Loans held for sale decreased to $11.7 million at the end of 2012, from $37.3 million at September 30, 2012 and $27.8 million a year ago, reflecting the seasonality in the mortgage market. Northrim purchases these loans from its mortgage affiliate, Residential Mortgage, and sells them into the secondary market.
The mix of deposits continues to improve with balances in transaction accounts at December 31, 2012 representing 90.4% of total deposits, up from 88.1% a year ago. At the end of 2012, total deposits were $970.1 million, up 3% from $944.9 million at September 30, 2012, and up 6% from $911.2 million a year ago.
Noninterest-bearing demand deposits at December 31, 2012, were up 11% from a year ago and interest-bearing demand deposits grew 3% over the same period. At year end, money market balances increased 17% and savings account balances were up 10% from year ago levels, while the Alaska CD (a flexible certificate of deposit program) balances were down 1%. Time deposit balances fell 15% during the past twelve months. At the end of 2012, noninterest-bearing demand deposits accounted for 37.2% of total deposits, interest-bearing demand accounts were 15.1%, savings deposits were 9.0%, money market balances accounted for 18.7%, the Alaska CD accounted for 10.4% and time certificates were 9.6% of total deposits.
Shareholders' equity totaled $136.4 million, or $20.93 per share, at December 31, 2012, compared to $134.1 million, or $20.70 per share, at September 30, 2012, and $125.4 million, or $19.39 per share, a year ago. Tangible book value per share was $19.67 at December 31, 2012, compared to $19.43 per share at September 30, 2012, and $18.09 per share a year ago. Northrim remains well-capitalized with Tier 1 Capital to Risk Adjusted Assets of 15.34% at December 31, 2012.
"While our asset quality was impacted by the global economic recession over the past three years, we weathered the storm better than many banks in the nation," said Chris Knudson, Chief Operating Officer. "In 2012, we recognized net recoveries of $1.5 million, which included a $1.0 million recovery in the third quarter on a commercial loan that had been previously charged off to our reserve account," continued Knudson. Asset quality continued to improve during 2012 with nonperforming loans dropping to 0.64% of portfolio loans from 1.14% a year ago. The ratio of nonperforming assets (NPAs) to total assets dropped to 0.78% at December 31, 2012, down from 0.94% three months earlier and 1.16% a year ago.