Our capital levels in the fourth quarter of 2014 continued to grow. The tier 1 leverage ratio rose to 9.96% at fourth quarter end, and tangible equity to net tangible assets ended December at 8.92%. As mentioned previously these higher capital levels and our strong operating income generation allowed us to again raise our quarterly dividend to shareholders in 2014 to $0.30 per quarter, or 7.1% increase. Tangible book value per share increased to $15.63 per share at quarter end, and includes $35.8 million of deferred tax liabilities generated from tax deductible goodwill or $0.88 per share.
Shifting now to the income statement, our reported net interest margin for the fourth quarter was 3.89%, which was even with the third quarter of this year and up one basis point in the fourth quarter of 2014. Consistent with historical results the second and fourth quarters of each year include our semi-annual dividend from the Federal Reserve Bank of approximately a half a million dollars, which adds three basis points of net interest margins to fourth quarter results compared to the linked third quarter.
Proactive and disciplined management of deposit funding costs continue to have a positive effect on margin results, but have generally not been able to fully offset declining asset yields. Fourth quarter non-interest income was up 6% from last years fourth quarter excluding the $6.9 million of net losses incurred on sales of investment securities and debt extinguishments in last year’s fourth quarter. The company’s employee benefits, administration and consulting businesses posted a 9% increase in revenues from new customer additions, favorable equity market conditions, and additional service offerings.
Our wealth management group also generated 9% revenue improvement from last year’s fourth quarter, and included solid organic growth in trust and asset advisory services, while also benefiting from favorable market conditions. Seasonally, our fourth quarter revenues from banking non-interest income sources were down slightly from the levels reported in the third quarter, but were 2.9% higher than the fourth quarter of 2014. Consistent with prior years, the third quarter included the annual distribution from our participation in certain pools, retail and insurance programs which approximated $900,000 or $1.05 cents per share this year.
Quarterly operating expenses of $56.7 million increased $1.5 million or 2.7% over the fourth quarter of 2013 excluding acquisition costs and included the operating cost associated with the additional branches acquired in December 2013.
Merit based personnel cost increases in 2014 were partially offset by lower retirement planning costs related to the combination of strong plan asset performance and slightly higher pension discount rates. Fourth quarter salaries and benefits costs were consistent with the third quarter of this year reflective of equivalent number of payroll days in each quarter.
