Net interest income was up to $52.5 million for the three months ended December 31, 2012, compared with $50.5 million for the three months ended December 31, 2011. The Company's FTE net interest margin was 3.83% for the three months ended December 31, 2012, down from 3.98% for the three months ended December 31, 2011. The increase in average earning assets for the three months ended December 31, 2012 as compared to the same period of 2011 offset the decline in rates, resulting in the increase in net interest income over the same period last year.

While the rate paid on interest bearing liabilities decreased 15 basis points, the yield on interest earning assets declined 28 basis points, resulting in margin compression for the three months ended December 31, 2012, compared to the same period for 2011. The yield on securities available for sale was 2.27% for the three months ended December 31, 2012, as compared with 2.70% for the three months ended December 31, 2011. This decrease was due primarily to the reinvestment of cash flows from maturing securities and cash received from previous branch acquisitions into lower yielding securities in the current rate environment. The average balance of securities available for sale for the three months ended December 31, 2012 was $1.1 billion, down approximately $51.9 million, or 4.4%, from the three months ended December 31, 2011, as cash flows from maturing available for sale securities was used to support the aforementioned loan growth.  The yield on loans was 5.05% for the three months ended December 31, 2012, compared with 5.45% for the three months ended December 31, 2011. The average balance of loans for the three months ended December 31, 2012 was $4.3 billion, up approximately $505.8 million, or 13.5%, from the three months ended December 31, 2011.  The reduction in yields on earning assets was partially offset by a reduction in rates paid on interest bearing liabilities. The rate on time deposits was 1.31% for the three months ended December 31, 2012, compared with 1.72% for the three months ended December 31, 2011. The rate on money market deposit accounts was 0.14% for the three months ended December 31, 2012, compared with 0.24% for the three months ended December 31, 2011.

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