in addition , tangible book value per common share increased 6 % to $ 20.18 from $ 18.98 at december 31 , 2016. the company 's credit quality remained strong as non-performing assets totaled $ 31.6 million at december 31 , 2017 compared to $ 33.8 million at december 31 , 2016 due to a decrease in non-performing commercial loans . non-performing assets represented 0.58 % of total assets at december 31 , 2017 compared to 0.66 % at december 31 , 2016. the ratio of net charge-offs to average loans was 0.04 % for 2017 , compared to 0.06 % for the prior year . total assets at december 31 , 2017 increased 7 % compared to december 31 , 2016. loan balances increased 10 % compared to the prior year end due to increases of 11 % in residential mortgage and construction loans and 11 % in commercial loans . the growth in commercial loans was driven by double digit increases in owner-occupied real estate and investor real estate loans while the increase in mortgage loans was due primarily to growth in residential construction loans . customer funding sources , which include deposits plus other short-term borrowings from core customers , increased 10 % compared to balances at december 31 , 2016. the increase in customer funding sources was driven by increases of 18 % in certificates of deposit , 11 % in money market savings and 10 % in checking accounts . the company utilizes low cost fhlb borrowings to assist in the management of the net interest margin . the effect on the net interest margin partially mitigates the increased rates offered on certificates of deposit and money market accounts to retain these deposit relationships in the expectation of higher interest rates . during the same period , stockholders ' equity increased to $ 563 million due to net income in 2017 , which effect was somewhat offset by dividends paid to stockholders during 2017 . 29 net interest income increased 13 % compared to the prior year due to the effects of an 11 % growth in average interest-earning assets with an increase of 12 basis points in the yield while the rate on interest-bearing liabilities which grew 10 % from the prior year increased 9 basis points over the same period . non-interest income , exclusive of investment securities gains of $ 1.3 million in 2017 and $ 1.9 million in 2016 , as well as the $ 1.2 million gain in the prior year 's from debt extinguishment , increased 4 % for 2017 compared to 2016. this was due to increases in income from wealth management , insurance agency commissions and deposit service charges during 2017 as compared to 2016. non-interest expenses increased 5 % to $ 129.1 million for the year ended december 31 , 2017 , compared to $ 123.1 million for the prior year . a primary driver of expenses in 2017 was $ 4.3 million in merger expenses related to the washingtonfirst acquisition . this expense was partially offset by the decrease in prepayment penalties of $ 1.9 million for the early payoff of high-rate fhlb advances as compared to the year ended december 31 , 2016. excluding the impact of the fhlb prepayment penalties from the current and prior year 's results and the exclusion of merger expenses for 2017 , non-interest expense increased 3 % . the tax rate reduction associated with the recently enacted tax reform legislation caused a revaluation of net deferred tax assets and resulted in $ 5.6 million of additional income tax expense in the fourth quarter of 2017. this additional income tax expense and merger expenses , net of tax , resulted in a reduction of earnings per share of approximately $ 0.34 per share for 2017. pre-tax , pre-provision income , which adjusts for these items , increased 23 % from full-year 2016 to full-year 2017 to a record $ 95.2 million . critical accounting policies the company 's consolidated financial statements are prepared in accordance with generally accepted accounting principles ( “ gaap ” ) in the united states of america and follow general practices within the banking industry . application of these principles requires management to make estimates , assumptions , and judgments that affect the amounts reported in the financial statements and accompanying notes . these estimates , assumptions , and judgments are based on information available as of the date of the financial statements ; accordingly , as this information changes , the financial statements may reflect different estimates , assumptions , and judgments . certain policies inherently rely more extensively on the use of estimates , assumptions , and judgments and as such may have a greater possibility of producing results that could be materially different than originally reported . estimates , assumptions , and judgments are necessary for assets and liabilities that are required to be recorded at fair value . a decline in the value of assets required to be recorded at fair value will warrant an impairment write-down or valuation allowance to be established . carrying assets and liabilities at fair value inherently results in greater financial statement volatility . the fair values and the information used to record valuation adjustments for certain assets and liabilities are based either on quoted market prices or are provided by other third-party sources , when readily available . management believes the following accounting policies are the most critical to aid in fully understanding and evaluating our reported financial results : · allowance for loan losses ; · goodwill and other intangible asset impairment ; · accounting for income taxes ; · fair value measurements ; · defined benefit pension plan . allowance for loan losses the allowance for loan losses is an estimate of the probable losses that are inherent in the loan portfolio at the balance sheet date . story_separator_special_tag in 2017 , the average balance of the loan portfolio increased 11 % and average investments increased 10 % compared to the prior year . the growth in the loan portfolio was primarily in the commercial investor real estate and owner occupied portfolios . these increases were driven by organic loan growth as the regional economy continued to improve . the yield on average loans increased by 10 basis points compared to the prior year due to higher yields on the entire loan portfolio , as the commercial portfolio increased 5 basis points compared to the prior year . the yield on the portfolio benefited from the impact of multiple rate increases by the federal reserve during the year . exclusive of the $ 1.1 million in interest recoveries recognized during 2017 , the yield on the average loan portfolio would have increased 8 basis points . the average yield on total investment securities increased 11 basis points while the average balance of the portfolio increased 10 % in 2017 compared to 2016. the increase in the yield on investments was driven primarily by the acquisition of higher yielding state and municipal securities during the year with excess available funding . as a result , the average balance of the higher yielding state and municipal portfolio increased during the year as a percentage of the overall portfolio while the proportion of lower yielding securities had decreased due to sales and normal amortization of mortgage-backed securities in 2016 . 2016 vs. 2015 the company 's total tax-equivalent interest income increased 8 % for 2016 compared to the prior year . the previous table shows that the increase in average loans more than offset the decrease in earning asset yields with respect to the loan portfolio . in 2016 , the average balance of the loan portfolio increased 12 % compared to the prior year . this increase was driven by organic loan growth as the regional economy improved . growth occurred primarily in the commercial investor real estate and residential mortgage portfolios . the yield on average loans decreased by 1 basis point compared to the prior year due to lower yields on commercial loans . the average yield on total investment securities increased 9 basis points while the average balance of the portfolio decreased 16 % in 2016 compared to 2015. the increase in the yield on investments was due primarily to a decline in the relative size of the lower-yielding mortgage-backed securities portfolio due in large part to the sale of $ 40 million of such securities to fund the prepayment of fhlb advances in the 2016. the average balance of the higher-yielding state and municipal portfolio reflected a decline due to calls during 2016. this decline resulted in an increase to the relative size of this portfolio as a percentage of the overall portfolio . interest expense 2017 vs. 2016 interest expense increased by $ 5.0 million or 25 % in 2017 compared to 2016. the increase in interest expense was driven by the increased cost of interest-bearing deposits due to higher rates paid on money market savings deposits and the rates offered on certificates of deposit together combined with 10 % growth in the average balances . the increases in average deposits were mainly comprised of $ 191 million or 11 % in average noninterest-bearing and interest-bearing checking accounts together with an increase of $ 93 million or 17 % in certificates of deposit as the company offered higher rates on certificates of deposit to fund loan growth . additionally , average balances of money market accounts increased $ 81 million or 9 % and average balances of regular savings accounts increased $ 23 million or 8 % in 2017 compared to 2016. average balances of federal home loan bank advances increased 18 % and the average rates paid decreased 18 basis points in 2017 compared to 2016 due to the redemption of high-rate advances during 2017 and 2016 , which had a beneficial impact on the cost of funds as the average rate decreased 18 basis points . 2016 vs. 2015 37 interest expense increased by $ 0.9 million or 4 % in 2016 compared to 2015. the increase in expense was due to the cost of interest-bearing deposits increasing primarily due to higher rates offered on certificates of deposit together with growth in the average balances , while the average balances of federal home loan bank advances declined 4 % and the average rates paid decreased 17 basis points due to the redemption of high-rate advances early in 2016. average deposits increased 9 % in 2016 compared to 2015. this increase was primarily due to increases of $ 117 million or 7 % in average noninterest-bearing and interest-bearing checking accounts together with an increase of $ 77 million or 16 % in certificates of deposit as the company offered higher rates on certificates of deposit to fund loan growth . average balances of regular savings accounts increased $ 23 million or 8 % and average balances of money market accounts increased $ 60 million or 7 % in 2016 compared to 2015. interest rate performance 2017 vs. 2016 the company 's net interest margin increased to 3.55 % for 2017 compared to 3.49 % for 2016 while the net interest spread increased to 3.31 % in 2017 compared to 3.28 % in 2016. this increase is the result of interest-earning asset growth at increased yields which exceeded the increased rate paid on interest-bearing liabilities that grew at a lower pace . 2016 vs. 2015 the company 's net interest margin increased to 3.49 % for 2016 compared to 3.44 % for 2015 while the net interest spread increased to 3.28 % in 2016 compared to 3.21 % in 2015. this increase was driven by an increase in the yield on interest-earning assets as a result of loan growth and the migration of assets from lower-yielding investment securities into higher-yielding loans . 38 non-interest income non-interest

liquidity management liquidity is measured by a financial institution 's ability to raise funds through loan repayments , maturing investments , deposit growth , borrowed funds , capital and the sale of highly marketable assets such as investment securities and residential mortgage loans . the company 's liquidity position , considering both internal and external sources available , exceeded anticipated short-term and long-term needs at december 31 , 2017. management considers core deposits , defined to include all deposits other than time deposits of $ 100 thousand or more , to be a relatively stable funding source . core deposits equaled 69 % of total interest-earning assets at december 31 , 2017 . in addition , loan payments , maturities , calls and pay downs of securities , deposit growth and earnings contribute a flow of funds available to meet liquidity requirements . in assessing liquidity , management considers operating requirements , the seasonality of deposit flows , investment , loan and deposit maturities and calls , expected funding of loans and deposit withdrawals , and the market values of available-for-sale investments , so that sufficient funds are available on short notice to meet obligations as they arise and to ensure that the company is able to pursue new business opportunities . in addition to factors discussed above that can affect liquidity , the company 's growth , mortgage banking activities and changes in the liquidity of the investment portfolio due to fluctuations in interest rates are also taken into consideration . under this approach , implemented by the funds management subcommittee of alco under formal policy guidelines , the company 's liquidity position is measured weekly , looking forward at thirty day intervals from thirty ( 30 ) to three hundred sixty ( 360 ) days .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity management liquidity is measured by a financial institution 's ability to raise funds through loan repayments , maturing investments , deposit growth , borrowed funds , capital and the sale of highly marketable assets such as investment securities and residential mortgage loans . the company 's liquidity position , considering both internal and external sources available , exceeded anticipated short-term and long-term needs at december 31 , 2017. management considers core deposits , defined to include all deposits other than time deposits of $ 100 thousand or more , to be a relatively stable funding source . core deposits equaled 69 % of total interest-earning assets at december 31 , 2017 . in addition , loan payments , maturities , calls and pay downs of securities , deposit growth and earnings contribute a flow of funds available to meet liquidity requirements . in assessing liquidity , management considers operating requirements , the seasonality of deposit flows , investment , loan and deposit maturities and calls , expected funding of loans and deposit withdrawals , and the market values of available-for-sale investments , so that sufficient funds are available on short notice to meet obligations as they arise and to ensure that the company is able to pursue new business opportunities . in addition to factors discussed above that can affect liquidity , the company 's growth , mortgage banking activities and changes in the liquidity of the investment portfolio due to fluctuations in interest rates are also taken into consideration . under this approach , implemented by the funds management subcommittee of alco under formal policy guidelines , the company 's liquidity position is measured weekly , looking forward at thirty day intervals from thirty ( 30 ) to three hundred sixty ( 360 ) days .
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 Suspicious Activity Report : in addition , tangible book value per common share increased 6 % to $ 20.18 from $ 18.98 at december 31 , 2016. the company 's credit quality remained strong as non-performing assets totaled $ 31.6 million at december 31 , 2017 compared to $ 33.8 million at december 31 , 2016 due to a decrease in non-performing commercial loans . non-performing assets represented 0.58 % of total assets at december 31 , 2017 compared to 0.66 % at december 31 , 2016. the ratio of net charge-offs to average loans was 0.04 % for 2017 , compared to 0.06 % for the prior year . total assets at december 31 , 2017 increased 7 % compared to december 31 , 2016. loan balances increased 10 % compared to the prior year end due to increases of 11 % in residential mortgage and construction loans and 11 % in commercial loans . the growth in commercial loans was driven by double digit increases in owner-occupied real estate and investor real estate loans while the increase in mortgage loans was due primarily to growth in residential construction loans . customer funding sources , which include deposits plus other short-term borrowings from core customers , increased 10 % compared to balances at december 31 , 2016. the increase in customer funding sources was driven by increases of 18 % in certificates of deposit , 11 % in money market savings and 10 % in checking accounts . the company utilizes low cost fhlb borrowings to assist in the management of the net interest margin . the effect on the net interest margin partially mitigates the increased rates offered on certificates of deposit and money market accounts to retain these deposit relationships in the expectation of higher interest rates . during the same period , stockholders ' equity increased to $ 563 million due to net income in 2017 , which effect was somewhat offset by dividends paid to stockholders during 2017 . 29 net interest income increased 13 % compared to the prior year due to the effects of an 11 % growth in average interest-earning assets with an increase of 12 basis points in the yield while the rate on interest-bearing liabilities which grew 10 % from the prior year increased 9 basis points over the same period . non-interest income , exclusive of investment securities gains of $ 1.3 million in 2017 and $ 1.9 million in 2016 , as well as the $ 1.2 million gain in the prior year 's from debt extinguishment , increased 4 % for 2017 compared to 2016. this was due to increases in income from wealth management , insurance agency commissions and deposit service charges during 2017 as compared to 2016. non-interest expenses increased 5 % to $ 129.1 million for the year ended december 31 , 2017 , compared to $ 123.1 million for the prior year . a primary driver of expenses in 2017 was $ 4.3 million in merger expenses related to the washingtonfirst acquisition . this expense was partially offset by the decrease in prepayment penalties of $ 1.9 million for the early payoff of high-rate fhlb advances as compared to the year ended december 31 , 2016. excluding the impact of the fhlb prepayment penalties from the current and prior year 's results and the exclusion of merger expenses for 2017 , non-interest expense increased 3 % . the tax rate reduction associated with the recently enacted tax reform legislation caused a revaluation of net deferred tax assets and resulted in $ 5.6 million of additional income tax expense in the fourth quarter of 2017. this additional income tax expense and merger expenses , net of tax , resulted in a reduction of earnings per share of approximately $ 0.34 per share for 2017. pre-tax , pre-provision income , which adjusts for these items , increased 23 % from full-year 2016 to full-year 2017 to a record $ 95.2 million . critical accounting policies the company 's consolidated financial statements are prepared in accordance with generally accepted accounting principles ( “ gaap ” ) in the united states of america and follow general practices within the banking industry . application of these principles requires management to make estimates , assumptions , and judgments that affect the amounts reported in the financial statements and accompanying notes . these estimates , assumptions , and judgments are based on information available as of the date of the financial statements ; accordingly , as this information changes , the financial statements may reflect different estimates , assumptions , and judgments . certain policies inherently rely more extensively on the use of estimates , assumptions , and judgments and as such may have a greater possibility of producing results that could be materially different than originally reported . estimates , assumptions , and judgments are necessary for assets and liabilities that are required to be recorded at fair value . a decline in the value of assets required to be recorded at fair value will warrant an impairment write-down or valuation allowance to be established . carrying assets and liabilities at fair value inherently results in greater financial statement volatility . the fair values and the information used to record valuation adjustments for certain assets and liabilities are based either on quoted market prices or are provided by other third-party sources , when readily available . management believes the following accounting policies are the most critical to aid in fully understanding and evaluating our reported financial results : · allowance for loan losses ; · goodwill and other intangible asset impairment ; · accounting for income taxes ; · fair value measurements ; · defined benefit pension plan . allowance for loan losses the allowance for loan losses is an estimate of the probable losses that are inherent in the loan portfolio at the balance sheet date . story_separator_special_tag in 2017 , the average balance of the loan portfolio increased 11 % and average investments increased 10 % compared to the prior year . the growth in the loan portfolio was primarily in the commercial investor real estate and owner occupied portfolios . these increases were driven by organic loan growth as the regional economy continued to improve . the yield on average loans increased by 10 basis points compared to the prior year due to higher yields on the entire loan portfolio , as the commercial portfolio increased 5 basis points compared to the prior year . the yield on the portfolio benefited from the impact of multiple rate increases by the federal reserve during the year . exclusive of the $ 1.1 million in interest recoveries recognized during 2017 , the yield on the average loan portfolio would have increased 8 basis points . the average yield on total investment securities increased 11 basis points while the average balance of the portfolio increased 10 % in 2017 compared to 2016. the increase in the yield on investments was driven primarily by the acquisition of higher yielding state and municipal securities during the year with excess available funding . as a result , the average balance of the higher yielding state and municipal portfolio increased during the year as a percentage of the overall portfolio while the proportion of lower yielding securities had decreased due to sales and normal amortization of mortgage-backed securities in 2016 . 2016 vs. 2015 the company 's total tax-equivalent interest income increased 8 % for 2016 compared to the prior year . the previous table shows that the increase in average loans more than offset the decrease in earning asset yields with respect to the loan portfolio . in 2016 , the average balance of the loan portfolio increased 12 % compared to the prior year . this increase was driven by organic loan growth as the regional economy improved . growth occurred primarily in the commercial investor real estate and residential mortgage portfolios . the yield on average loans decreased by 1 basis point compared to the prior year due to lower yields on commercial loans . the average yield on total investment securities increased 9 basis points while the average balance of the portfolio decreased 16 % in 2016 compared to 2015. the increase in the yield on investments was due primarily to a decline in the relative size of the lower-yielding mortgage-backed securities portfolio due in large part to the sale of $ 40 million of such securities to fund the prepayment of fhlb advances in the 2016. the average balance of the higher-yielding state and municipal portfolio reflected a decline due to calls during 2016. this decline resulted in an increase to the relative size of this portfolio as a percentage of the overall portfolio . interest expense 2017 vs. 2016 interest expense increased by $ 5.0 million or 25 % in 2017 compared to 2016. the increase in interest expense was driven by the increased cost of interest-bearing deposits due to higher rates paid on money market savings deposits and the rates offered on certificates of deposit together combined with 10 % growth in the average balances . the increases in average deposits were mainly comprised of $ 191 million or 11 % in average noninterest-bearing and interest-bearing checking accounts together with an increase of $ 93 million or 17 % in certificates of deposit as the company offered higher rates on certificates of deposit to fund loan growth . additionally , average balances of money market accounts increased $ 81 million or 9 % and average balances of regular savings accounts increased $ 23 million or 8 % in 2017 compared to 2016. average balances of federal home loan bank advances increased 18 % and the average rates paid decreased 18 basis points in 2017 compared to 2016 due to the redemption of high-rate advances during 2017 and 2016 , which had a beneficial impact on the cost of funds as the average rate decreased 18 basis points . 2016 vs. 2015 37 interest expense increased by $ 0.9 million or 4 % in 2016 compared to 2015. the increase in expense was due to the cost of interest-bearing deposits increasing primarily due to higher rates offered on certificates of deposit together with growth in the average balances , while the average balances of federal home loan bank advances declined 4 % and the average rates paid decreased 17 basis points due to the redemption of high-rate advances early in 2016. average deposits increased 9 % in 2016 compared to 2015. this increase was primarily due to increases of $ 117 million or 7 % in average noninterest-bearing and interest-bearing checking accounts together with an increase of $ 77 million or 16 % in certificates of deposit as the company offered higher rates on certificates of deposit to fund loan growth . average balances of regular savings accounts increased $ 23 million or 8 % and average balances of money market accounts increased $ 60 million or 7 % in 2016 compared to 2015. interest rate performance 2017 vs. 2016 the company 's net interest margin increased to 3.55 % for 2017 compared to 3.49 % for 2016 while the net interest spread increased to 3.31 % in 2017 compared to 3.28 % in 2016. this increase is the result of interest-earning asset growth at increased yields which exceeded the increased rate paid on interest-bearing liabilities that grew at a lower pace . 2016 vs. 2015 the company 's net interest margin increased to 3.49 % for 2016 compared to 3.44 % for 2015 while the net interest spread increased to 3.28 % in 2016 compared to 3.21 % in 2015. this increase was driven by an increase in the yield on interest-earning assets as a result of loan growth and the migration of assets from lower-yielding investment securities into higher-yielding loans . 38 non-interest income non-interest

