Mike: Thank you, Scott. I am going to start on slide number 4. I think if you look at that slide, the two things you would take away from it is consistency and strong earnings at a high performance level, both for the year and the quarter. You can see that core net income in the year increased by 6%.In the quarter, the 18 cents was adjusted for about $3 million of nonrecurring costs related to TF. You recall that we estimated those costs to be about $10 million and $7 million of those were expensed pre-deal on the TF side. So you look at TF, the results we expected from the cost savings, a contribution and balance sheet impact were as we expected them to be.
On slide number 5 you look at that consistency of the margin on the right hand side year-over-year. I think that’s an accomplishment for us. We had estimated our margin to be in 340-range for the year, it was. In the quarter, the margins declined by 10 basis points, about 6 basis points of that decline related to the $125 million in senior debt and other 4 points core compression. As Scott mentioned, loan growth in the quarter was 6%.Looking at 2015, we expect the margin to be in the 3.25 range. You will note that based upon the TF acquisition and anticipated loan growth, which we view at the same levels of as in 2014, average earning assets would grow by about 10%.
Slide number 6 gives you an overview of the year and the quarter. For the year, loans on the bottom of the slide grow 4%, commercial loans up 5%. And again, we expect those types of growth rate as we move into 2015.
When you look at slide number 7 on the top left, classified loans declined by 10% in the quarter, 20% for the year, exclusive of the loans acquired from TF. TF loans were marked by about 2.7%. We talked about a $600 million portfolio, with about two-thirds of it being residential related.In the quarter, the provision increases to $3.5 million from a $1 million, despite the fact that net charge-offs are comparable. That is reflective of non-performing loans increasing from $43 million to $59 million primarily driven by a one credit. We think we have addressed that credit, consistent with our past practice as being timely and appropriately. But as you can look at the bottom of the slide, despite that increase in non-performer, our metrics relative to the peers remains very strong.
On slide number 8, in other income, little benefit in the quarter from wealth and mortgage but on an annualized basis, a little contraction based upon the mortgage refinance activity. As we look at 2015, we anticipate a growth rate in the low single digits as it relates to other income. Operating expenses and I’d focus you on the right-hand side of the slide. When we look at the year and you look at operating expenses in total, flat for the last three years, efficiency ratio in that 57% range. When you look at next year, our goal is to again keep these expenses flat adjusted for the TF acquisition.So we anticipate a quarterly run rate in the $55 million range. You will recall that early in the year, we rationalized our branch franchise by closing nine branches. Our 2015 estimates include further reductions in the cost of running the branch network, offsetting inflationary increases and allowing us to keep expenses relatively flat.
