Total deposits on September 30, 2013 were $364 million, an increase of $30 million or 9% over a year ago. This growth was mainly in core demand deposits and municipal deposits. At quarter-end, 26% of total deposits were in non-interest bearing demand accounts, 54% were in low-cost savings and NOW accounts, and 20% were in time deposits.
Total revenues, consisting of net interest and dividend income plus noninterest income, were $3,331,000 in the third quarter compared to $3,677,000 a year ago, a decrease of 9%. Net interest and dividend income increased by $270,000 or 10%, primarily due to an increase in yield on earning assets and increases in average outstanding balances. Noninterest income decreased by $616,000 primarily due to a decrease in gain on loan sales in the amount of $498,000. For the nine months ended September 30, 2013, total revenues were $10,657,000 compared to $10,690,000 for the nine months ended September 30, 2012, a decrease of $33,000 or less than 1%. Over this period, core net interest and dividend income increased by $242,000 or 3% while noninterest income decreased by $275,000 primarily due to a decrease in gains on loans sold.
The Company’s taxable-equivalent net interest margin (taxable-equivalent net interest and dividend income divided by average earning assets) was 3.15% for the third quarter of 2013 as compared to 3.03% for the third quarter of 2012. The Company’s cost of funds declined 5 basis points while the yield on interest earning assets increased 7 basis points during the third quarter of 2013 as compared to the third quarter of 2012.
Total noninterest expenses for the third quarter of 2013 were $3,160,000, an increase of $196,000 or 6.6% above the third quarter of 2012. The increase was primarily due to increases in marketing related expenses in the amount of $61,000, other operating expenses in the amount of $82,000 and occupancy expenses in the amount of $23,000. Third quarter 2013 occupancy costs included costs related to relocating the Company’s administrative offices to a larger facility. The move was completed during the month of July. For the nine months ended September 30, 2013, total noninterest expenses were $9,200,000 compared to $8,557,000 for the nine months ended September 30, 2012, an increase of $643,000 or 8%. Over this period, the increase in expenses was primarily in salary and employee benefits.
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