For the fourth quarter and the full year 2012 interest expense was $170,461 and $698,016, respectively, a decrease of $25,265 or 12.9% over the fourth quarter of 2011 and a decrease of $137,937 or 16.5% for the year 2012 over 2011. As interest rates have continued at historically low levels, the Bank has been able to reduce interest expense by focusing on increasing low cost core deposits and lowering deposit rates. Especially noteworthy is that the decrease in interest expense is coupled with an increase in the Bank's deposit base of $12.6 million.
Non-Interest expense for the fourth quarter and year ending December 31, 2012 was $919,144 and $3,734,063 respectively, a decrease of $28,592 or 3.0% over the fourth quarter of 2011 and a decrease of $225,906 or 5.7% over 2011 expenses of $3,959,969. Over the past three years the Bank has focused on expense control, reducing non-interest expense by 5.1%, while growing revenue $1.3 million or 40.3%. Assets-per-employee has improved, from $4.3 million at the end of 2009 to $6.2 million as of year end 2012. The Bank's efficiency ratio also improved from 83% for 2011 to 78% for 2012.
The Bank provided $465,000 for credit losses in 2012 compared to $560,000 in 2011. Net credit losses were $524,673 and $343,931 for 2012 and 2011, respectively, representing 0.70% and 0.47% of gross year end loans, respectively. The Bank's Allowance for Loan & Lease Losses (ALLL) was 2.18% of loans as of December 31, 2012 compared to 2.30% as of December 31, 2011. The December 31, 2012 balance in the Bank's loan loss reserve stands at $1,631,083 and is considered adequate to absorb the inherent risk of credit loss in the Bank's loan portfolio.
Earnings per share for the fourth quarter and twelve months ending December 31, 2012 were $0.13 and $0.38, respectively, compared to $0.16 and $0.31 for the same periods in 2011, which represents a 22.3% increase for 2012. Return on average assets was 0.50% for 2012 compared to 0.43% in 2011, an improvement of 16.4% for the year. Return on average equity was 6.7% on an annualized basis for the fourth quarter and 4.8% for the twelve months ending December 31, 2012. Earnings increases were primarily due to lower interest expense, a lower provision for loan losses, higher fee income and lower non-interest expenses.