XML 17 R13.htm IDEA: XBRL DOCUMENT  v2.3.0.11
Transactions with Affiliates
 6 Months Ended
Jun. 30, 2011
Transactions with Affiliates [Abstract]  
Transactions with Affiliates
Note 7. Transactions with Affiliates

The Company entered into a sublease for a portion of its office space in Philadelphia, Pennsylvania with RAIT Financial Trust (RAIT) commencing in October 2000. The Chief Executive Officer of the Company was the Chairman of RAIT until December 31, 2010, at which date she retired from that position. The former Chief Executive Officer of RAIT (from December 2006 to February 2009), who was also a RAIT trustee, is the Chairman of the Company and a director and Chairman of the Executive Committee of the Bank. Rent expense for the six month periods ended June 30, 2011 and 2010, respectively, was approximately $328,000 and $330,000, net of rental charged to RAIT of approximately $148,000 and $147,000, respectively.

The Bank maintains deposits for various affiliated companies totaling approximately $110.8 million and $15.0 million as of June 30, 2011 and December 31, 2010, respectively.  The increase resulted from deposits of related interests of the Board of Directors, and is likely temporary.

The Bank has entered into lending transactions in the ordinary course of business with directors, executive officers, principal stockholders and affiliates of such persons on the same terms as those prevailing for comparable transactions with other borrowers. At June 30, 2011, these loans were current as to principal and interest payments and did not involve more than normal risk of collectability. At June 30, 2011, loans to these related parties amounted to $32.1 million as compared to $7.5 million at December 31, 2010.

The Bank has a participation in one loan at June 30, 2011 that was originated by RAIT. The outstanding principal balance of the loan was $21.7 million at June 30, 2011.  The Bank has a senior position on the loan.

On July 7, 2011, the Bank, as lender, entered into a loan agreement with Resource Capital Corp., as borrower.  The loan, in the principal amount of $10.0 million with a rate of prime plus 2.75%, .25% per draw fee and a loan commitment fee of .50%, matures in 12 months, is secured by an assignment of A-1 notes with investment grade ratings.  The President of Resource Capital Corp. is the brother of the Chairman of the Board and son of the Chief Executive Officer of the Company.  One director of Resource Capital Corp. is the father of the Chairman of the Board and the spouse of the Chief Executive Officer of the Company.  One director of the Company also serves as a director of Resource Capital Corp., and an additional director of the Company serves as a director of the parent company of Resource Capital Corp., Resource America, Inc. All of the directors with related interests in the loan did not vote or participate in any way in the loan approval.