----

----

| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|-----------------------------------------------------------------------------------------|

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

| Kentucky                                                      |   | 61-1142247                          |
|---------------------------------------------------------------|--------|-------------------------------------|
| (State or other jurisdiction ofincorporation or organization) |   | (I.R.S. EmployerIdentification No.) |
|                                                          |   |                                |
| 2500 Eastpoint Parkway, Louisville, Kentucky                  |   | 40223                               |
| (Address of principal executive offices)                      |   | (Zip Code)                          |

----

|   | Large accelerated filer   ̈ | Accelerated filer   ̈    |
|--------|-------------------------------------------|----------------------------------------|
|   | Non-accelerated filer   ̈        | Smaller reporting company  x |

----

----

|      |                                                        | Page   |
|-----------|-------------------------------------------------------------|--------|
| PART I -  | FINANCIAL INFORMATION                                       |   |
|      |                                                        |   |
| ITEM 1.   | FINANCIAL STATEMENTS                                        | 1      |
|      |                                                        |   |
| ITEM 2.   | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL     |   |
|      | CONDITION AND RESULTS OF OPERATIONS                         | 27     |
|      |                                                        |   |
| ITEM 3.   | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  | 39     |
|      |                                                        |   |
| ITEM 4.   | CONTROLS AND PROCEDURES                                     | 40     |
|      |                                                        |   |
| PART II - | OTHER INFORMATION                                           |   |
|      |                                                        |   |
| ITEM 1.   | LEGAL PROCEEDINGS                                           | 41     |
|      |                                                        |   |
| ITEM 1A.  | RISK FACTORS                                                | 41     |
|      |                                                        |   |
| ITEM 2.   | UNREGISTERED SALES ON EQUITY SECURITIES AND USE OF PROCEEDS | 41     |
|      |                                                        |   |
| ITEM 3.   | DEFAULTS UPON SENIOR SECURITIES                             | 41     |
|      |                                                        |   |
| ITEM 4.   | REMOVED & RESERVED                                      | 41     |
|      |                                                        |   |
| ITEM 5.   | OTHER INFORMATION                                           | 41     |
|      |                                                        |   |
| ITEM 6.   | EXHIBITS                                                    | 42     |

----

Item 1. Financial Statements

----

|                                                           |   | March 31, |      |   | December 31, |   |
|----------------------------------------------------------------|--------|-----------|-----------|--------|--------------|--------|
|                                                           |   | 2011      |      |   | 2010         |   |
| Assets                                                         |   |      |      |   |         |   |
| Cash and due from financial institutions                       |   | $         | 156,726   |   |         | $      | 178,693 |   |
| Federal funds sold                                             |   |      | 5,377     |   |         |   | 6,742 |   |
| Cash and cash equivalents                                      |   |      | 162,103   |   |         |   | 185,435 |   |
| Securities available for sale                                  |   |      | 163,032   |   |         |   | 106,309 |   |
| Mortgage loans held for sale                                   |   |      | 330       |   |         |   | 345 |   |
| Loans, net of allowance of $33,599 and $34,285, respectively   |   |      | 1,243,568 |   |         |   | 1,268,383 |   |
| Premises and equipment                                         |   |      | 22,175    |   |         |   | 22,468 |   |
| Other real estate owned                                        |   |      | 73,942    |   |         |   | 67,635 |   |
| Goodwill                                                       |   |      | 23,794    |   |         |   | 23,794 |   |
| Accrued interest receivable and other assets                   |   |      | 48,163    |   |         |   | 49,583 |   |
| Total assets                                                   |   | $         | 1,737,107 |   |         | $      | 1,723,952 |   |
|                                                           |   |      |      |   |         |   |   |   |
| Liabilities and Stockholders’ Equity                     |   |      |      |   |         |   |   |   |
| Deposits                                                       |   |      |      |   |         |   |   |   |
| Non-interest bearing                                           |   | $         | 106,772   |   |         | $      | 98,398 |   |
| Interest bearing                                               |   |      | 1,375,551 |   |         |   | 1,369,270 |   |
| Total deposits                                                 |   |      | 1,482,323 |   |         |   | 1,467,668 |   |
| Federal funds purchased and repurchase agreements              |   |      | 11,429    |   |         |   | 11,616 |   |
| Federal Home Loan Bank advances                                |   |      | 14,564    |   |         |   | 15,022 |   |
| Accrued interest payable and other liabilities                 |   |      | 5,507     |   |         |   | 6,681 |   |
| Subordinated capital note                                      |   |      | 8,550     |   |         |   | 8,550 |   |
| Junior subordinated debentures                                 |   |      | 25,000    |   |         |   | 25,000 |   |
| Total liabilities                                              |   |      | 1,547,373 |   |         |   | 1,534,537 |   |
|                                                           |   |      |      |   |         |   |   |   |
| Stockholders’ equity                                     |   |      |      |   |         |   |   |   |
| Preferred stock, no par, 1,000,000 shares authorized,          |   |      |      |   |         |   |   |   |
| Series A – 35,000 issued and outstanding;                |   |      |      |   |         |   |   |   |
| Liquidation preference of $35 million at March 31, 2011        |   |      | 34,528    |   |         |   | 34,484 |   |
| Series C – 317,042 issued and outstanding;               |   |      |      |   |         |   |   |   |
| Liquidation preference of $3.6 million at March 31, 2011       |   |      | 3,283     |   |         |   | 3,283 |   |
| Common stock, no par, 19,000,000 shares authorized, 11,840,176 |   |      |      |   |         |   |   |   |
| and 11,846,107 shares issued and outstanding, respectively     |   |      | 112,236   |   |         |   | 112,236 |   |
| Additional paid-in capital                                     |   |      | 19,526    |   |         |   | 19,438 |   |
| Retained earnings                                              |   |      | 18,017    |   |         |   | 17,822 |   |
| Accumulated other comprehensive income                         |   |      | 2,144     |   |         |   | 2,152 |   |
| Total stockholders' equity                                     |   |      | 189,734   |   |         |   | 189,415 |   |
| Total liabilities and stockholders’ equity               |   | $         | 1,737,107 |   |         | $      | 1,723,952 |   |

----

|                                                |   | Three Months Ended |   |
|-----------------------------------------------------|--------|--------------------|--------|
|                                                |   | March 31,          |   |
|                                                |   | 2011               |   |   | 2010 |   |
| Interest income                                     |   |               |   |   |   |   |
| Loans, including fees                               |   | $                  | 18,110 |   |   | $ | 19,873 |   |
| Taxable securities                                  |   |               | 1,042  |   |   |   | 2,335 |   |
| Tax exempt securities                               |   |               | 260    |   |   |   | 216 |   |
| Fed funds sold and other                            |   |               | 204    |   |   |   | 202 |   |
|                                                |   |               | 19,616 |   |   |   | 22,626 |   |
| Interest expense                                    |   |               |   |   |   |   |   |   |
| Deposits                                            |   |               | 5,360  |   |   |   | 7,383 |   |
| Federal Home Loan Bank advances                     |   |               | 142    |   |   |   | 720 |   |
| Subordinated capital note                           |   |               | 73     |   |   |   | 75 |   |
| Junior subordinated debentures                      |   |               | 155    |   |   |   | 152 |   |
| Federal funds purchased and other                   |   |               | 118    |   |   |   | 119 |   |
|                                                |   |               | 5,848  |   |   |   | 8,449 |   |
| Net interest income                                 |   |               | 13,768 |   |   |   | 14,177 |   |
| Provision for loan losses                           |   |               | 5,100  |   |   |   | 3,000 |   |
| Net interest income after provision for loan losses |   |               | 8,668  |   |   |   | 11,177 |   |
|                                                |   |               |   |   |   |   |   |   |
| Non-interest income                                 |   |               |   |   |   |   |   |   |
| Service charges on deposit accounts                 |   |               | 630    |   |   |   | 720 |   |
| Income from fiduciary activities                    |   |               | 255    |   |   |   | 252 |   |
| Secondary market brokerage fees                     |   |               | 76     |   |   |   | 60 |   |
| Title insurance commissions                         |   |               | 31     |   |   |   | 37 |   |
| Net gain on sales of loans originated for sale      |   |               | 221    |   |   |   | 91 |   |
| Net gain on sales of securities                     |   |               | 83     |   |   |   | 57 |   |
| Other                                               |   |               | 491    |   |   |   | 475 |   |
|                                                |   |               | 1,787  |   |   |   | 1,692 |   |
| Non-interest expense                                |   |               |   |   |   |   |   |   |
| Salaries and employee benefits                      |   |               | 4,124  |   |   |   | 3,947 |   |
| Occupancy and equipment                             |   |               | 972    |   |   |   | 1,022 |   |
| Other real estate owned expense                     |   |               | 1,367  |   |   |   | 378 |   |
| FDIC Insurance                                      |   |               | 855    |   |   |   | 705 |   |
| State franchise tax                                 |   |               | 582    |   |   |   | 543 |   |
| Professional fees                                   |   |               | 280    |   |   |   | 266 |   |
| Loan collection expense                             |   |               | 262    |   |   |   | 175 |   |
| Communications                                      |   |               | 168    |   |   |   | 186 |   |
| Postage and delivery                                |   |               | 123    |   |   |   | 188 |   |
| Advertising                                         |   |               | 102    |   |   |   | 96 |   |
| Other                                               |   |               | 560    |   |   |   | 543 |   |
|                                                |   |               | 9,395  |   |   |   | 8,049 |   |
| Income before income taxes                          |   |               | 1,060  |   |   |   | 4,820 |   |
| Income tax expense                                  |   |               | 261    |   |   |   | 1,564 |   |
| Net income                                          |   |               | 799    |   |   |   | 3,256 |   |
| Less:                                               |   |               |   |   |   |   |   |   |
| Dividends on preferred stock                        |   |               | 438    |   |   |   | 438 |   |
| Accretion on Series A preferred stock               |   |               | 44     |   |   |   | 44 |   |
| Earnings allocated to participating securities      |   |               | 12     |   |   |   | 42 |   |
| Net income available to common shareholders         |   | $                  | 305    |   |   | $ | 2,732 |   |
| Basic earnings per common share                     |   | $                  | 0.03   |   |   | $ | 0.30 |   |
| Diluted earnings per common share                   |   | $                  | 0.03   |   |   | $ | 0.30 |   |

----

|                                     |       |   |      |   |       |   |   |    |      |   |      |   |    |    |     |   | Accumulated   |   |   |    |
|------------------------------------------|------------|--------|-----------|--------|------------|--------|--------|---------|-----------|--------|-----------|--------|---------|---------|----------|--------|---------------|--------|--------|---------|
|                                     | Shares     |   | Amount    |   | Additional |   |   |    | Other     |   |      |   |
|                                     |       |   | Series A  |   | Series C   |   |   |    | Series A  |   | Series C  |   | Paid-In |    | Retained |   | Comprehensive |   |   |    |
|                                     | Common     |   | Preferred |   | Preferred  |   | Common |    | Preferred |   | Preferred |   | Capital |    | Earnings |   | Income        |   | Total  |    |
| Balances, January 1, 2011                | 11,846,107 |   | 35,000    |   | 317,042    |   | $      | 112,236 |      | $      | 34,484    |   | $       | 3,283   |     | $      | 19,438        |   | $      | 17,822  |   | $ | 2,152 |   | $ | 189,415 |   |
| Forfeited unvested stock                 | (5,931     | )      | –   |   | –    |   |   | – |      |   | –   |   |    | – |     |   | –       |   |   | – |   |   | – |   |   | – |   |
| Stock-based compensation expense         | –    |   | –   |   | –    |   |   | – |      |   | –   |   |    | – |     |   | 88            |   |   | – |   |   | – |   |   | 88 |   |
| Comprehensive income:                    |       |   |      |   |       |   |   |    |      |   |      |   |    |    |     |   |          |   |   |    |   |   |   |   |   |   |   |
| Net income                               | –    |   | –   |   | –    |   |   | – |      |   | –   |   |    | – |     |   | –       |   |   | 799     |   |   | – |   |   | 799 |   |
| Changes in accumulated other             |       |   |      |   |       |   |   |    |      |   |      |   |    |    |     |   |          |   |   |    |   |   |   |   |   |   |   |
|   comprehensive income,             |       |   |      |   |       |   |   |    |      |   |      |   |    |    |     |   |          |   |   |    |   |   |   |   |   |   |   |
|   net of taxes                      | –    |   | –   |   | –    |   |   | – |      |   | –   |   |    | – |     |   | –       |   |   | – |   |   | (8 | ) |   | (8 | ) |
| Total comprehensive income               | –    |   | –   |   | –    |   |   | – |      |   | –   |   |    | – |     |   | –       |   |   | – |   |   | – |   |   | 791 |   |
| Dividends 5% on Series A preferred stock | –    |   | –   |   | –    |   |   | – |      |   | –   |   |    | – |     |   | –       |   |   | (438    | ) |   | – |   |   | (438 | ) |
| Dividends on Series C preferred          |       |   |      |   |       |   |   |    |      |   |      |   |    |    |     |   |          |   |   |    |   |   |   |   |   |   |   |
|   stock ($0.01 per share)           | –    |   | –   |   | –    |   |   | – |      |   | –   |   |    | – |     |   | –       |   |   | (3      | ) |   | – |   |   | (3 | ) |
| Amortization of Series A preferred       |       |   |      |   |       |   |   |    |      |   |      |   |    |    |     |   |          |   |   |    |   |   |   |   |   |   |   |
|   stock discount                    | –    |   | –   |   | –    |   |   | – |      |   | 44        |   |    | – |     |   | –       |   |   | (44     | ) |   | – |   |   | – |   |
| Cash dividends declared on               |       |   |      |   |       |   |   |    |      |   |      |   |    |    |     |   |          |   |   |    |   |   |   |   |   |   |   |
|   common stock ($0.01 per share)    | –    |   | –   |   | –    |   |   | – |      |   | –   |   |    | – |     |   | –       |   |   | (119    | ) |   | – |   |   | (119 | ) |
|                                     |       |   |      |   |       |   |   |    |      |   |      |   |    |    |     |   |          |   |   |    |   |   |   |   |   |   |   |
| Balances, March 31, 2011                 | 11,840,176 |   | 35,000    |   | 317,042    |   | $      | 112,236 |      | $      | 34,528    |   | $       | 3,283   |     | $      | 19,526        |   | $      | 18,017  |   | $ | 2,144 |   | $ | 189,734 |   |

----

|                                                            |   | 2011   |    |   | 2010   |   |
|-----------------------------------------------------------------|--------|--------|---------|--------|--------|--------|
| Cash flows from operating activities                       |   |   |    |   |   |   |
| Net income                                                      |   | $      | 799     |   |   | $      | 3,256 |   |
| Adjustments to reconcile net income to                          |   |   |    |   |   |   |   |   |
|   net cash from operating activities                       |   |   |    |   |   |   |   |   |
| Depreciation and amortization                                   |   |   | 610     |   |   |   | 844 |   |
| Provision for loan losses                                       |   |   | 5,100   |   |   |   | 3,000 |   |
| Net amortization (accretion) on securities                      |   |   | 321     |   |   |   | (226 | ) |
| Stock-based compensation expense                                |   |   | 118     |   |   |   | 99 |   |
| Deferred income taxes                                           |   |   | 238     |   |   |   | 1,177 |   |
| Net gain on loans originated for sale                           |   |   | (221    | )      |   |   | (91 | ) |
| Loans originated for sale                                       |   |   | (7,188  | )      |   |   | (6,182 | ) |
| Proceeds from sales of loans originated for sale                |   |   | 7,234   |   |   |   | 5,588 |   |
| Net gain on sales of investment securities                      |   |   | (83     | )      |   |   | (57 | ) |
| Net (gain) loss on sales of other real estate owned             |   |   | 391     |   |   |   | (1 | ) |
| Net write-down of other real estate owned                       |   |   | 486     |   |   |   | 240 |   |
| Earnings on bank owned life insurance                           |   |   | (70     | )      |   |   | (70 | ) |
| Net change in accrued interest receivable and other assets      |   |   | 1,130   |   |   |   | 1,338 |   |
| Net change in accrued interest payable and other liabilities    |   |   | (1,169  | )      |   |   | (1,707 | ) |
| Net cash from operating activities                              |   |   | 7,696   |   |   |   | 7,208 |   |
| Cash flows from investing activities                       |   |   |    |   |   |   |   |   |
| Purchases of available-for-sale securities                      |   |   | (66,641 | )      |   |   | (23,105 | ) |
| Sales and calls of available-for-sale securities                |   |   | 2,894   |   |   |   | 8,163 |   |
| Maturities and prepayments of available-for-sale securities     |   |   | 6,773   |   |   |   | 6,832 |   |
| Proceeds from sale of other real estate owned                   |   |   | 624     |   |   |   | 878 |   |
| Improvements to other real estate owned                         |   |   | (1,037  | )      |   |   | (338 | ) |
| Loan originations and payments, net                             |   |   | 12,951  |   |   |   | 3,582 |   |
| Purchases of premises and equipment, net                        |   |   | (42     | )      |   |   | (35 | ) |
| Net cash from investing activities                              |   |   | (44,478 | )      |   |   | (4,023 | ) |
| Cash flows from financing activities                       |   |   |    |   |   |   |   |   |
| Net change in deposits                                          |   |   | 14,655  |   |   |   | (45,056 | ) |
| Net change in federal funds purchased and repurchase agreements |   |   | (187    | )      |   |   | 78 |   |
| Repayment of Federal Home Loan Bank advances                    |   |   | (458    | )      |   |   | (35,695 | ) |
| Cash dividends paid on preferred stock                          |   |   | (441    | )      |   |   | (438 | ) |
| Cash dividends paid on common stock                             |   |   | (119    | )      |   |   | (1,765 | ) |
| Net cash from financing activities                              |   |   | 13,450  |   |   |   | (82,876 | ) |
| Net change in cash and cash equivalents                         |   |   | (23,332 | )      |   |   | (79,691 | ) |
| Beginning cash and cash equivalents                             |   |   | 185,435 |   |   |   | 172,173 |   |
| Ending cash and cash equivalents                                |   | $      | 162,103 |   |   | $      | 92,482 |   |
| Supplemental cash flow information:                        |   |   |    |   |   |   |   |   |
| Interest paid                                                   |   | $      | 5,861   |   |   | $      | 8,744 |   |
| Income taxes paid                                               |   |   | — |   |   |   | — |   |
| Supplemental non-cash disclosure:                               |   |   |    |   |   |   |   |   |
| Transfer from loans to other real estate                        |   | $      | 8,812   |   |   | $      | 52,214 |   |
| Financed sales of other real estate owned                       |   |   | 2,041   |   |   |   | 6,295 |   |

----

----

|                   |   | Three Months Ended |    |   | Twelve Months Ended |   |
|------------------------|--------|--------------------|---------|--------|---------------------|--------|
|                   |   | March 31, 2011     |    |   | December 31, 2010   |   |
|                   |   |               |    |   | Weighted            |   |   |   |   |   | Weighted |   |
|                   |   |               |    |   | Average             |   |   |   |   |   | Average |   |
|                   |   |               |    |   | Exercise            |   |   |   |   |   | Exercise |   |
|                   |   | Options            |    |   | Price               |   |   | Options |   |   | Price |   |
| Outstanding, beginning |   |               | 86,469  |   |                | $      | 20.72 |   |   |   | 312,227 |   |   | $ | 21.80 |   |
| Forfeited              |   |               | (291    | )      |                |   | 22.03 |   |   |   | (16,797 | ) |   |   | 21.55 |   |
| Expired                |   |               | (27,699 | )      |                |   | 22.03 |   |   |   | (208,961 | ) |   |   | 22.27 |   |
| Outstanding, ending    |   |               | 58,479  |   |                | $      | 20.09 |   |   |   | 86,469 |   |   | $ | 20.72 |   |

|                                            |   | March 31, 2011 |   |
|-------------------------------------------------|--------|----------------|--------|
| Stock options vested and currently exercisable: |   |           | 58,479 |   |
| Weighted average exercise price                 |   | $              | 20.09  |   |
| Aggregate intrinsic value                       |   | $              | 0      |   |
| Weighted average remaining life (in years)      |   |           | 0.9    |   |
| Total Options Outstanding:                      |   |           | 58,479 |   |
| Aggregate intrinsic value                       |   | $              | 0      |   |
| Weighted average remaining life (in years)      |   |           | 0.9    |   |

----

|                   |   | Three Months Ended |    |   | Twelve Months Ended |   |
|------------------------|--------|--------------------|---------|--------|---------------------|--------|
|                   |   | March 31, 2011     |    |   | December 31, 2010   |   |
|                   |   |               |    |   | Weighted            |   |   |   |   |   | Weighted |   |
|                   |   |               |    |   | Average             |   |   |   |   |   | Average |   |
|                   |   |               |    |   | Grant               |   |   |   |   |   | Grant |   |
|                   |   | Shares             |    |   | Price               |   |   | Shares |   |   | Price |   |
| Outstanding, beginning |   |               | 157,697 |   |                | $      | 13.43 |   |   |   | 119,598 |   |   | $ | 15.00 |   |
| Granted                |   |               | — |   |                |   | — |   |   |   | 72,655 |   |   |   | 11.11 |   |
| Vested                 |   |               | (26,909 | )      |                |   | 12.25 |   |   |   | (24,505 | ) |   |   | 14.46 |   |
| Forfeited              |   |               | (5,886  | )      |                |   | 14.08 |   |   |   | (10,051 | ) |   |   | 12.78 |   |
| Outstanding, ending    |   |               | 124,902 |   |                | $      | 13.65 |   |   |   | 157,697 |   |   | $ | 13.43 |   |

| April 2011 – December 2011 |   | $      | 355 |   |
|----------------------------------|--------|--------|-----|--------|
| 2012                             |   |   | 463 |   |
| 2013                             |   |   | 377 |   |
| 2014                             |   |   | 264 |   |
| 2015 & thereafter       |   |   | 169 |   |

----

|                                |   | AmortizedCost  |    |   | GrossUnrealizedGains |   |    | GrossUnrealizedLosses |   |   | FairValue |   |
|-------------------------------------|--------|----------------|---------|--------|----------------------|--------|---------|-----------------------|--------|--------|-----------|--------|
|                                |   | (in thousands) |    |
| March 31, 2011                      |   |           |    |   |                 |   |    |                  |   |   |      |   |
| U.S. Government and federal agency  |   | $              | 10,595  |   |                 | $      | 60      |                  |   | $      | —   |   |   | $ | 10,655 |   |
| Agency mortgage-backed: residential |   |           | 109,491 |   |                 |   | 1,438   |                  |   |   | (375      | )      |   |   | 110,554 |   |
| State and municipal                 |   |           | 30,427  |   |                 |   | 1,315   |                  |   |   | (2        | )      |   |   | 31,740 |   |
| Corporate bonds                     |   |           | 7,249   |   |                 |   | 579     |                  |   |   | (23       | )      |   |   | 7,805 |   |
| Other                               |   |           | 572     |   |                 |   | — |                  |   |   | —   |   |   |   | 572 |   |
| Total debt securities               |   |           | 158,334 |   |                 |   | 3,392   |                  |   |   | (400      | )      |   |   | 161,326 |   |
| Equity                              |   |           | 1,400   |   |                 |   | 311     |                  |   |   | (5        | )      |   |   | 1,706 |   |
| Total                               |   | $              | 159,734 |   |                 | $      | 3,703   |                  |   | $      | (405      | )      |   | $ | 163,032 |   |

| December 31, 2010                   |   |   |    |   |   |   |    |   |   |   |    |   |
|-------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|
| U.S. Government and federal agency  |   | $      | 5,973   |   |   | $      | 37      |   |   | $      | — |   |   | $ | 6,010 |   |
| Agency mortgage-backed: residential |   |   | 60,270  |   |   |   | 1,590   |   |   |   | (5      | )      |   |   | 61,855 |   |
| State and municipal                 |   |   | 26,039  |   |   |   | 995     |   |   |   | (32     | )      |   |   | 27,002 |   |
| Corporate bonds                     |   |   | 8,744   |   |   |   | 507     |   |   |   | (32     | )      |   |   | 9,219 |   |
| Other                               |   |   | 572     |   |   |   | — |   |   |   | — |   |   |   | 572 |   |
| Total debt securities               |   |   | 101,598 |   |   |   | 3,129   |   |   |   | (69     | )      |   |   | 104,658 |   |
| Equity                              |   |   | 1,400   |   |   |   | 254     |   |   |   | (3      | )      |   |   | 1,651 |   |
| Total                               |   | $      | 102,998 |   |   | $      | 3,383   |   |   | $      | (72     | )      |   | $ | 106,309 |   |

|         |   | Three Months Ended |    |
|--------------|--------|--------------------|---------|
|         |   | March 31,          |    |
|         |   | 2011               |    |   | 2010 |   |
|         |   | (in thousands)     |    |
| Proceeds     |   | $                  | 2,894   |   |   | $ | 8,163 |   |
| Gross gains  |   |               | 83      |   |   |   |  256 |   |
| Gross losses |   |               | — |   |   |   | (199 | )  |

|                     |   | March 31, 2011 |    |
|--------------------------|--------|----------------|---------|
|                     |   | AmortizedCost  |    |   | FairValue |   |
|                     |   | (in thousands) |    |
| Maturity            |   |           |    |   |   |   |
| Available-for-sale  |   |           |    |   |   |   |
| Within one year          |   | $              | 1,725   |   |   | $ | 1,751 |   |
| One to five years        |   |           | 14,640  |   |   |   | 15,404 |   |
| Five to ten years        |   |           | 30,158  |   |   |   | 31,255 |   |
| Beyond ten years         |   |           | 2,320   |   |   |   | 2,362 |   |
| Mortgage-backed          |   |           | 109,491 |   |   |   | 110,554 |   |
| Total                    |   | $         | 158,334 |   |   | $  |  161,326 |   |

----

|                                |   | Less than 12 Months |   |   | 12 Months or More |   |   | Total     |   |
|-------------------------------------|--------|---------------------|--------|--------|-------------------|--------|--------|-----------|--------|
| Description of Securities           |   | FairValue           |   |   | UnrealizedLoss    |   |   | FairValue |   |   | UnrealizedLoss |   |   | FairValue |   |   | UnrealizedLoss |   |
|                                |   | (in thousands)      |   |
| March 31, 2011                      |   |                |   |   |              |   |   |      |   |   |   |   |   |   |   |   |   |   |
| Agency mortgage-backed: residential |   | $                   | 38,501 |   |              | $      | (375   | )         |   | $ | — |   |   | $ | — |   |   | $ | 38,501 |   |   | $ | (375 | ) |
| State and municipal                 |   |                | 1,137  |   |              |   | (2     | )         |   |   | — |   |   |   | — |   |   |   | 1,137 |   |   |   | (2 | ) |
| Corporate bonds                     |   |                | 1,004  |   |              |   | (23    | )         |   |   | — |   |   |   | — |   |   |   | 1,004 |   |   |   | (23 | ) |
| Equity                              |   |                | 27     |   |              |   | (2     | )         |   |   | 19 |   |   |   | (3 | ) |   |   | 46 |   |   |   | (5 | ) |
|                                |   |                |   |   |              |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total temporarily impaired          |   | $                   | 40,669 |   |              | $      | (402   | )         |   | $ | 19 |   |   | $ | (3 | ) |   | $ | 40,688 |   |   | $ | (405 | ) |
|                                |   |                |   |   |              |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                |   |                |   |   |              |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| December 31, 2010                   |   |                |   |   |              |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| State and municipal                 |   | $                   | 3,119  |   |              | $      | (32    | )         |   | $ | — |   |   | $ | — |   |   | $ | 3,119 |   |   | $ | (32 | ) |
| Agency mortgage-backed: residential |   |                | 1,060  |   |              |   | (5     | )         |   |   | — |   |   |   | — |   |   |   | 1,060 |   |   |   | (5 | ) |
| Corporate bonds                     |   |                | 995    |   |              |   | (32    | )         |   |   | — |   |   |   | — |   |   |   | 995 |   |   |   | (32 | ) |
| Equity                              |   |                | 27     |   |              |   | (1     | )         |   |   | 74 |   |   |   | (2 | ) |   |   | 101 |   |   |   | (3 | ) |
|                                |   |                |   |   |              |   |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total temporarily impaired          |   | $                   | 5,201  |   |              | $      | (70    | )         |   | $ | 74 |   |   | $ | (2 | ) |   | $ | 5,275 |   |   | $ | (72 | ) |

----

|                            |   | March 31,2011  |      |   | December 31,2010 |   |
|---------------------------------|--------|----------------|-----------|--------|------------------|--------|
|                            |   | (in thousands) |      |
| Commercial                      |   | $              | 76,521    |   |             | $      | 90,290 |   |
| Commercial Real Estate:         |   |           |      |   |             |   |   |   |
| Construction                    |   |           | 175,805   |   |             |   | 199,524 |   |
| Farmland                        |   |           | 86,161    |   |             |   | 85,523 |   |
| Other                           |   |           | 458,278   |   |             |   | 441,844 |   |
| Residential Real Estate:        |   |           |      |   |             |   |   |   |
| Multi-family                    |   |           | 75,283    |   |             |   | 74,919 |   |
| Other                           |   |           | 349,247   |   |             |   | 353,418 |   |
| Consumer                        |   |           | 30,758    |   |             |   | 31,913 |   |
| Agriculture                     |   |           | 24,158    |   |             |   | 24,177 |   |
| Other                           |   |           | 956       |   |             |   | 1,060 |   |
| Subtotal                        |   |           | 1,277,167 |   |             |   | 1,302,668 |   |
| Less: Allowance for loan losses |   |           | (33,599   | )      |             |   | (34,285 | ) |
| Loans, net                      |   | $              | 1,243,568 |   |             | $      | 1,268,383 |   |

|                      |   | For the Three Months Ended |   |
|---------------------------|--------|----------------------------|--------|
|                      |   | March 31,2011              |   |   | March 31,2010 |   |
|                      |   | (in thousands)             |   |
| Beginning balance         |   | $                          | 34,285 |   |   | $ | 26,392 |   |
| Provision for loan losses |   |                       | 5,100  |   |   |   | 3,000 |   |
| Loans charged-off         |   |                       | (5,867 | ) |   |   | (2,906 | ) |
| Loan recoveries           |   |                       | 81     |   |   |   | 57 |   |
| Ending balance            |   | $                          | 33,599 |   |   | $ | 26,543 |   |

|                      |   | Commercial |   |   | CommercialReal Estate |   |   | ResidentialReal Estate |   |   | Consumer |   |   | Agriculture |   |          | Other  |   |    | Total  |   |
|---------------------------|--------|------------|--------|--------|-----------------------|--------|--------|------------------------|--------|--------|----------|--------|--------|-------------|--------|---------------|--------|--------|---------|--------|--------|
|                      |   |       |   |   |                  |   |   |                   |   |   |     |   |   |        |   |          |   |   |    |   |   |
|                      |   |       |   |   |                  |   |   |                   |   |   |     |   |   |        |   |          |   |   |    |   |   |
| Beginning balance         |   | $          | 2,147  |   |                  | $      | 24,075 |                   |   | $      | 7,224    |   |   | $           | 701    |          |   | $      | 134     |   |   | $ | 4 |   |   | $ | 34,285 |   |
| Provision for loan losses |   |       | (106   | )      |                  |   | 3,457  |                   |   |   | 1,618    |   |   |        | 122    |          |   |   | 5       |   |   |   | 4 |   |   |   | 5,100 |   |
| Loans charged off         |   |       | (79    | )      |                  |   | (4,141 | )                      |   |   | (1,434   | )      |   |        | (213   | )   |   |   | – |   |   |   | – |   |   |   | (5,867 | ) |
| Recoveries                |   |       | 12     |   |                  |   | 5      |                   |   |   | 43       |   |   |        | 21     |          |   |   | – |   |   |   | – |   |   |   | 81 |   |
|                      |   |       |   |   |                  |   |   |                   |   |   |     |   |   |        |   |          |   |   |    |   |   |   |   |   |   |   |   |   |
| Ending balance            |   | $          | 1,974  |   |                  | $      | 23,396 |                   |   | $      | 7,451    |   |   | $           | 631    |          |   | $      | 139     |   |   | $ | 8 |   |   | $ | 33,599 |   |

----

|                                            |   | Commercial |   |   | CommercialReal Estate |   |    | ResidentialReal Estate |   |   | Consumer |   |   | Agriculture |    |   | Other  |   |    | Total  |   |
|-------------------------------------------------|--------|------------|--------|--------|-----------------------|--------|---------|------------------------|--------|--------|----------|--------|--------|-------------|---------|--------|--------|--------|---------|--------|--------|
|                                            |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |
| Allowance for loan losses:                      |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |
| Ending allowance balance attributable to loans: |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |
| Individually evaluated for impairment           |   | $          | 57     |   |                  | $      | 4,660   |                   |   | $      | —  |   |   | $           | — |   |   | $      | — |   |   | $ | — |   |   | $ | 4,717 |   |
| Collectively evaluated for impairment           |   |       | 1,917  |   |                  |   | 18,736  |                   |   |   | 7,451    |   |   |        | 631     |   |   |   | 139     |   |   |   | 8 |   |   |   | 28,882 |   |
|                                            |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Total ending allowance balance                  |   | $          | 1,974  |   |                  | $      | 23,396  |                   |   | $      | 7,451    |   |   | $           | 631     |   |   | $      | 139     |   |   | $ | 8 |   |   | $ | 33,599 |   |
|                                            |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
|                                            |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Loans:                                          |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Loans individually evaluated for impairment     |   | $          | 3,475  |   |                  | $      | 60,246  |                   |   | $      | 10,629   |   |   | $           | — |   |   | $      | 86      |   |   | $ | — |   |   | $ | 74,436 |   |
| Loans collectively evaluated for impairment     |   |       | 73,046 |   |                  |   | 659,998 |                   |   |   | 413,901  |   |   |        | 30,758  |   |   |   | 24,072  |   |   |   | 956 |   |   |   | 1,202,731 |   |
|                                            |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Total ending loans balance                      |   | $          | 76,521 |   |                  | $      | 720,244 |                   |   | $      | 424,530  |   |   | $           | 30,758  |   |   | $      | 24,158  |   |   | $ | 956 |   |   | $ | 1,277,167 |   |

|                                            |   | Commercial |   |   | CommercialReal Estate |   |    | ResidentialReal Estate |   |   | Consumer |   |   | Agriculture |    |   | Other  |   |    | Total  |   |
|-------------------------------------------------|--------|------------|--------|--------|-----------------------|--------|---------|------------------------|--------|--------|----------|--------|--------|-------------|---------|--------|--------|--------|---------|--------|--------|
|                                            |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |
| Allowance for loan losses:                      |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |
| Ending allowance balance attributable to loans: |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |
| Individually evaluated for impairment           |   | $          | 23     |   |                  | $      | 5,096   |                   |   | $      | —  |   |   | $           | — |   |   | $      | — |   |   | $ | — |   |   | $ | 5,119 |   |
| Collectively evaluated for impairment           |   |       | 2,124  |   |                  |   | 18,979  |                   |   |   | 7,224    |   |   |        | 701     |   |   |   | 134     |   |   |   | 4 |   |   |   | 29,166 |   |
|                                            |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Total ending allowance balance                  |   | $          | 2,147  |   |                  | $      | 24,075  |                   |   | $      | 7,224    |   |   | $           | 701     |   |   | $      | 134     |   |   | $ | 4 |   |   | $ | 34,285 |   |
|                                            |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
|                                            |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Loans:                                          |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Loans individually evaluated for impairment     |   | $          | 3,673  |   |                  | $      | 51,223  |                   |   | $      | 16,718   |   |   | $           | — |   |   | $      | 112     |   |   | $ | — |   |   | $ | 71,726 |   |
| Loans collectively evaluated for impairment     |   |       | 86,617 |   |                  |   | 675,668 |                   |   |   | 411,619  |   |   |        | 31,913  |   |   |   | 24,065  |   |   |   | 1,060 |   |   |   | 1,230,942 |   |
|                                            |   |       |   |   |                  |   |    |                   |   |   |     |   |   |        |    |   |   |   |    |   |   |   |   |   |   |   |   |   |
| Total ending loans balance                      |   | $          | 90,290 |   |                  | $      | 726,891 |                   |   | $      | 428,337  |   |   | $           | 31,913  |   |   | $      | 24,177  |   |   | $ | 1,060 |   |   | $ | 1,302,668 |   |

----

|                                              |   | March 31,2011  |   |   | December 31,2010 |   |
|---------------------------------------------------|--------|----------------|--------|--------|------------------|--------|
|                                              |   | (in thousands) |   |
| Loans with no allocated allowance for loan losses |   | $              | 40,019 |   |             | $      | 41,885 |   |
| Loans with allocated allowance for loan losses    |   |           | 34,417 |   |             |   | 29,841 |   |
| Total                                             |   | $              | 74,436 |   |             | $      | 71,726 |   |
| Amount of the allowance for loan losses allocated |   | $              | 4,717  |   |             | $      | 5,119 |   |

|                                         |   | Three MonthsEndedMarch 31,2011 |   |   | Year EndedDecember 31,2010 |   |
|----------------------------------------------|--------|--------------------------------|--------|--------|----------------------------|--------|
| Average of impaired loans during the period  |   | $                              | 73,081 |   |                       | $      | 69,167 |   |
| Interest income recognized during impairment |   |                           | 338    |   |                       |   | 1,358 |   |
| Cash basis interest income recognized        |   |                           | 87     |   |                       |   | 115 |   |

|                                |   | UnpaidPrincipalBalance |    |   | RecordedInvestment |   |    | AllowanceFor LoanLossesAllocated |   |   | AverageRecordedInvestment |   |   | InterestIncomeRecognized |    |   | Cash BasisInterestRecognized |   |
|-------------------------------------|--------|------------------------|---------|--------|--------------------|--------|---------|----------------------------------|--------|--------|---------------------------|--------|--------|--------------------------|---------|--------|------------------------------|--------|
|                                |   |                   |    |   |               |   |    |                             |   |   |                      |   |   |                     |    |   |                         |   |
|                                |   | (in thousands)         |    |
| With No Related Allowance Recorded: |   |                   |    |
| Commercial                          |   | $                      | 2,370   |   |               | $      | 2,334   |                             |   | $      | —                   |   |   | $                        | 2,428   |   |                         | $      | 22 |   |   | $ | 8 |   |
| Commercial real estate:             |   |                   |    |   |               |   |    |                             |   |   |                      |   |   |                     |    |   |                         |   |   |   |   |   |   |   |
| Construction                        |   |                   | 3,901   |   |               |   | 3,901   |                             |   |   | —                   |   |   |                     | 6,917   |   |                         |   | 11 |   |   |   | 3 |   |
| Farmland                            |   |                   | 6,754   |   |               |   | 6,754   |                             |   |   | —                   |   |   |                     | 6,750   |   |                         |   | 86 |   |   |   | 7 |   |
| Other                               |   |                   | 19,435  |   |               |   | 16,315  |                             |   |   | —                   |   |   |                     | 14,692  |   |                         |   | 44 |   |   |   | 14 |   |
| Residential real estate:            |   |                   |    |   |               |   |    |                             |   |   |                      |   |   |                     |    |   |                         |   |   |   |   |   |   |   |
| Multi-family                        |   |                   | 3,912   |   |               |   | 3,912   |                             |   |   | —                   |   |   |                     | 3,920   |   |                         |   | 46 |   |   |   | — |   |
| Other                               |   |                   | 7,810   |   |               |   | 6,717   |                             |   |   | —                   |   |   |                     | 9,753   |   |                         |   | 76 |   |   |   | 2 |   |
| Consumer                            |   |                   | — |   |               |   | — |                             |   |   | —                   |   |   |                     | — |   |                         |   | — |   |   |   | — |   |
| Agriculture                         |   |                   | 86      |   |               |   | 86      |                             |   |   | —                   |   |   |                     | 99      |   |                         |   | — |   |   |   | — |   |
| Other                               |   |                   | — |   |               |   | — |                             |   |   | —                   |   |   |                     | — |   |                         |   | — |   |   |   | — |   |
| With An Allowance Recorded:         |   |                   |    |   |               |   |    |                             |   |   |                      |   |   |                     |    |   |                         |   |   |   |   |   |   |   |
| Commercial                          |   |                   | 1,141   |   |               |   | 1,141   |                             |   |   | 57                        |   |   |                     | 1,145   |   |                         |   | 24 |   |   |   | 24 |   |
| Commercial real estate:             |   |                   |    |   |               |   |    |                             |   |   |                      |   |   |                     |    |   |                         |   |   |   |   |   |   |   |
| Construction                        |   |                   | 6,105   |   |               |   | 5,633   |                             |   |   | 796                       |   |   |                     | 4,807   |   |                         |   | — |   |   |   | — |   |
| Farmland                            |   |                   | 1,234   |   |               |   | 1,234   |                             |   |   | 90                        |   |   |                     | 1,234   |   |                         |   | — |   |   |   | — |   |
| Other                               |   |                   | 28,361  |   |               |   | 26,409  |                             |   |   | 3,774                     |   |   |                     | 21,336  |   |                         |   | 29 |   |   |   | 29 |   |
| Residential real estate:            |   |                   |    |   |               |   |    |                             |   |   |                      |   |   |                     |    |   |                         |   |   |   |   |   |   |   |
| Multi-family                        |   |                   | — |   |               |   | — |                             |   |   | —                   |   |   |                     | — |   |                         |   | — |   |   |   | — |   |
| Other                               |   |                   | — |   |               |   | — |                             |   |   | —                   |   |   |                     | — |   |                         |   | — |   |   |   | — |   |
| Consumer                            |   |                   | — |   |               |   | — |                             |   |   | —                   |   |   |                     | — |   |                         |   | — |   |   |   | — |   |
| Agriculture                         |   |                   | — |   |               |   | — |                             |   |   | —                   |   |   |                     | — |   |                         |   | — |   |   |   | — |   |
| Other                               |   |                   | — |   |               |   | — |                             |   |   | —                   |   |   |                     | — |   |                         |   | — |   |   |   | — |   |
|                                |   |                   |    |   |               |   |    |                             |   |   |                      |   |   |                     |    |   |                         |   |   |   |   |   |   |   |
| Total                               |   | $                      | 81,109  |   |               | $      | 74,436  |                             |   | $      | 4,717                     |   |   | $                        | 73,081  |   |                         | $      | 338 |   |   | $ | 87 |   |

----

|                                |   | UnpaidPrincipalBalance |    |   | RecordedInvestment |   |    | AllowanceFor LoanLossesAllocated |   |
|-------------------------------------|--------|------------------------|---------|--------|--------------------|--------|---------|----------------------------------|--------|
|                                |   | (in thousands)         |    |
| With No Related Allowance Recorded: |   |                   |    |   |               |   |    |                             |   |
| Commercial                          |   | $                      | 2,559   |   |               | $      | 2,523   |                             |   | $ | — |   |
| Commercial real estate:             |   |                   |    |   |               |   |    |                             |   |   |   |   |
| Construction                        |   |                   | 3,269   |   |               |   | 3,268   |                             |   |   | — |   |
| Farmland                            |   |                   | 6,745   |   |               |   | 6,746   |                             |   |   | — |   |
| Other                               |   |                   | 12,662  |   |               |   | 12,518  |                             |   |   | — |   |
| Residential real estate:            |   |                   |    |   |               |   |    |                             |   |   |   |   |
| Multi-family                        |   |                   | 3,929   |   |               |   | 3,929   |                             |   |   | — |   |
| Other                               |   |                   | 13,303  |   |               |   | 12,789  |                             |   |   | — |   |
| Consumer                            |   |                   | — |   |               |   | — |                             |   |   | — |   |
| Agriculture                         |   |                   | 119     |   |               |   | 112     |                             |   |   | — |   |
| Other                               |   |                   | — |   |               |   | — |                             |   |   | — |   |
| With An Allowance Recorded:         |   |                   |    |   |               |   |    |                             |   |   |   |   |
| Commercial                          |   |                   | 1,150   |   |               |   | 1,150   |                             |   |   | 23 |   |
| Commercial real estate:             |   |                   |    |   |               |   |    |                             |   |   |   |   |
| Construction                        |   |                   | 13,314  |   |               |   | 10,645  |                             |   |   | 1,923 |   |
| Farmland                            |   |                   | 1,234   |   |               |   | 1,234   |                             |   |   | 89 |   |
| Other                               |   |                   | 16,912  |   |               |   | 16,812  |                             |   |   | 3,084 |   |
| Residential real estate:            |   |                   |    |   |               |   |    |                             |   |   |   |   |
| Multi-family                        |   |                   | — |   |               |   | — |                             |   |   | — |   |
| Other                               |   |                   | — |   |               |   | — |                             |   |   | — |   |
| Consumer                            |   |                   | — |   |               |   | — |                             |   |   | — |   |
| Agriculture                         |   |                   | — |   |               |   | — |                             |   |   | — |   |
| Other                               |   |                   | — |   |               |   | — |                             |   |   | — |   |
|                                |   |                   |    |   |               |   |    |                             |   |   |   |   |
| Total                               |   | $                      | 75,196  |   |               | $      | 71,726  |                             |   | $ | 5,119 |   |

----

|                                            |   | March 31,2011  |   |   | December 31,2010 |   |
|-------------------------------------------------|--------|----------------|--------|--------|------------------|--------|
|                                            |   | (in thousands) |   |
| Loans past due 90 days or more still on accrual |   | $              | 3,907  |   |             | $      | 594 |   |
| Non-accrual loans                               |   |           | 65,964 |   |             |   | 59,799 |   |

----

|                     |   | Nonaccrual     |    |   | Loans PastDue 90 DaysAnd Over StillAccruing |   |
|--------------------------|--------|----------------|---------|--------|---------------------------------------------|--------|
|                     |   | 2011           |    |   | 2010                                        |   |   | 2011 |   |   | 2010 |   |
|                     |   | (in thousands) |    |
|                     |   |           |    |   |                                        |   |   |   |   |   |   |   |
| Commercial               |   | $              | 2,575   |   |                                        | $      | 2,778 |   |   | $ | 394 |   |   | $ | 432 |   |
| Commercial Real Estate:  |   |           |    |   |                                        |   |   |   |   |   |   |   |   |   |   |   |
| Construction             |   |           | 8,718   |   |                                        |   | 12,651 |   |   |   | 100 |   |   |   | — |   |
| Farmland                 |   |           | 2,836   |   |                                        |   | 2,811 |   |   |   | 314 |   |   |   | 143 |   |
| Other                    |   |           | 31,888  |   |                                        |   | 23,031 |   |   |   | 854 |   |   |   | 12 |   |
| Residential Real Estate: |   |           |    |   |                                        |   |   |   |   |   |   |   |   |   |   |   |
| Multi-family             |   |           | 1,075   |   |                                        |   | 345 |   |   |   | 168 |   |   |   | — |   |
| Other                    |   |           | 18,554  |   |                                        |   | 17,778 |   |   |   | 1,873 |   |   |   | — |   |
| Consumer                 |   |           | 232     |   |                                        |   | 293 |   |   |   | 174 |   |   |   | 7 |   |
| Agriculture              |   |           | 86      |   |                                        |   | 112 |   |   |   | 30 |   |   |   | — |   |
| Other                    |   |           | — |   |                                        |   | — |   |   |   | — |   |   |   | — |   |
|                     |   |           |    |   |                                        |   |   |   |   |   |   |   |   |   |   |   |
| Total                    |   | $              | 65,964  |   |                                        | $      | 59,799 |   |   | $ | 3,907 |   |   | $ | 594 |   |

|                     |   | 30 – 59DaysPast Due |    |   | 60 – 89DaysPast Due |   |    | 90 DaysAnd OverPast Due |   |   |   Non-accrual |   |   | TotalPast DueAndNon-accrual |    |   |  Loans NotPast Due |   |    |   Total |   |
|--------------------------|--------|---------------------------|---------|--------|---------------------------|--------|---------|-------------------------|--------|--------|-------------------------|--------|--------|-----------------------------|---------|--------|-------------------------|--------|---------|-------------------|--------|
|                     |   |                      |    |   |                      |   |    |                    |   |   |                    |   |   |                        |    |   |                    |   |    |              |   |
| March 31, 2011           |   |                      |    |   |                      |   |    |                    |   |   |                    |   |   |                        |    |   |                    |   |    |              |   |
| Commercial               |   | $                         | 6,997   |   |                      | $      | 871     |                    |   | $      | 394                     |   |   | $                           | 2,575   |   |                    | $      | 10,837  |              |   | $ | 65,684 |   |   | $ | 76,521 |   |
| Commercial Real Estate:  |   |                      |    |   |                      |   |    |                    |   |   |                    |   |   |                        |    |   |                    |   |    |              |   |   |   |   |   |   |   |   |
| Construction             |   |                      | 3,757   |   |                      |   | 6,997   |                    |   |   | 100                     |   |   |                        | 8,718   |   |                    |   | 19,572  |              |   |   | 156,233 |   |   |   | 175,805 |   |
| Farmland                 |   |                      | 1,034   |   |                      |   | 342     |                    |   |   | 314                     |   |   |                        | 2,836   |   |                    |   | 4,526   |              |   |   | 81,635 |   |   |   | 86,161 |   |
| Other                    |   |                      | 7,056   |   |                      |   | 13,205  |                    |   |   | 854                     |   |   |                        | 31,888  |   |                    |   | 53,003  |              |   |   | 405,275 |   |   |   | 458,278 |   |
| Residential Real Estate: |   |                      |    |   |                      |   |    |                    |   |   |                    |   |   |                        |    |   |                    |   |    |              |   |   |   |   |   |   |   |   |
| Multi-family             |   |                      | 1,897   |   |                      |   | 1,100   |                    |   |   | 168                     |   |   |                        | 1,075   |   |                    |   | 4,240   |              |   |   | 71,043 |   |   |   | 75,283 |   |
| Other                    |   |                      | 11,599  |   |                      |   | 2,259   |                    |   |   | 1,873                   |   |   |                        | 18,554  |   |                    |   | 34,285  |              |   |   | 314,962 |   |   |   | 349,247 |   |
| Consumer                 |   |                      | 755     |   |                      |   | 219     |                    |   |   | 174                     |   |   |                        | 232     |   |                    |   | 1,380   |              |   |   | 29,378 |   |   |   | 30,758 |   |
| Agriculture              |   |                      | 272     |   |                      |   | 31      |                    |   |   | 30                      |   |   |                        | 86      |   |                    |   | 419     |              |   |   | 23,739 |   |   |   | 24,158 |   |
| Other                    |   |                      | — |   |                      |   | — |                    |   |   | —                 |   |   |                        | — |   |                    |   | — |              |   |   | 956 |   |   |   | 956 |   |
|                     |   |                      |    |   |                      |   |    |                    |   |   |                    |   |   |                        |    |   |                    |   |    |              |   |   |   |   |   |   |   |   |
| Total                    |   | $                         | 33,367  |   |                      | $      | 25,024  |                    |   | $      | 3,907                   |   |   | $                           | 65,964  |   |                    | $      | 128,262 |              |   | $ | 1,148,905 |   |   | $ | 1,277,167 |   |

----

|                     |   | 30 – 59DaysPast Due |    |   | 60 – 89DaysPast Due |   |    | 90 DaysAnd OverPast Due |   |   |   Non-accrual |   |   | TotalPast DueAndNon-accrual |    |   |  Loans NotPast Due |   |    |   Total |   |
|--------------------------|--------|---------------------------|---------|--------|---------------------------|--------|---------|-------------------------|--------|--------|-------------------------|--------|--------|-----------------------------|---------|--------|-------------------------|--------|---------|-------------------|--------|
|                     |   |                      |    |   |                      |   |    |                    |   |   |                    |   |   |                        |    |   |                    |   |    |              |   |
| December 31, 2010        |   |                      |    |   |                      |   |    |                    |   |   |                    |   |   |                        |    |   |                    |   |    |              |   |
| Commercial               |   | $                         | 477     |   |                      | $      | 110     |                    |   | $      | 432                     |   |   | $                           | 2,778   |   |                    | $      | 3,797   |              |   | $ | 86,493 |   |   | $ | 90,290 |   |
| Commercial Real Estate:  |   |                      |    |   |                      |   |    |                    |   |   |                    |   |   |                        |    |   |                    |   |    |              |   |   |   |   |   |   |   |   |
| Construction             |   |                      | 1,097   |   |                      |   | 346     |                    |   |   | —                 |   |   |                        | 12,651  |   |                    |   | 14,094  |              |   |   | 185,430 |   |   |   | 199,524  |   |
| Farmland                 |   |                      | 1,232   |   |                      |   | 145     |                    |   |   | 143                     |   |   |                        | 2,811   |   |                    |   | 4,331   |              |   |   | 81,192 |   |   |   | 85,523 |   |
| Other                    |   |                      | 7,855   |   |                      |   | 2,094   |                    |   |   | 12                      |   |   |                        | 23,031  |   |                    |   | 32,992  |              |   |   | 408,852 |   |   |   | 441,844 |   |
| Residential Real Estate: |   |                      |    |   |                      |   |    |                    |   |   |                    |   |   |                        |    |   |                    |   |    |              |   |   |   |   |   |   |   |   |
| Multi-family             |   |                      | 714     |   |                      |   | 71      |                    |   |   | —                 |   |   |                        | 345     |   |                    |   | 1,130   |              |   |   | 73,789 |   |   |   | 74,919 |   |
| Other                    |   |                      | 8,239   |   |                      |   | 3,218   |                    |   |   | —                 |   |   |                        | 17,778  |   |                    |   | 29,235  |              |   |   | 324,183 |   |   |   | 353,418 |   |
| Consumer                 |   |                      | 1,156   |   |                      |   | 164     |                    |   |   | 7                       |   |   |                        | 293     |   |                    |   | 1,620   |              |   |   | 30,293 |   |   |   | 31,913 |   |
| Agriculture              |   |                      | 186     |   |                      |   | — |                    |   |   | —                 |   |   |                        | 112     |   |                    |   | 298     |              |   |   | 23,879 |   |   |   | 24,177 |   |
| Other                    |   |                      | — |   |                      |   | — |                    |   |   | —                 |   |   |                        | — |   |                    |   | — |              |   |   | 1,060 |   |   |   | 1,060 |   |
|                     |   |                      |    |   |                      |   |    |                    |   |   |                    |   |   |                        |    |   |                    |   |    |              |   |   |   |   |   |   |   |   |
| Total                    |   | $                         | 20,956  |   |                      | $      | 6,148   |                    |   | $      | 594                     |   |   | $                           | 59,799  |   |                    | $      | 87,497  |              |   | $ | 1,215,171 |   |   | $ | 1,302,668 |   |

----

|                     |   | Pass           |    |   | Watch  |   |    | SpecialMention |   |   | Substandard |   |   | Doubtful |    |   | Total  |   |
|--------------------------|--------|----------------|---------|--------|--------|--------|---------|----------------|--------|--------|-------------|--------|--------|----------|---------|--------|--------|--------|
|                     |   |           |    |   |   |   |    |           |   |   |        |   |   |     |    |   |   |   |
|                     |   | (in thousands) |    |
| March 31, 2011           |   |           |    |   |   |   |    |           |   |   |        |   |   |     |    |   |   |   |
| Commercial               |   | $              | 58,567  |   |   | $      | 6,849   |           |   | $      | 908         |   |   | $        | 10,197  |   |   | $      | — |   |   | $ | 76,521 |   |
| Commercial Real Estate:  |   |           |    |   |   |   |    |           |   |   |        |   |   |     |    |   |   |   |   |   |   |   |   |   |
| Construction             |   |           | 107,468 |   |   |   | 29,348  |           |   |   | 6,280       |   |   |     | 32,709  |   |   |   | — |   |   |   | 175,805 |   |
| Farmland                 |   |           | 73,263  |   |   |   | 2,929   |           |   |   | 437         |   |   |     | 9,532   |   |   |   | — |   |   |   | 86,161 |   |
| Other                    |   |           | 289,040 |   |   |   | 83,023  |           |   |   | 2,555       |   |   |     | 83,660  |   |   |   | — |   |   |   | 458,278 |   |
| Residential Real Estate: |   |           |    |   |   |   |    |           |   |   |        |   |   |     |    |   |   |   |   |   |   |   |   |   |
| Multi-family             |   |           | 53,300  |   |   |   | 7,545   |           |   |   | 449         |   |   |     | 13,989  |   |   |   | — |   |   |   | 75,283 |   |
| Other                    |   |           | 284,694 |   |   |   | 21,474  |           |   |   | 1,314       |   |   |     | 41,765  |   |   |   | — |   |   |   | 349,247 |   |
| Consumer                 |   |           | 28,819  |   |   |   | 1,273   |           |   |   | 43          |   |   |     | 609     |   |   |   | 14 |   |   |   | 30,758 |   |
| Agriculture              |   |           | 22,788  |   |   |   | 91      |           |   |   | 203         |   |   |     | 1,076   |   |   |   | — |   |   |   | 24,158 |   |
| Other                    |   |           | 956     |   |   |   | — |           |   |   | —     |   |   |     | — |   |   |   | — |   |   |   | 956 |   |
|                     |   |           |    |   |   |   |    |           |   |   |        |   |   |     |    |   |   |   |   |   |   |   |   |   |
| Total                    |   | $              | 918,895 |   |   | $      | 152,532 |           |   | $      | 12,189      |   |   | $        | 193,537 |   |   | $      | 14 |   |   | $ | 1,277,167 |   |

|                     |   | Pass           |    |   | Watch  |   |    | SpecialMention |   |   | Substandard |   |   | Doubtful |    |   | Total  |   |
|--------------------------|--------|----------------|---------|--------|--------|--------|---------|----------------|--------|--------|-------------|--------|--------|----------|---------|--------|--------|--------|
|                     |   |           |    |   |   |   |    |           |   |   |        |   |   |     |    |   |   |   |
|                     |   | (in thousands) |    |
| December 31, 2010        |   |           |    |   |   |   |    |           |   |   |        |   |   |     |    |   |   |   |
| Commercial               |   | $              | 74,284  |   |   | $      | 5,478   |           |   | $      | 894         |   |   | $        | 9,634   |   |   | $      | — |   |   | $ | 90,290 |   |
| Commercial Real Estate:  |   |           |    |   |   |   |    |           |   |   |        |   |   |     |    |   |   |   |   |   |   |   |   |   |
| Construction             |   |           | 137,631 |   |   |   | 15,397  |           |   |   | 12,968      |   |   |     | 33,528  |   |   |   | — |   |   |   | 199,524 |   |
| Farmland                 |   |           | 74,220  |   |   |   | 2,481   |           |   |   | —     |   |   |     | 8,822   |   |   |   | — |   |   |   | 85,523 |   |
| Other                    |   |           | 280,091 |   |   |   | 82,548  |           |   |   | 2,334       |   |   |     | 76,871  |   |   |   | — |   |   |   | 441,844 |   |
| Residential Real Estate: |   |           |    |   |   |   |    |           |   |   |        |   |   |     |    |   |   |   |   |   |   |   |   |   |
| Multi-family             |   |           | 65,482  |   |   |   | 3,493   |           |   |   | 1,328       |   |   |     | 4,616   |   |   |   | — |   |   |   | 74,919 |   |
| Other                    |   |           | 298,748 |   |   |   | 18,783  |           |   |   | 1,458       |   |   |     | 34,429  |   |   |   | — |   |   |   | 353,418 |   |
| Consumer                 |   |           | 30,197  |   |   |   | 1,069   |           |   |   | 6           |   |   |     | 623     |   |   |   | 18 |   |   |   | 31,913 |   |
| Agriculture              |   |           | 22,923  |   |   |   | 1,086   |           |   |   | —     |   |   |     | 168     |   |   |   | — |   |   |   | 24,177 |   |
| Other                    |   |           | 1,060   |   |   |   | — |           |   |   | —     |   |   |     | — |   |   |   | — |   |   |   | 1,060 |   |
|                     |   |           |    |   |   |   |    |           |   |   |        |   |   |     |    |   |   |   |   |   |   |   |   |   |
| Total                    |   | $              | 984,636 |   |   | $      | 130,335 |           |   | $      | 18,988      |   |   | $        | 168,691 |   |   | $      | 18 |   |   | $ | 1,302,668 |   |

----

|                     |   | March 31,2011  |   |   | December 31,2010 |   |
|--------------------------|--------|----------------|--------|--------|------------------|--------|
|                     |   | (in thousands) |   |
| Commercial Real Estate:  |   |           |   |   |             |   |
| Construction             |   | $              | 56,274 |   |             | $      | 50,491 |   |
| Farmland                 |   |           | 1,989  |   |             |   | 1,904 |   |
| Other                    |   |           | 6,600  |   |             |   | 6,504 |   |
| Residential Real Estate: |   |           |   |   |             |   |   |   |
| Multi-family             |   |           | 809    |   |             |   | 823 |   |
| Other                    |   |           | 8,270  |   |             |   | 7,913 |   |
|                     |   |           |   |   |             |   |   |   |
|                     |   | $              | 73,942 |   |             | $      | 67,635 |   |

| OREO Activity (in thousands) |   |   |   |
|------------------------------|--------|--------|--------|
| OREO as of January 1, 2011   |   | $      | 67,635 |   |
| Real estate acquired         |   |   | 8,812  |   |
| Valuation adjustments        |   |   | (486   | ) |
| Improvements                 |   |   | 1,037  |   |
| Properties sold              |   |   | (3,056 | ) |
|                         |   |   |   |   |
| OREO as of March 31, 2011    |   | $      | 73,942 |   |

|                     |   |  Three Months Ended |   |
|--------------------------|--------|--------------------------|--------|
|                     |   | March 31,2011            |   |   | March 31,2010 |   |
|                     |   | (in thousands)           |   |
| Net loss (gain) on sales |   | $                        | 391    |   |   | $ | (1 | ) |
| Impairment write-downs   |   |                     | 486    |   |   |   | 240 |   |
| Operating expense        |   |                     | 490    |   |   |   | 139 |   |
|                     |   |                     |   |   |   |   |   |   |
| Total                    |   | $                        | 1,367  |   |   | $ | 378 |   |

----

|                                                                    |   | March 31,2011  |   |   | December 31,2010 |   |
|-------------------------------------------------------------------------|--------|----------------|--------|--------|------------------|--------|
|                                                                    |   | (in thousands) |   |
|                                                                    |   |           |   |
| Single maturity advance with fixed rate of 4.48% maturing in 2012       |   | $              | 5,000  |   |             | $      | 5,000 |   |
| Monthly amortizing advances with fixed rates from 0.00% to 6.49%        |   |           |   |   |             |   |   |   |
| and maturities ranging from 2011 through 2035, averaging 3.55% for 2011 |   |           | 9,564  |   |             |   | 10,022 |   |
|                                                                    |   |           |   |   |             |   |   |   |
| Total                                                                   |   | $              | 14,564 |   |             | $      | 15,022 |   |

----

----

|                               |   |          |    |   | Fair Value Measurements at March 31, 2011 Using             |   |
|------------------------------------|--------|---------------|---------|--------|-------------------------------------------------------------|--------|
|                               |   |          |    |   | (in thousands)                                              |   |
| Description                        |   | March 31,2011 |    |   | Quoted Prices InActive Markets forIdentical Assets(Level 1) |   |   | Significant OtherObservable Inputs(Level 2) |   |   | SignificantUnobservableInputs(Level 3) |   |
|                               |   |          |    |   |                                                        |   |   |   |   |   |   |   |
| Available-for-sale securities      |   |          |    |   |                                                        |   |   |   |   |   |   |   |
| U.S. Government and federal agency |   | $             | 10,655  |   |                                                        | $      | – |   |   | $ | 10,655 |   |   | $ | – |   |
| Agency mortgage-backed             |   |          | 110,554 |   |                                                        |   | – |   |   |   | 110,554 |   |   |   | – |   |
| State and municipal                |   |          | 31,740  |   |                                                        |   | – |   |   |   | 31,740 |   |   |   | – |   |
| Corporate bonds                    |   |          | 7,805   |   |                                                        |   | – |   |   |   | 7,805 |   |   |   | – |   |
| Other debt securities              |   |          | 572     |   |                                                        |   | – |   |   |   | – |   |   |   | 572 |   |
| Equity securities                  |   |          | 1,706   |   |                                                        |   | 1,706 |   |   |   | – |   |   |   | – |   |
| Total                              |   | $             | 163,032 |   |                                                        | $      | 1,706 |   |   | $ | 160,754 |   |   | $ | 572 |   |

| Available-for-sale securities      |   | ThreeMonths EndedMarch 31, 2011 |    |
|------------------------------------|--------|---------------------------------|---------|
| Balance, January 1, 2011           |   | $                               | 572     |   |
| Sales                              |   |                            | — |   |
| Net accretion (amortization)       |   |                            | — |   |
| Principal paydowns                 |   |                            | — |   |
| Net change in unrealized gain/loss |   |                            | — |   |
| Balance, March 31, 2011            |   | $                               | 572     |   |

----

|                    |   |          |   |   | Fair Value Measurements at March 31, 2011 Using             |   |
|-------------------------|--------|---------------|--------|--------|-------------------------------------------------------------|--------|
|                    |   |          |   |   | (in thousands)                                              |   |
| Description             |   | March 31,2010 |   |   | Quoted Prices InActive Markets forIdentical Assets(Level 1) |   |   | Significant OtherObservable Inputs(Level 2) |   |   | SignificantUnobservableInputs(Level 3) |   |
|                    |   |          |   |   |                                                        |   |   |   |   |   |   |   |
| Impaired loans:         |   |          |   |   |                                                        |   |   |   |   |   |   |   |
| Commercial              |   | $             | 1,084  |   |                                                        | $      | – |   |   | $ | – |   |   | $ | 1,084 |   |
| Commercial real estate: |   |          |   |   |                                                        |   |   |   |   |   |   |   |   |   |   |   |

| Construction                  |   |   | 4,837  |   |   |   | – |   |   |   | – |   |   |   | 4,837  |   |
|-------------------------------|--------|--------|--------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|--------|--------|
| Farmland                      |   |   | 1,144  |   |   |   | – |   |   |   | – |   |   |   | 1,144  |   |
| Other                         |   |   | 22,635 |   |   |   | – |   |   |   | – |   |   |   | 22,635 |   |
| Other real estate owned, net: |   |   |   |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Commercial real estate:       |   |   |   |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Construction                  |   |   | 56,274 |   |   |   | – |   |   |   | – |   |   |   | 56,274 |   |
| Farmland                      |   |   | 1,989  |   |   |   | – |   |   |   | – |   |   |   | 1,989  |   |
| Other                         |   |   | 6,600  |   |   |   | – |   |   |   | – |   |   |   | 6,600  |   |
| Residential real estate:      |   |   |   |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Multi-family                  |   |   | 809    |   |   |   | – |   |   |   | – |   |   |   | 809    |   |
| Other                         |   |   | 8,270  |   |   |   | – |   |   |   | – |   |   |   | 8,270  |   |

|                               |   |             |    |   | Fair Value Measurements at December 31, 2010 Using          |   |
|------------------------------------|--------|------------------|---------|--------|-------------------------------------------------------------|--------|
|                               |   |             |    |   | (in thousands)                                              |   |
| Description                        |   | December 31,2010 |    |   | Quoted Prices InActive Markets forIdentical Assets(Level 1) |   |   | Significant OtherObservable Inputs(Level 2) |   |   | SignificantUnobservableInputs(Level 3) |   |
|                               |   |             |    |   |                                                        |   |   |   |   |   |   |   |
| Available-for-sale securities      |   |             |    |   |                                                        |   |   |   |   |   |   |   |
| U.S. Government and federal agency |   | $                | 6,010   |   |                                                        | $      | – |   |   | $ | 6,010 |   |   | $ | – |   |
| Agency mortgage-backed             |   |             | 61,855  |   |                                                        |   | – |   |   |   | 61,855 |   |   |   | – |   |
| State and municipal                |   |             | 27,002  |   |                                                        |   | – |   |   |   | 27,002 |   |   |   | – |   |
| Corporate bonds                    |   |             | 9,219   |   |                                                        |   | – |   |   |   | 9,219 |   |   |   | – |   |
| Other debt securities              |   |             | 572     |   |                                                        |   | – |   |   |   | – |   |   |   | 572 |   |
| Equity securities                  |   |             | 1,651   |   |                                                        |   | 1,651 |   |   |   | – |   |   |   | – |   |
| Total                              |   | $                | 106,309 |   |                                                        | $      | 1,651 |   |   | $ | 104,086 |   |   | $ | 572 |   |

----

|                    |   |             |   |   | Fair Value Measurements at December 31, 2010 Using          |   |
|-------------------------|--------|------------------|--------|--------|-------------------------------------------------------------|--------|
|                    |   |             |   |   | (in thousands)                                              |   |
| Description             |   | December 31,2010 |   |   | Quoted Prices InActive Markets forIdentical Assets(Level 1) |   |   | Significant OtherObservable Inputs(Level 2) |   |   | SignificantUnobservableInputs(Level 3) |   |
|                    |   |             |   |   |                                                        |   |   |   |   |   |   |   |
| Impaired loans:         |   |             |   |   |                                                        |   |   |   |   |   |   |   |
| Commercial              |   | $                | 1,127  |   |                                                        | $      | – |   |   | $ | – |   |   | $ | 1,127 |   |
| Commercial real estate: |   |             |   |   |                                                        |   |   |   |   |   |   |   |   |   |   |   |

| Construction                  |   |   | 8,722  |   |   |   | – |   |   |   | – |   |   |   | 8,722  |   |
|-------------------------------|--------|--------|--------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|--------|--------|
| Farmland                      |   |   | 1,145  |   |   |   | – |   |   |   | – |   |   |   | 1,145  |   |
| Other                         |   |   | 13,728 |   |   |   | – |   |   |   | – |   |   |   | 13,728 |   |
| Other real estate owned, net: |   |   |   |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Commercial real estate:       |   |   |   |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Construction                  |   |   | 50,491 |   |   |   | – |   |   |   | – |   |   |   | 50,491 |   |
| Farmland                      |   |   | 1,904  |   |   |   | – |   |   |   | – |   |   |   | 1,904  |   |
| Other                         |   |   | 6,504  |   |   |   | – |   |   |   | – |   |   |   | 6,504  |   |
| Residential real estate:      |   |   |   |   |   |   |    |   |   |   |    |   |   |   |   |   |
| Multi-family                  |   |   | 823    |   |   |   | – |   |   |   | – |   |   |   | 823    |   |
| Other                         |   |   | 7,913  |   |   |   | – |   |   |   | – |   |   |   | 7,913  |   |

|                                           |   | March 31, 2011 |      |   | December 31, 2010 |   |
|------------------------------------------------|--------|----------------|-----------|--------|-------------------|--------|
|                                           |   | Carrying       |      |   | Fair              |   |   | Carrying |   |   | Fair |   |
|                                           |   | Amount         |      |   | Value             |   |   | Amount |   |   | Value |   |
|                                           |   | (in thousands) |      |
| Financial assets                               |   |           |      |
| Cash and cash equivalents                      |   | $              | 162,103   |   |              | $      | 162,103 |   |   | $ | 185,435 |   |   | $ | 185,435 |   |
| Securities available for sale                  |   |           | 163,032   |   |              |   | 163,032 |   |   |   | 106,309 |   |   |   | 106,309 |   |
| Federal Home Loan Bank stock                   |   |           | 10,072    |   |              |   | N/A |   |   |   | 10,072 |   |   |   | N/A |   |
| Mortgage loans held for sale                   |   |           | 330       |   |              |   | 330 |   |   |   | 345 |   |   |   | 345 |   |
| Loans, net                                     |   |           | 1,243,568 |   |              |   | 1,250,503 |   |   |   | 1,268,383 |   |   |   | 1,276,198 |   |
| Accrued interest receivable                    |   |           | 7,611     |   |              |   | 7,611 |   |   |   | 7,668 |   |   |   | 7,668 |   |
| Financial liabilities                          |   |           |      |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                                       |   | $              | 1,482,323 |   |              | $      | 1,488,845 |   |   | $ | 1,467,668 |   |   | $ | 1,472,677 |   |
| Securities sold under agreements to repurchase |   |           | 11,429    |   |              |   | 11,429 |   |   |   | 11,616 |   |   |   | 11,616 |   |
| Federal Home Loan Bank advances                |   |           | 14,564    |   |              |   | 14,601 |   |   |   | 15,022 |   |   |   | 15,051 |   |
| Subordinated capital notes                     |   |           | 8,550     |   |              |   | 7,909 |   |   |   | 8,550 |   |   |   | 7,879 |   |
| Junior subordinated debentures                 |   |           | 25,000    |   |              |   | 21,571 |   |   |   | 25,000 |   |   |   | 21,474 |   |
| Accrued interest payable                       |   |           | 1,897     |   |              |   | 1,897 |   |   |   | 1,910 |   |   |   | 1,910 |   |

----

|                                                           |   | Three Months EndedMarch 31,                    |       |
|----------------------------------------------------------------|--------|------------------------------------------------|------------|
|                                                           |   | 2011                                           |       |   | 2010 |   |
|                                                           |   | (in thousands, exceptshare and per share data) |       |
|                                                           |   |                                           |       |
| Net income                                                     |   | $                                              | 799        |   |   | $ | 3,256 |   |
| Less:                                                          |   |                                           |       |   |   |   |   |   |
| Preferred stock dividends                                      |   |                                           | (438       | ) |   |   | (438 | ) |
| Accretion of Series A preferred stock discount                 |   |                                           | (44        | ) |   |   | (44 | ) |
| Earnings allocated to unvested shares                          |   |                                           | (4         | ) |   |   | (42 | ) |
| Earnings allocated Series C preferred                          |   |                                           | (8         | ) |   |   | – |   |
| Net income allocated to common shareholders, basic and diluted |   | $                                              | 305        |   |   | $ | 2,732 |   |
|                                                           |   |                                           |       |   |   |   |   |   |
| Basic                                                     |   |                                           |       |   |   |   |   |   |
| Weighted average common shares including                       |   |                                           |       |   |   |   |   |   |
| unvested common shares outstanding                             |   |                                           | 12,178,845 |   |   |   | 9,212,054 |   |
| Less: Weighted average unvested common shares                  |   |                                           | (141,300   | ) |   |   | (129,932 | ) |
| Less: Weighted average Series C preferred                      |   |                                           | (332,894   | ) |   |   | – |   |
| Weighted average common shares outstanding                     |   |                                           | 11,704,651 |   |   |   | 9,082,122 |   |
| Basic earnings per common share                                |   | $                                              | 0.03       |   |   | $ | 0.30 |   |
|                                                           |   |                                           |       |   |   |   |   |   |
| Diluted                                                   |   |                                           |       |   |   |   |   |   |
| Add: Dilutive effects of assumed exercises of common           |   |                                           |       |   |   |   |   |   |
| and Preferred Series C stock warrants                          |   |                                           | –    |   |   |   | – |   |
| Weighted average common shares and potential common shares     |   |                                           | 11,704,651 |   |   |   | 9,082,122 |   |
| Diluted earnings per common share                              |   | $                                              | 0.03       |   |   | $ | 0.30 |   |

----

|                                                           |   | Three Months EndedMarch 31, |   |
|----------------------------------------------------------------|--------|-----------------------------|--------|
|                                                           |   | 2011                        |   |   | 2010 |   |
|                                                           |   | (in thousands)              |   |
| Unrealized holding gains on available-for-sale securities      |   | $                           | 71     |   |   | $ | 3,525 |   |
| Less: Reclassification adjustment for gains realized in income |   |                        | 83     |   |   |   | 57 |   |
| Net unrealized gains                                           |   |                        | (12    | ) |   |   | 3,468 |   |
| Tax effect                                                     |   |                        | 4      |   |   |   | (1,214 | ) |
| Net-of-tax amount                                              |   | $                           | (8     | ) |   | $ | 2,254 |   |

|                     |   |               |    |   |                     |   |   |                |   | March 31, 2011 |    |   | December 31, 2010 |
|--------------------------|--------|--------------------|---------|--------|--------------------------|--------|--------|---------------------|--------|----------------|---------|--------|-------------------|
|                     |   | RegulatoryMinimums |    |   | Well-CapitalizedMinimums |   |   | PorterBancorp  |   |           | PBIBank |   |              | PorterBancorp  |   |   | PBIBank |
|                     |   |               |    |   |                     |   |   |                |   |           |    |   |              |   |   |   |   |   |   |   |   |   |   |
| Tier I capital           |   | 4.0                | %  |   |                     | 6.0    | %      |                |   | 14.59          | %       |   |              | 13.02 | % |   |   | 14.39 | % |   |   | 12.79 | % |
| Total risk-based capital |   | 8.0                |    |   |                     | 10.0   |   |                |   | 16.52          |    |   |              | 14.96 |   |   |   | 16.32 |   |   |   | 14.72 |   |
| Tier I leverage ratio    |   | 4.0                |    |   |                     | 5.0    |   |                |   | 10.93          |    |   |              | 9.75 |   |   |   | 11.08 |   |   |   | 9.85 |   |

----

Item 2. Management’s Discussion and Analysis of Financial Condition

and Results of Operations

----

| ● | Net income declined to $799,000 for the three months ended March 31, 2011, compared with $3.3 million for the first quarter of 2010.  Earnings per diluted common share were $0.03 compared with $0.30 in the first quarter of 2010. |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Net interest margin increased 22 basis points to 3.54% in the first quarter of 2011 compared with 3.32% in the first quarter of 2010. The increase in margin since last year benefited from a lower average cost of funds. |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Average loans decreased 8.1% to $1.29 billion in the first quarter of 2011 compared with $1.40 billion in the first quarter of 2010.  Net loans decreased 6.8% to $1.24 billion in the first quarter of 2011, compared with $1.33 billion at March 31, 2010. |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Deposits decreased 0.2% to $1.48 billion compared with $1.49 billion at March 31, 2010, and increased 1.0% from $1.47 billion at December 31, 2010. Demand and savings account deposits increased by 8.5% and 10.3%, respectively during the first quarter of 2011 compared with the fourth quarter of 2010. |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Total assets decreased 1.2% to $1.74 billion compared with $1.76 billion at March 31, 2010. |
|---------|---------------------------------------------------------------------------------------------|

| ● | Efficiency ratio was 60.7% for the first three months of 2011, compared with 50.9% for the first quarter of 2010. Our efficiency ratio increased primarily due to higher credit related costs and increases in other real estate owned (OREO) expense. |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Non-performing loans increased $9.5 million during the first quarter to $69.9 million at March 31, 2011, compared with $60.4 million at December 31, 2010. The increase was primarily in the commercial and residential real estate segments of our portfolio. |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Non-performing assets increased $15.8 million during the first quarter to $143.9 million at March 31, 2011. The increase was primarily due to a higher level of non-performing loans described above and non-performing loans moving through the collection and foreclosure process. |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | Loans past due 30-59 days increased from $21.0 million at December 31, 2010 to $33.4 million at March 31, 2011.  Loans past due 60-89 days increased from $6.1 million at December 31, 2010 to $25.0 million at March 31, 2011.  These increases were primarily in the commercial and commercial real estate segments of the portfolio. |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ● | On April 19, 2011, an Oldham County, Kentucky jury rendered a judgment against PBI Bank for $529,000 in compensatory damages and from $529,000 to $882,000 in punitive damages.  The case concerns a dispute with a prior landowner in connection with a project for which PBI Bank provided development financing to a third party.  The final amount of the judgment is subject to additional proceedings. We intend to file motions to set aside the judgment, and if denied, to file an appeal.  Based on advice of legal counsel, we believe that we have several meritorious grounds for appeal and no amounts have been accrued for this matter as we expect a favorable outcome to the bank. |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                      |   | For the Three MonthsEnded March 31, |   | Change fromPrior Period |
|---------------------------|--------|-------------------------------------|--------|-------------------------|
|                      |   | 2011                                |   | 2010                    |   | Amount |   | Percent |
|                      |   | (dollars in thousands)              |
|                      |   |                                |
| Gross interest income     |   | $                                   | 19,616 |                    |   | $ | 22,626 |   |   | $ | (3,010 | ) |   |   | (13.3 | )% |
| Gross interest expense    |   |                                | 5,848  |                    |   |   | 8,449 |   |   |   | (2,601 | ) |   |   | (30.8 | ) |
| Net interest income       |   |                                | 13,768 |                    |   |   | 14,177 |   |   |   | (409 | ) |   |   | (2.9 | ) |
| Provision for loan losses |   |                                | 5,100  |                    |   |   | 3,000 |   |   |   | 2,100 |   |   |   | 70.0 |   |
| Non-interest income       |   |                                | 1,787  |                    |   |   | 1,692 |   |   |   | 95 |   |   |   | 5.6 |   |
| Non-interest expense      |   |                                | 9,395  |                    |   |   | 8,049 |   |   |   | 1,346 |   |   |   | 16.7 |   |
| Net income before taxes   |   |                                | 1,060  |                    |   |   | 4,820 |   |   |   | (3,760 | ) |   |   | (78.0 | ) |
| Income tax expense        |   |                                | 261    |                    |   |   | 1,564 |   |   |   | (1,303 | ) |   |   | (83.3 | ) |
| Net income                |   |                                | 799    |                    |   |   | 3,256 |   |   |   | (2,457 | ) |   |   | (75.5 | ) |

----

----

|                                              |   | Three Months Ended March 31,     |      |
|---------------------------------------------------|--------|----------------------------------|-----------|
|                                              |   | 2011                             |      |   | 2010 |   |
|                                              |   | AverageBalance                   |      |   | InterestEarned/Paid |   |   | AverageYield/Cost |   |   | AverageBalance |   |   | InterestEarned/Paid |   |   | AverageYield/Cost |   |
|                                              |   | (dollars in thousands) |      |
| ASSETS                                            |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-earning assets:                          |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loan receivables (1)(2)                           |   | $                                | 1,290,851 |   |   | $ | 18,110 |   |   |   | 5.69 | % |   | $ | 1,404,486 |   |   | $ | 19,873 |   |   |   | 5.74 | % |
| Securities                                        |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Taxable                                           |   |                             | 111,893   |   |   |   | 1,029 |   |   |   | 3.73 |   |   |   | 156,554 |   |   |   | 2,323 |   |   |   | 6.02 |   |
| Tax-exempt (3)                                    |   |                             | 27,020    |   |   |   | 260 |   |   |   | 6.00 |   |   |   | 21,546 |   |   |   | 216 |   |   |   | 6.25 |   |
| FHLB stock                                        |   |                             | 10,072    |   |   |   | 114 |   |   |   | 4.59 |   |   |   | 10,072 |   |   |   | 114 |   |   |   | 4.59 |   |
| Other equity securities                           |   |                             | 1,400     |   |   |   | 13 |   |   |   | 3.77 |   |   |   | 1,885 |   |   |   | 12 |   |   |   | 2.58 |   |
| Federal funds sold and other                      |   |                             | 150,325   |   |   |   | 90 |   |   |   | 0.24 |   |   |   | 148,966 |   |   |   | 88 |   |   |   | 0.24 |   |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total interest-earning assets                     |   |                             | 1,591,561 |   |   |   | 19,616 |   |   |   | 5.03 | % |   |   | 1,743,509 |   |   |   | 22,626 |   |   |   | 5.29 | % |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Less: Allowance for loan losses                   |   |                             | (34,233   | ) |   |   |   |   |   |   |   |   |   |   | (27,329 | ) |   |   |   |   |   |   |   |   |
| Non-interest earning assets                       |   |                             | 180,925   |   |   |   |   |   |   |   |   |   |   |   | 118,028 |   |   |   |   |   |   |   |   |   |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total assets                                      |   | $                                | 1,738,253 |   |   |   |   |   |   |   |   |   |   | $ | 1,834,208 |   |   |   |   |   |   |   |   |   |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY        |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities:                     |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Certificates of deposit and other time deposits   |   | $                                | 1,166,832 |   |   | $ | 4,875 |   |   |   | 1.69 | % |   | $ | 1,248,704 |   |   | $ | 6,864 |   |   |   | 2.23 | % |
| NOW and money market deposits                     |   |                             | 172,077   |   |   |   | 424 |   |   |   | 1.00 |   |   |   | 163,510 |   |   |   | 451 |   |   |   | 1.12 |   |
| Savings accounts                                  |   |                             | 36,188    |   |   |   | 61 |   |   |   | 0.68 |   |   |   | 34,477 |   |   |   | 68 |   |   |   | 0.80 |   |
| Federal funds purchased and repurchase agreements |   |                             | 11,346    |   |   |   | 118 |   |   |   | 4.22 |   |   |   | 11,606 |   |   |   | 119 |   |   |   | 4.16 |   |
| FHLB advances                                     |   |                             | 14,725    |   |   |   | 142 |   |   |   | 3.91 |   |   |   | 66,307 |   |   |   | 720 |   |   |   | 4.40 |   |
| Junior subordinated debentures                    |   |                             | 33,550    |   |   |   | 228 |   |   |   | 2.76 |   |   |   | 34,000 |   |   |   | 227 |   |   |   | 2.71 |   |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total interest-bearing liabilities                |   |                             | 1,434,718 |   |   |   | 5,848 |   |   |   | 1.65 | % |   |   | 1,558,604 |   |   |   | 8,449 |   |   |   | 2.20 | % |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Non-interest-bearing liabilities:                 |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Non-interest-bearing deposits                     |   |                             | 106,095   |   |   |   |   |   |   |   |   |   |   |   | 98,778 |   |   |   |   |   |   |   |   |   |
| Other liabilities                                 |   |                             | 6,855     |   |   |   |   |   |   |   |   |   |   |   | 7,067 |   |   |   |   |   |   |   |   |   |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total liabilities                                 |   |                             | 1,547,668 |   |   |   |   |   |   |   |   |   |   |   | 1,664,449 |   |   |   |   |   |   |   |   |   |
| Stockholders’ equity                        |   |                             | 190,585   |   |   |   |   |   |   |   |   |   |   |   | 169,759 |   |   |   |   |   |   |   |   |   |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total liabilities and stockholders’ equity  |   | $                                | 1,738,253 |   |   |   |   |   |   |   |   |   |   | $ | 1,834,208 |   |   |   |   |   |   |   |   |   |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                               |   |                             |      |   |   | $ | 13,768 |   |   |   |   |   |   |   |   |   |   | $ | 14,177 |   |   |   |   |   |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest spread                               |   |                             |      |   |   |   |   |   |   |   | 3.38 | % |   |   |   |   |   |   |   |   |   |   | 3.09 | % |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest margin                               |   |                             |      |   |   |   |   |   |   |   | 3.54 | % |   |   |   |   |   |   |   |   |   |   | 3.32 | % |
|                                              |   |                             |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| (1) | Includes loan fees in both interest income and the calculation of yield on loans. |
|-----|-----------------------------------------------------------------------------------|

| (2) | Calculations include non-accruing loans in average loan amounts outstanding. |
|-----|------------------------------------------------------------------------------|

| (3) | Taxable equivalent yields are calculated assuming a 35% federal income tax rate. |
|-----|----------------------------------------------------------------------------------|

----

|                                                 |   | Three Months Ended March 31,2011 vs. 2010 |   |
|------------------------------------------------------|--------|-------------------------------------------|--------|
|                                                 |   | Increase (decrease)due to change in       |   |   | NetChange |   |
|                                                 |   | Rate                                      |   |   | Volume |   |
|                                                 |   | (in thousands)                       |   |
| Interest-earning assets:                             |   |                                      |   |   |   |   |   |   |   |
| Loan receivables                                     |   | $                                         | (168   | ) |   | $ | (1,595 | ) |   | $ | (1,763 | ) |
| Securities                                           |   |                                      | (766   | ) |   |   | (484 | ) |   |   | (1,250 | ) |
| Other equity securities                              |   |                                      | 5      |   |   |   | (4 | )  |   |   | 1 |   |
| Federal funds sold and other                         |   |                                      | 1      |   |   |   | 1 |   |   |   | 2 |   |
|                                                 |   |                                      |   |   |   |   |   |   |   |   |   |   |
| Total  decrease in interest income         |   |                                      | (928   | ) |   |   | (2,082 | ) |   |   | (3,010 | ) |
|                                                 |   |                                      |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities:                        |   |                                      |   |   |   |   |   |   |   |   |   |   |
| Certificates of deposit and other time deposits |   |                                      | (1,562 | ) |   |   | (427 | ) |   |   | (1,989 | ) |
| NOW and money market accounts                        |   |                                      | (50    | ) |   |   | 23 |   |   |   | (27 | ) |
| Savings accounts                                     |   |                                      | (10    | ) |   |   | 3 |   |   |   | (7 | ) |
| Federal funds purchased and repurchased agreements   |   |                                      | 2      |   |   |   | (3 | ) |   |   | (1 | ) |
| FHLB advances                                        |   |                                      | (73    | ) |   |   | (505 | ) |   |   | (578 | ) |
| Junior subordinated debentures                       |   |                                      | 4      |   |   |   | (3 | ) |   |   | 1 |   |
|                                                 |   |                                      |   |   |   |   |   |   |   |   |   |   |
| Total decrease in interest expense                   |   |                                      | (1,689 | ) |   |   | (912 | ) |   |   | (2,601 | ) |
|                                                 |   |                                      |   |   |   |   |   |   |   |   |   |   |
| Increase (decrease) in net interest income           |   | $                                         | 761    |   |   | $ | (1,170 | ) |   | $ | (409 | ) |

----

|                                         |   | Three Months EndedMarch 31, |   |
|----------------------------------------------|--------|-----------------------------|--------|
|                                         |   | 2011                        |   |   | 2010 |   |
|                                         |   | (in thousands)              |   |
| Service charges on deposit accounts          |   | $                           | 630    |   |   | $ | 720 |   |
| Income from fiduciary activities             |   |                        | 255    |   |   |   | 252 |   |
| Secondary market brokerage fees              |   |                        | 76     |   |   |   | 60 |   |
| Title insurance commissions                  |   |                        | 31     |   |   |   | 37 |   |
| Gains on sales of loans originated for sale  |   |                        | 221    |   |   |   | 91 |   |
| Gains on sales of investment securities, net |   |                        | 83     |   |   |   | 57 |   |
| Other                                        |   |                        | 491    |   |   |   | 475 |   |
| Total non-interest income                    |   | $                           | 1,787  |   |   | $ | 1,692 |   |

|                            |   | Three Months EndedMarch 31, |   |
|---------------------------------|--------|-----------------------------|--------|
|                            |   | 2011                        |   |   | 2010 |   |
|                            |   | (in thousands)              |   |
| Salary and employee benefits    |   | $                           | 4,124  |   |   | $ | 3,947 |   |
| Occupancy and equipment         |   |                        | 972    |   |   |   | 1,022 |   |
| Other real estate owned expense |   |                        | 1,367  |   |   |   | 378 |   |
| FDIC insurance                  |   |                        | 855    |   |   |   | 705 |   |
| State franchise tax             |   |                        | 582    |   |   |   | 543 |   |
| Professional fees               |   |                        | 280    |   |   |   | 266 |   |
| Loan collection fees            |   |                        | 262    |   |   |   | 175 |   |
| Communications                  |   |                        | 168    |   |   |   | 186 |   |
| Postage and delivery            |   |                        | 123    |   |   |   | 188 |   |
| Advertising                     |   |                        | 102    |   |   |   | 96 |   |
| Office supplies                 |   |                        | 111    |   |   |   | 97 |   |
| Other                           |   |                        | 449    |   |   |   | 446 |   |
| Total non-interest expense      |   | $                           | 9,395  |   |   | $ | 8,049 |   |

----

|                                                    |   | Three Months EndedMarch 31, |   |
|---------------------------------------------------------|--------|-----------------------------|--------|
|                                                    |   | 2011                        |   |   | 2010 |   |
|                                                    |   | (dollars in thousands)      |   |
| Federal statutory rate times financial statement income |   | $                           | 371    |   |   | $ | 1,687 |   |
| Effect of:                                         |   |                        |   |   |   |   |   |   |
| Tax-exempt income                                       |   |                        | (91    | ) |   |   | (76 | ) |
| Non-taxable life insurance income                       |   |                        | (24    | ) |   |   | (26 | ) |
| Federal tax credits                                     |   |                        | (11    | ) |   |   | (11 | ) |
| Other, net                                              |   |                        | 16     |   |   |   | (10 | ) |
| Total                                                   |   | $                           | 261    |   |   | $ | 1,564 |   |

|                         |   | As of March 31,        |    |   | As of December 31, |   |
|------------------------------|--------|------------------------|---------|--------|--------------------|--------|
|                         |   | 2011                   |    |   | 2010               |   |
|                         |   | Amount                 |    |   | Percent            |   |   | Amount |   |   | Percent |   |
|                         |   | (dollars in thousands) |    |
| Commercial                   |   | $                      | 76,521  |   |               |   | 5.99 | % |   | $ | 90,290 |   |   |   | 6.93 | % |
| Commercial Real Estate  |   |                   |    |   |               |   |   |   |   |   |   |   |   |   |   |   |
| Construction                 |   |                   | 175,805 |   |               |   | 13.77 |   |   |   | 199,524 |   |   |   | 15.32 |   |
| Farmland                     |   |                   | 86,161  |   |               |   | 6.75 |   |   |   | 85,523 |   |   |   | 6.56 |   |
| Other                        |   |                   | 458,278 |   |               |   | 35.88 |   |   |   | 441,844 |   |   |   | 33.92 |   |

| Residential Real Estate |   |   |      |   |   |   |   |   |   |   |      |   |   |   |   |   |
|-------------------------|--------|--------|-----------|--------|--------|--------|--------|--------|--------|--------|-----------|--------|--------|--------|--------|--------|
| Multi-family            |   |   | 75,283    |   |   |   | 5.89   |   |   |   | 74,919    |   |   |   | 5.75   |   |
| Other                   |   |   | 349,247   |   |   |   | 27.35  |   |   |   | 353,418   |   |   |   | 27.13  |   |
| Consumer                |   |   | 30,758    |   |   |   | 2.41   |   |   |   | 31,913    |   |   |   | 2.45   |   |
| Agriculture             |   |   | 24,158    |   |   |   | 1.89   |   |   |   | 24,177    |   |   |   | 1.86   |   |
| Other                   |   |   | 956       |   |   |   | 0.07   |   |   |   | 1,060     |   |   |   | 0.08   |   |
| Total loans             |   | $      | 1,277,167 |   |   |   | 100.00 | %      |   | $      | 1,302,668 |   |   |   | 100.00 | %      |

----

|                                                       |   | March 31,2011          |    |   | December 31,2010 |   |
|------------------------------------------------------------|--------|------------------------|---------|--------|------------------|--------|
|                                                       |   | (dollars in thousands) |    |
| Loans past due 90 days or more still on accrual            |   | $                      | 3,907   |   |             | $      | 594 |   |
| Non-accrual loans                                          |   |                   | 65,964  |   |             |   | 59,799 |   |
| Total non-performing loans                                 |   |                   | 69,871  |   |             |   | 60,393 |   |
| Real estate acquired through foreclosure                   |   |                   | 73,942  |   |             |   | 67,635 |   |
| Other repossessed assets                                   |   |                   | 41      |   |             |   | 52 |   |
| Total non-performing assets                                |   | $                      | 143,854 |   |             | $      | 128,080 |   |
| Non-performing loans to total loans                        |   |                   | 5.47    | %      |             |   | 4.64 | % |
| Non-performing assets to total assets                      |   |                   | 8.28    | %      |             |   | 7.43 | % |
| Allowance for non-performing loans                         |   |                   | 7,835   |   |             |   | 7,977 |   |
| Allowance for non-performing loans to non-performing loans |   |                   | 11.21   | %      |             |   | 13.21 | % |

----

----

|                                              |   | Three Months EndedMarch 31, |   |   | Year EndedDecember 31, |   |
|---------------------------------------------------|--------|-----------------------------|--------|--------|------------------------|--------|
|                                              |   | 2011                        |   |   | 2010                   |   |   | 2010 |   |
|                                              |   | (dollars in thousands)      |   |
|                                              |   |                        |   |   |                   |   |   |   |   |   |   |   |
| Balance at beginning of period                    |   | $                           | 34,285 |   |                   | $      | 26,392 |   |   | $ | 26,392 |   |
| Provision for loan losses                         |   |                        | 5,100  |   |                   |   | 3,000 |   |   |   | 30,100 |   |
| Recoveries                                        |   |                        | 81     |   |                   |   | 57 |   |   |   | 254 |   |
| Charge-offs                                       |   |                        | (5,867 | )      |                   |   | (2,906 | ) |   |   | (22,461 | ) |
| Balance at end of period                          |   | $                           | 33,599 |   |                   | $      | 26,543 |   |   | $ | 34,285 |   |
|                                              |   |                        |   |   |                   |   |   |   |   |   |   |   |
| Allowance for loan losses to period-end loans     |   |                        | 2.63   | %      |                   |   | 1.95 | % |   |   | 2.63 | % |
| Net charge-offs to average loans                  |   |                        | 0.45   | %      |                   |   | 0.20 | % |   |   | 1.64 | % |
| Allowance for loan losses to non-performing loans |   |                        | 48.09  | %      |                   |   | 43.90 | % |   |   | 56.77 | % |

----

|                    |   | For the Three Months   |      |   | For the Year       |   |
|-------------------------|--------|------------------------|-----------|--------|--------------------|--------|
|                    |   | Ended March 31,        |      |   | Ended December 31, |   |
|                    |   | 2011                   |      |   | 2010               |   |
|                    |   | Average                |      |   | Average            |   |   | Average |   |   | Average |   |
|                    |   | Balance                |      |   | Rate               |   |   | Balance |   |   | Rate |   |
|                    |   | (dollars in thousands) |      |
| Demand                  |   | $                      | 106,095   |   |               |   | – |   |   | $ | 102,383 |   |   |   | – |   |
| Interest checking       |   |                   | 90,716    |   |               |   | 0.89 | % |   |   | 83,111 |   |   |   | 0.85 | % |
| Money market            |   |                   | 81,361    |   |               |   | 1.12 |   |   |   | 81,430 |   |   |   | 1.24 |   |
| Savings                 |   |                   | 36,188    |   |               |   | 0.68 |   |   |   | 35,393 |   |   |   | 0.74 |   |
| Certificates of deposit |   |                   | 1,166,832 |   |               |   | 1.69 |   |   |   | 1,156,724 |   |   |   | 2.02 |   |
| Total deposits          |   | $                      | 1,481,192 |   |               |   | 1.47 | % |   | $ | 1,459,041 |   |   |   | 1.74 | % |

|               |   | For the Three Months   |      |   | For the Year       |   |
|--------------------|--------|------------------------|-----------|--------|--------------------|--------|
|               |   | Ended March 31,        |      |   | Ended December 31, |   |
|               |   | 2011                   |      |   | 2010               |   |
|               |   | Average                |      |   | Average            |   |   | Average |   |   | Average |   |
|               |   | Balance                |      |   | Rate               |   |   | Balance |   |   | Rate |   |
|               |   | (dollars in thousands) |      |
| Less than $100,000 |   | $                      | 581,490   |   |               |   | 1.67 | % |   | $ | 579,978 |   |   |   | 2.00 | % |
| $100,000 or more   |   |                   | 585,342   |   |               |   | 1.72 | % |   |   | 576,746 |   |   |   | 2.05 | % |
| Total              |   | $                      | 1,166,832 |   |               |   | 1.69 | % |   | $ | 1,156,724 |   |   |   | 2.02 | % |

|                             |   | As of          |    |   | As of        |   |
|----------------------------------|--------|----------------|---------|--------|--------------|--------|
|                             |   | March 31,      |    |   | December 31, |   |
| Maturity Period                  |   | 2011           |    |   | 2010         |   |
|                             |   | (in thousands) |    |
|                             |   |           |    |   |         |   |
| Three months or less             |   | $              | 84,064  |   |         | $      | 88,778 |   |
| Three months through six months  |   |           | 77,895  |   |         |   | 84,908 |   |
| Six months through twelve months |   |           | 113,380 |   |         |   | 117,405 |   |
| Over twelve months               |   |           | 307,037 |   |         |   | 306,781 |   |
| Total                            |   | $              | 582,376 |   |         | $      | 597,872 |   |

----

Item 3. Quantitative and Qualitative Disclosures about Market Risk

----

|               |   |   | Change in Future       |   |
|--------------------|--------|--------|------------------------|--------|
|               |   |   | Net Interest Income    |   |
|               |   |   | Dollar Change     |   |   |   | Percentage Change  |   |
|               |   |   | (dollars in thousands) |   |
|               |   |   |                   |   |   |   |   |   |
| + 200 basis points |   | $      | 8,592                  |   |   |   | 14.76 | % |
| + 100 basis points |   |   | 4,276                  |   |   |   | 7.35 |   |

Item 4. Controls and Procedures

----

Item 1. Legal Proceedings

Item 1A. Risk Factors

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Item 3. Default Upon Senior Securities

Item 4. (Removed & Reserved)

Item 5. Other Information

----

Item 6. Exhibits

| Exhibit Number | Description of Exhibit                                                                                                                                 |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------|
|           |                                                                                                                                                   |
| 31.1           | Certification of Principal Executive Officer, pursuant to Rule 13a – 14(a).                                                                      |
|           |                                                                                                                                                   |
| 31.2      | Certification of Principal Financial Officer, pursuant to Rule 13a – 14(a).                                                                      |
|           |                                                                                                                                                   |
| 32.1      | Certification of Principal Executive Officer, pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|           |                                                                                                                                                   |
| 32.2      | Certification of Principal Financial Officer, pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |

|               | PORTER BANCORP, INC. |
|--------------------|----------------------|
|               | (Registrant)         |
|               |                 |   |   |
| May 16, 2011       |                 | By: | /s/ Maria L. Bouvette |
|               |                 |   | Maria L. Bouvette |
|               |                 |   | President & Chief Executive Officer |
|               |                 |   |   |
| May 16, 2011  |                 | By: | /s/ David B. Pierce |
|               |                 |   | David B. Pierce |
|               |                 |   | Chief Financial Officer and Chief Accounting Officer |