Our total investment securities portfolio — that is the securities held to maturity and the securities available for sale — increased by $71 million on an average between third quarter and the fourth quarter of 2014. This is — it was the primarily the impact of maturities and cash flows from our mortgage-backed securities portfolio, coupled with the decision to take advantage of market opportunities as they presented themselves to selectively sell out of loan return duration mortgage-backed securities at a gain of $335 thousand. We also allowed $18. 4 million of our overnight investments uses the funding source for our loan growth. However, overnight investments still remain at a very healthy new level for the fourth quarter, decreasing to $580 million from $598 million in the third quarter. At year end the federal fund bounces approximately $630 million, up about $41 million from the last quarter end.
Fourth quarter deposit balances were again effective by the seasonality in this time of the year. Over all our average funding sources decreased by $14. 4 million between the third and fourth quarters of 2014. This is consistent with prior year fourth quarter results. However as compared to last years fourth quarter, the total average funding sources have increased by $9 million, which shows the success we’ve had during the year in attracting and retaining core banking customers. The total cost of interest rate liabilities increased slightly to 42 basis points during the quarter, which is two basis points more than the third quarter of 2014 in the fourth quarter of last year.
As we’ve noted in prior conference calls we have just about reach the point where current market rates offered on deposit products equals or slightly exceeds the cost of funds in those maturing funds. Therefore, the expansion entries part will come primarily from the asset side of the balance sheet. In addition to the liquidity that is on the balance sheet, we expect that we will have between $200 million and $400 million of loan payments coming in over the next 12 months along with approximately $150 million of investment security cash flow during the same time period. You could see our provision for our loan losses come down by $100,000 during the quarter during the quarter as a result of continued positive trends and loan charge-offs. Scott will review this in a minute. But let me say that the decrease in provision for our loan losses which is directly attributable to the improving credit quality of the portfolio and ongoing resolution of existing problem loss.
Non-interest income came at a 4.8 million for the quarter compared to $4.9 million for the third quarter. During the fourth quarter similar to the third quarter, we have approximately $350 thousand of security gains. As you know, our business model do not rely on significant sources of non-interest income. The most significant recurring source of non-interest income is derived from our financial services division which has approximately $918 million of assets under management at year-end. There gross change to various line items to non-interest expenses is always interesting to explain in the fourth quarter. We do a couple of request entries in year-end so that our payroll and benefit expenses match up with our W-2s and our final payroll registers. This requires movement of our expense balances for the year from other expenses and equivalent expense categories off to salaries. But if you start on the bottom line and look at the total non-interest expense, you’ll see that it came in at $22.2 million in the fourth quarter. Flat compared to the third quarter at $20.9 million for the fourth quarter of 2013.
