As compared to the fourth quarter 2011, noninterest expense increased $3.1 million primarily due to the OREO write-down discussed above. In addition, professional fees increased $0.9 million primarily related to legal expenses, which were partially offset by declines in occupancy expense of $0.4 million due to savings related to branch closures and declines in insurance and assessment expense of $0.2 million related to decreases in FDIC and other insurance premiums.
Noninterest expense increased $1.6 million to $64.1 million for the year ended December 31, 2012 as compared to $62.5 million for the same period in 2011. Increases in noninterest expense consisted of the increases in OREO expenses of $2.8 million, mostly due to the write-down discussed above, the impairment charge related to the closure of two branches of $2.8 million, an increase in professional fees of $0.6 million related to legal expenses, and an increase in salary and benefit expense of $0.7 million, primarily related to annual salary increases. These increases in noninterest expense were partially offset by the prepayment penalty on FHLB borrowings of $2.7 million incurred in September 2011; reductions in loan collection expenses of $1.0 million, as the result of improved credit quality; decrease in amortization of intangible assets of $1.0 million; reductions in insurance and assessments of $0.9 million, related to lower insurance premiums and FDIC assessments; and reductions in occupancy and furniture and equipment of $0.6 million due to savings related to branch closures in 2012.
Balance Sheet
December September % December % 31, 2012 30, 2012 Change 31, 2011 Change ---------- ---------- ------ ---------- -------- (Dollars in thousands)Total assets $1,886,938 $1,834,978 2.8% $1,689,668 11.7%Average assets, quarter-to- date 1,843,212 1,776,557 3.8% 1,682,168 9.6%Total loans, net of unearned discount 1,158,749 1,118,968 3.6% 1,098,140 5.5%Total deposits 1,454,756 1,395,096 4.3% 1,313,786 10.7%Equity ratio - GAAP 9.97% 10.09% (1.2)% 10.12% (1.5)%Tangible common equity ratio 9.53% 9.59% (0.6)% 9.59% (0.6)%
At December 31, 2012, the Company had total assets of $1.9 billion, which represented a $52.0 million increase as compared to September 30, 2012 and a $197.3 million increase as compared to December 31, 2011. The increase in assets from September 30, 2012 consisted primarily of an increase in loans, net of unearned discount, of $39.8 million and an increase in investments of $22.5 million, partially offset by a decline in other assets of $11.2 million related to securities sold not yet settled. As compared to December 31, 2011, the increase in total assets was primarily due to an increase in investments of $72.8 million, an increase in loans, net of unearned discount, of $60.6 million, an increase in time deposits with banks of $50.0 million, and an increase in cash and cash equivalents of $12.0 million, partially offset by a decrease in OREO of $9.5 million. In addition, the allowance for loan losses decreased by $9.5 million.
The following table sets forth the amounts of loans outstanding at the dates indicated:
