Total non-interest expense was stable year over year with total non-interest expense of $4.45 million in the third quarter of 2013 compared to $4.45 million for the same period in 2012. For the first nine months of 2013, non-interest expense was $13.11 million compared with $13.04 million in the first nine months of 2012.
Balance Sheet Highlights
Total deposits were $551.86 million at September 30, 2013, up 4% compared with $530.42 million at December 31, 2012. At September 30, 2012, total deposits were $517.88 million. Growth was supported by initiatives to attract core deposits and expand customer relationships to incorporate more deposit activity. Core deposit growth contributed positively to the company's 0.46% average cost of funds for third quarter 2013. The company trimmed Federal Home Loan Bank borrowings to $10 million during the nine months of 2013 compared with $20 million at December 31, 2012.
Total loans and leases before allowance for credit losses were $399.24 million at September 30, 2013 compared with $396.50 million at December 31, 2012. Loan totals reflect growth in commercial lending and relative stability in retail lending. This was partially offset by customer pay-downs of higher-rate loans and the company choosing to not renew selected weaker credits.
Overall asset quality reflected consistent long-term improvement as ratios of non-performing loans to total loans and non-performing assets to total assets improved significantly over the previous four quarters. Non-accrual loans were $5.25 million at September 30, 2013, compared with $9.56 million at December 31, 2012 and $7.11 million at September 30, 2012. Accruing loans 90 days past due declined to $335,561 in the third quarter of 2013 compared with $2.72 million in the third quarter of 2012, which management believes is a clear indication of the increased strength of the current loan portfolio. Total non-performing loans were $5.59 million at September 30, 2013 compared with $10.43 million at December 31, 2012 and $9.83 million at September 30, 2012.