NET INTEREST MARGINThe Company's net interest margin ratio was 3.56% during second quarter 2013. The Company recorded net recoveries of charged-off interest of $142 thousand during second quarter 2013, $620 thousand during first quarter 2013 and $766 thousand during second quarter 2012. Exclusive of net recoveries of charged-off interest, the Company's net interest margin ratio was 3.55% during second quarter 2013, as compared to 3.51% during first quarter 2013 and 3.70% during second quarter 2012. Declines in yields earned on the Company's loan and investment portfolios during second quarter 2013 were offset by increases in average outstanding loans, reductions in the cost of interest bearing liabilities and lower average outstanding interest bearing deposits in banks. Also offsetting the impact of lower asset yields during the three and six months ended June 30, 2013, as compared to the same periods in 2012, was the December 2012 contractual repricing of $46 million of junior subordinated debentures from a weighted average fixed interest rate of 7.07% to variable rates averaging 2.60% over LIBOR. NON-INTEREST INCOME Income from the origination and sale of loans was $10.0 million during second quarter 2013, compared to $10.7 million during first quarter 2013, and $9.4 million during second quarter 2012. During second quarter 2013, the Company originated loans for home purchases of approximately $277 million, the highest level in the Company's history and a 21% increase over second quarter 2012. For the six months ended June 30, 2013, mortgage loan origination was flat, as compared to the same period in 2012, with loans originated for home purchases accounting for approximately 43% of the Company's mortgage loan production, compared to approximately 35% during the same period in 2012. Other service charges, commissions and fees increased to $9.0 million during second quarter 2013, as compared to $8.3 million during first quarter 2013 and $8.3 million during second quarter 2012, primarily due to increases in debit and credit card interchange revenues, the result of higher transaction volumes.