Non-interest expense was $10.3 million during the six months ended June 30, 2024 compared to $10.2 million during the six months ended June 30, 2023, an increase of 0.4%. Most significantly impacting non-interest expense in the comparative six month periods were increases of $274,000 in salary expense due to annual salary increases and overtime pay from the core conversion in the first quarter of 2024, as well as an increase of $170,000 in other non-interest expense, primarily due to a $107,000 increase in the provision for unfunded commitments in the 2024 period. Also contributing to the increase in other non-interest expense in the six months ended June 30, 2024 compared to June 30, 2023 were increases of $110,000 in professional fees and $99,000 in FDIC insurance premiums due to an increase in the annual assessment rate for all institutions. These increases were partially offset by decreases of $306,000 in employee benefits expense, due to a decline in medical claims expense, and $209,000 recorded in the 2023 period due to the merger and acquisition expense from the Path Valley branch acquisition which was not repeated in the 2024 period.
An income tax provision of $497,000 was recorded during the six months ended June 30, 2024 compared to an income tax provision of $398,000 recorded during the six months ended June 30, 2023. Juniata qualifies for a federal tax credit for investments in low-income housing partnerships. The tax credit decreased from $202,000 in the six months ended June 30, 2023 to $165,000 in the six months ended June 30, 2024 due to the completion of the amortization period for one of Juniata’s low-income housing partnership investments in January 2023.
Financial Results for the Quarter
Annualized return on average assets for the three months ended June 30, 2024 was 0.81%, an increase of 20.9%, compared to 0.67% for the three months ended June 30, 2023. Annualized return on average equity for the three months ended June 30, 2024 was 16.38%, an increase of 5.7%, compared to 15.49% for the three months ended June 30, 2023.
Net interest income was $5.8 million for the three months ended June 30, 2024 compared to $5.7 million for the three months ended June 30, 2023. Average earning assets increased $24.6 million, or 2.9%, to $858.5 million during the three months ended June 30, 2024, compared to the same period in 2023, primarily due to an increase of $43.0 million, or 8.7%, in average loans, partially offset by a decline of $20.7 million, or 6.2%, in average investment securities. Average interest bearing liabilities increased by $19.9 million, or 3.3%, compared to the corresponding 2023 period, primarily due to growth in average time deposits, repurchase agreements and short-term borrowings. The yield on earning assets increased 44 basis points, to 4.36%, during the three months ended June 30, 2024 compared to same period in 2023, while the cost to fund interest earning assets with interest bearing liabilities increased 63 basis points, to 2.29%. The net interest margin, on a fully tax equivalent basis, decreased from 2.76% during the three months ended June 30, 2023, to 2.73% during the three months ended June 30, 2024.
Juniata recorded a provision for credit losses of $119,000 for the three months ended June 30, 2024 compared to a provision for credit losses of $47,000 for the three months ended June 30, 2023. For the 2024 period, elevated qualitative risk factors were considered including credit concentrations, asset quality trends, loan growth and net charge-offs resulting in a higher provision for credit losses in comparison to the 2023 period.
Non-interest income was $1.5 million for the three months ended June 30, 2024, an increase of 7.3%, over the three months ended June 30, 2023. Most significantly impacting non-interest income in the comparative three month periods were increases of $117,000 in customer service fees and $86,000 in fees derived from loan activity, resulting primarily from an increase in title insurance commissions in the 2024 period. Partially offsetting these increases in the comparative three month periods was a decrease of $161,000 in life insurance proceeds as no such income was recorded in the three months ended June 30, 2024.
Non-interest expense was $5.1 million for the three months ended June 30, 2024, compared to $5.5 million for the three months ended June 30, 2023, a decrease of 6.6%. Most significantly impacting non-interest expense in the comparative three month periods were decreases of $216,000 in employee benefits expense, due primarily to a decline in medical claims expenses, and the recording of $209,000 in merger and acquisition expense from the Path Valley branch acquisition in the second quarter of 2023. Also impacting the comparative three month periods was a $115,000 decrease in data processing expense due to the recording of a $238,000 breakage fee from our previous core provider in June 2023. These decreases were partially offset by increases of $101,000 in employee compensation and $60,000 in equipment expense.
An income tax provision of $296,000 was recorded during the three months ended June 30, 2024 compared to an income tax provision of $151,000 recorded during the three months ended June 30, 2023.
