Core other income increased by $577 thousand from the first quarter of 2012 to the second quarter of 2012. Loan service fees increased due to an increase in loan prepayment fees. Net lease financing increased due to an increase in remarketing revenues. Accretion of FDIC indemnification asset decreased as accretion is recorded based on the FDIC indemnification asset balance, which has declined as we have received loss-share payments. Card fee income increased due primarily to fees earned on prepaid cards and credit cards. Non-core other income was primarily impacted by lower losses recognized on OREO.
Core other income decreased by $2.1 million from the first six months of 2011 to the first six months of 2012 primarily due to a $2.5 million decrease in accretion of FDIC indemnification asset. Accretion is recorded based on the FDIC indemnification asset balance which has declined as we have received loss-share payments. Loan service fees decreased in the first six months of 2012 compared to the same period in 2011 due to a decrease in loan prepayment and exit fees. Net lease financing increased primarily due to an increase in remarketing revenues. Cash surrender value of life insurance decreased as a result of a death benefit recorded in the first six months of 2011. Card fee income increased due primarily to fees earned on prepaid cards and credit cards. Non-core other income was primarily impacted by higher losses recognized on OREO.
Other Expense (in thousands):
|Three Months Ended||Six Months Ended|
|June 30,||March 31,||December 31,||September 30,||June 30,||June 30,||June 30,|
|Core other expense:|
|Salaries and employee benefits||$||40,295||$||39,928||$||39,826||$||38,827||$||37,657||$||80,223||$||75,245|
|Occupancy and equipment expense||9,188||9,570||8,498||9,092||8,483||18,758||17,877|
|Computer services and telecommunication expense||3,909||3,653||4,382||3,488||3,570||7,562||7,015|
|Advertising and marketing expense||1,930||2,066||1,831||1,740||1,748||3,996||3,467|
|Professional and legal expense||1,503||1,413||1,422||1,647||1,853||2,916||3,078|
|Other intangible amortization expense||1,251||1,257||1,410||1,414||1,416||2,508||2,841|
|FDIC insurance premiums||2,010||2,643||2,662||2,272||3,502||4,653||6,930|
|Other real estate expense, net||424||1,243||1,464||1,181||1,251||1,667||1,649|
|Other operating expenses||6,473||5,057||7,324||7,352||7,090||11,530||14,145|
|Total core other expense||66,983||66,830||68,819||67,013||66,570||133,813||132,247|
|Non-core other expense: (1)|
|Branch impairment charges||-||-||594||-||-||-||1,000|
|Increase (decrease) in market value of assets held|
|in trust for deferred compensation (A)||(149||)||501||20||(405||)||158||352||345|
|Total non-core other expense||(149||)||501||614||(405||)||158||352||1,345|
|Total other expense||$||66,834||$||67,331||$||69,433||$||66,608||$||66,728||$||134,165||$||133,592|
(1) Letters denote the corresponding line items where these non-core other expense items reside in the consolidated statements of income as follows: A – Salaries and employee benefits.