The net interest margin was 3.76% for the fourth quarter compared to 3.93% for the fourth quarter of 2010 and 3.81% for the third quarter of 2011. For the year 2011, the net interest income on a taxable equivalent basis increased to $642.1 million, up 4.2% over the $616.3 million reported in 2010.

Non-interest income for the fourth quarter of 2011 was $67.7 million, down $2.6 million. The Dodd-Frank commitment to -- the Durbin amendment to Dodd-Frank negatively impacts non-interest income by approximately $5 million per quarter. In the fourth quarter, that impact was most evident in other income, which was down $3.4 million and service charges on deposits, which were down $1 million. For the entire year, non-interest income was $290 million, up $8 million over 2010.

Non-interest expenses for the fourth quarter of 2011 was $143.8 million, up $10.1 million from the $133.7 million in the fourth quarter of 2010. Salaries rose $5.4 million over the same quarter a year earlier from normal annual merit and market increases as well as increase in stock-based compensation expense and incentive compensation.

Brand marketing and advertising increased $2.4 million to help us spread the great message about Frost. We also made a special $2 million contrition to the Frost Charitable Foundation for donations to worthy non-profits in communities we serve.

Economic uncertainty over regulation and intense competition on pricing and structure continued to affect our loan environment. For the year ended December 31, 2011, outstanding loans remained relatively flat at $8 billion. We are working hard to drive new loan commitments through long term relationships and good quality loans.

It is encouraging to see that more of a return to normal in commitments from our customers. For the year, we added 18% more new loan commitments than in 2010. But our loan pay-off rate was much higher than in previous years. Comparing the year end 2010 and 2011, it’s encouraging that our revolving commitments increased by 9.6% and our construction commitments increased by 10.7%. It’s interesting that while commitments are increasing, at the same time the funding rate is decreasing.

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