Core deposits increased 9.13% year-over-year and non-interest income, excluding gains on the sale of investment securities and SBA loans and the write down of OREO properties, was $1.2 million for the fourth quarter, representing a 36.30% increase over 2011 and $3.9 million for the full year 2012, up 17.97% from $3.4 million in 2011.
"We continued to accrue capital through retained earnings and have grown low-cost core deposits, which provide necessary liquidity to meet our funding needs. Our net loan balances declined, but not due to weak loan demand. Gross loans funded in 2012 were $89.7 million compared to $78.7 million in 2011. However, pay-downs were $96.9 million for 2012, up from $71.2 million in 2011."
Net loans for commercial term and commercial mortgage increased $5.6 million and $2.0 million or 7.32% and .82% respectively, while commercial construction declined $12.6 million or 50.65%.
Latoff continued, "We focused on reducing our exposure to commercial construction, while increasing balances for commercial mortgage and term loans, which invest in our communities and build relationships."Total assets increased $32.5 million or 5.35% to $639.6 million at December 31, 2012 compared to $607.1 million at December 31, 2011. Deposits increased by $32.9 million or 6.61% to $530.4 million at December 31, 2012 compared to $497.5 million at December 31, 2011. Core deposits, i.e., demand deposits, money market accounts, NOW and savings accounts increased $35.8 million in aggregate or 9.13%, while time deposits declined $2.9 million or 2.77% each since December 31, 2011. DNB's composite cost of funds for the fourth quarter of 2012 dropped 13 basis points to 0.61% compared to 0.74% for the three months ended December 31, 2011. DNB's Tier 1 leverage ratio stood at 10.50%, while its total risk-based capital ratio stood at 15.84%, well exceeding minimum accepted regulatory standards for a well-capitalized institution. Stockholders' equity increased $5.6 million to $56.7 million at December 31, 2012 compared to $51.1 million at December 31, 2011, reflecting solid earnings growth.