Same commitment. - Seaway Bank and Trust Company

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Seaway Bancshares, Inc. 2008 Annual Report Note 4 — Investment Securities The following is a summary of investment securities classified as available-for-sale at December 31, 2008: Amortized Cost Gross Unrealized Gross Unrealized F fair Value holding Gains H holding Losses Equity Securities $ 1,068.453 79,055 — $ 1,147,508 United States Government Agencies 122,760,860 889,943 — 123,650,803 Obligations of State and Political Subdivisions 728,934 12,747 — 741,681 Mortgage-Backed Securities 11,477,493 29,565 — 11,507,058 Other Investment Securities 1,100,000 — (218,440) 881,560 Total $ 137,135,740 1,011,310 (218,440) $ 137,928,610 The following is a summary of Investment securities classified as held-to-maturity at December 31, 2008: Amortized Cost Gross Unrealized Gross Unrealized F fair Value holding Gains H holding Losses Other Investment Securities $ 685,493 — — $ 685,493 Total $ 685,493 — — $ 685,493 At December 31, 2008, investments in debt securities with a fixed maturity, classified as available-for-sale, are scheduled to mature as follows: (based on amortized cost) maturity Within One Year One Through Five Years five Through Ten Years After Ten Years United States Government Agencies $ 12,999,191 12,195,575 47,691,251 $ 49,874,843 Obligations of State and Political Subdivisions 578,934 150,000 — — Mortgage-Backed Securities 30,067 6,658,707 1,720,520 3,068,199 Other Investment Securities — 1,100,000 — — Total $ 13,608,192 20,104,282 49,411,771 $ 52,943,042 At December 31, 2008, investments in debt securities classified as held-to-maturity are scheduled to mature as follows: maturity Within One Year One Through Five Years five Through Ten Years After Ten Years Other Investment Securities $ 1,477 9,771 9,104 665,141 Total $ 1,477 9,771 9,104 665,141 The following is a summary of investment securities classified as available for sale at December 31, 2007: Amortized Cost Gross Unrealized Gross Unrealized F fair Value holding Gains H holding Losses Equity Securities $ 1,068,453 179,091 — $ 1,247,544 United States Government Agencies 118,076,148 107,681 — 118,183,829 Obligations of State and Political Subdivisions 914,853 26,536 — 941,389 Mortgage-Backed Securities 11,110,933 — (124,067) 10,986,866 Other Investment Securities 1,150,000 — (94,710) 1,055,290 Total $ 132,320,387 313,308 (218,777) $ 132,414,918 The following is a summary of investment securities classified as held-to-maturity as of December 31, 2007: Amortized Cost Gross Unrealized Gross Unrealized F fair Value holding Gains H holding Losses Other Investment Securities $ 654,172 — — $ 654,172 Total $ 654,172 — — $ 654,172 At December 31, 2007, investments in debt securities with a fixed maturity, classified as available-for-sale, are scheduled to mature as follows: (based on amortized cost) maturity Within One Year One Through Five Years five Through Ten Years After Ten Years United States Government Agencies $ 6,999,591 31,164,469 43,687,968 $ 36,224,120 Obligations of State and Political Subdivisions 190,000 724,853 — — Mortgage-Backed Securities 220,088 7,363,892 3,275,171 251,782 Other investment Securities $ 50,000 1,000,000 50,000 $ 50,000 Total $ 7,459,679 $ 40,253,214 $ 47,013,139 $ 36,475,902 At December 31, 2007, investments in debt securities classified as held-to-maturity are scheduled to mature as follows: maturity Within One Year One Through Five Years five Through Ten Years After Ten Years Other Investment Securities $ — 14,251 35,980 $ 603,941 Total $ — 14,251 35,980 $ 603,941 18
Note 4, continued During 2008, sales proceeds and gross realized gains and losses on investment securities classified as available-for-sale and held to maturity were: Available for Sale held to Maturity Sale Proceeds $ 92,886,740 $ — Gross Realized (Losses) — — Realized Gains $ 145,197 $ — During 2007, sales proceeds and gross realized gains and losses on investment securities classified as available-for-sale and held to maturity were: Available for Sale held to Maturity Sale Proceeds $ 15,265,000 $ — Gross Realized (Losses) — — Realized Gains $ — $ — Investment securities carried at approximately $119,683,650 and $102,986,212 at December 31, 2008 and 2007 respectively, were pledged to secure public deposits and for other purposes required by law. Note 5 - Loans Major classifications of loans included in the accompanying Statements of Condition at December 2008 and 2007 are as follows: 2008 2007 Consumer Loans $ 3,049,855 $ 4,130,092 Commercial and Industrial loans 42,952,122 22,555,480 Real Estate Loans 138,502,493 125,209,853 Real Estate Construction Loans 13,318,078 29,351,302 Gross Loans 196,822,548 181,246,727 Less-Unearned Discount — (123) Loans, Net of Unearned Discount $ 196,822,548 $ 181,246,604 At December 31, 2008 and 2007, loans aggregating $3,400,526 and $3,499,068 respectively, were outstanding to Officers, Directors and principal shareholders of the Bank or to corporations in which such officers or directors had a beneficial interest. These loans were all made with substantially the same interest rates and collateral requirements as comparable loans to non-related borrowers. During 2008, and 2007, new loans to such related parties amounted to $475,305 and $459,924 respectively. Loan repayments during the year amounted to $573,847 and $1,104,375 respectively. Non-accrual loans at December 31, 2008 and 2007 approximated $10,243,603 and $1,868,085 respectively. The amount of interest income, which would have been recorded if the loans were on an accrual basis, would have approximated $691,761 during 2008, and $111,357 during 2007. Commercial and multi-family real estate loans aggregated approximately $44,939,160 and $25,000,200 at December 31,2008 and December 31, 2007 respectively. A majority of these properties are located in the Chicago metropolitan area. These loans are collateralized by the related properties and the loan-to-value ratios generally do not exceed 75 percent. During the year the Corporation made a $5,000,000 loan to the Metavante Corporation. Metavante provides data processing services. The loan was made with substantially the same interest rate and collateral requirements as the comparable loans to non-related borrowers. Note 6 — Allowance for Possible Loan Losses and Impaired Loans As of December 31, 2008 and December 31, 2007, the total recorded investment in impaired loans was $14,815,147 and $2,576,824, respectively. Of these amounts, in 2008 and 2007, $3,117,666 and $936,201 were subject to an allowance for possible loan losses of $552,234 and $72,823 respectively. During 2008, the average recorded investment in impaired loans was $15,265,122 and $2,939,857 in 2007. Interest income recognized in 2008 and 2007 during the period in which the loans were impaired was $493,880 and $140,588. The amount of income that would have been recorded on a cash basis during 2008 and 2007 would have been $564,768 and $154,180. Following is a summary of the activity in the Allowance for Possible Loan Losses: 2008 2007 Balance at Beginning of Year $ 1,840,318 $ 1,734,781 Recoveries credited to the allowance 29,506 335,431 Provision for possible loan losses 995,000 80,000 Loans charged-off (704,079) (309,894) Balance at End of Year $ 2,160,745 $ 1,840,318 Note 7 — Premises and Equipment A summary of premises and equipment at December 31, 2008 and 2007 is a follows: consolidated B bank Only 2008 2007 2008 2007 Premises $ 7,141,988 7,033,362 7,283,845 $ 7,175,219 Equipment 5,225,900 4,872,710 5,225,900 4,872,710 12,367,888 11,906,072 12,509,745 12,047,929 Less-Accumulated Depreciation (7,578,800) (7,033,266) (7,578,800) (7,033,266) Net Book Value $ 4,789,088 4,872,806 4,930,945 $ 5,014,663 Depreciation charged to consolidated operating expenses amounted to $666,869 and $567,843 for 2008 and 2007 respectively. Equipment rental expense for 2008 and 2007 was $8,101 and $13,816 respectively. 19
Page 1 and 2: Seaway Bancshares, Inc. 2008 Annual
Page 3 and 4: Letter to Our Shareholders Without
Page 5 and 6: The installation of the new Seaway
Page 7 and 8: Best of all, our new charter promis
Page 9 and 10: Seaway Bancshares, Inc. 2008 Annual
Page 11 and 12: Seaway Bancshares, Inc. and Subsidi
Page 13 and 14: Seaway Bank and Trust Company State
Page 15 and 16: Seaway Bank and Trust Company State
Page 17 and 18: Notes to Financial Statements For t
Page 19: Note 2, continued December 31, 2007
Page 23 and 24: Note 9, continued December 31, 2008
Page 25 and 26: Independent Auditor’s Report To t
Page 27 and 28: Banking Facilities Design: Stephen

Same commitment. - Seaway Bank and Trust Company

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