The NIM for the 2012 second quarter was up 14 basis points from the same period of 2011 to 4.04%. The improvement was largely due to our continuing strategy of shifting the asset mix from investments into loans driving higher yields as well as a growing cost effective demand deposit base and our ongoing control of deposit costs.
Sterling’s earnings power has also benefited from our balance of revenue mix, which includes a significant level of non-income generated by a range of financial products and services. The fact that our non-interest income is nearly 30% of total revenues helps to balance out the effect on loan yields from the low interest rate environment.
At the same time, we have maintained firm control on non-interest expenses, which were up $388,000 or less than 2% this quarter, versus an increase of about $1.4 million or 4% in total revenues.
Our credit metrics have continued to improve from an already solid base. Net charge-offs fell to $1.7 billion or 0.43% of loans for the 2012 second quarter, which is the lowest level of net charge-offs since the third quarter of 2008.Non-performing assets at June 30, 2012 were just 0.28% of total assets. The allowance for loan losses as a percentage of non-accrual loans was 377% at June 30, 2012. The level of allowance to total portfolio of loans was 1.35% at the end of the 2012 second quarter, essentially even with the year ago. These factors led to impressive earnings growth for the 2012 second quarter. Net income available to common shareholders was almost double the year-ago level at $4.9 million. Earnings per share also doubled versus a year ago to $0.16 for the 2012 second quarter. Our return on average tangible equity for the 2012 second quarter approached 10% which compares very favorably to our bank peer group. Read the rest of this transcript for free on seekingalpha.com