Bank of Marin Bancorp, parent company of Bank of Marin, announced earnings of $4.9 million in the fourth quarter of 2015.
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This is an increase from $4.8 million in the third quarter of 2015 and $4.7 million in the fourth quarter of 2014. Diluted earnings per share totaled $0.81 in the fourth quarter of 2015, compared to $0.79 in the prior quarter and $0.78 in the same quarter a year ago.
Annual earnings for 2015 totaled $18.4 million, compared to $19.8 million a year ago. Diluted earnings per share totaled $3.04 for the year ended December 31, 2015, compared to $3.29 per share for the same period in 2014.
Gross loans totaled $1,451.2 million at December 31, 2015, an increase of $88 million from both September 30, 2015 and December 31, 2014. 2015 was highlighted by record new loan volume of approximately $114 million for the fourth quarter and approximately $252 million for the year, compared to approximately $192 million in 2014.
These numbers reflect the success of our long-term strategy and work by the lending team all year long to expand existing markets and build new ones. Payoffs for the year ended at $169 million or 12% of gross loans, a reasonable level despite the sales of some large businesses and properties early in the year.
Total deposits grew 11.4% year-over-year to $1,728.2 million from $1,551.6 million. The Bank added several significant new commercial deposit relationships in 2015 while maintaining its low cost of funding. Non-interest bearing deposits make up 44.6% of total deposits and the cost of deposits dropped to 0.09%.
Credit quality remains strong with non-accrual loans trending downward, representing 0.15% of total loans at December 31, 2015, down from 0.19% at September 30, 2015 and 0.69% a year ago. The Texas ratio was 1.18% at December 31, 2015, down from 1.41% at the end of the prior quarter and 4.79% a year ago.
Classified loans totaled $22.3 million, down from $24.0 million at the end of the prior quarter and $36.2 million a year ago. These improvements, in combination with loan growth for the quarter resulted in a provision for loan losses of $500 thousand and a slight decline in the loan loss reserve as a percentage of total loans to 1.03%.
The total risk-based capital ratio for Bancorp was 13.4% at December 31, 2015 compared to 14.0% at September 30, 2015. The common equity tier one ratio, a regulatory ratio under Basel III (Basel Committee on Bank Supervision guidelines for determining regulatory capital), was 12.2% at December 31, 2015, compared to 12.7% at September 30, 2015.
All capital ratios are well above regulatory requirements for a well-capitalized institution under the new requirements that took effect January 1, 2015. Tangible common equity to tangible assets totaled 10.1% at December 31, 2015, compared to 10.8% at September 30, 2015 and 10.7% at December 31, 2014.
To reflect the strength of the Bank and its future prospects, the Board of Directors declared a quarterly cash dividend of $0.25 per share on January 22, 2016. The dividend increased $0.01 from the prior quarter and $0.03, or 14% from one year ago.
The cash dividend is payable to shareholders of record at the close of business on February 5, 2016 and will be payable on February 12, 2016. ■