Providence core earnings of $0.43 per share were impacted by continued margin compression, albeit slight and increased expenses primarily from consulting fees related to CECL modeling and implementation.
Our core return on average assets was 1.13% and core return on average tangible equity was 11.36% for the quarter.
We experienced only 2 basis points of margin compression in Q4 and forecast it being relatively neutral in 2020.
Regulatory costs were being $10 billion and technology investments to remain relevant in the new digital banking paradigm.
We can fund our organic growth and support a solid and consistently above average cash dividend with only a 54% pay-out ratio and supportive buybacks when they meet our total return criteria.
Our net income was $26 million or $0.40 per diluted share compared with $35.8 million or $0.55 per diluted share for the fourth quarter of 2018 and $31.4 million or $0.49 per diluted share in the trailing quarter.
Current [Phonetic] quarter earnings were adversely impacted by a $2 million or $0.03 per basic and diluted share net of tax expense increase in the estimated fair value of the contingent consideration liability related to the April 1st, 2019 acquisition of New York City-based RAI Tirschwell & Loewy.
At December 31st, 2019, the contingent liability was $9.4 million with maximum potential future payments totaling $11 million.
Excluding this charge, the Company would have reported net income of $27.9 million or $0.43 per basic and diluted share and net income of $114.6 million or $1.77 per basic and diluted share for the quarter and year ended December 31st, 2019 respectively.
Our net interest margin contracted 2 basis points versus the trailing quarter and 23 basis points versus the same period last year.
This deposit rate management coupled with an $80 million or 21% annualized increase in average non-interest bearing deposits resulted in a 3 basis point decrease in the total cost of deposits this quarter to 65 basis points.
Noninterest-bearing deposits averaged $1.6 billion or 23% of average total deposits for the quarter.
Quarter-end loan totals increased $66 million or 3.6% annualized from September 30th as growth in CRE construction and residential mortgage loans was partially offset by net reductions in C&I multifamily and consumer loans.
Loan originations excluding line of credit advances reached their best levels of the year, up $106 million or 30% versus the trailing quarter to $461 million.
But payoffs remained elevated, up $46 million or 18% versus the trailing quarter to $298 million.
The pipeline at December 31st decreased to $905 million from $1.1 billion at the trailing quarter end, reflecting strong year-end closing activity.
The pipeline rate has decreased 14 basis points since last quarter to 3.97% at December 31st.
Our provision for loan losses was $2.9 million for the current quarter compared with $0.5 million in the trailing quarter.
Our annualized net charge-offs as a percentage of average loans were 26 basis points for the quarter and 18 basis points for the full year.
Overall, credit metrics remained stable this quarter with non-performing assets totalling 55 basis points of total assets at quarter end.
The allowance for loan losses to total loans decreased to 76 basis points from 79 basis points in the trailing quarter largely as a result of improvements in qualitative allowance factors.
Non-interest income decreased slightly versus the trailing quarter to $17.7 million as lower swap fee income offset increased bank-owned life insurance benefits and loan prepayment fees.
Excluding the increase in the fair value of the contingent consideration liability related to the T&L acquisition, non-interest expenses were an annualized 2.05% of average assets for the quarter.
Core expenses increased $1.2 million versus the trailing quarter with consultancy and audit costs related to CECL implementation, additional examination and consulting fees that totaled $1.4 million driving the increase.
We did, once again, benefit this quarter from an FDIC insurance small bank assessment credit of $758,000 and our total remaining FDIC credit potentially realizable in future quarters is $1 million.
Our effective tax rate decreased to 23.6% from 24% for the trailing quarter and we are currently projecting an effective tax rate of approximately 24% for 2020.

Summary:
Our net income was $26 million or $0.40 per diluted share compared with $35.8 million or $0.55 per diluted share for the fourth quarter of 2018 and $31.4 million or $0.49 per diluted share in the trailing quarter.