UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
DC 20549





FORM
10-K





ANNUAL
REPORT


PURSUANT
TO SECTIONS 13 OR 15(d)


OF
THE SECURITIES EXCHANGE ACT OF 1934


(Mark
One)


[X]
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934


For the
fiscal year ended: December 31, 2009 or


[  ]
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934


For the
transition period from ____________ to ____________





Commission
File No. 000-51338





PARKE
      BANCORP, INC.(Exact
      name of Registrant as specified in its
Charter)





New
      Jersey
            
            65-1241959(State
      or other Jurisdiction of
              Incorporation
      or Organization)
            
            (I.R.S.
      Employer Identification No.)





601
      Delsea Drive, Washington Township, New Jersey
            
            
            08080(Address
      of Principal Executive Offices)
            
            
            (Zip
      Code)





Registrant’s
telephone number, including area code: 856-256-2500




Securities
registered pursuant to Section 12(b) of the Act:







Title
      of Each Class
            
            Name
      of Each Exchange on Which RegisteredCommon
      Stock, $0.10 par value
            
            The
      Nasdaq Stock Market LLC




Securities
registered pursuant to Section 12(g) of the Act:  None




Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.


YES
[  ] NO [X]




Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act.


YES
[  ] NO [X]




Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.YES [X] NO [  ]






Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Website, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§229.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such
files).     [  ] YES [   ]
NO




Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.[X]




Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller company.  See
the definitions of “large accelerated filer”, “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):





Large
      accelerated filer [  ]
            Accelerated
      filer [  ]
            Non-accelerated
      filer [   ]
            Smaller
      reporting company [ X ]





Indicate
by check mark whether the registrant is a shell company (as defined by Rule
12b-2 of the Exchange Act). YES [  ] NO [X]




The
aggregate market value of the voting stock held by non-affiliates of the
Registrant, based on the closing price of the Registrant’s common stock as
quoted on the Nasdaq Capital Market on June 30, 2009, was approximately $36.9
million.




As of March 25, 2010 there were issued
and outstanding 4,034,639 shares of the Registrant’s common stock.




DOCUMENTS
INCORPORATED BY REFERENCE




1.
            Portions
      of the Annual Report to Shareholders for the Fiscal Year Ended December
      31, 2009. (Parts II and IV)


2.
            Portions
      of the Proxy Statement for the 2010 Annual Meeting of Shareholders. (Parts
      II and III)





PARKE
BANCORP, INC.





FORM
10-K





FOR
THE FISCAL YEAR ENDED DECEMBER 31, 2009





INDEX





PART 1
            
            
            
            PageItem
      1.
            
            Business
            
            1Item
      1A.
            
            Risk
      Factors
            
            23Item
      1B.
            
            Unresolved
      Staff Comments
            
            23Item
      2.
            
            Properties
            
            23Item
      3.
            
            Legal
      Proceedings
            
            23Item
      4.
            
            Reserved
            
            23PART IIItem
      5.
            
            Market
      for Common Equity, Related stockholder Matters and Issuer Purchases of
      Equity Securities
            
            24Item
      6.
            
            Selected
      Financial Data
            
            24Item
      7.
            
            Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
            
            24Item
      7A.
            
            Quantitative
      and Qualitative Disclosures About Market Risk
            
            24Item
      8.
            
            Financial
      Statements and Supplementary Data
            
            24Item
      9.
            
            Changes
      and Disagreements with Accountants on Accounting and
              Financial
      Disclosure
            
            24Item
      9A(T).
            
            Controls
      and Procedures
            
            25Item
      9B.
            
            Other
      Information
            
            25PART IIIItem
      10.
            
            Directors,
      Executive Officers and Corporate Governance
            
            25Item
      11.
            
            Executive
      Compensation
            
            26Item
      12.
            
            Security
      Ownership of Certain Beneficial Owners and Management and
              Related
      Stockholder Matters
            
            26Item
      13.
            
            Certain
      Relationships and Related Transactions, and Director
      Independence
            
            26Item
      14.
            
            Principal
      Accountant Fees and Services
            
            27PART IVItem
      15.
            
            Exhibits
      and Financial Statement Schedules
            
            27Signatures















i







PART
I


Forward-Looking
Statements




Parke
Bancorp, Inc. (the “Company”) may from time to time make written or oral
“forward-looking statements,” including statements contained in the Company’s
filings with the Securities and Exchange Commission (including this Annual
Report on Form 10-K and the exhibits hereto), in its reports to shareholders and
in other communications by the Company, which are made in good faith by the
Company pursuant to the “safe harbor” provisions of the Private Securities
Litigation Reform Act of 1995.




These
forward-looking statements involve risks and uncertainties, such as statements
of the Company’s plans, objectives, expectations, estimates and intentions that
are subject to change based on various important factors (some of which are
beyond the Company’s control). The following factors, among others, could cause
the Company’s financial performance to differ materially from the plans,
objectives, expectations, estimates and intentions expressed in such
forward-looking statements: the strength of the United States economy in general
and the strength of the local economies in which the Company’s wholly-owned
subsidiary, Parke Bank (the “Bank”), conducts operations; the effects of, and
changes in, trade, monetary and fiscal policies and laws, including interest
rate policies of the Board of Governors of the Federal Reserve System,
inflation, interest rates, market and monetary fluctuations; the timely
development of and acceptance of new products and services of the Bank and the
perceived overall value of these products and services by users, including the
features, pricing and quality compared to competitors’ products and services;
the impact of changes in financial services’ laws and regulations (including
laws concerning taxes, banking, securities and insurance); technological
changes; changes in consumer spending and saving habits; and the success of the
Company at managing the risks resulting from these factors.




The
Company cautions that the listed factors are not exclusive. The Company does not
undertake to update any forward-looking statement, whether written or oral, that
may be made from time to time by or on behalf of the Company.





Item
      1.
            Business




General




The
Company is a bank holding company incorporated under the laws of the State of
New Jersey in January 2005 for the sole purpose of becoming the holding company
of the Bank. The Company commenced operations on June 1, 2005, upon completion
of the reorganization of the Bank into the holding company form of organization
following approval of the reorganization by shareholders of the Bank at its 2005
Annual Meeting of Shareholders.  The Company’s business and operations
primarily consist of its ownership of the Bank.




The Bank
is a commercial bank, which commenced operations on January 28, 1999. The Bank
is chartered by the New Jersey Department of Banking and insured by the Federal
Deposit Insurance Corporation (“FDIC”). The Company and the Bank maintain their
principal offices at 601 Delsea Drive, Washington Township, New
Jersey.  The Bank also conducts business through offices in Northfield
and Washington Township, New Jersey, and in Philadelphia, Pennsylvania. The Bank
is a full service bank, with an emphasis on providing personal and business
financial services to individuals and small to mid-sized businesses in
Gloucester, Atlantic and Cape May Counties in New Jersey and the Philadelphia
area in Pennsylvania.  At December 31, 2009, the Company had assets of
$654.2 million, net loans of $591.0 million, deposits of $520.3 million and
shareholders’ equity of $62.0 million.




1


The Bank
focuses its commercial loan originations on small and mid-sized businesses
(generally up to $25 million in annual sales).  Commercial loan
products include residential and commercial real estate construction loans;
working capital loans and lines of credit; demand, term and time loans; and
equipment, inventory and accounts receivable financing.  Residential
construction loans in tract development are also included in the commercial loan
category. The Bank also offers a range of deposit products to its commercial
customers.  Commercial customers also have the ability to use
overnight depository, ACH, wire transfer services and merchant capture
electronic check processing services.




The
Bank’s retail banking activities emphasize consumer deposit and checking
accounts. An extensive range of these services is offered by the Bank to meet
the varied needs of its customers in all age groups. In addition to traditional
products and services, the Bank offers contemporary products and services, such
as debit cards, Internet banking and online bill payment. Retail lending
activities by the Bank include residential mortgage loans, home equity lines of
credit, fixed rate second mortgages, new and used auto loans and overdraft
protection.




Market
Area




Substantially
all of the Bank’s business is with customers in its market areas of Southern New
Jersey and the Philadelphia area of Pennsylvania. Most of the Bank’s customers
are individuals and small and medium-sized businesses which are dependent upon
the regional economy. Adverse changes in economic and business conditions in the
Bank’s markets could adversely affect the Bank’s borrowers, their ability to
repay their loans and to borrow additional funds, and consequently the Bank’s
financial condition and performance.




Additionally,
most of the Bank’s loans are secured by real estate located in Southern New
Jersey and the Philadelphia area. A decline in local economic conditions could
adversely affect the values of such real estate. Consequently, a decline in
local economic conditions may have a greater effect on the Bank’s earnings and
capital than on the earnings and capital of larger financial institutions whose
real estate loan portfolios are more geographically diverse.




Competition




The Bank faces significant competition,
both in making loans and attracting deposits. The Bank’s competition in both
areas comes principally from other commercial banks, thrift and savings
institutions, including savings and loan associations and credit unions, and
other types of financial institutions, including brokerage firms and credit card
companies. The Bank faces additional competition for deposits from short-term
money market mutual funds and other corporate and government securities
funds.




Most of
the Bank’s competitors, whether traditional or nontraditional financial
institutions, have a longer history and significantly greater financial and
marketing resources than does the Bank. Among the advantages certain of these
institutions have over the Bank are their ability to finance wide-ranging and
effective advertising campaigns, to access international money markets and to
allocate their investment resources to regions of highest yield and demand.
Major banks operating in the primary market area offer certain services, such as
international banking and trust services, which are not offered directly by the
Bank.




In
commercial transactions, the Bank’s legal lending limit to a single borrower
enables the Bank to compete effectively for the business of individuals and
smaller enterprises. However, the Bank’s legal lending limit is considerably
lower than that of various competing institutions, which have substantially
greater capitalization. The Bank has a relatively smaller capital base than most
other competing institutions which, although above regulatory minimums, may
constrain the Bank’s effectiveness in competing for loans.


2


Lending
Activities




Composition of Loan Portfolio.Set forth below is selected data relating to the composition of the
Bank’s loan portfolio by type of loan at the dates indicated. (1)Except as set forth below, the Bank had no concentrations of loans
exceeding 10% of its loans. Refer to pages 5 through 8 for descriptions of the
loan categories presented.





At
      December 31,2009
            
            2008
            
            2007
            
            2006
            
            2005Amount
            
            Percentage
            
            Amount
            
            Percentage
            
            Amount
            
            Percentage
            
            Amount
            
            Percentage
            
            Amount
            
            Percentage(Amounts
      in thousands, except percentages)Commercial
            $
            20,174
            
            3.3
            %
            $
            19,935
            
            3.6
            %
            $
            14,899
            
            3.7
            %
            $
            13,436
            
            4.3
            %
            $
            11,053
            
            4.3
            %Real
      estate constructionResidential
            
            89,006
            
            14.7
            
            
            87,327
            
            15.9
            
            
            2,091
            
            0.5
            
            
            2,465
            
            0.8
            
            
            1,174
            
            0.5Commercial
            
            27,327
            
            4.5
            
            
            31,582
            
            5.8
            
            
            106,320
            
            26.0
            
            
            69,254
            
            22.3
            
            
            70,157
            
            27.1Real
      estate mortgageResidential
            
            143,385
            
            23.8
            
            
            90,226
            
            16.5
            
            
            24,488
            
            6.0
            
            
            19,727
            
            6.4
            
            
            17,309
            
            6.7Commercial
            
            310,484
            
            51.5
            
            
            308,457
            
            56.3
            
            
            242,668
            
            59.4
            
            
            198,668
            
            64.0
            
            
            154,288
            
            59.6Consumer
            
            13,025
            
            2.2
            
            
            10,133
            
            1.9
            
            
            17,923
            
            4.4
            
            
            7,005
            
            2.2
            
            
            5,054
            
            1.8Total
      Loans
            $
            603,401
            
            100.00
            %
            $
            547,660
            
            100.00
            %
            $
            408,389
            
            100.0
            %
            $
            310,555
            
            100.0
            %
            $
            259,035
            
            100.0
            %





(1)           Amounts
presented include adjustments for related unamortized deferred costs and
fees.





3


Loan Maturity.The following
table sets forth the contractual maturity of certain loan categories at December
31, 2009.





Due
      within
              one
      year
            
            Due
      after one
              through
      five
              years
            
            Due
      after
              five
      years
            
            Total(Amounts
      in thousands)Commercial
            
            $
            9,136
            
            $
            4,642
            
            $
            6,396
            
            $
            20,174Real
      estate constructionResidential
            
            
            62,513
            
            
            15,080
            
            
            11,413
            
            
            89,006Commercial
            
            
            15,276
            
            
            6,447
            
            
            5,604
            
            
            27,327Real
      estate mortgageResidential
            
            
            36,622
            
            
            8,446
            
            
            98,317
            
            
            143,385Commercial
            
            
            72,740
            
            
            47,644
            
            
            190,100
            
            
            310,484Consumer
            
            
            1,546
            
            
            145
            
            
            11,334
            
            
            13,025Total
      Loans
            
            $
            197,833
            
            $
            82,404
            
            $
            323,164
            
            $
            603,401







The
following table sets forth the dollar amount of loans in certain loan categories
due one year or more after December 31, 2009, which have predetermined interest
rates and which have floating or adjustable interest rates.





Fixed
      Rates
            
            
            Floating
      or
              Adjustable
              Rates
            
            Total(Amounts
      in  thousands)Commercial
            
            $
            3,013
            
            
            $
            8,025
            
            $
            11,038Real
      estate constructionResidential
            
            
            11,586
            
            
            
            14,907
            
            
            26,493Commercial
            
            
            2,490
            
            
            
            9,561
            
            
            12,051Real
      estate mortgageResidential
            
            
            46,391
            
            
            
            60,372
            
            
            106,763Commercial
            
            
            23,764
            
            
            
            213,980
            
            
            237,744Consumer
            
            
            11,107
            
            
            
            372
            
            
            11,479Total
      Loans
            
            $
            98,351
            
            
            $
            307,217
            
            $
            405,568








Commercial Loans.The Bank originates secured loans for business purposes. Loans are made
to provide working capital to businesses in the form of lines of credit, which
may be secured by real estate, accounts receivable, inventory, equipment or
other assets. The financial condition and cash flow of commercial borrowers are
closely monitored by means of corporate financial statements, personal financial
statements and income tax returns.  The frequency of submissions of
required financial information depends on the size and complexity of the credit
and the collateral that secures the loan. The Bank’s general policy is to obtain
personal guarantees from the principals of the commercial loan borrowers. Such
loans are made to businesses located in the Bank’s market area.




Commercial
business loans generally involve a greater degree of risk than residential
mortgage loans and carry larger loan balances. This increased credit risk is a
result of several factors, including the concentration of principal in a limited
number of loans and borrowers, the mobility of collateral, the


4




effects
of general economic conditions and the increased difficulty of evaluating and
monitoring these types of loans. Unlike residential mortgage loans, which
generally are made on the basis of the borrower’s ability to make repayment from
his or her employment and other income and which are secured by real property
whose value tends to be more easily ascertainable, commercial business loans
typically are made on the basis of the borrower’s ability to make repayment from
the cash flow of the borrower’s business. As a result, the availability of funds
for the repayment of commercial business loans may be substantially dependent on
the success of the business itself and the general economic environment. If the
cash flow from business operations is reduced, the borrower’s ability to repay
the loan may be impaired.





Real Estate
Development and Construction Loans.The Bank has emphasized the
origination of construction loans to individuals and real estate developers in
its market area. The advantages of construction lending are that the market is
typically less competitive than more standard mortgage products, the interest
rate typically charged is a variable rate, which permits the Bank to protect
against sudden changes in its costs of funds, and the fees or “points” charged
by the Bank to its customers can be amortized over the shorter term of a
construction loan, typically, one to two years, which permits the Bank to
recognize income received over a shorter period of time. The Bank from time to
time structures construction loans in excess of the legal lending limit of the
Bank, with respect to which the Bank sells participation interests in the
construction loans to other lenders, while maintaining and servicing the
construction loan.




The Bank
provides interim real estate acquisition development and construction loans to
builders and developers. Real estate development and construction loans to
provide interim financing on the property are based on acceptable percentages of
the appraised value of the property securing the loan in each case. Real estate
development and construction loan funds are disbursed periodically at
pre-specified stages of completion. Interest rates on these loans are generally
adjustable. The Bank carefully monitors these loans with on-site inspections and
control of disbursements. These loans are generally made on properties located
in the Bank’s market area.




Development
and construction loans are secured by the properties under development and
personal guarantees are typically obtained. Further, to assure that reliance is
not placed solely in the value of the underlying property, the Bank considers
the financial condition and reputation of the borrower and any guarantors, the
amount of the borrower’s equity in the project, independent appraisals, costs
estimates and pre-construction sale information.




Loans to
residential builders are for the construction of residential homes for which a
binding sales contract exists and the prospective buyers have been pre-qualified
for permanent mortgage financing. Loans to residential developers are made only
to developers with a proven sales record. Generally, these loans are extended
only when the borrower provides evidence that the lots under development will be
sold to potential buyers satisfactory to the Bank.




The Bank
also originates loans to individuals for construction of single family
dwellings. These loans are for the construction of the individual’s primary
residence. They are typically secured by the property under construction,
occasionally include additional collateral (such as second mortgage on the
borrower’s present home), and commonly have maturities of six to twelve
months.




Construction
financing is labor intensive for the Bank, requiring employees of the Bank to
expend substantial time and resources in monitoring and servicing each
construction loan to completion. Construction financing is generally considered
to involve a higher degree of risk of loss than long-term


5




financing
on improved, occupied real estate. Risk of loss on a construction loan is
dependent largely upon the accuracy of the initial estimate of the property’s
value at completion of construction and development, the accuracy of
projections, such as the sales of homes or the future leasing of commercial
space, and the accuracy of the estimated cost (including interest) of
construction. Substantial deviations can occur in such projections. During the
construction phase, a number of factors could result in delays and cost
overruns. If the estimate of construction costs proves to be inaccurate, the
Bank may be required to advance funds beyond the amount originally committed to
permit completion of the development. If the estimate of value proves to be
inaccurate, the Bank may be confronted, at or prior to the maturity of the loan,
with a project having a value which is insufficient to assure full repayment.
Also, a construction loan that is in default can cause problems for the Bank
such as designating replacement builders for a project, considering alternate
uses for the project and site and handling any structural and environmental
issues that might arise.





Commercial Real
Estate Mortgage Loans.The Bank originates mortgage loans secured by
commercial real estate. Such loans are primarily secured by office buildings,
retail buildings, warehouses and general purpose business space. Although terms
may vary, the Bank’s commercial mortgages generally have maturities of twenty
years, but re-price within five years.




Loans
secured by commercial real estate are generally larger and involve a greater
degree of risk than one- to four-family residential mortgage loans. Of primary
concern in commercial and multi-family real estate lending is the borrower’s
creditworthiness and the feasibility and cash flow potential of the project.
Payments on loans secured by income properties are often dependent on successful
operation or management of the properties. As a result, repayment of such loans
may be subject to a greater extent than residential real estate loans to adverse
conditions in the real estate market or the economy.




The Bank
seeks to reduce the risks associated with commercial mortgage lending by
generally lending in its primary market area and obtaining periodic financial
statements and tax returns from borrowers. It is also the Bank’s general policy
to obtain personal guarantees from the principals of the borrowers and
assignments of all leases related to the collateral.





Residential Real
Estate Mortgage Loans.The Bank originates adjustable and fixed-rate
residential mortgage loans. Such mortgage loans are generally originated under
terms, conditions and documentation acceptable to the secondary mortgage market.
Although the Bank has placed all of these loans into its portfolio, a
substantial majority of such loans can be sold in the secondary market or
pledged for potential borrowings.





Consumer Loans.The Bank offers a variety of consumer loans. These loans are typically
secured by residential real estate or personal property, including automobiles.
Home equity loans (closed-end and lines of credit) are typically made up to 80%
of the appraised or assessed value of the property securing the loan in each
case, less the amount of any existing prior liens on the property, and generally
have maximum terms of ten years, although the Bank does offer a 90% loan to
value product if certain conditions related to the borrower and property are
satisfied. The interest rates on second mortgages are generally fixed, while
interest rates on home equity lines of credit are variable.





Loans to One
Borrower.Federal regulations limit loans to one borrower in an amount
equal to 15% of unimpaired capital and unimpaired surplus. At December 31, 2009,
the Bank’s loan to one borrower limit was approximately $12.8 million and the
Bank had no borrowers with loan balances in excess of $10.0 million. At December
31, 2009, the Bank’s largest loan to one borrower was a loan
for


6


commercial
real estate, with a balance of $10.0 million and was secured by real
estate.  At December 31, 2009, this loan was current and performing in
accordance with the terms of the loan agreement.




The size
of loans which the Bank can offer to potential borrowers is less than the size
of loans which many of the Bank’s competitors with larger capitalization are
able to offer. The Bank may engage in loan participations with other banks for
loans in excess of the Bank’s legal lending limits. However, no assurance can be
given that such participations will be available at all or on terms which are
favorable to the Bank and its customers.




Non-Performing
and Problem Assets




Non-Performing
Assets.Non-accrual loans are those on which the accrual of interest has
ceased. Loans are generally placed on non-accrual status if, in the opinion of
management, collection is doubtful, or when principal or interest is past due 90
days or more unless the collateral is considered sufficient to cover principal
and interest and the loan is in the process of collection. Interest accrued, but
not collected at the date a loan is placed on non-accrual status, is reversed
and charged against interest income. Subsequent cash receipts are applied either
to the outstanding principal or recorded as interest income, depending on
management’s assessment of ultimate collectibility of principal and interest.
Loans are returned to an accrual status when the borrower’s ability to make
periodic principal and interest payments has returned to normal (i.e., brought
current with respect to principal or interest or restructured) and the paying
capacity of the borrower and/or the underlying collateral is deemed sufficient
to cover principal and interest.




A loan is
considered impaired when, based on current information and events, it is
probable that the Company will be unable to collect the scheduled payments of
principal or interest when due according to the contractual terms of the loan
agreement. Impaired loans are measured based on the present value of expected
future discounted cash flows, the market price of the loan or the fair value of
the underlying collateral if the loan is collateral dependent. The recognition
of interest income on impaired loans is the same as for non-accrual loans
discussed above. Total impaired loans, which includes non-accrual loans, were
$50.8 million, $10.2 million, $2.0 million, $2.4 million and $500,000 at
December 31 2009, 2008, 2007, 2006, and 2005, respectively.




The
Company maintains interest reserves for the purpose of making periodic and
timely interest payments for borrowers that qualify.  Total loans with
interest reserves were $74.8 million, $120.8 million and $110.5 million at
December 31, 2009, December 31, 2008 and December 31, 2007, respectively.
Management on a monthly basis reviews loans with interest reserves to assess
current and projected performance.




The
following table sets forth information regarding non-accrual loans at the dates
indicated. As of the dates indicated, the Bank did not have any troubled
restructurings as defined within accounting guidance and regulatory
literature.


7





At
      December 31,2009
            
            2008
            
            2007
            
            2006
            
            
            2005(Amounts
      in thousands, except percentages)Loans
      accounted for on a non-accrual basis:Commercial
            $
            350
            
            $
            41
            
            $
            52
            
            $
            91
            
            $
            50Real
      Estate ConstructionResidential
            
            18,895
            
            
            5,905
            
            
            —
            
            
            —
            
            
            —Commercial
            
            198
            
            
            —
            
            
            325
            
            
            —
            
            
            —Real
      Estate MortgageResidential
            
            2,511
            
            
            897
            
            
            7
            
            
            —
            
            
            20Commercial
            
            3,381
            
            
            1,380
            
            
            367
            
            
            687
            
            
            1,865Consumer
            
            117
            
            
            —
            
            
            54
            
            
            —
            
            
            —Total
      non-accrual loans
            
            25,452
            
            
            8,223
            
            
            805
            
            
            778
            
            
            1,935Accruing
      loans delinquent 90 days or more:Commercial
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —Real
      Estate ConstructionResidential
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —Commercial
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —Real
      Estate MortgageResidential
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —Commercial
            
            —
            
            
            —
            
            
            —
            
            
            267
            
            
            655Consumer
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —Total
            
            —
            
            
            —
            
            
            —
            
            
            267
            
            
            655Total
      non-performing loans
            $
            25,452
            
            $
            8,223
            
            $
            805
            
            $
            1,045
            
            $
            2,600Total
      non-performing loans as a percentage of loans
            
            4.2
            %
            
            1.50
            %
            
            0.20
            %
            
            0.34
            %
            
            1.00
            %







When a
loan is more than 30 days delinquent, the borrower is contacted by mail or phone
and payment is requested. If the delinquency continues, subsequent efforts are
made to contact the delinquent borrower. In certain instances, the Company may
modify the loan or grant a limited moratorium on loan payments to enable the
borrower to reorganize their financial affairs. If the loan continues in a
delinquent status for 90 days or more, the Company generally will initiate
foreclosure proceedings.




Loans are
generally placed on non-accrual status when either principal or interest is 90
days or more past due. Interest accrued and unpaid at the time a loan is placed
on non-accrual status is charged against interest income. Such interest, when
ultimately collected, is applied either to the outstanding principal or recorded
as interest income, depending on management’s assessment of ultimate
collectibility of principal and interest. At December 31, 2009, the Bank had
$25.5 million of loans that were on a non-accrual basis.Gross interest income of
$1.3 million would have been recorded during the year ended December 31, 2009 if
these loans had been performing in accordance with their terms. Interest income
of $10,000 was recognized on these loans during the year ended December 31,
2009.




Classified
Assets.Federal Regulations provide for a classification system for
problem assets of insured institutions. Under this classification system,
problem assets of insured institutions are classified as substandard, doubtful
or loss. An asset is considered “substandard” if it involves more than
an


8




acceptable
level of risk due to a deteriorating financial condition, unfavorable history of
the borrower, inadequate payment capacity, insufficient security or other
negative factors within the industry, market or management. Substandard loans
have clearly defined weaknesses that can jeopardize the timely payments of the
loan.




Assets
classified as “doubtful” exhibit all of the weakness defined under the
Substandard Category but with enough risk to present a high probability of some
principal loss on the loan, although not yet fully ascertainable in amount.
Assets classified as “loss” are those considered un-collectable or of little
value, even though a collection effort may continue after the classification and
potential charge-off.




The Bank
also internally classifies certain assets as “special mention;” such assets do
not demonstrate a current potential for loss but are monitored in response to
negative trends which, if not reversed, could lead to a substandard rating in
the future.




When an
insured institution classifies problem assets as either “substandard” or
“doubtful,” it may establish specific allowances for loan losses in an amount
deemed prudent by management. When an insured institution classifies problem
assets as “loss,” it is required either to establish an allowance for losses
equal to 100% of that portion of the assets so classified or to charge off such
amount. All of the Bank’s loans rated “substandard” and worse are also on
non-accrual and deemed impaired.




At
December 31, 2009, the Bank had assets classified as follows:





Loan
      Balance(Amounts
      in thousands)Special
      mention
            
            $
            25,123Substandard
            
            
            26,426Doubtful
            
            
            —Loss
            
            
            —$
            51,549





Foreclosed Real
Estate.Real estate acquired by the Bank as a result of foreclosure or by
deed in lieu of foreclosure is classified as real estate owned until such time
as it is sold. When real estate owned is acquired, it is recorded at the lower
of the unpaid principal balance of the related loan or its fair value less
disposal costs. Management also periodically performs valuations of real estate
owned and establishes allowances to reduce book values of the properties to
their net realizable values when necessary. Any write-down of real estate owned
is charged to operations. At December 31, 2009, the Bank had no real estate
owned.




Allowance for
Losses on Loans and Real Estate Owned.It is the policy of management to
provide for possible losses on all loans in its portfolio, whether classified or
not. A provision for loan losses is charged to operations based on management’s
evaluation of the inherent losses estimated to have occurred in the Bank’s loan
portfolio.




Management’s
judgment as to the level of probable losses on existing loans is based on its
internal review of the loan portfolio, including an analysis of the borrowers’
current financial position; the level and trends in delinquencies, non-accruals
and impaired loans; the consideration of national and local economic conditions
and trends; concentrations of credit; the impact of any changes in credit
policy; the experience and depth of management and the lending staff; and any
trends in loan volume and terms. In


9




determining
the collectibility of certain loans, management also considers the fair value of
any underlying collateral. However, management’s determination of the
appropriate allowance level which is based upon the factors outlined above,
which are believed to be reasonable, may or may not prove to be valid. Thus,
there can be no assurance that charge-offs in future periods will not exceed the
allowance for loan losses or that additional increases in the allowance for loan
losses will not be required.




The
following table sets forth information with respect to the Bank’s allowance for
losses on loans at the dates and for the periods indicated.





For
      the Year Ended December 31,2009
            
            
            
            2008
            
            
            
            2007
            
            
            
            2006
            
            
            
            2005(Amounts
      in thousands, except percentages)Balance
      at beginning of the period
            
            $
            7,777
            
            
            
            $
            5,706
            
            
            
            $
            4,511
            
            
            
            $
            3,574
            
            
            
            $
            2,621Charge-offs:Commercial
            
            
            (73
            )
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —Real
      estate constructionResidential
            
            
            (600
            )
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —Commercial
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            (227
            )Real
      estate mortgageResidential
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —Commercial
            
            
            —
            
            
            
            
            —
            
            
            
            
            (200
            )
            
            
            
            —
            
            
            
            
            —Consumer
            
            
            —
            
            
            
            
            (5
            )
            
            
            
            —
            
            
            
            
            (3
            )
            
            
            
            —Total
      charge-offs:
            
            
            (673
            )
            
            
            
            (5
            )
            
            
            
            (200
            )
            
            
            
            (3
            )
            
            
            
            (227
            )Recoveries:Commercial
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —Real
      estate constructionResidential
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —Commercial
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —Real
      estate mortgageResidential
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —Commercial
            
            
            —
            
            
            
            
            —
            
            
            
            
            234
            
            
            
            
            —
            
            
            
            
            —Consumer
            
            
            —
            
            
            
            
            13
            
            
            
            
            —
            
            
            
            
            —
            
            
            
            
            —Total
      recoveries:
            
            
            —
            
            
            
            
            13
            
            
            
            
            234
            
            
            
            
            —
            
            
            
            
            —Net
      recoveries (charge-offs)
            
            
            (673
            )
            
            
            
            8
            
            
            
            
            34
            
            
            
            
            (3
            )
            
            
            
            (227
            )Provision
      for loan losses
            
            
            5,300
            
            
            
            
            2,063
            
            
            
            
            1,161
            
            
            
            
            940
            
            
            
            
            1,180Balance
      at end of period
            
            $
            12,404
            
            
            
            $
            7,777
            
            
            
            $
            5,706
            
            
            
            $
            4,511
            
            
            
            $
            3,574Period-end
      loans outstanding (net of deferred costs/fees)
            
            $
            603,401
            
            
            
            $
            547,660
            
            
            
            $
            408,389
            
            
            
            $
            310,555
            
            
            
            $
            295,035Average
      loans outstanding
            
            $
            621,619
            
            
            
            $
            476,994
            
            
            
            $
            365,884
            
            
            
            $
            286,691
            
            
            
            $
            219,217Allowance
      as a percentage of period end loans
            
            
            2.06
            %
            
            
            
            1.42
            %
            
            
            
            1.40
            %
            
            
            
            1.45
            %
            
            
            
            1.38
            %Net
      loans charged off as a percentage of average loans
    outstanding
            
            
            0.11
            %
            
            
            
            0.00
            %
            
            
            
            (
      0.01
            )%
            
            
            
            0.00
            %
            
            
            
            0.10
            %







10


Allocation of
Allowance for Loan Losses.The following table sets forth the allocation
of the Bank’s allowance for loan losses by loan category at the dates indicated.
The portion of the loan loss allowance allocated to each loan category does not
represent the total available for future losses that may occur within the loan
category as the total loan loss allowance is a valuation reserve applicable to
the entire loan portfolio.





At
      December 31,2009
            
            2008
            
            2007
            
            2006
            
            2005Amount
            
            Percentage
            
            Amount
            
            Percentage
            
            Amount
            
            Percentage
            
            Amount
            
            Percentage
            
            Amount
            
            Percentage(Amounts
      in thousands, except percentages)Commercial
            
            $
            409
            
            3.3
            %
            
            $
            283
            
            3.6
            %
            
            $
            209
            
            3.7
            %
            
            $
            188
            
            4.3
            %
            
            $
            154
            
            4.3
            %Real
      estate construction:Residential
            
            
            1,823
            
            14.7
            
            
            
            1,240
            
            15.9
            
            
            
            22
            
            0.4
            
            
            
            25
            
            0.8
            
            
            
            18
            
            0.5Commercial
            
            
            558
            
            4.5
            
            
            
            448
            
            5.8
            
            
            
            1,489
            
            26.1
            
            
            
            847
            
            22.3
            
            
            
            969
            
            27.1Real
      estate mortgage:Residential
            
            
            2,952
            
            23.8
            
            
            
            1,281
            
            16.5
            
            
            
            257
            
            4.5
            
            
            
            218
            
            6.4
            
            
            
            239
            
            6.7Commercial
            
            
            6,389
            
            51.5
            
            
            
            4,381
            
            56.3
            
            
            
            3,568
            
            62.5
            
            
            
            3,185
            
            64.0
            
            
            
            2,130
            
            59.6Consumer
            
            
            273
            
            2.2
            
            
            
            144
            
            1.9
            
            
            
            161
            
            2.8
            
            
            
            48
            
            2.2
            
            
            
            64
            
            1.8Total
      Allowance
            
            $
            12,404
            
            100.0
            %
            
            $
            7,777
            
            100.0
            %
            
            $
            5,706
            
            100.0
            %
            
            $
            4,511
            
            100.0
            %
            
            $
            3,574
            
            100.0
            %













11


Investment
Activities




General.The investment policy of the Bank is established by senior management and
approved by the Board of Directors. It is based on asset and liability
management goals and is designed to provide a portfolio of high quality
investments that foster interest income within acceptable interest rate risk and
liquidity guidelines. In accordance with accounting guidance, the Bank
classifies the majority of its portfolio of investment securities as “available
for sale” with the remainder, which are municipal bonds, as “held to maturity.”
At December 31, 2009, the Bank’s investment policy allowed investments in
instruments such as: (i) U.S. Treasury obligations, (ii) U.S. government agency
or government-sponsored agency obligations, (iii) local municipal obligations,
(iv) mortgage-backed securities, (v) certificates of deposit, and (vi)
investment grade corporate bonds, trust preferred securities and mutual funds.
The Board of Directors may authorize additional investments.




Composition of
Investment Securities Portfolio.The following table sets forth the
carrying value of the Bank’s investment securities portfolio at the dates
indicated. For additional information, see Note 3 of the Notes to the
Consolidated Financial Statements. At December 31, 2009, no one issuer of
investment securities represented 10% or more of the Company’s stockholders’
equity.





At
      December 31,2009
            
            
            
            2008
            
            
            
            2007(Amounts
      in  thousands)Securities Held to
      Maturity:Municipals
            
            $
            2,509
            
            
            
            $
            2,482
            
            
            
            $
            2,456Securities Available
      for Sale:U.S.
      government-sponsored entity securities
            
            
            3,232
            
            
            
            
            2,011
            
            
            
            
            5,499Mortgage-backed
      securities
            
            
            23,507
            
            
            
            
            25,150
            
            
            
            
            17,442Corporate
      and trust preferred securities
            
            
            2,681
            
            
            
            
            4,769
            
            
            
            
            6,841Total
      securities available for sale
            
            
            29,420
            
            
            
            
            31,930
            
            
            
            
            29,782Total
            
            $
            31,929
            
            
            
            $
            34,412
            
            
            
            $
            32,238












12


Investment
Portfolio Maturities.The following table sets forth information
regarding the scheduled maturities, amortized costs, estimated fair values, and
weighted average yields for the Bank’s investment securities portfolio at
December 31, 2009 by contractual maturity. The following table does not take
into consideration the effects of scheduled repayments or the effects of
possible prepayments.





At
      December 31, 2009One
      Year or Less
            
            
            One
      to Five Years
            
            
            Five
      to Ten Years
            
            
            More
      Than Ten Years
            
            
            Total
      Investment SecuritiesAmort-
              ized
      Cost
            
            Average
              Yield
            
            
            Amort-
              ized
      Cost
            
            Average
              Yield
            
            
            Amort-
              ized
      Cost
            
            Average
              Yield
            
            
            Amort-
              ized
      Cost
            
            Average
              Yield
            
            
            Amort-
              ized
      Cost
            
            Average
              Yield
            
            
            Fair
              Value(Amounts
      in thousands, except yields)Securities Held to
      Maturity:Municipals
            
            $
            541
            
            2.9
            %
            
            
            $
            —
            
            —
            %
            
            
            $
            —
            
            —
            %
            
            
            $
            1,968
            
            4.7
            %
            
            
            $
            2,509
            
            4.3
            %
            
            $
            2,404Securities Available for
      Sale:U.S.
      government sponsored entity
            
            
            —
            
            —
            %
            
            
            
            998
            
            2.0
            %
            
            
            
            2,275
            
            3.6
            %
            
            
            
            —
            
            —
            %
            
            
            
            3,273
            
            3.1
            %
            
            
            3,232Mortgage-backed
      securities
            
            
            —
            
            —
            
            
            
            
            1,940
            
            3.5
            
            
            
            
            1,892
            
            4.4
            
            
            
            
            19,125
            
            5.0
            
            
            
            
            22,957
            
            4.8
            
            
            
            23,507Corporate
            
            
            —
            
            —
            
            
            
            
            —
            
            —
            
            
            
            
            —
            
            —
            
            
            
            
            7,562
            
            3.6
            
            
            
            
            7,562
            
            3.6
            
            
            
            2,681Total
      securities available for sale
            
            
            —
            
            —
            
            
            
            
            2,938
            
            3.0
            
            
            
            
            4,167
            
            4.0
            
            
            
            
            26,687
            
            4.6
            
            
            
            
            33,792
            
            4.4
            
            
            
            29,420Total
            
            $
            541
            
            2.9
            %
            
            
            $
            2,938
            
            3.0
            %
            
            
            $
            4,167
            
            4.0
            %
            
            
            $
            28,655
            
            4.6
            %
            
            
            $
            36,301
            
            4.4
            %
            
            $
            31,824












13


Sources
of Funds




General.Deposits are the major external source of the Bank’s funds for lending
and other investment purposes. In addition to deposits, the Bank derives funds
from the amortization, prepayment or sale of loans, maturities of investment
securities and operations. Scheduled loan principal repayments are a relatively
stable source of funds, while deposit inflows and outflows and loan prepayments
are significantly influenced by general interest rates and market
conditions.




Deposits.The Bank offers individuals and businesses a wide variety of accounts,
including checking, savings, money market accounts, individual retirement
accounts and certificates of deposit. Deposits are obtained primarily from
communities that the Bank serves, however, the Bank held brokered deposits of
$96.1 million and $176.1 million at December 31, 2009 and 2008, respectively.
Brokered deposits are a more volatile source of funding than core deposits and
do not increase the deposit franchise of the Bank. In a rising rate environment,
the Bank may be unwilling or unable to pay a competitive rate. To the extent
that such deposits do not remain with the Bank, they may need to be replaced
with borrowings which could increase the Bank’s cost of funds and negatively
impact its interest rate spread, financial condition and results of operation.
To mitigate the potential negative impact associated with brokered deposits, the
Bank joined Promontory Interfinancial Network during 2007 to secure an
additional alternative funding source. Promontory provides the Bank an
additional source of external funds through their weekly CDARS settlement
process. The rates are comparable to brokered deposits and can be obtained
within a shorter period time than brokered deposits. The Bank’s CDARS deposits
included within the brokered deposit total amounted to $5.9 million and $36.4
million at December 31, 2009 and December 31, 2008, respectively.




The
following tables detail the average amount, the average rate paid, and the
percentage of each category to total deposits for the most recent three years
ended December 31.





2009Average
              Balance
            
            Yield/Rate
            
            Percent
      of
              Total(Amounts
      in thousands, except percentages)NOWs
            
            $
            10,945
            
            1.41
            %
            
            2.1
            %Money
      markets
            
            
            70,533
            
            1.46
            %
            
            13.5Savings
            
            
            104,586
            
            2.11
            %
            
            20.0Time
      deposits
            
            
            181,866
            
            3.14
            %
            
            34.6Brokered
      CDs
            
            
            136,168
            
            3.36
            %
            
            26.0Total
      interest-bearing deposits
            
            
            504,098
            
            2.71
            %
            
            96.2Non-interest
      bearing demand deposits
            
            
            21,488
            
            
            
            
            3.8Total
      deposits
            
            $
            520,313
            
            
            
            
            100.0
            %





14








2008Average
              Balance
            
            Yield/Rate
            
            Percent
      of
              Total(Amounts
      in thousands, except percentages)NOWs
            
            $
            11,730
            
            2.35
            %
            
            2.7
            %Money
      markets
            
            
            39,146
            
            3.06
            %
            
            8.9Savings
            
            
            42,683
            
            3.33
            %
            
            9.7Time
      deposits
            
            
            171,420
            
            4.17
            %
            
            39.0Brokered
      CDs
            
            
            153,297
            
            4.51
            %
            
            34.8Total
      interest-bearing deposits
            
            
            418,276
            
            4.05
            %
            
            95.1Non-interest
      bearing demand deposits
            
            
            21,658
            
            
            
            
            4.9Total
      deposits
            
            $
            439,934
            
            
            
            
            100.0
            %








2007Average
              Balance
            
            Yield/Rate
            
            Percent
      of
              Total(Amounts
      in thousands, except percentages)NOWs
            
            $
            8,685
            
            1.90
            %
            
            2.6
            %Money
      markets
            
            
            26,080
            
            4.36
            %
            
            7.7Savings
            
            
            27,774
            
            3.74
            %
            
            8.2Time
      deposits
            
            
            155,284
            
            5.09
            %
            
            46.0Brokered
      CDs
            
            
            100,097
            
            5.17
            %
            
            29.7Total
      interest-bearing deposits
            
            
            317,920
            
            4.85
            %
            
            94.2Non-interest
      bearing demand deposits
            
            
            19,591
            
            
            
            
            5.8Total
      deposits
            
            $
            337,511
            
            
            
            
            100.0
            %





The
following table indicates the amount of the Bank’s certificates of deposit of
$100,000 or more by time remaining until maturity as of December 31,
2009.





Maturity
      Period
            
            Certificates
      of Deposit(Amounts
      in thousands)Within
      three months
            
            $
            15,822Three
      through twelve months
            
            
            28,682Over
      twelve months
            
            
            26,596Total
            
            $
            71,100





15




Borrowings.Borrowings consist of reverse repurchase agreements, subordinated debt
and advances from the FHLB and other parties. Reverse repurchase agreements were
priced at origination and are payable in four years or less. Borrowings from the
FHLB outstanding during 2009, 2008, and 2007 had maturities of ten years or less
and cannot be prepaid without penalty.




The
following table sets forth information regarding the Bank’s
borrowings:





December
      31,2009
            
            
            
            2008
            
            
            
            2007(Amounts
      in thousands, except rates)Amount
      outstanding at year end
            
            
            
            $
            67,831
            
            
            
            $
            61,943
            
            
            
            $
            40,322Weighted
      average interest rates at year end
            
            
            
            
            2.74
            %
            
            
            
            4.05
            %
            
            
            
            5.43
            %Maximum
      outstanding at any month end
            
            
            
            $
            67,831
            
            
            
            $
            78,244
            
            
            
            $
            49,209Average
      outstanding
            
            
            
            $
            58,351
            
            
            
            $
            54,843
            
            
            
            $
            39,502Weighted
      average interest rate during the year
            
            
            
            
            3.51
            %
            
            
            
            4.25
            %
            
            
            
            5.51
            %





Subsidiary
Activities




The
largest subsidiary of the Company is the Bank. The Bank has a subsidiary, Parke
Capital Markets, a corporation, which was formed in 2001 to generate fee income
from capital markets financing activities, which include term financings. Farm
Folly, a corporation that is a subsidiary of the Bank, was formed in 2006 for
real estate assets associated with a previous loan that were repossessed by the
Bank in 2006. At December 31, 2009, there were no assets in the subsidiary as a
result of the sale of these repossessed assets during the second quarter of
2007. 44 Business Capital LLC was formed in 2009 for the purpose of originating
and servicing Small Business Administration (SBA) loans. The Bank has a 51%
ownership interest.




Personnel




At
December 31, 2009, the Bank had 42 full-time and 5 part-time
employees.




Regulation




General.Set forth below is a brief description of certain laws that relate to the
regulation of the Bank and the Company. The description does not purport to be
complete and is qualified in its entirety by reference to applicable laws and
regulations.




Emergency
Economic Stabilization Act of 2008




In
response to unprecedented market turmoil, the Emergency Economic Stabilization
Act  (“EESA”) was enacted on October 3, 2008.  EESA
authorizes the Secretary of the Treasury to purchase up to $700 billion in
troubled assets from financial institutions under the Troubled Asset Relief
Program or TARP.  Pursuant to his authority under EESA, the Secretary
of the Treasury has created the TARP Capital Purchase Plan under which the
Treasury Department will invest up to $250 billion in senior preferred stock of
U.S. banks and savings associations or their holding
companies.  Qualifying financial institutions may issue senior
preferred stock with a value equal to not less than 1% of risk-weighted assets
and not more than the lesser of $25 billion or 3% of risk-weighted
assets.  The senior preferred stock will pay dividends at the rate of
5% per annum until the fifth anniversary of the investment and thereafter at the
rate of 9% per annum.  The senior preferred stock may not be redeemed
for three years except with the proceeds from an offering common stock or
preferred stock qualifying as Tier 1 capital in an amount


16




equal to
not less than 25% of the amount of the senior preferred.  After three
years, the senior preferred may be redeemed at any time in whole or in part by
the financial institution.  No dividends may be paid on common stock
unless dividends have been paid on the senior preferred stock.  Until
the third anniversary of the issuance of the senior preferred, the consent of
the U.S. Treasury will be required for any increase in the dividends on the
common stock or for any stock repurchases unless the senior preferred has been
redeemed in its entirety or the Treasury has transferred the senior preferred to
third parties.  The senior preferred will not have voting rights other
than the right to vote as a class on the issuance of any preferred stock ranking
senior, any change in its terms or any merger, exchange or similar transaction
that would adversely affect its rights.  The senior preferred will
also have the right to elect two directors if dividends have not been paid for
six periods.  The senior preferred will be freely transferable and
participating institutions will be required to file a shelf registration
statement covering the senior preferred.  The issuing institution must
grant the Treasury piggyback registration rights.  Prior to issuance,
the financial institution and its senior executive officers must modify or
terminate all benefit plans and arrangements to comply with
EESA.  Senior executives must also waive any claims against the
Department of Treasury.




In
connection with the issuance of the senior preferred, participating institutions
must issue to the Secretary immediately exercisable 10-year warrants to purchase
common stock with an aggregate market price equal to 15% of the amount of senior
preferred.  The exercise price of the warrants will equal the market
price of the common stock on the date of the investment.  The
Secretary may only exercise or transfer one-half of the warrants prior to the
earlier of December 31, 2009 or the date the issuing financial institution has
received proceeds equal to the senior preferred investment form one or more
offerings of common or preferred stock qualifying as Tier 1
capital.  The Secretary will not exercise voting rights with respect
to any shares of common stock acquired through exercise of the
warrants.  The financial institution must file a shelf registration
statement covering the warrants and underlying common stock as soon as
practicable after issuance and grant piggyback registration
rights.  The number of warrants will be reduced by one-half if the
financial institution raises capital equal to the amount of the senior preferred
through one or more offerings of common stock or preferred stock qualifying a
Tier 1 capital.  If the financial institution does not have sufficient
authorized shares of common stock available to satisfy the warrants or their
issuance otherwise requires shareholder approval, the financial institution must
call a meeting of shareholders for that purpose as soon as practicable after the
date of investment.  The exercise price of the warrants will be
reduced by 15% for each six months that lapse before shareholder approval
subject to a maximum reduction of 45%.




On
January 30, 2009, the Company entered into a Letter Agreement and Securities
Purchase Agreement (collectively, the “Purchase Agreement”) with the United
States Department of the Treasury (“Treasury”) under the TARP Capital Purchase
Program, pursuant to which the Company sold (i) 16,288 shares of the Company’s
Fixed Rate Cumulative Perpetual Preferred Stock, Series A (the “Series A
Preferred Stock”) and (ii) a warrant (the “Warrant”) to purchase 299,779
shares of the Company’s common stock, par value $0.10 per share (the “Common
Stock”), for an aggregate purchase price of $16.3 million in cash.




The
Series A Preferred Stock will qualify as Tier 1 capital and will pay cumulative
dividends at a rate of 5% per annum for the first five years, and
9% per annum thereafter.  The Series A Preferred Stock may be
redeemed by the Company at anytime without penalty, subject to Treasury’s
consultation with the appropriate federal banking agency.




Pursuant
to the terms of the Purchase Agreement, the ability of the Company to declare or
pay dividends or distributions on, or purchase, redeem or otherwise acquire for
consideration, shares of its Junior Stock (as defined below) and Parity Stock
(as defined below) will be subject to restrictions,


17




including
a restriction against increasing dividends from the last quarterly cash dividend
declared on the Common Stock prior to January 9, 2009.  The
redemption, purchase or other acquisition of trust preferred securities of the
Company or its affiliates also will be restricted.  These restrictions
will terminate on the earlier of (a) the third anniversary of the date of
issuance of the Series A Preferred Stock and (b) the date on which the
Series A Preferred Stock has been redeemed in whole or Treasury has transferred
all of the Series A Preferred Stock to third parties.  The
restrictions described in this paragraph are set forth in the Purchase
Agreement.




In
addition, the ability of the Company to declare or pay dividends or
distributions on, or repurchase, redeem or otherwise acquire for consideration,
shares of its Junior Stock and Parity Stock will be subject to restrictions in
the event that the Company fails to declare and pay full dividends (or declare
and set aside a sum sufficient for payment thereof) on its Series A Preferred
Stock.




“Junior
Stock” means the Common Stock and any other class or series of stock of the
Company the terms of which expressly provide that it ranks junior to the Series
A Preferred Stock as to dividend rights and/or rights on liquidation,
dissolution or winding up of the Company. “Parity Stock” means any class or
series of stock of the Company the terms of which do not expressly provide that
such class or series will rank senior or junior to the Series A Preferred Stock
as to dividend rights and/or rights on liquidation, dissolution or winding up of
the Company (in each case without regard to whether dividends accrue
cumulatively or non-cumulatively).




The
Warrant has a 10-year term and is immediately exercisable upon its issuance,
with an exercise price, subject to anti-dilution adjustments, equal to $8.15 per
share of the Common Stock. Treasury has agreed not to exercise voting power with
respect to any shares of Common Stock issued upon exercise of the
Warrant.




The
Series A Preferred Stock and the Warrant were issued in a private placement
exempt from registration pursuant to Section 4(2) of the Securities Act of
1933, as amended.  Upon the request of Treasury at any time, the
Company has agreed to promptly enter into a deposit arrangement pursuant to
which the Series A Preferred Stock may be deposited and depositary shares
(“Depositary Shares”), representing fractional shares of Series A Preferred
Stock, may be issued.  The Company has agreed to register the Series A
Preferred Stock, the Warrant, the shares of Common Stock underlying the Warrant
(the “Warrant Shares”) and Depositary Shares, if any, as soon as practicable
after the date of the issuance of the Series A Preferred Stock and the
Warrant.  Neither the Series A Preferred Stock nor the Warrant will be
subject to any contractual restrictions on transfer, except that Treasury may
only transfer or exercise an aggregate of one-half of the Warrant Shares prior
to the earlier of the redemption of 100% of the shares of Series A Preferred
Stock and December 31, 2009.




The
Purchase Agreement also subjects the Company to certain of the executive
compensation limitations included in the EESA.  In this connection, as
a condition to the closing of the transaction, the Company’s Senior Executive
Officers (as defined in the Purchase Agreement) (the “Senior Executive
Officers”), (i) executed a waiver (the “Waiver”) voluntarily waiving any
claim against the Treasury or the Company for any changes to such Senior
Executive Officer’s compensation or benefits that are required to comply with
the regulation issued by the Treasury under the TARP Capital Purchase Program as
published in the Federal Register on October 20, 2008 and acknowledging
that the regulation may require modification of the compensation, bonus,
incentive and other benefit plans, arrangements and policies and agreements
(including so-called “golden parachute” agreements) (collectively, “Benefit
Plans”) as they relate to the period the Treasury holds any equity or debt
securities of the Company acquired through the TARP Capital Purchase Program;
and (ii) entered into a letter agreement (the “Letter Agreement”) with the
Company amending the Benefit Plans with respect to such Senior Executive Officer
as may be necessary, during the period that the Treasury owns any debt or equity
securities of the Company


18




acquired
pursuant to the Purchase Agreement or the Warrant, as necessary to comply with
Section 111(b) of the EESA.




The
foregoing description of the TARP, the CPP and securities covered thereby is
qualified in its entirety by reference to the Summary of Senior Preferred Terms
and other information regarding the TARP and CPP published on the Department’s
website at www.treasury.gov and
incorporated herein by reference.




EESA
increases the maximum deposit insurance amount up to $250,000 until December 31,
2013 and removes the statutory limits on the FDIC’s ability to borrow from the
Treasury during this period.  The FDIC may not take the temporary
increase in deposit insurance coverage into account when setting
assessments.  EESA allows financial institutions to treat any loss on
the preferred stock of the Federal National Mortgage Association or Federal Home
Loan Mortgage Corporation as an ordinary loss for tax purposes.




Holding
Company Regulation




General.The Company is a bank holding company within the meaning of the Bank
Holding Company Act of 1956 (the “BHC Act”), and is regulated by the Board of
Governors of the Federal Reserve System (the “Federal Reserve Board”). The
Federal Reserve Board has enforcement authority over the Company and the
Company’s non-bank subsidiaries which also permits the Federal Reserve Board to
restrict or prohibit activities that are determined to be a serious risk to the
subsidiary bank. This regulation and oversight is intended primarily for the
protection of the depositors of the Bank and not for shareholders of the
Company.




As a bank
holding company, the Company is required to file with the Federal Reserve Board
an annual report and any additional information as the Federal Reserve Board may
require under the BHC Act. The Federal Reserve Board will also examine the
Company and its subsidiaries.




Subsidiary
banks of a bank holding company are subject to certain restrictions imposed by
the BHC Act on extensions of credit to the bank holding company or any of its
subsidiaries, on investments in the stock or other securities of the bank
holding company or its subsidiaries, and on the taking of such stock or
securities as collateral for loans to any borrower. Furthermore, under
amendments to the BHC Act and regulations of the Federal Reserve Board, a bank
holding company and its subsidiaries are prohibited from engaging in certain
tie-in arrangements in connection with any extension of credit or provision of
credit or providing any property or services. Generally, this provision provides
that a bank may not extend credit, lease or sell property, or furnish any
service to a customer on the condition that the customer provide additional
credit or service to the bank, to the bank holding company, or to any other
subsidiary of the bank holding company or on the condition that the customer not
obtain other credit or service from a competitor of the bank, the bank holding
company, or any subsidiary of the bank.




Extensions
of credit by the Bank to executive officers, directors, and principal
shareholders of the Bank or any affiliate thereof, including the Company, are
subject to Section 22(h) of the Federal Reserve Act, which among other things,
generally prohibits loans to any such individual where the aggregate amount
exceeds an amount equal to 15% of a bank’s unimpaired capital and surplus, plus
an additional 10% of unimpaired capital and surplus in the case of loans that
are fully secured by readily marketable collateral.


19




Federal
Securities Law.The Company’s common stock is registered under Section
12(b) of the Securities Exchange Act of 1934, as amended (the “1934 Act”), and
the Company is subject to the periodic reporting and other requirements of
Section 12(b) of the 1934 Act, as amended.




Sarbanes-Oxley
Act of 2002.The Sarbanes-Oxley Act of 2002 (the “SOX Act”) was enacted
to address corporate and accounting fraud. The SEC has promulgated new
regulations pursuant to the SOX Act and may continue to propose additional
implementing or clarifying regulations as necessary in furtherance of the SOX
Act. The passage of the SOX Act by Congress and the implementation of new
regulations by the SEC subject publicly-traded companies to additional and more
cumbersome reporting, regulations, and disclosure. Compliance with the SOX Act
and corresponding regulations may increase the Company’s expenses.




During
2009, the Company evaluated the effectiveness of the internal control over
financial reporting based upon the framework in Internal Control- Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission. Based upon the evaluation performed by management in conjunction
with an outside consultant, the Company concluded that the internal control over
financial reporting (Sarbanes-Oxley Section 404 certification) was effective as
of December 31, 2009. This annual report does not include an attestation report
of the Company’s registered public accounting firm regarding internal control
over financial reporting. Management’s report was not subject to attestation by
the Company’s registered public accounting firm pursuant to temporary rules of
the Securities and Exchange Commission that permit the Company to provide only
management’s report in this annual report.




Regulation
of the Bank




The Bank
operates in a highly regulated industry. This regulation and supervision
establishes a comprehensive framework of activities in which a bank may engage
and is intended primarily for the protection of the deposit insurance fund and
depositors and not shareholders of the Bank.




Any
change in applicable statutory and regulatory requirements, whether by the New
Jersey Department of Banking and Insurance, the Federal Deposit Insurance
Corporation (the “FDIC”) or the United States Congress, could have a material
adverse impact on the Bank, and its operations. The adoption of regulations or
the enactment of laws that restrict the operations of the Bank or impose
burdensome requirements upon it could reduce its profitability and could impair
the value of the Bank’s franchise which could hurt the trading price of the
Bank’s stock.




As a New
Jersey-chartered commercial bank, the Bank is subject to the regulation,
supervision, and control of the New Jersey Department of Banking and Insurance.
As an FDIC-insured institution, the Bank is subject to regulation, supervision
and control of the FDIC, an agency of the federal government. The regulations of
the FDIC and the New Jersey Department of Banking and Insurance affect virtually
all activities of the Bank, including the minimum level of capital the Bank must
maintain, the ability of the Bank to pay dividends, the ability of the Bank to
expand through new branches or acquisitions and various other
matters.




Federal Deposit
Insurance.The Bank’s deposits are insured to applicable limits by the
FDIC.  The maximum deposit insurance amount has been increased from
$100,000 to $250,000 until December 31, 2013.  On October 13, 2008,
the FDIC established a Temporary Liquidity Guarantee Program under which the
FDIC fully guarantees all non-interest-bearing transaction accounts until
December 31, 2009 (the “Transaction Account Guarantee Program”) and all senior
unsecured debt of insured depository


20




institutions
or their qualified holding companies issued between October 14, 2008 and June
30, 2009, with the FDIC’s guarantee expiring by June 30, 2012 (the “Debt
Guarantee Program”).  Senior unsecured debt would include federal
funds purchased and certificates of deposit standing to the credit of the
bank.  After November 12, 2008, institutions that did not opt out of
the Programs by December 5, 2008 were assessed at the rate of ten basis points
for transaction account balances in excess of $250,000 and at a rate between 50
and 100 basis points of the amount of debt issued.  In May, 2009, the
Debt Guarantee Program issue end date and the guarantee expiration date were
both extended, to October 31, 2009 and December 31, 2012,
respectively.  Participating holding companies that have not issued
FDIC-guaranteed debt prior to April 1, 2009 must apply to remain in the Debt
Guarantee Program.  Participating institutions will be subject to
surcharges for debt issued after that date.  Effective October 1,
2009, the Transaction Account Guarantee Program was extended until June 30,
2010, with an increased assessment after December 31, 2009.  The
Company and the Bank did not opt out of the Debt Guarantee Program.The Bank did not opt out
of the original Transaction Account Guarantee Program or its
extension.




The FDIC
has adopted a risk-based premium system that provides for quarterly assessments
based on an insured institution’s ranking in one of four risk categories based
on their examination ratings and capital ratios. Well-capitalized institutions
with the CAMELS ratings of 1 or 2 are grouped in Risk Category I and, until
2009, were assessed for deposit insurance at an annual rate of between five and
seven basis points with the assessment rate for an individual institution
determined according to a formula based on a weighted average of the
institution’s individual CAMELS component ratings plus either five financial
ratios or the average ratings of its long-term debt. Institutions in Risk
Categories II, III and IV were assessed at annual rates of 10, 28 and 43 basis
points, respectively.  Insured depository institutions that were in
existence on December 31, 1996 and paid assessments prior to that date (or their
successors) were entitled to a one-time credit against future assessments based
on their past contributions to the predecessor to the Deposit Insurance
Fund.  The Bank used its special assessment credit to offset the cost
of its deposit insurance premium until the fourth quarter of calendar 2007 when
the credit was exhausted.




Pursuant
to the Federal Deposit Insurance Reform Act of 2005 (the “Reform Act”), the FDIC
is authorized to set the reserve ratio for the Deposit Insurance Fund annually
at between 1.15% and 1.5% of estimated insured deposits.  Due to
recent bank failures, the FDIC determined that the reserve ratio was 1.01% as of
June 30, 2008.  In accordance with the Reform Act, as amended by the
Helping Families Save Their Home Act of 2009, the FDIC has established and
implemented a plan to restore the reserve ratio to 1.15% within eight
years.  For the quarter beginning January 1, 2009, the FDIC raised the
base annual assessment rate for institutions in Risk Category I to between 12
and 14 basis points while the base annual assessment rates for institutions in
Risk Categories II, III and IV were increased to 17, 35 and 50 basis points,
respectively.  For the quarter beginning April 1, 2009 the FDIC
set the base annual assessment rate for institutions in Risk Category I to
between 12 and 16 basis points and the base annual assessment rates for
institutions in Risk Categories II, III and IV at 22, 32 and 45 basis points,
respectively.  An institution’s assessment rate could be lowered by as
much as five basis points based on the ratio of its long-term unsecured debt to
deposits or, for smaller institutions based on the ratio of certain amounts of
Tier 1 capital to adjusted assets.  The assessment rate may be
adjusted for Risk Category I institutions that have a high level of brokered
deposits and have experienced higher levels of asset growth (other than through
acquisitions) and could be increased by as much as ten basis points for
institutions in Risk Categories II, III and IV whose ratio of brokered deposits
to deposits exceeds 10%.  Reciprocal deposit arrangements like CDARS®
were treated as brokered deposits for Risk Category II, III and IV institutions
but not for institutions in Risk Category I.  An institution’s base
assessment rate would also be increased if an institution’s ratio of secured
liabilities (including FHLB advances and repurchase agreements) to deposits
exceeds 25%.  The maximum adjustment for secured liabilities
for


21




institutions
in Risk Categories I, II, III and IV would be 8, 11, 16 and 22.5 basis points,
respectively, provided that the adjustment may not increase an institution’s
base assessment rate by more than 50%.




The FDIC
imposed a special assessment equal to five basis points of assets less Tier 1
capital as of June 30, 2009, payable on September 30, 2009, and reserved the
right to impose additional special assessments.  In November, 2009,
instead of imposing additional special assessments, the FDIC amended the
assessment regulations to require all insured depository institutions to prepay
their estimated risk-based assessments for the fourth quarter of 2009, and for
all of 2010, 2011 and 2012 on December 30, 2009.  For purposes of
estimating the future assessments, each institution’s base assessment rate in
effect on September 30, 2009 was used, assuming a 5% annual growth rate in the
assessment base and a 3 basis point increase in the assessment rate in 2011 and
2012.  The prepaid assessment will be applied against actual quarterly
assessments until exhausted.  Any funds remaining after June 30, 2013
will be returned to the institution.  If the prepayment would impair
an institution’s liquidity or otherwise create significant hardship, it may
apply for an exemption.  Requiring this prepaid assessment does not
preclude the FDIC from changing assessment rates or from further revising the
risk-based assessment system.




In
addition, all FDIC-insured institutions are required to pay assessments to the
FDIC to fund interest payments on bonds issued by the Financing Corporation
(“FICO”), an agency of the Federal government established to recapitalize the
Federal Savings and Loan Insurance Corporation.  The FICO assessment
rates, which are determined quarterly, averaged 0.011% of insured deposits on an
annualized basis in fiscal year 2009.  These assessments will continue
until the FICO bonds mature in 2017.




Capital Adequacy
Guidelines.Parke Bancorp (on a consolidated basis) and the Bank are
subject to risk-based capital guidelines promulgated by the FDIC that are
designed to make regulatory capital requirements more sensitive to differences
in risk profile among banks, to account for off-balance sheet exposure, and to
minimize disincentives for holding liquid assets. Under the guidelines, assets
and off-balance sheet items are assigned to broad risk categories, each with
appropriate weights. The resulting capital ratios represent capital as a
percentage of total risk-weighted assets and off-balance sheet
items.




The
minimum ratio of total capital to risk-weighted assets (including certain
off-balance sheet activities, such as standby letters of credit) is 8%. At least
4% of the total capital is required to be “Tier I Capital,” consisting of common
shareholders’ equity and qualifying preferred stock, less certain goodwill items
and other intangible assets. The remainder (“Tier II Capital”) may consist of
(a) the allowance for loan losses of up to 1.25% of risk-weighted assets, (b)
excess of qualifying preferred stock, (c) hybrid capital instruments, (d)
perpetual debt, (e) mandatory convertible securities, and (f) qualifying
subordinated debt and intermediate-term preferred stock up to 50% of Tier I
capital. Total capital is the sum of Tier I and Tier II capital less reciprocal
holdings of other banking organizations, capital instruments, investments in
unconsolidated subsidiaries and any other deductions as determined by the FDIC
(determined on a case-by-case basis or as a matter of policy after formal
rule-making).




In
addition to the risk-based capital guidelines, the FDIC has adopted a minimum
Tier I capital (leverage) ratio, under which a bank must maintain a minimum
level of Tier I capital to average total consolidated assets of at least 3% in
the case of a bank that has the highest regulatory examination rating and is not
contemplating significant growth or expansion. All other banks are expected to
maintain a leverage ratio of at least 100 to 200 basis points above the stated
minimum.




At
December 31, 2009, the Company and the Bank had the requisite capital levels to
qualify as “well capitalized.”


22




Item
1A.          Risk
Factors




This item is not applicable as the
Company is a “smaller reporting company.”




Item
      1B.
            Unresolved
      Staff Comments




None.




Item
      2.
            Properties




(a)           Properties.


The
Company’s and the Bank’s main office is located in Washington Township,
Gloucester County, New Jersey, in an office building of approximately 13,000
square feet.  The main office facilities include teller windows, a
lobby area, drive-through windows, automated teller machine, a night depository,
and executive and administrative offices. In December 2002, the Bank executed
its lease option to purchase the building for $1.5 million.




The Bank
also conducts business from a full-service office in Northfield, New Jersey, a
full-service office in Washington Township, Gloucester County, New Jersey, and a
full-service office in Philadelphia, Pennsylvania. These offices were opened by
the Bank in September 2002, February 2003, and August 2006, respectively. The
Northfield office and the Philadelphia office are leased. The Washington
Township office was purchased in February 2003. Management considers the
physical condition of all offices to be good and adequate for the conduct of the
Bank’s business. At December 31, 2009, net property and equipment totaled
approximately $2.9 million.




Item
      3.
            Legal
      Proceedings




At
December 31, 2009, the Company was not a party to any material legal
proceedings.




Item
      4.
            Reserved


23




PART
II




Item
      5.
            Market
      for Common Equity, Related Stockholder Matters and Issuer Purchases of
      Equity Securities




(a)
            The
      information contained under the section captioned “Market Prices and
      Dividends” in the Company’s 2009 Annual Report is incorporated herein by
      reference.




(b)
            Not
      applicable.




(c)
            There
      were no treasury stock repurchases during the fourth quarter of
      2009.




On
November 9, 2005, the Board of Directors authorized 174,570 shares (adjusted for
stock dividends), or approximately 5%, of the issued and outstanding common
stock for repurchase by the Company. As of December 31, 2009, the Company had
repurchased all of the authorized shares. In addition, 61,459 shares were
repurchased by the Company in connection with the exercise of warrants issued in
connection with the Bank’s formation. The ability of the Company to repurchase
additional shares will be subject to restrictions under the TARP Capital
Purchase Program as described in the section captioned “Emergency Economic
Stabilization Act of 2008”.




Item
      6.
            Selected
      Financial Data




The
information contained under the section captioned “Selected Financial Data” in
the 2009 Annual Report is incorporated herein by reference.




Item
      7.
            Management’s
      Discussion and Analysis  of Financial Condition and Results of
      Operations




The
information contained in the section captioned “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” in the Annual Report
is incorporated herein by reference.




Item
      7A.
            Quantitative
      and Qualitative Disclosures About Market
Risk




The
information contained in the section captioned “Management’s Discussion and
Analysis of Financial Condition and Results of Operations — Interest Rate
Sensitivity and Liquidity — Rate Sensitivity Analysis” in the Annual Report is
incorporated herein by reference.




Item
      8.
            Financial
      Statements and Supplementary Data




The
Company’s financial statements listed under Item 15 are incorporated herein by
reference.




Item
      9.
            Changes
      in and Disagreements With Accountants on Accounting and Financial
      Disclosure




None.


24




Item
9A (T).   Controls and Procedures




(a)           Disclosure
Controls and Procedures




Based on
their evaluation of the Company’s disclosure controls and procedures (as defined
in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange
Act”)), the Company’s principal executive officer and principal financial
officer have concluded that as of the end of the period covered by this Annual
Report on Form 10-K such disclosure controls and procedures are
effective.




(b)           Internal
Control Over Financial Reporting




1.  Management’s
Annual Report on Internal Control Over Financial Reporting.




Management’s
report on the Company’s internal control over financial reporting appears in the
Company’s financial statements that are contained in the 2009 Annual Report
filed as Exhibit 13 to this Annual Report on Form 10-K. Such report is
incorporated herein by reference.




2.  Report
of Independent Registered Public Accounting Firm




This
annual report does not include an attestation report of the Company’s registered
public accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by the Company’s registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit the Company to provide only management’s report
in this annual report.




3.Changes in internal control over
financial reporting.




During
the last quarter of the year under report, there was no change in the Company’s
internal control over financial reporting that has materially affected, or is
reasonably likely to materially affect, the Company’s internal control over
financial reporting.




Item
      9B.
            Other
      Information




Not
applicable.




PART
III




Item
      10.
            Directors,
      Executive Officers and Corporate
Governance




The
information contained under the headings “Section 16(a) Beneficial Ownership
Reporting Compliance”, “Proposal I - Election of Directors” and “Corporate
Governance” in the Company’s Proxy Statement for its 2010 Annual Meeting of
Stockholders (the “Proxy Statement”) is incorporated herein by
reference.




The
Company has adopted a Code of Ethics that applies to its principal executive
officer, principal financial officer, principal accounting officer or controller
or persons performing similar functions. A copy of the Code of Ethics will be
furnished without charge upon written request to the Chief Financial Officer,
Parke Bancorp, Inc., 601 Delsea Drive, Washington Township, New Jersey,
08080.


25




There
have been no material changes to the procedures by which security holders may
recommend nominees to the Registrant’s Board of Directors since the date of the
Registrant’s last proxy statement mailed to its stockholders.




Item
      11.
            Executive
      Compensation




The
information contained in the sections captioned “Executive Compensation” and
“Director Compensation” in the Proxy Statement is incorporated herein by
reference.




Item
      12.
            Security
      Ownership of Certain Beneficial Owners and Management and Related
      Stockholder Matters




(a)           Security
Ownership of Certain Beneficial Owners




The
information contained in the section captioned  “Principal Holders of
our Common Stock” in the Proxy Statement is incorporated herein by
reference.




(b)           Security
Ownership of Management




The
information contained in the sections captioned “Principal Holders of our Common
Stock” and “Proposal I – Election of Directors” in the Proxy Statement is
incorporated herein by reference.




(c)           Management
of the Registrant knows of no arrangements, including any pledge by any person
of securities of the Registrant, the operation of which may at a subsequent date
result in a change in control of the Registrant.




(d)           Securities
Authorized for Issuance Under Equity Compensation Plans





Set forth
below is information as of December 31, 2009 with respect to compensation plans
under which equity securities of the Registrant are authorized for
issuance.





( a
      )
            
            ( b
      )
            
            ( c
      )Number
      of Securities to be issued upon exercise of outstanding
      options
            
            Weighted-average
              exercise
      price of
              outstanding
      options
            
            Number
      of securities remaining available for issuance under equity
      compensation plans (excluding securities reflected in column
      (a))Equity
      compensation plans approved by shareholders
            
            320,181
            
            $         12.01
            
            148,181Total
            
            320,181
            
            $         12.01
            
            148,181





Item
      13.
            Certain
      Relationships and Related Transactions, and Director
      Independence




The
information contained in the sections captioned “Related Party Transactions” and
“Corporate Governance” in the Proxy Statement is incorporated herein by
reference.


26




Item
14.          Principal
Accountant Fees and Services




The
information contained in the section captioned “Proposal II - Ratification of
Appointment of Auditors” in the Proxy Statement is incorporated herein by
reference.




PART
IV




Item
      15.
            Exhibits
      and Financial Statement Schedules




(a)           Listed
below are all financial statements and exhibits filed as part of this
report.




1.
            The
      following financial statements and the independent auditors’ report
      included in the Annual Report are incorporated herein by
      reference:




•
            Management’s
      Report on Internal Controls




•
            Report
      of Independent Registered Public Accounting
Firm




•
            Consolidated
      Balance Sheets as of December 31, 2009 and
2008




•
            Consolidated
      Statements of Income For the Years Ended December 31, 2009 and
      2008.




•
            Consolidated
      Statements of Change in Shareholders’ Equity for the Years Ended December
      31, 2009 and 2008




•
            Consolidated
      Statements of Cash Flows for the Years Ended December 31, 2009 and
      2008




•
            Notes
      to Consolidated Financial
Statements




2.
            Schedules
      omitted as they are not applicable.




27


3.
            The
      following exhibits are included in this Report or incorporated herein by
      reference:






3.1
              
              Certificate
      of Incorporation of Parke Bancorp, Inc.*3.2
              
              Certificate
      of Amendment setting forth the terms of the Registrant’s Fixed Rate,
      Cumulative Perpetual Preferred Stock, Series A**3.3
              
              Bylaws
      of Parke Bancorp, Inc.*4.1
              
              Specimen
      stock certificate of Parke Bancorp, Inc.*4.2
              
              Specimen
      common stock purchase warrant of Parke Bancorp, Inc.*4.3
              
              Warrant
      to Purchase shares of the Registrant’s common stock, dated January 30,
      2009.**4.4
              
              Letter
      Agreement (including Securities Purchase Agreement Standard Terms attached
      as Exhibit A) dated January 30, 2009 betweenthe Registrant and the
      United States Department of the Treasury.**10.1
              
              Amended
      Employment Agreement Between Bancorp, Bank and Vito S.
      Pantilione****10.2
              
              Change
      in Control Agreement Between Bancorp, Bank and Elizabeth Milavsky, Paul
      Palmieri and David Middlebrook****10.3
              
              Supplemental
      Executive Retirement Plan*10.4
              
              1999
      Stock Option Plan*10.5
              
              2002
      Stock Option Plan*10.6
              
              2003
      Stock Option Plan*10.7
              
              2005
      Stock Option Plan***13
              
              Annual
      Report to Shareholders for the fiscal year ended December 31,
      200921
              
              Subsidiaries
      of the Registrant23
              
              Consent
      of McGladrey & Pullen, LLP31.1
              
              Certification
      of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of
      200231.2
              
              Certification
      of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of
      200232
              
              Certifications
      pursuant to Section 906 of the Sarbanes-Oxley Act of
  200299.1
              
              Certification
      of CEO pursuant to Section 111(b)(4) of EESA99.2
              
              Certification
      of CFO pursuant to Section 111(b)(4) of
EESA
 
 *
                
                Incorporated
      by reference to the Company’s Registration Statement on Form S-4 filed
      with the SEC on January 31, 2005.**
                
                Incorporated
      by reference to the Company’s Current Report on Form 8-K filed with the
      SEC on January 30, 2009.***
                
                Incorporated
      by reference to the Company’s Definitive Proxy Statement filed with the
      SEC on December 20, 2005.****
                
                Incorporated
      by reference to the Company’s Current Report on Form 8-  K filed
      with the SEC on November 29, 2007.


28










SIGNATURESPursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act
      of 1934, the Registrant has duly caused this Report to be signed on its
      behalf by the undersigned, thereunto duly authorized.PARKE
      BANCORP, INC.Dated:
      March 25, 2010
            
            
            /S/
      Vito S. PantilioneBy:
            Vito
      S. Pantilione
              President,
      Chief Executive Officer and DirectorPursuant
      to the requirement of the Securities Exchange Act of 1934, this Report has
      been signed below by the following persons on behalf of the Registrant and
      in the capacities indicated on March, 2010./s/
      Celestino R. Pennomi
            
            /s/
      Vito S. PantilioneCelestino
      R. Pennoni
            
            Vito
      S. PantilioneChairman
      of the Board and Director
            
            President,
      Chief Executive Office and Director/s/
      Fred G. Choate
            
            /s/
      Daniel J. DaltonFred
      G. Choate
            
            Daniel
      J. DaltonDirector
            
            Director/s/
      Arret F. Dobson
            
            /s/
      Thomas HedenbergArret
      F. Dobson
            
            Thomas
      HedenbergDirector
            
            Director/s/
      Anthony J. JannettiEdward
      Infantolino
            
            Anthony
      J. JannettiDirector
            
            Director/s/
      Jeffrey H. Krippitz
            
            /s/
      Richard PhalinesJeffrey
      H. Krippitz
            
            Richard
      PhalinesDirector
            
            Director/s/
      Jack C. Sheppard, Jr.
            
            /s/
      Ray H. TreschJack
      C. Sheppard, Jr.
            
            Ray
      H. TreschDirector
            
            Director/s/
      John F. HawkinsJohn
      F. HawkinsSenior
      Vice President and Chief Financial Officer(Principal
      Financial and Accounting Officer)Date:
            March
      25, 2010