OREO balances totaled $5.0 million at December 31, 2012, compared to $5.6 million at September 30, 2012 and $6.7 million at December 31, 2011. The Company sold 6 properties totaling $764,000 in the fourth quarter, had net negative valuation adjustments of $191,000 and added 3 properties totaling $270,000. A total of 6 properties remained in the OREO portfolio at quarter end, consisting of $4.9 million in land and land development and $79,000 in residential real estate.
Investment Portfolio, Deposit, Borrowings and Equity Summary
Investments available for sale decreased by $10.1 million during the quarter, as the Company sold several longer-dated securities for gains and experienced more rapid prepayment speeds on its mortgage-backed securities. The $61.1 million increase from December 31, 2011 primarily reflects the investment of funds raised in the Company's 2012 capital offerings.
Deposits totaled $748.9 million at December 31, 2012, compared to $722.1 million at September 30, 2012 and $729.4 million at the end of 2011. The increase from the third quarter reflects increases in demand deposit account balances, which offset continued reductions in CDs. While demand deposits grew by $50.1 million during the fourth quarter, approximately $30.1 million of this growth resulted from temporary shifts in the Company's money market demand deposits and other customer investment funds used to pay taxes and dividends at year end. After adjusting for this temporary growth, demand deposits were still up approximately $20 million, or 6.6% during the quarter. Overall, low-cost transaction deposits now represent 75.8% of the deposit portfolio, up from 70.7% at December 31, 2011. During the fourth quarter, the Company redeemed $13.8 million in brokered CDs, which will save about $125,000 in future annual interest expense. The table below provides information on both current composition and trends in the deposit portfolio.
|(Dollars in thousands)||12/31/2012||% of total||9/30/2012||% of total||12/31/2011||% of total|
|Non-interest bearing demand accounts||$ 254,979||34%||$ 214,524||29.7%||$ 190,074||26.1%|
|Interest bearing demand accounts||99,623||13.3%||89,941||12.5%||—||—|
|Money market accounts||213,155||28.5%||216,767||30%||201,237||27.6%|
|Savings & IRA accounts||75,788||10.1%||74,315||10.3%||73,493||10.1%|
|Certificates of deposit (CDs)||43,535||5.8%||47,509||6.6%||59,199||8.1%|
|CDARS CDs to local customers||426||0.1%||601||0.1%||4,717||0.6%|
|Total Deposits||$ 748,934||100.0%||$ 722,084||100.0%||$ 729,373||100.0%|
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