Deposits totaled $392.7 million at March 31, 2010 compared to $385.5 million at December 31, 2009. The increase was primarily due to increases in certificates of deposit (“CDs”). Core deposits (NOW, demand, money market and passbook accounts) represented 29% of total deposits at March 31, 2010 compared to 30% at December 31, 2009 and CDs represented 71% of total deposits at March 31, 2010 compared to 70% at December 31, 2009. Included in CDs are brokered deposits, which decreased $6.1 million, or 6%, in the first quarter of 2010 and represented 24% of total deposits at March 31, 2010, compared to 26% at December 31, 2009.

Stockholders' equity was $32.4 million, or 6% of the Company’s total assets at March 31, 2010. In February 2010, the Company borrowed $5.0 million on a line of credit with another financial institution and invested it as additional capital into the Bank. Also, effective March 2010, we reduced the quarterly dividend on our common stock to $.01 per share. These measures were taken to enhance liquidity and retain capital for reinvestment in our business. At March 31, 2010, the Bank’s Total Risk-Based Capital ratio was 11.89% and its Tangible Capital ratio equaled 7.82%. The Company is currently considering plans to increase capital to further strengthen the Bank’s capital ratios, and position the Bank for future growth.

Asset Quality

The Company experienced an improvement in its asset quality during the quarter ended March 31, 2010. Total non-performing assets (“NPAs”) decreased to $36.2 million, or 6.85% of total assets, at March 31, 2010 from $37.0 million, or 7.10% of total assets, at December 31, 2009 because of a reduction in non-accrual loans. These loans consist of delinquent loans that are 90 days or more past due, plus troubled debt restructurings that do not qualify for accrual status because the borrowers have not yet demonstrated performance according to the restructured terms for a period of at least six months. At March 31, 2010, total NPAs were comprised of $34.0 million in non-accrual loans and $2.2 million in REO. The non-accrual loans of $34.0 million included $19.9 million of commercial real estate loans, $7.2 million of commercial loans, $3.6 million of one-to-four family residential real estate loans, $1.1 million of multi-family residential real estate loans and $2.2 million of secured consumer loans.