Edgar Filing: PARKE BANCORP, INC.

ars_2010-0343.htm

PARKE BANCORP, INC.

2010 ANNUAL REPORT TO SHAREHOLDERS

PARKE BANCORP, INC.

2010 ANNUAL REPORT TO SHAREHOLDERS

TABLE OF CONTENTS

	Page
Section One

Letter to Shareholders	1

Selected Financial Data	3

Management’s Discussion and Analysis of Financial Condition and Results of Operations	4

Market Prices and Dividends	18

Management’s Report on Internal Control Over Financial Reporting	20

Section Two

Report of Independent Registered Public Accounting Firm	1

Consolidated Financial Statements	2

Notes to Consolidated Financial Statements	6

Corporate Information	52

Parke Bancorp, Inc. (the “Company”) may from time to time make written or oral “forward-looking statements” including statements contained in this Annual Report and in other communications by the Company which are made in good faith pursuant to the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties, such as statements of the Company’s plans, objectives, estimates and intentions that are subject to change based on various important factors (some of which are beyond the Company’s control). The following factors, among others, could cause the Company’s financial performance to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements; the strength of the United States economy in general and the strength of the local economies in which the Company’s bank subsidiary, Parke Bank, conducts operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; inflation, interest rate, market and monetary fluctuations; increased competition from both banks and non-banks; legal and regulatory developments; the impact of our participation in the Treasury’s capital purchase plan; technological changes; mergers and acquisitions; changes in consumer spending and saving habits; and the success of Parke Bank at managing these risks.

To Our Shareholders:

We are again proud to report record profits for Parke Bancorp in 2010. Net Income available to common shareholders improved to $6.4 million or a $1.41 per share, a 22% increase over 2009. Although the economic experts declared the end of the “Great Recession”, unemployment remains above 9% and real estate values and activity continued to decline. However, an economic recovery, although slow, appears to be underway. We are beginning to see activity at many projects that were dormant over the last couple of years. Agreements of sale are being executed and many businesses are reporting increased revenues. These are positive signs that point to an economic recovery both regionally and nationally. Unfortunately, there remains a substantial amount of pain that we still must work through. Experiencing the severe cash flow crunch over the last three years, many real estate developments, both residential and commercial, are finding it very difficult to remain solvent. Our non-performing loans increased 3.6% to $27.4 million, $1.9 million over December 31, 2009. We have had some success in disposing of troubled assets since the beginning of 2010, but unfortunately, new loan challenges continue to affect our non-performing loan totals and our 30 to 89 day past due loans. OREO (Other Real Estate Owned) also increased to $16.7 million as of December 31, 2010. The legal process to resolve troubled loans has worsened in the region. There is currently a moratorium on sheriff sales in Philadelphia and a foreclosure, residential and commercial, in New Jersey now averages 849 days. This further exacerbates the efforts of the real estate industry to recover. These troubled properties have to move through the system in order to accelerate the recovery of the real estate industry. We continue to be very aggressive in resolving our non-performing loans and our OREO properties, while maintaining a conservative financial position by increasing our loan loss reserve to 2.36% of total loans.

Total assets increased to $756.9 million from $654.2 million at December 31, 2009, an increase of $102.7 million or 15.7%. This growth was driven by our aggressive marketing plan for retail deposits. Total deposits grew by $84.4 million, a 16.2% increase from December 31, 2009 to $604.7 million. The opening of our new branch in Galloway Township contributed to our retail deposit growth. In less than one year, this branch has generated over $30 million in deposits. Our Northfield branch continues to be our strongest retail branch and is approaching $200 million in deposits. The main office, our Philadelphia office and our Washington Township “Kennedy” (located next to Kennedy hospital) branch also contributed to our strong deposit growth. Unfortunately, our Kennedy branch was destroyed by fire in January 2011. Most importantly no one was injured thanks to the immediate response from the fire and police departments. Everyone is working very hard to get the branch rebuilt and open for business as soon as possible.

The current economy makes it very difficult for businesses to grow and expand their market base. This has had a ripple effect on the availability of quality loans. Depressed real estate values make it very difficult for companies and individuals to utilize their real estate holdings to finance expansion and growth. However, we did increase our loan portfolio to $626.7 million, an increase of $23.3 million. Last year we reported opening a SBA lending subsidiary, 44 Business Capital. Since opening in August of

2009, this company has closed over $40 million of SBA 7A loans. We are fortunate to have some of the best SBA lenders and servicing administrators in the industry leading this company. The government’s stimulus program that increased government guarantees to 90% and eliminated borrower fees provided a substantial increase in SBA lending. Although this government incentive has expired, the company continues to grow and generate profits for Parke Bancorp. We have carefully identified expansion plans for 44 Business Capital to increase our market share and lending footprint.

Increased banking regulatory pressure continues to slow down the banking industry recovery. Increased insurance assessment fees and capital requirements, combined with a dramatic increase in reporting requirements has added substantial expenses to a bank’s operating costs while reducing a bank’s ability to increase lending. We have been proactive in adding to our senior management team, which will focus on the increased reporting and regulatory requirements.

2011 will continue to be very challenging for our communities, the economy and the banking industry, but there are clear signs that a recovery is under way. There will be additional troubled projects and challenging loans, however, we now see businesses starting to recover, projects beginning to sell and a renewed positive commitment in consumer spending. These factors will lead the country and our communities back to economic growth and prosperity. Parke Bancorp is positioned to overcome the remaining economic and real estate industries hurdles and take advantage of market opportunities. The success of our new branch and SBA subsidiary, combined with continued critical controls on our expenses supports a bright future for our bank. As always, we continue to appreciate the loyalty of our customers and the commitment of our shareholders. We will continue to work diligently to provide the best products and services to our customers, while enhancing shareholder value.

/s/ C.R. “Chuck” Pennoni /s/ Vito S. Pantilione

C.R. “Chuck” Pennoni Vito S. Pantilione

Chairman President and Chief Executive Officer

Selected Financial Data

	At or for the Year Ended December, 31
	2010		2009			2008			2007		2006
Balance Sheet Data: (in thousands)
Assets	$	756,853	$	654,198		$	601,952		$	460,795	$	359,997
Loans Net	$	611,950	$	590,997		$	539,883		$	402,683	$	306,044
Securities Available for Sale	$	27,730	$	29,420		$	31,930		$	29,782	$	24,530
Securities Held to Maturity	$	1,999	$	2,509		$	2,482		$	2,456	$	2,431
Cash and Cash Equivalents	$	57,628	$	4,154		$	7,270		$	9,178	$	11,261
Deposits	$	604,722	$	520,313		$	495,327		$	379,480	$	289,929
Borrowings	$	75,616	$	67,831		$	61,943		$	40,322	$	34,851
Equity	$	70,732	$	61,973		$	40,301		$	36,417	$	30,709

Operational Data: (in thousands)
Interest Income	$	41,636	$	40,395		$	36,909		$	33,186	$	25,476
Interest Expense		11,350		15,734			19,291			17,595		12,023
Net Interest Income		30,286		24,661			17,618			15,591		13,453
Provision for Loan Losses		9,001		5,300			2,063			1,161		940
Net Interest Income after Provision for Loan Losses		21,285		19,361			15,555			14,430		12,513
Noninterest Income (Loss)		2,757		(540	)		(1,251	)		1,491		857
Noninterest Expense		11,650		8,757			7,209			6,325		5,827
Income Before Income Tax Expense		12,392		10,064			7,095			9,596		7,543
Income Tax Expense		4,895		3,964			2,848			3,744		2,919
Net income attributable to Company and noncontrolling (minority) interest		7,497		6,100			4,247			5,852		4,624
Net income attributable to noncontrolling (minority) interest		(157)		—			—			—		—
Preferred Stock Dividend and Discount Accretion		988		899			—			—		—
Net Income Available to Common Shareholders	$	6,352	$	5,201		$	4,247		$	5,852	$	4,624

Per Share Data:
Basic Earnings per Common Share	$	1.43	$	1.17		$	1.03		$	1.46	$	1.18
Diluted Earnings per Common Share	$	1.41	$	1.17		$	0.95		$	1.29	$	1.00
Book Value per Common Share	$	12.25	$	10.30		$	9.14		$	9.00	$	7.65
Cash Dividends Declared per Share	$	—	$	—		$	—		$	—	$	0.18

Performance Ratios:
Return on Average Assets		1.05%		0.94%			0.79%			1.41%		1.41%
Return on Average Common Equity		12.19%		11.82%			11.03%			17.17%		15.68%
Net Interest Margin		4.60%		3.97%			3.36%			3.88%		4.25%
Efficiency Ratio		33.26%		33.88%			36.80%			38.70%		40.70%

Capital Ratios:
Equity to Assets		9.35%		9.47%			6.70%			7.91%		8.54%
Dividend Payout Ratio		0.00%		0.00%			0.00%			0.00%		12.20%
Tier 1 Risk-based Capital1		12.93%		13.02%			9.89%			11.10%		13.30%
Total Risk-based Capital1		14.19%		14.27%			11.14%			12.40%		14.50%

Asset Quality Ratios:
Non-Performing Loans/Total Loans		4.38%		4.22%			1.50%			0.20%		0.34%
Allowance for Loan Losses/Total Loans		2.36%		2.06%			1.42%			1.40%		1.45%
Allowance for Loan Losses/ Non-Performing Loans		53.89%		48.74%			94.61%			709.10%		571.90%

1 Capital Ratios for Parke Bank

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

Forward Looking Statements

Parke Bancorp, Inc. (the “Company”) may from time to time make written or oral "forward-looking statements", including statements contained in the Company's filings with the Securities and Exchange Commission (including the Proxy Statement and the Annual Report on Form 10-K, including the exhibits), in its reports to stockholders and in other communications by the Company, which are made in good faith by the Company.

These forward-looking statements involve risks and uncertainties, such as statements of the Company's plans, objectives, expectations, estimates and intentions, which are subject to change based on various important factors (some of which are beyond the Company's control). The following factors, among others, could cause the Company's financial performance to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements: the strength of the United States economy in general and the strength of the local economies in which Parke Bank (the “Bank”) conducts operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System, inflation, interest rates, market and monetary fluctuations; the timely development of and acceptance of new products and services of the Bank and the perceived overall value of these products and services by users, including the features, pricing and quality compared to competitors' products and services; the impact of changes in financial services' laws and regulations (including laws concerning taxes, banking, securities and insurance); technological changes; changes in consumer spending and saving habits; and the success of the Bank at managing the risks resulting from these factors. The Company cautions that the listed factors are not exclusive.

Overview

The Company's results of operations are dependent primarily on the Bank's net interest income, which is the difference between the interest income earned on its interest-earning assets, such as loans and securities, and the interest expense paid on its interest-bearing liabilities, such as deposits and borrowings. The Bank also generates non-interest income such as service charges, Bank Owned Life Insurance (BOLI) income and other fees. The Company's non-interest expenses primarily consist of employee compensation and benefits, occupancy expenses, marketing expenses, professional services, FDIC insurance assessments, data processing costs and other operating expenses. The Company is also subject to losses from its loan portfolio if borrowers fail to meet their obligations. The Company's results of operations are also significantly affected by general economic and competitive conditions, particularly changes in market interest rates, government policies and actions of regulatory agencies.

Results of Operation. The Company recorded net income available to common shareholders of $6.4 million or $1.41 per diluted share and $5.2 million, or $1.17 per diluted share for 2010 and 2009, respectively. Pre-tax earnings amounted to $12.4 million for 2010 and $10.1 million for 2009.

Total assets of $756.9 million at December 31, 2010 represented an increase of $102.7 million, or 15.7% from December 31, 2009. Total loans amounted to $626.7 million at year end 2010 for an increase of $23.3 million, or 3.9% from December 31, 2009. Deposits grew by $84.4 million, an increase of 16.2%. The Company continues to expand its balance sheet primarily through the generation of loan growth

through its effective business development of new and existing business relationships. Total capital at December 31, 2010 amounted to $70.7 million and increased $8.8 million, or 14.1%, during the past year.

The principal objective of this financial review is to provide a discussion and an overview of our consolidated financial condition and results of operations. This discussion should be read in conjunction with the accompanying financial statements and related notes thereto.

Comparative Average Balances, Yields and Rates. The following table sets forth average balance sheets, average yields and costs, and certain other information for the periods indicated. Interest rate spread is the difference between the average yield earned on interest-earning assets and the average rate paid on interest-bearing liabilities. Net interest margin is net interest income divided by average earning assets. All average balances are daily average balances. Non-accrual loans were included in the computation of average balances, and have been reflected in the table as loans carrying a zero yield. The yields set forth below include the effect of deferred fees, discounts and premiums that are amortized or accreted to interest income or expense.

	For the Years Ended December 31,
	2010								2009
	Average Balance			Interest Income/ Expense		Yield/ Cost			Average Balance			Interest Income/ Expense		Yield/ Cost
	(amounts in thousands except Yield Cost data)
Assets
Loans	$	622,716		$	39,934		6.41	%	$	587,047		$	38,482		6.56	%
Investment securities		35,565			1,702		4.79	%		34,384			1,912		5.56	%
Federal funds sold and cash equivalents		87			—		0.00	%		188			1		0.53	%
Total interest-earning assets		658,368		$	41,636		6.32	%		621,619		$	40,395		6.50	%
Non-interest earning assets		57,747								33,657
Allowance for loan losses		(14,250	)							(9,616	)
Total assets	$	701,865							$	645,660

Liabilities and Equity
Interest bearing deposits
NOWs	$	12,936			154		1.19	%	$	10,945			154		1.41	%
Money markets		89,866			1,045		1.16	%		70,533			1,033		1.46	%
Savings		150,008			2,190		1.46	%		104,586			2,205		2.11	%
Time deposits		203,238			4,027		1.98	%		181,866			5,711		3.14	%
Brokered certificates of deposit		86,235			2,184		2.53	%		136,168			4,582		3.36	%
Total interest-bearing deposits		542,283			9,600		1.77	%		504,098			13,685		2.71	%
Borrowings		66,044			1,750		2.65	%		58,351			2,049		3.51	%
Total interest-bearing liabilities		608,327		$	11,350		1.87	%		562,449		$	15,734		2.80	%
Non-interest bearing deposits		20,040								20,068
Other liabilities		5,822								4,149
Total liabilities		634,189								586,666
Equity		67,676								58,994
Total liabilities and equity	$	701,865							$	645,660
Net interest income				$	30,286							$	24,661
Interest rate spread							4.45	%							3.70	%
Net interest margin							4.60	%							3.97	%

Rate/Volume Analysis. For each category of interest-earning assets and interest-bearing liabilities, information is provided on changes attributable to (i) changes in volume (i.e., changes in volume multiplied by the old rate) and (ii) changes in rate (i.e., changes in rate multiplied by old volume). For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately to the change due to volume and the change due to rate.

	Years ended December 31,
	2010 vs. 2009									2009 vs. 2008
	Variance due to change in									Variance due to change in
	Average Volume			Average Rate			Net Increase/ (Decrease)			Average Volume			Average Rate			Net Increase/ (Decrease)
Interest Income:
Loans (net of deferred costs/fees)	$	2,336		$	(884	)	$	1,452		$	7,585		$	(3,568	)	$	4,017
Investment securities		67			(277	)		(210	)		(284	)		(54	)		(338	)
Federal funds sold		(1	)		—			(1	)		(114	)		(79	)		(193	)
Total interest income		2,402			(1,161	)		1,241			7,187			(3,701	)		3,486

Interest Expense:
Deposits		844			(4,929	)		(4,085	)		2,903			(6,177	)		(3,274	)
Borrowed funds		236			(535	)		(299	)		136			(419	)		(283	)
Total interest expense		1,080			(5,464	)		(4,384	)		3,039			(6,596	)		(3,557	)

Net interest income	$	1,322		$	4,303		$	5,625		$	4,148		$	2,895		$	7,043

Critical Accounting Policies and Estimates

Allowance for Losses on Loans. The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses. Loans that are determined to be uncollectible are charged against the allowance account, and subsequent recoveries, if any, are credited to the allowance. When evaluating the adequacy of the allowance, an assessment of the loan portfolio will typically include changes in the composition and volume of the loan portfolio, overall portfolio quality and past loss experience, review of specific problem loans, current economic conditions which may affect borrowers' ability to repay, and other factors which may warrant current recognition. Such periodic assessments may, in management's judgment, require the Company to recognize additions or reductions to the allowance.

Various regulatory agencies periodically review the adequacy of the Company’s allowance for loan losses as an integral part of their examination process. Such agencies may require the Company to recognize additions or reductions to the allowance based on their evaluation of information available to them at the time of their examination. It is reasonably possible that the above factors may change significantly and, therefore, affect management’s determination of the allowance for loan losses in the near term.

Valuation of Investment Securities. Available for Sale securities are reported at fair market value with unrealized gains and losses reported, net of deferred taxes, as comprehensive income, a component of shareholders’ equity. Although Held to Maturity securities are reported at amortized cost, the valuation of all securities is subject to impairment analysis at each reporting date. Any credit-related impairment that is deemed other than temporary is charged to the income statement as a current period charge. The current market volatility may have an impact on the financial condition and the credit ratings of issuers and hence, the ability of issuers to meet their payment obligations. Accordingly, these conditions could adversely impact the credit quality of the securities, and require an adjustment to the carrying value.

Operating Results for the Years Ended December 31, 2010 and 2009

Net Interest Income/Margins. The Company’s primary source of earnings is net interest income, which is the difference between income earned on interest-earning assets, such as loans and investment securities, and interest expense incurred on interest-bearing liabilities, such as deposits and borrowings. The level of net interest income is determined primarily by the average level of balances (“volume”) and the market rates associated with the interest-earning assets and interest-bearing liabilities.

Net interest income increased $5.6 million, or 22.8%, to $30.3 million for 2010, from $24.7 million for 2009. We experienced an increase in our interest rate spread of 75 basis points, to 4.45% for 2010, from 3.70% for last year. Our net interest margin increased 63 basis points, to 4.60% for 2010, from 3.97% for last year. Our ability to lower our cost of deposits, a change in deposit mix to lower cost core deposits and our practice of setting floors on commercial and real estate loans has allowed for this growth in net interest rate margin.

Interest income increased $1.2 million, or 3.1%, to $41.6 million for 2010, from $40.4 million for 2009. The increase is attributable to higher loan volumes, offset somewhat by a lower yield on loans. Average loans for the year were $622.7 million compared to $587.0 million for last year, while average loan yields were 6.41% for 2010 compared to 6.56% for 2009.

Interest expense decreased $4.4 million, or 27.9%, to $11.3 million for 2010, from $15.7 million for 2009. The decrease is primarily attributable to an increase of core deposits and a decline in the cost of funds. The average rate paid on deposits for 2010 was 1.77% compared to 2.71% for last year. The Bank has been able to re-price deposits due to the current, historically low, rate environment while still maintaining strong deposit growth.

Provision for Loan Losses. We establish provisions for loan losses, which are charged to operations, in order to maintain the allowance for loan losses at a level we consider necessary to absorb credit losses incurred in the loan portfolio that are both probable and reasonably estimable at the balance sheet date. In determining the level of the allowance for loan losses, we consider, among other things, past and current loss experience, evaluations of real estate collateral, current economic conditions, volume and type of lending, adverse situations that may affect a borrower’s ability to repay a loan, the levels of delinquent loans and current local and national industry and economic conditions. The amount of the allowance is based on estimates, and the ultimate losses may vary from such estimates as more information becomes available or conditions change. We assess the allowance for loan losses and make provisions for loan losses on a monthly basis.

At December 31, 2010, the Company’s allowance for loans losses increased to $14.8 million from $12.4 million at December 31, 2009, an increase of $2.4 million or 19.2%. The allowance for loan loss ratio increased to 2.36% of gross loans at December 31, 2010, from 2.06% of gross loans at December 31, 2009. The allowance for loan losses to non-performing loans coverage ratio increased to 53.9% at December 31, 2010, from 48.7% at December 31, 2009.

We recorded a provision for loan losses of $9.0 million for 2010 compared to $5.3 million for 2009. The increase in the provision for losses over the prior year correlates to the increase in credit deterioration within the loan portfolio and management’s analysis of non-performing loans and credit risk inherent in the portfolio.

Noninterest Income. Noninterest income is principally derived from fee income from loan services, service fees on deposits, BOLI (Bank-Owned Life Insurance) income and gains on the sale of loans. Noninterest income totaled $2.8 million in 2010 versus a loss of $540,000 in 2009. The loss in 2009 resulted from the Company recognizing an other-than-temporary impairment charge to non-interest income on investment securities totaling $1.7 million.

The Company recognized $1.8 million in gains from the sale of the guaranteed portion of SBA loans in 2010, compared to a gain of $313,000 in 2009. The increase is attributable to our SBA subsidiary being formed in the 4th quarter of 2009.

Loan fees of $301 thousand in 2010 increased from $241 thousand in 2009. Loan fees consist of “exit fees” that are charged on construction loans if the builder sells the property prior to the completion of the construction project. Exit fees are intended to discourage construction borrowers from starting projects and “flipping out” of the project or selling before it is completed. These loan fees are variable in nature and are dependent upon the borrowers’ course of action.

BOLI income of $178 thousand in 2010 decreased from $180 thousand in 2009.

Service fees on deposit accounts increased to $252,000 in 2010 from $187,000 in 2009. The increase was attributable to strong growth in retail deposits and an increase in the fee assessed to account holders with non-sufficient funds.

Other miscellaneous fee income, which includes ATM fees, debit card fees, early CD withdrawal penalties, rental income and other miscellaneous income, amounted to $329 thousand in 2010 and $249 thousand in 2009. The majority of the increase is attributable to packaging fee income generated from our SBA joint venture.

Noninterest Expense. Noninterest expense for 2010 was $11.7 million, an increase of $2.9 million or 33.0% above the level of $8.8 million in 2009.

Compensation and benefits expense for 2010 was $5.3 million, an increase of $1.1 million over last year. The increase is attributable to routine salary increases, higher benefits expense and increased staff as a result of the formation of the SBA joint venture and the opening of a new full-service branch.

Professional services in 2010 amounted to $1.2 million, compared to $862 thousand in 2009. The increase was primarily the result of increased legal cost related to loan matters.

OREO expenses increased to $622,000 in 2010, from $126,000 in 2009. The increase is a related to the carrying costs including property taxes, insurance and maintenance associated with a higher level of real estate properties.

Occupancy and equipment expense was $937 thousand for 2010, an increase of $89 over 2009. The increase is a result of opening a new full-service branch and the full year of operations of the SBA joint venture.

Other operating expense increased to $2.5 million in 2010, from $1.7 million in 2009. The majority of the increase is related to a $618,000 charge related to the funding of a letter of credit due to a borrower’s nonperformance.

Income Taxes. Income tax expense amounted to $4.9 million for 2010, compared to $4.0 million for 2009, resulting in effective tax rates of 39.5% and 39.4% for the respective years.

Financial Condition at December 31, 2010 and December 31, 2009

At December 31, 2010, the Company’s total assets increased to $756.9 million from $654.2 million at December 31, 2009, an increase of $102.7 million or 15.7%.

Cash and cash equivalents increased $53.5 million to $57.6 million at December 31, 2010 from $4.1 million at December 31, 2009. The increase is due to an effective deposit promotion and the opening of a full-service branch in Galloway Township, NJ in the second quarter of 2010. The cash will be utilized to fund future loan growth and pay off maturing brokered CDs.

Total investment securities decreased to $29.7 million at December 31, 2010 ($27.7 million classified as available for sale or 93.3%) from $31.9 million at December 31, 2009, a decrease of $2.2 million or 6.9%. The Company received $11.6 million in cash flow from maturities and principal payments, offset by purchases of $5.8 million. In addition, the fair value of the available-for sale portfolio increased by $3.6 million, primarily related to the collateralized debt obligation (“CDO”) portfolio, which reflected lower levels of unrealized losses.

Management evaluates the portfolio for other-than-temporary impairment (“OTTI”) on a quarterly basis. Factors considered in the analysis include, but are not limited to, whether an adverse change in cash flows has occurred, the length of time and the extent to which the fair value has been less than cost, whether the Company intends to sell, or will more likely than not be required to sell the investment before recovery of its amortized cost basis, which may be maturity, credit rating downgrades, the percentage of performing collateral that would need to default or defer to cause a break in yield or a temporary interest shortfall, and management’s assessment of the financial condition of the underlying issuers. For the year ended December 31, 2010, the Company recognized additional credit related OTTI charges (pre-tax) of $124,000 on an existing other-than-temporarily impaired private-label collateralized mortgage obligation (“CMO”).

Total loans increased to $626.7 million at December 31, 2010 from $603.4 million at December 31, 2009, an increase of $23.3 million or 3.9%, consistent with management’s plan for loan growth. In addition, there were $12.9 million of loans held for sale. These loans, the government guaranteed portion of originated SBA loans, were sold during the fourth quarter of 2010, but did not qualify for a sales treatment due to a 90 day warranty period in the sales agreement. The cash received from the sale was recorded as a secured borrowing. The sale of these loans will be recognized in the first quarter of 2011.

OREO at December 31, 2010 was $16.7 million, compared to none at December 31, 2009. The real estate owned consisted of 12 properties, the largest being a condominium development at $7.9 million. This property was sold in 2010 but does not qualify for a sales treatment under Generally Accepted Accounting Principles (GAAP) because of continuing involvement by the Company in the form of financing.

Other assets increased to $13.4 million at December 31, 2010 from $13.2 million at December 31, 2009, an increase of $266,000 or 2.0%.

At December 31, 2010, the Bank’s total deposits increased to $604.7 million from $520.3 million at December 31, 2009, an increase of $84.4 million or 16.2%. Non-interest bearing deposits increased $1.7 million, or 7.8%, to $23.2 million at December 31, 2010 from $21.5 million at December 31, 2009. NOW

and money market accounts increased $13.4 million, or 14.1%, to $108.7 million at December 31, 2010 from $95.3 million at December 31, 2009. Savings accounts increased $25.0 million, or 17.7%, to $166.7 million at December 31, 2010 from $141.7 million at December 31, 2009. Retail certificate of deposits increased $70.2 million, or 43.3%, to $236.0 million at December 31, 2010 from $165.8 million at December 31, 2009. This growth, generated through a successful marketing campaign and a cross selling program to increase core deposits and the opening of the Galloway NJ branch, has allowed us to reduce brokered deposits, which decreased $26.0 million, or 27.0%, to $70.1 million at December 31, 2010 from $96.1 million at December 31, 2009.

Borrowings increased $7.8 million, or 11.5%, to $75.6 million at December 31, 2010 from $67.8 million at December 31, 2009. The increase was due to the cash received from the sale of $11.5 million of SBA loans in the fourth quarter that was recorded as a secured borrowing due to the 90 day warranty period in the sales agreement. This was offset by a $3.7 million reduction in borrowings from the Federal Home Loan Bank due to retail deposit growth.

At December 31, 2010, total equity increased to $70.7 million from $62.0 million at December 31, 2009, an increase of $8.7 million or 14.1%. A $2.0 million favorable change in comprehensive income related to the investment portfolio, and net income represented the majority of the increase.

Asset Quality

The Company attempts to manage the risk characteristics of its loan portfolio through various control processes, such as credit evaluation of borrowers, establishment of lending limits and application of lending procedures, including the holding of adequate collateral and the maintenance of compensating balances. However, the Company seeks to rely primarily on the cash flow of its borrowers as the principal source of repayment. Although credit policies are designed to minimize risk, management recognizes that loan losses will occur and the amount of these losses will fluctuate depending on the risk characteristics of the loan portfolio as well as general and regional economic conditions.

The allowance for loan losses represents a reserve for losses inherent in the loan portfolio. The adequacy of the allowance for loan losses is evaluated periodically based on a review of all significant loans, with a particular emphasis on nonaccrual loans, past due and other loans that management believes require special attention.

For significant problem loans, management's review consists of an evaluation of the financial strengths of the borrower and the guarantor, the related collateral, and the effects of economic conditions. A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Impaired loans would include loans identified as troubled debt restructurings (TDRs). Impairment is measured on a loan by loan basis for commercial loans in order to establish specific reserves by either the present value of expected future cash flows discounted at the loans effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral dependent. General reserves against the remaining loan portfolio are based on analysis of historical loan loss ratios, loan charge-offs, delinquency trends, previous collection experience, and the risk rating on each individual loan along with an assessment of the effects of external economic conditions.

The Company maintains interest reserves for the purpose of making periodic and timely interest payments for borrowers that qualify. Management on a monthly basis reviews loans with interest reserves to assess current and projected performance.

Delinquent loans increased $10.5 million to $43.3 million or 6.9% of total loans at December 31, 2010 from $32.8 million or 5.4% of total loans at December 30, 2009. Delinquent loan balances by number of days delinquent were: 31 to 89 days --- $15.8 and 90 days and greater --- $27.5 million. Loans 90 days and more past due are no longer accruing interest.

At December 31, 2010, the Company had $27.5 million in non-performing loans or 4.4% of total loans, an increase from $25.5 million or 4.2% of total loans at December 31, 2009. The three largest relationships in non-performing loans are a $6.1 million residential loan, a $3.2 million residential construction loan, and a $2.4 million residential construction loan.

At December 31, 2010, the Company had $44.2 million in non-performing assets, which includes $27.5 million of non-performing loans and $16.7 of OREO, or 5.8% of total assets, an increase from $25.5 million or 3.9% of total assets at December 31, 2009.

The provision for loan losses is a charge to earnings in the current year to maintain the allowance at a level management has determined to be adequate based upon the factors noted above. The provision for loan losses amounted to $9.0 million for 2010, compared to $5.3 million for 2009. Net loan charge-offs/recoveries consisted of net charge-offs in the amount of $6.6 million in 2010 and net charge-offs of $673,000 in 2009.

At December 31 2010, the Company’s allowance for loans losses increased to $14.8 million from $12.4 million at December 31, 2009, an increase of $2.4 million or 19.2%. The allowance for loan loss ratio increased to 2.36% of gross loans at December 31, 2010, from 2.06% of gross loans at December 31, 2009. The allowance for loan losses to non-performing loans coverage ratio increased to 53.9% at December 31, 2010, from 48.7% at December 31, 2009.

We believe we have appropriately established adequate loss reserves on problem loans that we have identified and to cover credit risks that are inherent in the portfolio as of December 31, 2010. However, we believe that non-performing and delinquent loans will continue to increase as the current recession persists. We are aggressively managing all loan relationships. Credit monitoring and tracking systems have been instituted. Updated appraisals are being obtained, where appropriate, to ensure that collateral values are sufficient to cover outstanding loan balances. Cash flow dependent commercial real estate properties are being visited to inspect current tenant lease status. Where necessary, we will apply our loan work-out experience to protect our collateral position and actively negotiate with borrowers to resolve these non-performing loans.

Income Taxes

The Company accounts for income taxes according to the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using the enacted tax rates applicable to taxable income for the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is

recognized in income in the period that includes the enactment date. Valuation reserves are established against certain deferred tax assets when it is more likely than not that the deferred tax assets will not be realized. Increases or decreases in the valuation reserve are charged or credited to the income tax provision.

When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that ultimately would be sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. The evaluation of a tax position taken is considered by itself and not offset or aggregated with other positions. Tax positions that meet the more likely than not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination. Interest and penalties associated with unrecognized tax benefits would be recognized in income tax expense on the income statement.

For additional information on income taxes, see Note 10 to the Consolidated Financial Statements.

Interest Rate Sensitivity and Liquidity

Interest rate sensitivity is an important factor in the management of the composition and maturity configurations of earning assets and funding sources. The primary objective of asset/liability management is to ensure the steady growth of our primary earnings component, net interest income. Net interest income can fluctuate with significant interest rate movements. To lessen the impact of interest rate movements, management endeavors to structure the balance sheet so that re-pricing opportunities exist for both assets and liabilities in roughly equivalent amounts at approximately the same time intervals. Imbalances in these re-pricing opportunities at any point in time constitute interest rate sensitivity.

The measurement of our interest rate sensitivity, or "gap," is one of the principal techniques used in asset/liability management. Interest sensitive gap is the dollar difference between assets and liabilities that are subject to interest-rate pricing within a given time period, including both floating rate or adjustable rate instruments and instruments that are approaching maturity.

Our management and the Board of Directors oversee the asset/liability management function through the asset/liability committee of the Board that meets periodically to monitor and manage the balance sheet, control interest rate exposure, and evaluate our pricing strategies. The asset mix of the balance sheet is continually evaluated in terms of several variables: yield, credit quality, appropriate funding sources and liquidity. Management of the liability mix of the balance sheet focuses on expanding the various funding sources.

In theory, interest rate risk can be diminished by maintaining a nominal level of interest rate sensitivity. In practice, this is made difficult by a number of factors including cyclical variation in loan demand, different impacts on interest-sensitive assets and liabilities when interest rates change, and the availability of funding sources. Accordingly, we undertake to manage the interest-rate sensitivity gap by adjusting the maturity of and establishing rates on the earning asset portfolio and certain interest-bearing liabilities commensurate with management's expectations relative to market interest rates. Management generally attempts to maintain a balance between rate-sensitive assets and liabilities as the exposure period is lengthened to minimize our overall interest rate risk.

Rate Sensitivity Analysis. The interest rate sensitivity position as of December 31, 2010 is presented in the table below. Assets and liabilities are scheduled based on maturity or re-pricing data except for mortgage loans and mortgage-backed securities, which are based on prevailing prepayment assumptions and expected maturities and recent retention experience of core deposits. The difference between rate-sensitive assets and rate-sensitive liabilities or the interest rate sensitivity gap, is shown at the bottom of the table. As of December 31, 2010, our interest sensitive liabilities exceeded interest sensitive assets within a one year period by $145.9 million, or 20.6%, of total assets.

	As of December 31, 2010
	3 Months or Less			Over 3 Months Through 12 Months				Over 1 Year Through 2 Years				Over 3 Years Through 5 Years		Over 5 Years Through 10 Years		Total
Interest-earning assets:
Loans	$	214,057		$	40,451			$		96,049		$	247,846	$	28,336	$	626,739
Investment securities		6,535			2,094					3,876			7,977		10,068		30,550
Federal funds sold and cash equivalents			56,161			—				—			—		—		56,161
Total interest-earning assets	$	276,753		$	42,545			$		99,925		$	255,823	$	38,404	$	713,450

Interest-bearing liabilities::
Regular savings deposits	$	87,540		$	12,506			$		16,674		$	33,348	$	16,674	$	166,742
NOW and money market deposits		18,824			23,153					30,871			33,355		2,484		108,687
Retail time deposits		109,509			92,976					28,938			4,533		—		235,956
Brokered time deposits		26,316			42,854					849			150		---		70,169
Borrowed funds		15,991			35,516					160			10,546		13,403		75,616
Total interest-bearing liabilities	$	258,180		$	207,005			$		77,492		$	81,932	$	32,561	$	657,170

Interest rate sensitive gap	$	18,573		$	(164,460		)	$	22,433			$	173,891	$	5,843	$	56,280

Cumulative interest rate gap	$	18,573		$	(145,887		)	$	(123,454		)	$	50,437	$	56,280

Ratio of rate-sensitive assets to rate-sensitive liabilities		107.19%			20.55%					128.95%			312.24%		117.94%		108.56%

Liquidity describes our ability to meet the financial obligations that arise out of the ordinary course of business. Liquidity addresses the Company's ability to meet deposit withdrawals on demand or at contractual maturity, to repay borrowings as they mature, and to fund current and planned expenditures. Liquidity is derived from increased repayment and income from earning assets. Our loan to deposit ratio was 103.6% and 116.2% at December 31, 2010 and December 31, 2009 respectively. Funds received from new and existing depositors provided a large source of liquidity during 2010 and 2009. The Company seeks to rely primarily on core deposits from customers to provide stable and cost-effective sources of funding to support loan growth. The Bank also seeks to augment such deposits with longer term and higher yielding certificates of deposit.

Brokered deposits are a more volatile source of funding than core deposits and do not increase the deposit franchise of the Bank. In a rising rate environment, the Bank may be unwilling or unable to pay a competitive rate. To the extent that such deposits do not remain with the Bank, they may need to be replaced with borrowings which could increase the Bank’s cost of funds and negatively impact its interest rate spread, financial condition and results of operation. To mitigate the potential negative impact associated with brokered deposits, the Bank joined Promontory Inter financial Network to secure an additional alternative funding source. Promontory provides the Bank an additional source of external funds through their weekly CDARS® settlement process. The rates are comparable to brokered deposits and can be obtained within a shorter period time than brokered deposits. The Bank’s CDARS deposits included within the brokered deposit total amounted to $18.8 million and $5.9 million at December 31, 2010 and December 31, 2009, respectively. To the extent that retail deposits are not adequate to fund customer loan demand, liquidity needs can be met in the short term funds market. Longer term funding requirements can be obtained through advances from the Federal Home Loan Bank ("FHLB"). As of December 31, 2010, the Bank maintained unused lines of credit with the FHLB totaling $83.1 million. The Bank established lines of credit with other financial institutions totaling $11.0 million. These lines were not utilized at December 31, 2010.

As of December 31, 2010, the Bank's investment securities portfolio included $15.9 million of mortgage backed securities that provide significant cash flow each month. The majority of the investment portfolio is classified as available for sale, is readily marketable, and is available to meet liquidity needs. The Bank's residential real estate portfolio includes loans, which are underwritten to secondary market criteria, and provide an additional source of liquidity. Presently the residential mortgage loan portfolio and certain qualifying commercial real estate loans are pledged under a blanket lien to the FHLB as collateral. Management is not aware of any known trends, demands, commitments or uncertainties that are reasonably likely to result in material changes in liquidity.

Off-Balance Sheet Arrangements

The Bank is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. These instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated balance sheet. The contract or notional amounts of these instruments reflect the extent of the Bank's involvement in these particular classes of financial instruments. The Bank's exposure to credit loss in the event of nonperformance by the other party to the financial instruments for commitments to extend credit and standby letters of credit is represented by the contractual or notional amount of those instruments. The Bank uses the same credit policies in making commitments and conditional obligations as they do for on-balance sheet instruments.

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Bank evaluates each customer's credit-worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon the extension of credit, is based on management's credit evaluation. Collateral held varies but may include accounts receivable, inventory, property, plant and equipment and income-producing commercial properties. As of December 31, 2010

and 2009, commitments to extend credit amounted to approximately $73.7 million and $59.6 million, respectively.

Standby letters of credit are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. As of December 31, 2010 and 2009, standby letters of credit with customers were $5.9 million and $8.6 million, respectively.

Loan commitments and standby letters of credit are issued in the ordinary course of business to meet customer needs. Commitments to fund fixed-rate loans were immaterial at December 31, 2010. Variable-rate commitments are generally issued for less than one year and carry market rates of interest. Such instruments are not likely to be affected by annual rate caps triggered by rising interest rates. Management believes that off-balance sheet risk is not material to the results of operations or financial condition.

The following table sets forth information regarding the Bank’s contractual obligations and commitments as of December 31, 2010.

	Payments Due by Period
	Amounts in thousands
	Less than 1 year		1-3 Years		4-5 years		More than 5 years		Total

Retail time deposits	$	202,485	$	30,350	$	3,121	$	—	$	235,956
Brokered time deposits		69,170		999		—		—		70,169
Borrowed funds		51,507		9,847		859		13,403		75,616
Operating lease obligations		129		375		82		121		707
Total contractual obligations	$	323,291	$	41,571	$	4,062	$	13,524	$	382,448


	Amount of Commitments Expiring by Period
	Amounts in thousands
	Less than 1 year		1-3 Years		4-5 years		More than 5 years		Total

Loan Commitments	$	20,259	$	—	$	—	$	—	$	20,259
Lines of Credit		29,956		6,220		1,693	$	15,602		53,471
Total Commitments	$	50,215	$	6,220	$	1,693	$	15,602	$	73,730

Impact of Inflation and Changing Prices

The consolidated financial statements and notes have been prepared in accordance with GAAP, which require the measurement of financial position and operating results in terms of historical dollars without considering the change in the relative purchasing power of money over time and due to inflation. The impact of inflation is reflected in the increased cost of our operations. Unlike most industrial companies, nearly all of our assets are monetary in nature. As a result, market interest rates have a greater impact on our performance than do the effects of general levels of inflation. Interest rates do not necessarily move in the same direction or to the same extent as the price of goods and services.

MARKET PRICES AND DIVIDENDS

General

The Company's common stock is listed on the Nasdaq Capital Market under the trading symbol of "PKBK". The following table reflects high and low sales prices as reported on www.nasdaq.com during each quarter of the last two fiscal years. Prices reflect a 10% stock dividend paid in April 2010.

2010	High		Low

1st Quarter	$	8.64	$	7.05
2nd Quarter	$	11.93	$	8.11
3rd Quarter	$	9.50	$	8.30
4th Quarter	$	10.40	$	8.59

2009	High		Low

1st Quarter	$	7.73	$	3.87
2nd Quarter	$	8.95	$	5.55
3rd Quarter	$	9.07	$	7.50
4th Quarter	$	8.46	$	6.82

The number of shareholders of record of common stock as of March 18, 2011, was approximately 366. This does not reflect the number of persons or entities who held stock in nominee or "street" name through various brokerage firms. At March 25, 2011, there were 4,442,233 shares of our common stock outstanding.

Holders of the Company's common stock are entitled to receive dividends when, and if declared by the Board of Directors out of funds legally available therefore. The timing and amount of future dividends will be within the discretion of the Board of Directors and will depend on the consolidated earnings, financial condition, liquidity, and capital requirements of the Company and its subsidiaries, applicable governmental regulations and policies, and other factors deemed relevant by the Board.

The Company's ability to pay dividends is substantially dependent upon the dividends it receives from the Bank. Under current regulations, the Bank's ability to pay dividends is restricted as follows.

Under the New Jersey Banking Act of 1948, a bank may declare and pay dividends only if after payment of the dividend the capital stock of the bank will be unimpaired and either the bank will have a surplus of not less than 50% of its capital stock or the payment of the dividend will not reduce the bank's surplus.

The Federal Deposit Insurance Act generally prohibits all payments of dividends by any insured bank that is in default of any assessment to the FDIC. Additionally, because the FDIC may prohibit a bank from engaging in unsafe or unsound practices, it is possible that under certain circumstances the FDIC could claim that a dividend payment constitutes an unsafe or unsound practice. The New Jersey Department of Banking and Insurance has similar power to issue cease and desist orders to prohibit what might constitute unsafe or unsound practices. The payment of dividends may also be affected by other factors (e.g., the need to maintain adequate capital or to meet loan loss reserve requirements).

The Treasury Capital Purchase Program (CPP), more fully described in Note 13 of the Notes to the Consolidated Financial Statements, restricts us from increasing dividends from the last quarterly cash dividend declared on the Common Stock prior to January 9, 2009.

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a- 15(f). The Company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorization of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.

Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements prepared for external purposes in accordance with generally accepted accounting principles. Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

Under supervision and with the participation of management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation under the framework in Internal Control - Integrated Framework, management concluded that our internal control over financial reporting was effective as of December 31, 2010.

March 25, 2011

/s/ Vito S. Pantilione		/s/ John F. Hawkins
Vito S. Pantilione		John F. Hawkins
President and Chief Executive Officer		Senior Vice President and Chief Financial Officer

Parke Bancorp, Inc. and Subsidiaries

Consolidated Financial Report

December 31, 2010

Parke Bancorp, Inc. and Subsidiaries

Contents
	Page

Report of Independent Registered Public Accounting Firm ............................................................................................................................................................	1

Financial Statements
Consolidated Balance Sheets ........................................................................................................................................................................................................	2
Consolidated Statements of Income .............................................................................................................................................................................................	3
Consolidated Statements of Equity ..............................................................................................................................................................................................	4
Consolidated Statements of Cash Flows .....................................................................................................................................................................................	5
Notes to Consolidated Financial Statements ..............................................................................................................................................................................	6

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders

Parke Bancorp, Inc.

We have audited the consolidated balance sheets of Parke Bancorp, Inc. and Subsidiaries (the “Company”) as of December 31, 2010 and 2009 and the related consolidated statements of income, equity, and cash flows for the years there ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal controls over financial reporting. Our audits included consideration of internal controls over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Parke Bancorp, Inc. and Subsidiaries as of December 31, 2010 and 2009, and the results of their operations and their cash flows for the years there ended, in conformity with U.S. generally accepted accounting principles.

/s/ McGladrey & Pullen, LLP

Blue Bell, Pennsylvania

March 25, 2011

Parke Bancorp, Inc. and Subsidiaries

Consolidated Balance Sheets
December 31, 2010 and 2009
(in thousands except share data)	December 31,			December 31,
	2010			2009
Assets
Cash and due from financial institutions	$	57,628		$	4,099
Federal funds sold and cash equivalents		—			55
Cash and cash equivalents		57,628			4,154
Investment securities available for sale, at fair value		27,730			29,420
Investment securities held to maturity (fair value of $2,048 at December 31, 2010 and $2,404 at December 31, 2009)		1,999			2,509
Total investment securities		29,729			31,929
Loans held for sale		11,454			—
Loans, net of unearned income		626,739			603,401
Less: Allowance for loan and lease losses		14,789			12,404
Net loans and leases		611,950			590,997
Accrued interest receivable		3,273			2,808
Premises and equipment, net		4,279			2,861
Other real estate owned (OREO)		16,701			—
Restricted stock, at cost		3,040			3,094
Bank owned life insurance (BOLI)		5,362			5,184
Other assets		13,437			13,171
Total Assets	$	756,853		$	654,198

Liabilities and Equity
Liabilities
Deposits
Noninterest-bearing deposits	$	23,168		$	21,488
Interest-bearing deposits		581,554			498,825
Total deposits		604,722			520,313
FHLB borrowings		40,759			44,428
Other borrowed funds		21,454			10,000
Subordinated debentures		13,403			13,403
Accrued interest payable		828			821
Other liabilities		4,955			3,260
Total liabilities		686,121			592,225
Equity
Preferred stock, cumulative perpetual, $1,000 liquidation value; authorized 1,000,000 shares; Issued: 16,288 shares at December 31, 2010 and December 31, 2009		15,683			15,508
Common stock, $.10 par value; authorized 10,000,000 shares; Issued: 4,653,133 shares at December 31, 2010; and 4,224,867 shares at December 31, 2009		465			421
Additional paid-in capital		41,931			37,020
Retained earnings		15,494			14,071
Accumulated other comprehensive loss		(693	)		(2,867	)
Treasury stock, 210,900 shares at December 31, 2010; and 191,729 shares at December 31, 2009, at cost		(2,180	)		(2,180	)
Total shareholders’ equity		70,700			61,973
Noncontrolling (minority) interest in consolidated subsidiaries		32			—
Total equity		70,732			61,973
Total liabilities and equity	$	756,853		$	654,198

See accompanying notes to consolidated financial statements

Parke Bancorp, Inc. and Subsidiaries

Consolidated Statements of Income

Years Ended December 31, 2010 and 2009

(in thousands except share data)	2010			2009
Interest income:
Interest and fees on loans	$	39,934		$	38,482
Interest and dividends on investments		1,702			1,912
Interest on federal funds sold and cash equivalents		—			1
Total interest income		41,636			40,395
Interest expense:
Interest on deposits		9,600			13,685
Interest on borrowings		1,750			2,049
Total interest expense		11,350			15,734
Net interest income		30,286			24,661
Provision for loan losses		9,001			5,300
Net interest income after provision for loan losses		21,285			19,361
Noninterest income (loss)
Loan fees		301			241
Net income from BOLI		178			180
Service fees on deposit accounts		252			187
Gain on sale of SBA loans		1,789			313
Other than temporary impairment losses		(124	)		(2,482	)
Portion of loss recognized in other comprehensive income (OCI) (before taxes)		—			753
Net impairment losses recognized in earnings		(124	)		(1,729	)
Gain on sale of real estate owned		32			19
Other		329			249
Total noninterest income (loss)		2,757			(540	)
Noninterest expense
Compensation and benefits		5,250			4,114
Professional services		1,160			862
Occupancy and equipment		937			848
Data processing		344			292
FDIC insurance		873			835
OREO expense		622			126
Other operating expense		2,464			1,680
Total noninterest expense		11,650			8,757
Income before income tax expense		12,392			10,064
Income tax expense		4,895			3,964
Net income attributable to Company and noncontrolling (minority) interest		7,497			6,100
Net income attributable to noncontrolling (minority) interest		(157	)		—
Net income attributable to Company		7,340			6,100
Preferred stock dividend and discount accretion		988			899
Net income available to common shareholders	$	6,352		$	5,201

Earnings per common share
Basic	$	1.43		$	1.17
Diluted	$	1.41		$	1.17
Weighted average shares outstanding
Basic		4,438,926			4,434,490
Diluted		4,497,217			4,434,490

See accompanying notes to consolidated financial statements

Parke Bancorp, Inc. and Subsidiaries

Consolidated Statements of Equity
Years Ended December 31, 2010 and 2009
(in thousands)
	Preferred Stock		Common Stock		Additional Paid-In Capital		Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total Shareholders' Equity			Non- Controlling (Minority) Interest			Total Equity
Balance, December 31, 2008	$	—	$	414	$	35,656	$	8,870		$	(2,791	)	$	(1,848	)	$	40,301		$	—		$	40,301
Stock warrants exercised				7		415								(332	)		90						90
Stock compensation						19											19						19
Comprehensive income (loss):
Net income								6,100									6,100						6,100
Non-credit unrealized losses on debt securities with OTTI, net of taxes											(451	)					(451	)					(451	)
Net unrealized gains on available for sale securities without OTTI, net of taxes											380						380						380
Pension liability adjustments, net of tax											(5	)					(5	)					(5	)
Total comprehensive income																	6,024			—			6,024
Preferred stock issued		15,358				930											16,288						16,288
Dividend on preferred stock (5% annually)								(749	)								(749	)					(749	)
Accretion of discount on preferred stock		150						(150	)								0						0
Balance, December 31, 2009		15,508		421		37,020		14,071			(2,867	)		(2,180	)		61,973			—			61,973

Stock options exercised						32											32						32
Capital contribution by noncontrolling (minority) interest																				196			196
Capital withdrawals by noncontrolling (minority) interest																				(321	)		(321	)
10% common stock dividend				44		4,879		(4,923	)								—						—
Dividends on fractional shares								(6	)								(6	)					(6	)
Comprehensive income (loss):
Net income								7,340									7,340			157			7,497
Non-credit unrealized gains on debt securities with OTTI, net of taxes											124						124						124
Net unrealized gains on available for sale securities without OTTI, net of taxes											2,007						2,007						2,007
Pension liability adjustments, net of taxes											43						43						43
Total comprehensive income																	9,514			157			9,671
Dividend on preferred stock (5% annually)								(813	)								(813	)					(813	)
Accretion of discount on preferred stock		175						(175	)								—						—
Balance, December 31, 2010	$	15,683	$	465	$	41,931	$	15,494		$	(693	)	$	(2,180	)	$	70,700		$	32		$	70,732

See accompanying notes to consolidated financial statements

Parke Bancorp, Inc. and Subsidiaries

Consolidated Statements of Cash Flows
Years Ended December 31, 2010 and 2009
(in thousands)
	2010			2009
Cash Flows from Operating Activities
Net income	$	7,497		$	6,100
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		348			312
Provision for loan losses		9,001			5,300
Stock compensation		—			19
Bank owned life insurance		(178	)		(180	)
Supplemental executive retirement plan		508			384
Gain on sale of SBA loans		(1,789	)		(313	)
SBA loans originated for sale		(28,392	)		(3,552	)
Proceeds from sale of SBA loans originated for sale		31,386			3,197
Gain on sale of other real estate owned		(32	)		(19	)
Loss on write down of foreclosed assets		—			228
Other than temporary decline in value of investments		124			1,729
Net accretion of purchase premiums and discounts on securities		(194	)		(109	)
Deferred income tax benefit		(1,726	)		(2,825	)
Changes in operating assets and liabilities:
Increase in accrued interest receivable and other assets		995			(3,813	)
Increase in accrued interest payable and other accrued liabilities		(1,478	)		300
Net cash provided by operating activities		16,070			6,758
Cash Flows from Investing Activities
Purchases of investment securities available for sale		(5,753	)		(8,636	)
Purchases of restricted stock		54			(511	)
Proceeds from maturities of investment securities available for sale		3,790			3,500
Principal payments on mortgage-backed securities		7,784			5,880
Proceeds from sale of other real estate owned		758			505
Net increase in loans		(58,745	)		(57,060	)
Purchases of bank premises and equipment		(1,766	)		(159	)
Net cash used in investing activities		(53,878	)		(56,481	)
Cash Flows from Financing Activities
Proceeds from issuance of preferred stock					16,288
Payment of dividend on preferred stock		(813	)		(645	)
Dividends on fractional shares		(6	)		—
Net distribution to non-controlling interest		(125	)		—
Proceeds from exercise of stock options and warrants		32			422
Purchase of treasury stock		—			(332	)
Net increase in secured borrowings		11,454			2,025
Proceeds from other borrowings		—			29,500
Payments of Federal Home Loan Bank advances		(3,669	)		(25,637	)
Net increase in noninterest-bearing deposits		1,680			(773	)
Net increase in interest-bearing deposits		82,729			25,759
Net cash provided by financing activities		91,282			46,607
(Decrease)/increase in cash and cash equivalents		53,474			(3,116	)
Cash and Cash Equivalents, January 1,		4,154			7,270
Cash and Cash Equivalents, December 31,	$	57,628		$	4,154
Supplemental Disclosure of Cash Flow Information:
Cash paid during the year for:
Interest on deposits and borrowed funds	$	11,343		$	16,435
Income taxes	$	8,350		$	6,701
Supplemental Schedule of Noncash Activities:
Real estate acquired in settlement of loans	$	16,778		$	430

See accompanying notes to consolidated financial statements

Parke Bancorp, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

Note 1. Description of Business and Summary of Significant Accounting Policies

Description of Business: Parke Bancorp, Inc. (the “Company”) is a bank holding company headquartered in Sewell, New Jersey. Through subsidiaries, the Company provides individuals, corporations and other businesses, and institutions with commercial and retail banking services, principally loans and deposits. The Company was incorporated in January 2005 under the laws of the State of New Jersey for the sole purpose of becoming the holding company of Parke Bank (the "Bank").

The Bank is a commercial bank, which was incorporated on August 25, 1998, and commenced operations on January 28, 1999. The Bank is chartered by the New Jersey Department of Banking and Insurance and insured by the Federal Deposit Insurance Corporation. The Bank maintains its principal office at 601 Delsea Drive, Washington Township, New Jersey, and four additional branch office locations; 501 Tilton Road, Northfield, New Jersey, 567 Egg Harbor Road, Washington Township, New Jersey, 67 East Jimmie Leeds Road, Galloway Township, New Jersey and 1610 Spruce Street in Philadelphia, Pennsylvania.

The accounting and financial reporting policies of the Company and Subsidiaries conform to accounting principles generally accepted in the United States of America (“GAAP”) and to general practices within the banking industry. The policies that materially affect the determination of financial position, results of operations and cash flows are summarized below.

Principles of Consolidation: The accompanying consolidated financial statements include the accounts of Parke Bancorp, Inc. and its wholly-owned subsidiaries Parke Bank, Parke Capital Markets, Farm Folly, Inc. and Taylors Glen LLC. Also included are the accounts of 44 Business Capital Partners LLC, a joint venture formed in 2009 to originate and service SBA loans. Parke Bank has a 51% ownership interest in the joint venture; the non-controlling interest was not material as of December 31, 2009. Parke Capital Trust I, Parke Capital Trust II and Parke Capital Trust III are wholly-owned subsidiaries but are not consolidated because they do not meet the requirements for consolidation under applicable accounting guidance. All significant inter-company balances and transactions have been eliminated.

Investment Securities: At December 31, 2010 and 2009, the Company held investment securities that would be held for indefinite periods of time, including securities that would be used as part of the Company’s asset/liability management strategy and possibly sold in response to changes in interest rates, prepayments and similar factors. These securities are classified as “available for sale” and are carried at fair value, with any temporary unrealized gains or losses reported as other comprehensive income, net of the related income tax effect.

At December 31, 2010 and 2009, the Company also reported investments in securities that were carried at cost, adjusted for amortization of premium and accretion of discount. The Company has the intent and ability to hold these investment securities to maturity considering all reasonably foreseeable events or conditions. These securities are classified as “held to maturity.”

Declines in the fair value of individual debt securities below their cost that are deemed to be other-than-temporary result in write-downs of the individual securities to their fair value. Debt securities that are deemed to be other-than-temporarily impaired are reflected in earnings as realized losses to the extent

Parke Bancorp, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

impairment is related to credit losses. The amount of the impairment for debt securities related to other factors is recognized in other comprehensive income (loss). In evaluating other-than-temporary impairment losses, management considers (1) the length of time and the extent to which the fair value has been less than cost, (2) the reasons for the decline in value, (3) the financial position and access to capital of the issuer, including the current and future impact of any specific events, and (4) for fixed maturity securities, whether the Company intends to sell the security, or it is more likely than not that the Company will be required to sell the security before recovery of the cost basis, which may be maturity.

The amortization of premiums and accretion of discounts over the contractual lives of the related securities are recognized in interest income using the interest method. Gains and losses on the sale of such securities are accounted for using the specific identification method.

Restricted Stock: Restricted stock includes investments in the common stock of the Federal Home Loan Bank of New York (“FHLBNY”) and the Atlantic Central Bankers Bank for which no market exists and, accordingly, is carried at cost. FHLBNY stock has no quoted market value and is subject to redemption restrictions. Management reviews for impairment based on the ultimate recoverability of the cost basis in the stock. The stock’s value is determined by the ultimate recoverability of the par value rather than by recognizing temporary declines. Management considers such criteria as the significance of the decline in net assets, if any, of the FHLBNY, the length of time this situation has persisted, commitments by the FHLBNY to make payments required by law or regulation, the impact of legislative and regulatory changes on the customer base of the FHLBNY and the liquidity position of the FHLBNY.

Loans: The Company makes commercial, real estate and consumer loans to customers. A substantial portion of the loan portfolio is represented by loans in the Southern New Jersey and Philadelphia, Pennsylvania markets. The ability of the Company’s debtors to honor their contracts is dependent upon the real estate and general economic conditions in this area. Loans that management has the intent and ability to hold for the foreseeable future or until maturity or pay-off generally are reported at their outstanding unpaid principal amount, adjusted for charge-offs, the allowance for loan losses and any unamortized deferred fees or costs on originated loans. Interest income on loans is recognized as earned based on contractual interest rates applied to daily principal amounts outstanding.

Loans-Nonaccrual: Loans are placed on nonaccrual status and the accrual of interest income ceases when a default of principal or interest exists for a period of ninety days except when, in management’s judgment, the collection of principal and interest is reasonably anticipated (i.e. the loan is well secured and in the process of collection). Interest receivable on nonaccrual loans previously credited to income is reversed, and subsequently recognized as income only as received if the collection of principal is reasonably assured. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Troubled Debt Restructurings: Troubled debt restructurings (TDRs) are loans for which the Company, for legal or economic reasons related to a debtor’s financial difficulties, has granted a concession to the debtor that it otherwise would not have considered. Concessions that result in the categorization of a loan as a troubled debt restructuring include:

•	Reduction (absolute or contingent) of the stated interest rate;

Parke Bancorp, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

•	Extension of the maturity date or dates at a stated interest rate lower than the current market rate for new debt with similar risk;

•	Reduction (absolute or contingent) of the face amount or maturity amount of the debt as stated in the instrument or other agreement; or

•	Reduction (absolute or contingent) of accrued interest.

TDRs are reported as impaired loans.

Loans Held for Sale: Loans held for sale are the guaranteed portion of SBA loans and are reflected at the lower of aggregate cost or fair value. The net amount of loan origination fees on loans sold is included in the carrying value and in the gain or loss on the sale. The Company originates loans to customers under an SBA program that generally provides for SBA guarantees of up to 90 percent of each loan. When the sale of the guaranteed portion of an SBA loan occurs, the premium received on the sale and the present value of future cash flows of the servicing assets represent gain on the sale and are recognized in income over the estimated life of the loan. Income and fees collected for servicing are credited to noninterest income, net of amortization of the related servicing asset.

Concentration of Credit Risk: The Company’s loans are generally to diversified customers in Southern New Jersey and the Philadelphia area of Pennsylvania. Loans to general building contractors, general merchandise stores, restaurants, motels, warehouse space, and real estate ventures (including construction loans) constitute a majority of commercial loans. The concentrations of credit by type of loan are set forth in Note 4. Generally, loans are collateralized by assets of the borrower and are expected to be repaid from the borrower’s cash flow or proceeds from the sale of selected assets of the borrower.

Loan Fees: Loan fees and direct costs associated with loan originations are netted and deferred. The deferred amount is recognized as an adjustment to loan interest over the term of the related loans using the interest method. Loan brokerage fees, which represent commissions earned for facilitating loans between borrowers and other companies, are recorded in income as earned.

Allowance for Loan Losses: The allowance for loan losses is maintained through charges to the provision for loan losses in the Consolidated Statements of Income as losses are estimated to have occurred. Loans or portions thereof that are determined to be uncollectible are charged against the allowance, and subsequent recoveries, if any, are credited to the allowance. The allowance is an amount that management believes will be adequate to absorb estimated losses relating to specifically identified loans, as well as probable credit losses in the balance of the loan portfolio, based on an evaluation of collectability of existing loans and prior loss experience. When evaluating the adequacy of the allowance, an assessment of the loan portfolio will typically include changes in the composition and volume of the loan portfolio, overall portfolio quality and past loss experience, review of specific problem loans, current economic conditions which may affect borrowers’ ability to repay, and other factors which may warrant current recognition. Such periodic assessments may, in management’s judgment, require the Company to recognize additions or reductions to the allowance.

Parke Bancorp, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

them at the time of their examination. It is reasonably possible that the above factors may change significantly and, therefore, affect management’s determination of the allowance for loan losses in the near term.

The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired including TDRs. For those loans that are classified impaired, an allowance is established when the discounted cash flows (or collateral value for collateral dependent loans or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers non-classified loans and is based on historical charge-off experience and expected losses given the Company’s internal risk rating process. Other adjustments may be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not reflected in the historical loss or risk rating data.

A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. Factors considered by management when evaluating impaired loans include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Impairment is measured on a loan by loan basis for commercial loans by either the present value of expected future cash flows discounted at the loans effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral dependent.

Large groups of smaller balance homogeneous loans are collectively evaluated for impairment. Accordingly, the Company does not separately evaluate individual consumer and residential loans for impairment.

Other Real Estate Owned (OREO): Real estate acquired through foreclosure or other proceedings is carried at fair value less estimated costs of disposal. Costs of improving OREO are capitalized to the extent that the carrying value does not exceed its fair value less estimated selling costs. Subsequent valuation adjustments, if any, are recognized as a charge against current earnings. Holding costs are charged to expense. Gains and losses on sales are recognized in noninterest income as they occur.

Interest Rate Risk: The Company is principally engaged in the business of attracting deposits from the general public and using these deposits, together with other borrowed and brokered funds, to make commercial, commercial mortgage, residential mortgage, and consumer loans, and to invest in overnight and term investment securities. Inherent in such activities is interest rate risk that results from differences in the maturities and re-pricing characteristics of these assets and liabilities. For this reason, management regularly monitors the level of interest rate risk and the potential impact on net income.

Parke Bancorp, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

Bank Premises and Equipment: Bank premises and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed and charged to expense using the straight-line method over the estimated useful lives of the assets, generally three to forty years. Leasehold improvements are amortized to expense over the shorter of the term of the respective lease or the estimated useful life of the improvements.

Income Taxes: Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the difference between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Realization of deferred tax assets is dependent on generating sufficient taxable income in the future.

When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that ultimately would be sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more-likely-than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. The evaluation of a tax position taken is considered by itself and not offset or aggregated with other positions. Tax positions that meet the more likely-than not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination.

Interest and penalties associated with unrecognized tax benefits would be recognized in income tax expense on the income statement.

The Company did not recognize any interest or penalties related to income tax during the years ended December 31, 2010 or 2009 and did not accrue interest or penalties. The Company does not have an accrual for uncertain tax positions as of December 31, 2010 or 2009, as deductions taken and benefits accrued are based on widely understood administrative practices and procedures and are based on clear and unambiguous tax law. Tax returns for all years 2007 and thereafter are subject to further examination by tax authorities, with the exception of the State on New Jersey for which tax returns for all years 2006 and thereafter are subject to further examination.

Use of Estimates: The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the

Parke Bancorp, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

near term include the allowance for loan losses, other than temporary impairment losses on investment securities and the valuation of deferred income taxes.

Segment Reporting: The Company operates one reportable segment of business, “community banking”. Through its community banking segment, the Company provides a broad range of retail and community banking services.

Reclassifications: Certain items in the 2009 financial statements have been reclassified to conform to the 2010 presentation. Such reclassifications have no impact on prior year earnings.

Comprehensive Income: Comprehensive income consists of net income and other gains and losses affecting shareholders' equity that, under U.S. Generally Accepted Accounting Principles (GAAP), are excluded from net income, including unrealized gains and losses on available for sale securities and gains or losses, prior service costs or credits, and transition assets or obligations associated with pension or other postretirement benefits that have not been recognized as components of net periodic benefit cost.

The Company recognizes the overfunded or underfunded status of a defined benefit postretirement plan as an asset or a liability in the statement of financial position and changes in that funded status through comprehensive income in the year the changes occur. The accounting guidance related to compensation-retirement benefits also requires an employer to measure the funded status of a plan as of the date of the employer's year-end statement of financial position. The Company has recorded expense for the unfunded status of $509,000 and $384,000 for the years ended December 31, 2010 and 2009, respectively, relating to a Supplemental Executive Retirement Plan ("SERP") (Note 11).

The Company’s comprehensive income is presented in the following table:

	2010			2009
	(amounts in thousands)
Net Income:	$	7,497		$	6,100
Non-credit unrealized gains (losses) on available for sale securities with OTTI		81			(2,482	)
Unrealized gains (losses) on available for sale securities without OTTI		3,346			634
Reclassification adjustment for net losses realized in income		124			1,729
Minimum pension liability		43			(9	)
Tax impact		(1,420	)		52
Comprehensive income		9,671			6,024
Net income attributable to noncontrolling (minority) interest		(157	)		—
Comprehensive income attributable to Company	$	9,514		$	6,024

Parke Bancorp, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

Accumulated other comprehensive loss consisted of the following at December 31, 2010 and 2009:

	2010			2009
	(amounts in thousands)
Securities
Non-credit unrealized losses on available for sale securities with OTTI	$	(548	)	$	(753	)
Unrealized losses on available for sale securities without OTTI		(273	)		(3,619	)
Minimum pension liability		(201	)		(244	)