Other Operating ExpensesFor 2012, operating expenses increased 8% to $39.6 million, from $36.8 million in 2011. Overhead costs increased 6% during the fourth quarter of 2012 as compared to the third quarter of this year and increased 12% compared to the fourth quarter of 2011. Overhead in 2011 benefited from gains on sale and rental income from OREO properties that resulted in a net benefit of $710,000, compared to net expenses of $1.1 million in 2012. Compensation costs increased 5% in 2012 primarily due to increased health benefit costs, while full-time equivalent employee count declined to 245 at year end from 260 a year ago. "We are continuing to grow our franchise, in terms of assets, loans and profitability, without increasing our staffing levels, in part due to advances in technology. More than half of our transactions are now electronic rather than in-branch," said Knudson. "In addition, during the third quarter of 2012, we established a $349,000 reserve for our purchased receivables. Our purchased receivables assets are listed on our balance sheet net of this reserve." Provision for Income Taxes "With the change in the mix of our investment securities, particularly with a reduced tax exempt securities portfolio, our effective tax rate increased in the fourth quarter and year-to-date periods. We anticipate our provision for income taxes will stabilize or decline slightly in 2013," said Schierhorn. The provision for income taxes was $6.2 million, or 31.4% of 2012 pretax income, compared to $4.9 million, or 29.2% of pretax income a year ago. About Northrim BanCorp Northrim BanCorp, Inc. is the parent company of Northrim Bank, an Alaska-based community bank with ten branches in Anchorage, the Matanuska Valley, and Fairbanks serving 70% of Alaska's population; and an asset based lending division in Washington. The Bank differentiates itself with its detailed knowledge of Alaska's economy and its "Customer First Service" philosophy. Affiliated companies include Elliott Cove Insurance Agency, LLC; Elliott Cove Capital Management, LLC; Residential Mortgage, LLC; Northrim Benefits Group, LLC; and Pacific Wealth Advisors, LLC.