | 231,165 |   |                                            | $      | - |   |   | $ | 224,179 |   |   | $ | 6,986 |   |

| Fair Value Measurements Using                                |   |
|--------------------------------------------------------------|--------|
| Significant Unobservable Inputs                              |   |
| (Level 3)                                                    |   |
|                                                         |   | Available-for-sale |   |
|                                                         |   | securities |   |
|                                                         |   | March 31, 2011 |   |   | December 31, 2010 |   |
| Beginning balance                                            |   | $ | 6,986 |   |   | $ | 7,222 |   |
| Transfers into level 3                                       |   |   | - |   |   |   | - |   |
| Transfers out of level 3                                     |   |   | - |   |   |   | - |   |
| Total gains or losses (realized/unrealized)                  |   |   |   |   |   |   |   |   |
| Included in earnings (or changes in net assets)              |   |   | - |   |   |   | (13 | ) |
| Included in other comprehensive income                       |   |   | (80 | ) |   |   | 186 |   |
| Purchases, issuances, and settlements                        |   |   |   |   |   |   |   |   |
| Purchases                                                    |   |   | - |   |   |   | - |   |
| Issuances                                                    |   |   | - |   |   |   | - |   |
| Sales                                                        |   |   |   |   |   |   |   |   |
| Settlements                                                  |   |   | (323 | ) |   |   | (409 | ) |
| Ending balance                                               |   | $ | 6,583 |   |   | $ | 6,986 |   |
|                                                         |   |   |   |   |   |   |   |   |
| The amount of total gains or losses for the period           |   |   |   |   |   |   |   |   |
| included in earnings (or changes in net assets) attributable |   |   |   |   |   |
| to the change in unrealized gains or losses relating to      |   |   |   |   |   |   |   |   |
| assets still held at the reporting date.                     |   | $ | - |   |   | $ | - |   |

----

|                    |   |              |   |   | Fair Value Measurements at Reporting Date Using |                                            |
|-------------------------|--------|-------------------|--------|--------|-------------------------------------------------|-------------------------------------------------|
|                    |   |              |   |   | Quoted prices in active                         |                                            |   | Significant other |   |   | Significant |   |
|                    |   |              |   |   | markets for identical                           |                                            |   | observable |   |   | unobservable |   |
|                    |   |              |   |   | assets                                          |                                            |   | inputs |   |   | inputs |   |
| Description             |   | March 31, 2011    |   |   | (Level 1)                                       |                                            |   | (Level 2) |   |   | (Level 3) |   |
|                    |   |              |   |   |                                            |                                            |   |   |   |   |   |   |
| Impaired loans          |   | $                 | 14,228 |   |                                            | $                                               | - |   |   | $ | - |   |   | $ | 14,228 |   |
| Other real estate owned |   |              | 3,379  |   |                                            |                                            | - |   |   |   | - |   |   |   | 3,379 |   |
|                    |   | $                 | 17,607 |   |                                            | $                                               | - |   |   | $ | - |   |   | $ | 17,607 |   |
|                    |   |              |   |   |                                            |                                            |   |   |   |   |   |   |   |   |   |   |
|                    |   |              |   |   |                                            | Fair Value Measurements at Reporting Date Using |   |
|                    |   |              |   |   |                                            | Quoted prices in active                         |   |   | Significant other |   |   | Significant |   |
|                    |   |              |   |   |                                            | markets for identical                           |   |   | observable |   |   | unobservable |   |
|                    |   |              |   |   |                                            | assets                                          |   |   | inputs |   |   | inputs |   |
| Description             |   | December 31, 2010 |   |   | (Level 1)                                       |                                            |   | (Level 2) |   |   | (Level 3) |   |
|                    |   |              |   |   |                                            |                                            |   |   |   |   |   |   |   |   |   |   |
| Impaired loans          |   | $                 | 15,297 |   |                                            | $                                               | - |   |   | $ | - |   |   | $ | 15,297 |   |
| Other real estate owned |   |              | 2,115  |   |                                            |                                            | - |   |   |   | - |   |   |   | 2,115 |   |
|                    |   | $                 | 17,412 |   |                                            | $                                               | - |   |   | $ | - |   |   | $ | 17,412 |   |

----

Item 2. 

----

----

|                                                                                                                                                                                                                              |   | Three months ended March 31, |      |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|-----------|
|                                                                                                                                                                                                                              |   | 2011                         |      |   | 2010 |   |
|                                                                                                                                                                                                                              |   | Average                      |      |   |   |   |   | Average |   |   | Average |   |   |   |   |   | Average |   |
|                                                                                                                                                                                                                              |   | Balance                      |      |   | Interest |   |   | Rate |   |   | Balance |   |   | Interest |   |   | Rate |   |
|                                                                                                                                                                                                                              |   |                         |      |   | (dollars in thousands) |   |   |   |   |   |   |   |   | (dollars in thousands) |   |   |   |   |
| Assets:                                                                                                                                                                                                                           |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest earning assets:                                                                                                                                                                                                          |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans net of unearned discount                                                                                                                                                                                                    |   | $                            | 1,627,928 |   |   | $ | 18,260 |   |   |   | 4.49 | % |   | $ | 1,518,631 |   |   | $ | 17,916 |   |   |   | 4.72 | % |
| Loans-nontaxable*                                                                                                                                                                                                                 |   |                         | 2,344     |   |   |   | 50 |   |   |   | 8.53 | % |   |   | - |   |   |   | - |   |   |   | 0.00 | % |
| Investment securities-taxable                                                                                                                                                                                                     |   |                         | 185,583   |   |   |   | 1,557 |   |   |   | 3.36 | % |   |   | 130,432 |   |   |   | 1,308 |   |   |   | 4.01 | % |
| Investment securities-nontaxable*                                                                                                                                                                                                 |   |                         | 77,592    |   |   |   | 1,011 |   |   |   | 5.21 | % |   |   | 30,855 |   |   |   | 587 |   |   |   | 7.61 | % |
| Interest earning  deposits                                                                                                                                                                                              |   |                         | 833,085   |   |   |   | 515 |   |   |   | 0.25 | % |   |   | 472,388 |   |   |   | 351 |   |   |   | 0.30 | % |
| Federal funds sold                                                                                                                                                                                                                |   |                         | -         |   |   |   | - |   |   |   | 0.00 | % |   |   | - |   |   |   | - |   |   |   | 0.00 | % |
| Net interest earning assets                                                                                                                                                                                                       |   |                         | 2,726,532 |   |   |   | 21,393 |   |   |   | 3.14 | % |   |   | 2,152,306 |   |   |   | 20,162 |   |   |   | 3.75 | % |
|                                                                                                                                                                                                                              |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance for loan and lease losses                                                                                                                                                                                               |   |                         | (24,811   | ) |   |   |   |   |   |   |   |   |   |   | (19,821 | ) |   |   |   |   |   |   |   |   |
| Other assets                                                                                                                                                                                                                      |   |                         | 286,553   |   |   |   |   |   |   |   |   |   |   |   | 201,340 |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                              |   | $                            | 2,988,274 |   |   |   |   |   |   |   |   |   |   | $ | 2,333,825 |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                              |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities and shareholders' equity:                                                                                                                                                                                             |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Deposits:                                                                                                                                                                                                                         |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand (non-interest bearing) **                                                                                                                                                                                                  |   | $                            | 1,647,682 |   |   | $ | 425 |   |   |   | 0.10 | % |   | $ | 950,319 |   |   | $ | 219 |   |   |   | 0.09 | % |
| Interest bearing deposits                                                                                                                                                                                                         |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest checking                                                                                                                                                                                                                 |   |                         | 714,846   |   |   |   | 1,279 |   |   |   | 0.72 | % |   |   | 539,757 |   |   |   | 1,924 |   |   |   | 1.43 | % |
| Savings and money market                                                                                                                                                                                                          |   |                         | 321,472   |   |   |   | 797 |   |   |   | 0.99 | % |   |   | 544,758 |   |   |   | 1,182 |   |   |   | 0.87 | % |
| Time                                                                                                                                                                                                                              |   |                         | 46,507    |   |   |   | 104 |   |   |   | 0.89 | % |   |   | 50,270 |   |   |   | 133 |   |   |   | 1.06 | % |
| Total interest bearing deposits                                                                                                                                                                                                   |   |                         | 1,082,825 |   |   |   | 2,180 |   |   |   | 0.81 | % |   |   | 1,134,785 |   |   |   | 3,239 |   |   |   | 1.14 | % |
| Total deposits                                                                                                                                                                                                                    |   |                         | 2,730,507 |   |   |   | 2,605 |   |   |   | 0.38 | % |   |   | 2,085,104 |   |   |   | 3,458 |   |   |   | 0.66 | % |
|                                                                                                                                                                                                                              |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Short-term borrowings                                                                                                                                                                                                             |   |                         | 3,022     |   |   |   | 3 |   |   |   | 0.40 | % |   |   | 3,183 |   |   |   | 5 |   |   |   | 0.63 | % |
| Repurchase agreements                                                                                                                                                                                                             |   |                         | 17,030    |   |   |   | 16 |   |   |   | 0.38 | % |   |   | 4,774 |   |   |   | 7 |   |   |   | 0.59 | % |
| Subordinated debt                                                                                                                                                                                                                 |   |                         | 13,401    |   |   |   | 215 |   |   |   | 6.42 | % |   |   | 13,401 |   |   |   | 215 |   |   |   | 6.42 | % |
| Net interest bearing liabilities                                                                                                                                                                                                  |   |                         | 1,116,278 |   |   |   | 2,414 |   |   |   | 0.87 | % |   |   | 1,156,143 |   |   |   | 3,466 |   |   |   | 1.20 | % |
| Total cost of funds                                                                                                                                                                                                               |   |                         | 2,763,960 |   |   |   | 2,839 |   |   |   | 0.41 | % |   |   | 2,106,462 |   |   |   | 3,685 |   |   |   | 0.70 | % |
|                                                                                                                                                                                                                              |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other liabilities                                                                                                                                                                                                                 |   |                         | 9,435     |   |   |   |   |   |   |   |   |   |   |   | 12,658 |   |   |   |   |   |   |   |   |   |
| Total Liabilities                                                                                                                                                                                                                 |   |                         | 2,773,395 |   |   |   |   |   |   |   |   |   |   |   | 2,119,120 |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                              |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Shareholders' equity                                                                                                                                                                                                              |   |                         | 214,879   |   |   |   |   |   |   |   |   |   |   |   | 214,705 |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                              |   | $                            | 2,988,274 |   |   |   |   |   |   |   |   |   |   | $ | 2,333,825 |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                              |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income on tax equivalent basis *                                                                                                                                                                                     |   |                         | $         | 18,554 |   |   |   |   |   |   |   |   |   |   | $ | 16,477 |   |   |   |   |   |
|                                                                                                                                                                                                                              |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Tax equivalent adjustment                                                                                                                                                                                                         |   |                         |      |   |   |   | 356 |   |   |   |   |   |   |   |   |   |   |   | 197 |   |   |   |   |   |
|                                                                                                                                                                                                                              |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                                                                                                                                                                                               |   |                         |      |   |   | $ | 18,198 |   |   |   |   |   |   |   |   |   |   | $ | 16,280 |   |   |   |   |   |
|                                                                                                                                                                                                                              |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest margin *                                                                                                                                                                                                             |   |                         |      |   |   |   |   |   |   |   | 2.72 | % |   |   |   |   |   |   |   |   |   |   | 3.06 | % |
|                                                                                                                                                                                                                              |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |
| * Full taxable equivalent basis, using a 34% statutory tax rate.                                                                                                                                                                  |   |                         |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| ** Non-interest bearing demand accounts are not paid interest. The amount shown as interest reflects the fees paid to affinity groups, which are based upon a rate index, and therefore classified as interest expense. |   |
|                                                                                                                                                                                                                              |

----

----

----

|                                                    |   | Tier 1 capital |   |   | Tier 1 capital   |   |   | Total capital    |   |
|---------------------------------------------------------|--------|----------------|--------|--------|------------------|--------|--------|------------------|--------|
|                                                    |   | to average     |   |   | to risk-weighted |   |   | to risk-weighted |   |
|                                                    |   | assets ratio   |   |   | assets ratio     |   |   | assets ratio     |   |
|                                                    |   |           |   |   |             |   |   |             |   |
| As of March 31, 2011                                    |   |           |   |   |             |   |   |             |   |
| The Company                                             |   |           | 8.62   | %      |             |   | 15.33  | %                |   |   | 16.58 | % |
| The Bancorp Bank                                        |   |           | 6.00   | %      |             |   | 10.69  | %                |   |   | 11.94 | % |
| "Well capitalized" institution (under FDIC regulations) |   |           | 5.00   | %      |             |   | 6.00   | %                |   |   | 10.00 | % |
|                                                    |   |           |   |   |             |   |   |             |   |   |   |   |
| As of December 31, 2010                                 |   |           |   |   |             |   |   |             |   |   |   |   |
| The Company                                             |   |           | 8.37   | %      |             |   | 11.99  | %                |   |   | 13.24 | % |
| The Bancorp Bank                                        |   |           | 7.39   | %      |             |   | 10.60  | %                |   |   | 11.85 | % |
| "Well capitalized" institution (under FDIC regulations) |   |           | 5.00   | %      |             |   | 6.00   | %                |   |   | 10.00 | % |

----

|                                           |   | 1-90                   |      |   | 91-364 |   |     | 1-3    |   |   | 3-5     |   |   | Over 5 |    |
|------------------------------------------------|--------|------------------------|-----------|--------|--------|--------|----------|--------|--------|--------|---------|--------|--------|--------|---------|
|                                           |   | Days                   |      |   | Days   |   |     | Years  |   |   | Years   |   |   | Years  |    |
|                                           |   | (dollars in thousands) |      |
| Interest earning assets:                       |   |                   |      |   |   |   |     |   |   |   |    |   |   |   |    |   |   |   |   |
| Loans net of deferred loan costs               |   | $                      | 856,175   |   |   | $      | 200,124  |   |   | $      | 269,506 |   |   | $      | 102,822 |   |   | $ | 207,626 |   |
| Investment securities                          |   |                   | 7,056     |   |   |   | 23,588   |   |   |   | 48,193  |   |   |   | 38,760  |   |   |   | 177,344 |   |
| Interest earning deposits                      |   |                   | 630,524   |   |   |   | -        |   |   |   | -       |   |   |   | -       |   |   |   | - |   |
| Total interest earning assets                  |   |                   | 1,493,755 |   |   |   | 223,712  |   |   |   | 317,699 |   |   |   | 141,582 |   |   |   | 384,970 |   |
|                                           |   |                   |      |   |   |   |     |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Interest bearing liabilities:                  |   |                   |      |   |   |   |     |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Demand deposits *                              |   |                   | 780,188   |   |   |   | -        |   |   |   | -       |   |   |   | -       |   |   |   | - |   |
| Interest checking                              |   |                   | 374,852   |   |   |   | 187,426  |   |   |   | 187,426 |   |   |   | -       |   |   |   | - |   |
| Savings and money market                       |   |                   | 88,880    |   |   |   | 177,762  |   |   |   | 88,880  |   |   |   | -       |   |   |   | - |   |
| Time deposits                                  |   |                   | 2,542     |   |   |   | 7,940    |   |   |   | 2,745   |   |   |   | -       |   |   |   | - |   |
| Securities sold under agreements to repurchase |   |                   | 19,783    |   |   |   | -        |   |   |   | -       |   |   |   | -       |   |   |   | - |   |
| Subordinated debt                              |   |                   | 3,401     |   |   |   | -        |   |   |   | -       |   |   |   | 10,000  |   |   |   | - |   |
| Total interest bearing liabilities             |   |                   | 1,269,646 |   |   |   | 373,128  |   |   |   | 279,051 |   |   |   | 10,000  |   |   |   | - |   |
| Gap                                            |   | $                      | 224,109   |   |   | $      | (149,416 | )      |   | $      | 38,648  |   |   | $      | 131,582 |   |   | $ | 384,970 |   |
| Cumulative gap                                 |   | $                      | 224,109   |   |   | $      | 74,693   |   |   | $      | 113,341 |   |   | $      | 244,923 |   |   | $ | 629,893 |   |
| Gap to assets ratio                            |   |                   | 8         | %      |   |   | -5       | %      |   |   | 1       | %      |   |   | 5       | % |   |   | 14 | % |
| Cumulative gap to assets ratio                 |   |                   | 8         | %      |   |   | 3        | %      |   |   | 4       | %      |   |   | 9       | % |   |   | 22 | % |

----

|                                                                                                        |   | March 31, |      |   | December 31, |   |
|-------------------------------------------------------------------------------------------------------------|--------|-----------|-----------|--------|--------------|--------|
|                                                                                                        |   | 2011      |      |   | 2010         |   |
|                                                                                                        |   |      |      |   |         |   |
| Commercial                                                                                                  |   | $         | 430,081   |   |         | $      | 441,799 |   |
| Commercial mortgage (1)                                                                                     |   |      | 601,046   |   |         |   | 580,780 |   |
| Construction                                                                                                |   |      | 202,105   |   |         |   | 203,120 |   |
| Total commercial loans                                                                                      |   |      | 1,233,232 |   |         |   | 1,225,699 |   |
| Direct financing leases, net                                                                                |   |      | 107,624   |   |         |   | 103,289 |   |
| Residential mortgage                                                                                        |   |      | 94,682    |   |         |   | 93,004 |   |
| Consumer loans and others                                                                                   |   |      | 197,876   |   |         |   | 194,320 |   |
|                                                                                                        |   |      | 1,633,414 |   |         |   | 1,616,312 |   |
| Deferred loan costs                                                                                         |   |      | 2,839     |   |         |   | 2,883 |   |
| Total loans, net of deferred loan costs                                                                     |   | $         | 1,636,253 |   |         | $      | 1,619,195 |   |
|                                                                                                        |   |      |      |   |         |   |   |   |
| Supplemental loan data:                                                                                     |   |      |      |   |         |   |   |   |
| Construction 1-4 family                                                                                     |   | $         | 96,240    |   |         | $      | 100,689 |   |
| Construction commercial, acquisition and development                                                        |   |      | 105,865   |   |         |   | 102,431 |   |
|                                                                                                        |   | $         | 202,105   |   |         | $      | 203,120 |   |
|                                                                                                        |   |      |      |   |         |   |   |   |
| (1) At March 31, 2011, our owner occupied loans amounted to $136 million, or 22.7% of commercial mortgages. |   |

----

|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |
|-------------------------------------------------------|--------|------------|---------|--------|------------|--------|---------|--------------|--------|--------|-------------|--------|--------|----------|--------|--------|------------------|--------|---------|-------------|--------|--------|---------|--------|
|                                                  |   |       |    |   | Commercial |   |    |         |   |   | Residential |   |   |     |   |   | Direct financing |   |    |        |   |   |    |   |
|                                                  |   | Commercial |    |   | mortgage   |   |    | Construction |   |   | mortgage    |   |   | Consumer |   |   | leases, net      |   |    | Unallocated |   |   | Total   |   |
| March 31, 2011                                        |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |
| Beginning balance                                     |   | $          | 6,051   |   |       | $      | 9,501   |         |   | $      | 5,030       |   |   | $        | 2,115  |   |             | $      | 578     |        |   | $      | 164     |   |   | $ | 624 |   |   | $ | 24,063 |   |
| Charge-offs                                           |   |       | (4      | )      |       |   | (102    | )            |   |   | (2,143      | )      |   |     | (31    | )      |             |   | (668    | )           |   |   | -       |   |   |   | - |   |   |   | (2,948 | ) |
| Recoveries                                            |   |       | 2       |   |       |   | 12      |         |   |   | 1           |   |   |     | -      |   |             |   | -       |        |   |   | -       |   |   |   | - |   |   |   | 15 |   |
| Provision                                             |   |       | 1,322   |   |       |   | (639    | )            |   |   | 1,737       |   |   |     | 752    |   |             |   | 1,199   |        |   |   | 31      |   |   |   | 270 |   |   |   | 4,672 |   |
| Ending balance                                        |   | $          | 7,371   |   |       | $      | 8,772   |         |   | $      | 4,625       |   |   | $        | 2,836  |   |             | $      | 1,109   |        |   | $      | 195     |   |   | $ | 894 |   |   | $ | 25,802 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance:Individually evaluated for impairment  |   | $          | 1,347   |   |       | $      | 419     |         |   | $      | 611         |   |   | $        | 1,340  |   |             | $      | 428     |        |   | $      | -       |   |   | $ | - |   |   | $ | 4,145 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Collectively evaluated for impairment |   | $          | 6,024   |   |       | $      | 8,353   |         |   | $      | 4,014       |   |   | $        | 1,496  |   |             | $      | 681     |        |   | $      | 195     |   |   | $ | 894 |   |   | $ | 21,657 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Loans:                                                |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance                                        |   | $          | 430,081 |   |       | $      | 601,046 |         |   | $      | 202,105     |   |   | $        | 94,682 |   |             | $      | 197,876 |        |   | $      | 107,624 |   |   | $ | 2,839 |   |   | $ | 1,636,253 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Individually evaluated for impairment |   | $          | 2,544   |   |       | $      | 2,785   |         |   | $      | 1,695       |   |   | $        | 6,571  |   |             | $      | 633     |        |   | $      | -       |   |   | $ | - |   |   | $ | 14,228 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Collectively evaluated for impairment |   | $          | 427,537 |   |       | $      | 598,261 |         |   | $      | 200,410     |   |   | $        | 88,111 |   |             | $      | 197,243 |        |   | $      | 107,624 |   |   | $ | 2,839 |   |   | $ | 1,622,025 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| December 31, 2010                                     |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Beginning balance                                     |   | $          | 5,181   |   |       | $      | 7,041   |         |   | $      | 4,356       |   |   | $        | 1,699  |   |             | $      | 460     |        |   | $      | 151     |   |   | $ | 235 |   |   | $ | 19,123 |   |
| Charge-offs                                           |   |       | (4,453  | )      |       |   | (9,060  | )            |   |   | -           |   |   |     | (1,254 | )      |             |   | (618    | )           |   |   | (3      | )      |   |   | - |   |   |   | (15,388 | ) |
| Recoveries                                            |   |       | 232     |   |       |   | 47      |         |   |   | 4           |   |   |     | 742    |   |             |   | 6       |        |   |   | 10      |   |   |   | - |   |   |   | 1,041 |   |
| Provision                                             |   |       | 5,091   |   |       |   | 11,473  |         |   |   | 670         |   |   |     | 928    |   |             |   | 730     |        |   |   | 6       |   |   |   | 389 |   |   |   | 19,287 |   |
| Ending balance                                        |   | $          | 6,051   |   |       | $      | 9,501   |         |   | $      | 5,030       |   |   | $        | 2,115  |   |             | $      | 578     |        |   | $      | 164     |   |   | $ | 624 |   |   | $ | 24,063 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Individually evaluated for impairment |   |       | 1,316   |   |       |   | 284     |         |   |   | 2,644       |   |   |     | 970    |   |             |   | 117     |        |   |   | -       |   |   |   | - |   |   |   | 5,331 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Collectively evaluated for impairment |   |       | 4,735   |   |       |   | 9,217   |         |   |   | 2,386       |   |   |     | 1,145  |   |             |   | 461     |        |   |   | 164     |   |   |   | 624 |   |   |   | 18,732 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Loans:                                                |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance                                        |   | $          | 444,259 |   |       | $      | 580,780 |         |   | $      | 203,120     |   |   | $        | 93,147 |   |             | $      | 194,600 |        |   | $      | 103,289 |   |   | $ | - |   |   | $ | 1,619,195 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Individually evaluated for impairment |   | $          | 2,280   |   |       | $      | 1,650   |         |   | $      | 4,881       |   |   | $        | 5,526  |   |             | $      | 960     |        |   | $      | -       |   |   | $ | - |   |   | $ | 15,297 |   |
|                                                  |   |       |    |   |       |   |    |         |   |   |        |   |   |     |   |   |             |   |    |        |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance: Collectively evaluated for impairment |   | $          | 441,979 |   |       | $      | 579,130 |         |   | $      | 198,239     |   |   | $        | 87,621 |   |             | $      | 193,640 |        |   | $      | 103,289 |   |   | $ | - |   |   | $ | 1,603,898 |   |

----

|                                                  |   | March 31, |   |
|-------------------------------------------------------|--------|-----------|--------|
|                                                  |   | 2010      |   |
|                                                  |   |      |   |
| Balance in the allowance for loan and lease losses at |   |      |   |
| beginning of period                                   |   | $         | 19,123 |   |
|                                                  |   |      |   |   |
| Loans charged-off:                                    |   |      |   |   |
| Commercial                                            |   |      | 2,728  |   |
| Construction                                          |   |      | -      |   |
| Lease financing                                       |   |      | -      |   |
| Residential mortgage                                  |   |      | 223    |   |
| Consumer                                              |   |      | 44     |   |
| Total                                                 |   |      | 2,995  |   |
|                                                  |   |      |   |   |
| Recoveries:                                           |   |      |   |   |
| Commercial                                            |   |      | 79     |   |
| Construction                                          |   |      | 1      |   |
| Lease financing                                       |   |      | -      |   |
| Residential mortgage                                  |   |      | -      |   |
| Consumer                                              |   |      | 1      |   |
| Total                                                 |   |      | 81     |   |
| Net charge-offs                                       |   |      | 2,914  |   |
| Provision charged to operations                       |   |      | 4,148  |   |
| Balance in allowance for loan and lease losses at end |   |      |   |   |
| of period                                             |   | $         | 20,357 |   |
| Net charge-offs/average loans                         |   |      | 0.19   | % |

|                                                                            |   | March 31,      |   |   | December 31, |   |
|---------------------------------------------------------------------------------|--------|----------------|--------|--------|--------------|--------|
|                                                                            |   | 2011           |   |   | 2010         |   |
|                                                                            |   | (in thousands) |   |
|                                                                            |   |           |   |   |         |   |
| Non-accrual loans                                                               |   |           |   |   |         |   |
|           Construction        |   | $              | 1,695  |   |         | $      | 4,881 |   |
|           Commercial mortgage |   |           | 2,785  |   |         |   | 1,650 |   |
|           Commercial          |   |           | 2,544  |   |         |   | 2,280 |   |
|           Consumer            |   |           | 633    |   |         |   | 960 |   |
|           Residential         |   |           | 6,571  |   |         |   | 5,526 |   |
| Total non-accrual loans                                                         |   |           | 14,228 |   |         |   | 15,297 |   |
|                                                                            |   |           |   |   |         |   |   |   |
| Loans past due 90 days or more                                                  |   |           | 3,028  |   |         |   | 2,219 |   |
| Total non-performing loans                                                      |   |           | 17,256 |   |         |   | 17,516 |   |
| Other real estate owned                                                         |   |           | 3,379  |   |         |   | 2,115 |   |
| Total non-performing assets                                                     |   | $              | 20,635 |   |         | $      | 19,631 |   |
|                                                                            |   |           |   |   |         |   |   |   |
|                                                                            |   |           |   |   |         |   |   |   |
|                                                                            |   | March 31,      |   |   |         |   |   |
|                                                                            |   | 2010           |   |   |         |   |   |
|                                                                            |   | (in thousands) |   |   |         |   |   |
|                                                                            |   |           |   |   |         |   |   |   |
| Non-accrual loans                                                               |   | $              | 17,863 |   |         |   |   |   |
| Loans past due 90 days or more                                                  |   |           | 4,071  |   |         |   |   |   |
| Total non-performing loans                                                      |   |           | 21,934 |   |         |   |   |   |
| Other real estate owned                                                         |   |           | 648    |   |         |   |   |   |
| Total non-performing assets                                                     |   | $              | 22,582 |   |         |   |   |   |

----

|                          |   | Recordedinvestment |   |   | Unpaidprincipalbalance |   |   | Relatedallowance |   |
|-------------------------------|--------|--------------------|--------|--------|------------------------|--------|--------|------------------|--------|
| March 31, 2011                |   |               |   |   |                   |   |   |             |   |
| Without an allowance recorded |   |               |   |   |                   |   |   |             |   |
| Construction                  |   | $                  | 251    |   |                   | $      | 1,560  |             |   | $ | - |   |
| Commercial mortgage           |   |               | 774    |   |                   |   | 774    |             |   |   | - |   |
| Commercial                    |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| Consumer                      |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| Residential                   |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| With an allowance recorded    |   |               |   |   |                   |   |   |             |   |   |   |   |
| Construction                  |   |               | 1,444  |   |                   |   | 1,444  |             |   |   | 611 |   |
| Commercial mortgage           |   |               | 2,011  |   |                   |   | 2,011  |             |   |   | 419 |   |
| Commercial                    |   |               | 2,544  |   |                   |   | 2,544  |             |   |   | 1,347 |   |
| Consumer - home equity        |   |               | 633    |   |                   |   | 633    |             |   |   | 428 |   |
| Residential                   |   |               | 6,571  |   |                   |   | 6,544  |             |   |   | 1,340 |   |
| Total                         |   |               |   |   |                   |   |   |             |   |   |   |   |
| Construction                  |   | $                  | 1,695  |   |                   | $      | 3,004  |             |   | $ | 611 |   |
| Commercial                    |   | $                  | 5,329  |   |                   | $      | 5,329  |             |   | $ | 1,766 |   |
| Consumer                      |   | $                  | 633    |   |                   | $      | 633    |             |   | $ | 428 |   |
| Residential                   |   | $                  | 6,571  |   |                   | $      | 6,544  |             |   | $ | 1,340 |   |
|                          |   |               |   |   |                   |   |   |             |   |   |   |   |
| December 31, 2010             |   |               |   |   |                   |   |   |             |   |   |   |   |
| Without an allowance recorded |   |               |   |   |                   |   |   |             |   |   |   |   |
| Commercial mortgage           |   | $                  | -      |   |                   | $      | -      |             |   | $ | - |   |
| Commercial                    |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| Consumer                      |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| Residential                   |   |               | -      |   |                   |   | -      |             |   |   | - |   |
| With an allowance recorded    |   |               |   |   |                   |   |   |             |   |   |   |   |
| Construction                  |   |               | 4,881  |   |                   |   | 4,881  |             |   |   | 2,644 |   |
| Commercial mortgage           |   |               | 1,650  |   |                   |   | 1,650  |             |   |   | 284 |   |
| Commercial                    |   |               | 2,280  |   |                   |   | 2,280  |             |   |   | 1,316 |   |
| Consumer - home equity        |   |               | 960    |   |                   |   | 960    |             |   |   | 117 |   |
| Residential                   |   |               | 5,526  |   |                   |   | 5,622  |             |   |   | 970 |   |
| Total                         |   |               |   |   |                   |   |   |             |   |   |   |   |
| Construction                  |   | $                  | 4,881  |   |                   | $      | 4,881  |             |   | $ | 2,644 |   |
| Commercial                    |   | $                  | 3,930  |   |                   | $      | 3,930  |             |   | $ | 1,600 |   |
| Consumer                      |   | $                  | 960    |   |                   | $      | 960    |             |   | $ | 117 |   |
| Residential                   |   | $                  | 5,526  |   |                   | $      | 5,622  |             |   | $ | 970 |   |

----

|                          |   | Averagerecordedinvestment |   |   | Interestincomerecognized |   |
|-------------------------------|--------|---------------------------|--------|--------|--------------------------|--------|
| March 31, 2011                |   |                      |   |   |                     |   |
| Without an allowance recorded |   |                      |   |   |
| Construction                  |   | $                         | 905    |   |                     | $      | - |   |
| Commercial mortgage           |   |                      | 774    |   |                     |   |   |   |
| Commercial                    |   |                      | -      |   |                     |   | - |   |
| Consumer                      |   |                      | -      |   |                     |   | - |   |
| Residential                   |   |                      | -      |   |                     |   | - |   |
| With an allowance recorded    |   |                      |   |   |                     |
| Construction                  |   |                      | 2,382  |   |                     |   | - |   |
| Commercial mortgage           |   |                      | 1,831  |   |                     |   | - |   |
| Commercial                    |   |                      | 2,412  |   |                     |   | - |   |
| Consumer - home equity        |   |                      | 797    |   |                     |   | - |   |
| Residential                   |   |                      | 6,048  |   |                     |   | - |   |
| Total                         |   |                      |   |   |                     |   |   |   |
| Construction                  |   | $                         | 3,287  |   |                     | $      | - |   |
| Commercial                    |   | $                         | 5,017  |   |                     | $      | - |   |
| Consumer                      |   | $                         | 797    |   |                     | $      | - |   |
| Residential                   |   | $                         | 6,048  |   |                     | $      | - |   |

| Age Analysis of Past Due Loans |   |
|--------------------------------|--------|
|                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                           |   | 30-59 Days |   |   | 60-89 Days |   |   | Greater Than |   |   |   |   |   | Total |   |   |   |   |   | Total |   |
| March 31, 2011                 |   | Past Due |   |   | Past Due |   |   | 90 Days |   |   | Nonaccrual |   |   | Past Due |   |   | Current |   |   | Loans |   |
| Commercial                     |   | $ | 594 |   |   | $ | 7,076 |   |   | $ | 1,612 |   |   | $ | 2,544 |   |   | $ | 11,826 |   |   | $ | 418,255 |   |   | $ | 430,081 |   |
| Commercial mortgage            |   |   | 2,356 |   |   |   | - |   |   |   | 824 |   |   |   | 2,785 |   |   |   | 5,965 |   |   |   | 595,081 |   |   |   | 601,046 |   |
| Construction                   |   |   | - |   |   |   | 1,961 |   |   |   | 391 |   |   |   | 1,695 |   |   |   | 4,047 |   |   |   | 198,058 |   |   |   | 202,105 |   |
| Direct financing leases, net   |   |   | 2,087 |   |   |   | 188 |   |   |   | 193 |   |   |   | - |   |   |   | 2,468 |   |   |   | 105,156 |   |   |   | 107,624 |   |
| Consumer - other               |   |   | 35 |   |   |   | 2 |   |   |   | 8 |   |   |   | - |   |   |   | 45 |   |   |   | 153,554 |   |   |   | 153,599 |   |
| Consumer - home equity         |   |   | 330 |   |   |   | - |   |   |   | - |   |   |   | 633 |   |   |   | 963 |   |   |   | 43,314 |   |   |   | 44,277 |   |
| Residential mortgage           |   |   | - |   |   |   | 3,360 |   |   |   | - |   |   |   | 6,571 |   |   |   | 9,931 |   |   |   | 84,751 |   |   |   | 94,682 |   |
| Unamortized costs              |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 2,839 |   |   |   | 2,839 |   |
|                           |   | $ | 5,402 |   |   | $ | 12,587 |   |   | $ | 3,028 |   |   | $ | 14,228 |   |   | $ | 35,245 |   |   | $ | 1,601,008 |   |   | $ | 1,636,253 |   |
|                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31, 2010              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commercial                     |   | $ | - |   |   | $ | 100 |   |   | $ | 285 |   |   | $ | 2,280 |   |   | $ | 2,665 |   |   | $ | 439,134 |   |   | $ | 441,799 |   |
| Commercial mortgage            |   |   | 774 |   |   |   | - |   |   |   | 824 |   |   |   | 1,650 |   |   |   | 3,248 |   |   |   | 577,532 |   |   |   | 580,780 |   |
| Construction                   |   |   | - |   |   |   | 391 |   |   |   | - |   |   |   | 4,881 |   |   |   | 5,272 |   |   |   | 197,848 |   |   |   | 203,120 |   |
| Direct financing leases, net   |   |   | 816 |   |   |   | 192 |   |   |   | 49 |   |   |   | - |   |   |   | 1,057 |   |   |   | 102,232 |   |   |   | 103,289 |   |
| Consumer - other               |   |   | - |   |   |   | 2 |   |   |   | 12 |   |   |   | - |   |   |   | 14 |   |   |   | 148,715 |   |   |   | 148,729 |   |
| Consumer - home equity         |   |   | 330 |   |   |   | - |   |   |   | - |   |   |   | 960 |   |   |   | 1,290 |   |   |   | 44,301 |   |   |   | 45,591 |   |
| Residential mortgage           |   |   | - |   |   |   | - |   |   |   | 1,050 |   |   |   | 5,526 |   |   |   | 6,576 |   |   |   | 86,428 |   |   |   | 93,004 |   |
| Unamortized costs              |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 2,883 |   |   |   | 2,883 |   |
|                           |   | $ | 1,920 |   |   | $ | 685 |   |   | $ | 2,220 |   |   | $ | 15,297 |   |   | $ | 20,122 |   |   | $ | 1,599,073 |   |   | $ | 1,619,195 |   |

----

|            |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |
|-----------------|--------|------------|---------|--------|--------------|--------|---------|-------------------|--------|------------------|------------|--------|--------|------------|---------|--------|-------------|--------|
|            |   |       |    |   |         |   |    |              |   |             |       |   |   | Commercial |    |   | Residential |   |
|            |   | Commercial |    |   | Construction |   |    | mortgage          |   |             | mortgage   |   |
|            |   | 3/31/2011  |    |   | 12/31/2010   |   |    | 3/31/2011         |   |             | 12/31/2010 |   |   | 3/31/2011  |    |   | 12/31/2010  |   |   | 3/31/2011 |   |   | 12/31/2010 |   |
| Risk Rating     |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |   |   |   |   |   |   |
| Pass            |   | $          | 296,482 |   |         | $      | 291,140 |              |   | $                | 170,813    |   |   | $          | 165,089 |   |        | $      | 473,958 |   |   | $ | 461,378 |   |   | $ | 28,217 |   |   | $ | 30,066 |   |
| Special Mention |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Substandard     |   |       | 15,251  |   |         |   | 6,091   |              |   |             | 6,090      |   |   |       | 5,271   |   |        |   | 3,608 |   |   |   | 3,608 |   |   |   | 9,931 |   |   |   | 6,576 |   |
| Doubtful        |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Loss            |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Unrated         |   |       | 118,348 |   |         |   | 144,568 |              |   |             | 25,202     |   |   |       | 32,760  |   |        |   | 123,480 |   |   |   | 115,794 |   |   |   | 56,534 |   |   |   | 56,362 |   |
| Total           |   | $          | 430,081 |   |         | $      | 441,799 |              |   | $                | 202,105    |   |   | $          | 203,120 |   |        | $      | 601,046 |   |   | $ | 580,780 |   |   | $ | 94,682 |   |   | $ | 93,004 |   |
|            |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|            |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|            |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |   |   |   |   |   |   |   |   |   |
|            |   |       |    |   |         |   |    |              |   | Direct financing |       |   |   |       |    |   |        |   |   |   |   |   |   |   |   |   |   |
|            |   | Consumer   |    |   | leases, net  |   |    | Unamortized costs |   |             | Total      |   |
|            |   | 3/31/2011  |    |   | 12/31/2010   |   |    | 3/31/2011         |   |             | 12/31/2010 |   |   | 3/31/2011  |    |   | 12/31/2010  |   |   | 3/31/2011 |   |   | 12/31/2010 |   |
| Risk Rating     |   |       |    |   |         |   |    |              |   |             |       |   |   |       |    |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Pass            |   | $          | 60,457  |   |         | $      | 59,064  |              |   | $                | -          |   |   | $          | -       |   |        | $      | - |   |   | $ | - |   |   | $ | 1,029,927 |   |   | $ | 1,006,737 |   |
| Special Mention |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Substandard     |   |       | 644     |   |         |   | 1,224   |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | 35,524 |   |   |   | 22,770 |   |
| Doubtful        |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Loss            |   |       | -       |   |         |   | -       |              |   |             | -          |   |   |       | -       |   |        |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Unrated         |   |       | 136,775 |   |         |   | 134,032 |              |   |             | 107,624    |   |   |       | 103,289 |   |        |   | 2,839 |   |   |   | 2,883 |   |   |   | 570,802 |   |   |   | 589,688 |   |
| Total           |   | $          | 197,876 |   |         | $      | 194,320 |              |   | $                | 107,624    |   |   | $          | 103,289 |   |        | $      | 2,839 |   |   | $ | 2,883 |   |   | $ | 1,636,253 |   |   | $ | 1,619,195 |   |

----

|                            |   | For the three months ended |      |   | For the year ended |   |
|---------------------------------|--------|----------------------------|-----------|--------|--------------------|--------|
|                            |   | March 31, 2011             |      |   | December 31, 2010  |   |
|                            |   | Average                    |      |   | Average            |   |   | Average |   |   | Average |   |
|                            |   | balance                    |      |   | Rate               |   |   | balance |   |   | Rate |   |
|                            |   | (unaudited)                |      |   |               |   |
| Demand (non-interest bearing) * |   | $                          | 1,647,682 |   |               |   | 0.10 | % |   | $ | 1,011,667 |   |   |   | 0.13 | % |
| Interest checking               |   |                       | 714,846   |   |               |   | 0.72 | % |   |   | 622,116 |   |   |   | 1.27 | % |
| Savings and money market        |   |                       | 321,472   |   |               |   | 0.99 | % |   |   | 311,251 |   |   |   | 1.26 | % |
| Time                            |   |                       | 46,507    |   |               |   | 0.89 | % |   |   | 69,169 |   |   |   | 0.66 | % |
| Total deposits                  |   | $                          | 2,730,507 |   |               |   | 0.38 | % |   | $ | 2,014,203 |   |   |   | 0.67 | % |

| * Non-interest bearing demand accounts are not paid interest.  The amount shown as interest reflects the fees paid to affinity groups, which are based upon a rate index, and therefore classified as interest expense. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                              |

----

Item 3.

----

Item 6

| Signatures  |   |                                  |
|-------------|--------|---------------------------------------|
|        |   |                                  |   |
|        |   | THE BANCORP INC.                      |   |
|        |   | (Registrant)                          |   |
|        |   |                                  |   |
|        |   |                                  |   |
| May 9, 2011 |   | /s/ Betsy Z. Cohen                    |   |
| Date        |   | Betsy Z. Cohen                        |   |
|        |   | Chief Executive Officer               |   |
|        |   |                                  |   |
| May 9, 2011 |   | /s/Paul  Frenkiel           |   |
| Date        |   | Executive Vice President of Strategy, |   |
|        |   | Chief Financial Officer and Secretary |   |

| Exhibit No. |  Description                       |
|------------------|-----------------------------------------|
|             |                                    |
| 3.1              | Certificate of Incorporation (1)        |
|             |                                    |
| 3.2              | Bylaws (1)                              |
|             |                                    |
| 31.1             | Rule 13a-14(a)/15d-14(a) Certifications |
|             |                                    |
| 31.2             | Rule 13a-14(a)/15d-14(a) Certifications |
|             |                                    |
| 32.1             | Section 1350 Certifications             |
|             |                                    |
| 32.2             | Section 1350 Certifications             |

| (1) | Filed previously as an exhibit to our Registration Statement on Form S-4, as amended, registration number 333-117385, and by this reference incorporated herein. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----