We opened over 3,300 Shaka accounts since its launch in early November.
It has a strong value proposition that includes getting your paycheck up to two days early, no ATM fees and 24/7 digital convenience, among other benefits.
We were pleased to have a strong visitor holiday travel season with the daily average air arrivals over 25,000 in November through December.
Our statewide unemployment rate continued to decline and was at 6% in November 2021.
And while we were not immune to the COVID case spike related to the Omicron variant, our state has been able to manage through it, particularly as our vaccination rate is strong at approximately 75%.
The housing market in Hawaii remains very hot with our median single-family home price holding at just over $1 million.
Our asset quality continues to be very strong with nonperforming assets at just 8 basis points of total assets as of December 31.
Finally, during the quarter, we had net recoveries of $900,000.
In the fourth quarter, our core loan portfolio increased by $183 million or 4% sequential quarter, which was offset by PPP forgiveness paydowns of $127 million.
Year over year, our core loan portfolio increased by 10%.
Our residential mortgage production continued to be very strong, with total production in the fourth quarter of $354 million as several large condominium projects in Honolulu were completed during the quarter, with CPB leading the takeout financing for the homeowners.
Total net portfolio growth in residential mortgage and home equity was $146 million in the fourth quarter.
For all of 2021, we once again had record residential mortgage production, totaling $1.2 billion, putting us near to top of all residential mortgage lenders in Hawaii.
PPP forgiveness continues to progress well with 99% of the loan balances originated in 2020 and 73% of the balances originated in 2021 forgiven and paid down through December 31.
The purchases during the quarter all were within our established credit limits and had a weighted average FICO score of 750.
As of December 31, total Mainland consumer unsecured and auto purchase loans were approximately 5.7% of total loans.
Our target range for total Mainland loans, including commercial and consumer is around 15% of total loans.
On the deposit front, we continue to see strong inflow deposits with total core deposits increasing by $66 million or 1% sequential quarter growth.
On a year-over-year basis total core deposits increased by $1 billion or 20%.
Additionally, our average cost of total deposits in the fourth quarter was just 6 basis points.
We will be expanding our relationships with the new-to-CPB Shaka account holders, which represented over 50% of the new accounts and explore further complementary product offerings using the Shaka brand.
Net income for the fourth quarter was $22.3 million or $0.80 per diluted share, an increase of $1.5 million or $0.06 per diluted share from the prior quarter.
Return on average assets in the fourth quarter was 1.22% and return on average equity was 16.05%.
For the full 2021 year, net income was $79.9 million or $2.83 per diluted share.
This compares to $37.3 million or $1.32 per diluted share in 2020.
Net interest income for the fourth quarter was $53.1 million, which decreased by $3 million from the prior quarter due to less PPP fee income as the forgiveness process winds down.
Net interest income included $4.7 million in PPP net interest income and net loan fees compared to $8.6 million in the prior quarter.
At December 31, unearned net PPP fees was $3.5 million.
The net interest margin decreased to 3.08% in the fourth quarter compared to 3.31% in the prior quarter.
The NIM normalized for PPP was 2.87% in the third quarter compared -- I'm sorry, in the fourth quarter compared to 2.96% in the prior quarter.
Fourth quarter other operating income increased to $11.6 million from $10.3 million in the prior quarter.
Other operating expense for the fourth quarter was $42.2 million, which included nonrecurring expenses of $1.1 million of severance payments, $0.4 million branch consolidation costs and $0.3 million in promotion expenses related to our Shaka digital checking launch.
We anticipate $0.8 million in annualized savings from this consolidation.
The efficiency ratio increased to 65.6% in the fourth quarter due to lower net interest income and nonrecurring expenses.
At December 31, our allowance for credit losses was $68.1 million or 1.36% of outstanding loans excluding PPP loans.
In the fourth quarter, we recorded a $7.4 million credit to the provision for credit losses due to continued improvements in the economic forecast and our loan portfolio as well as net recoveries during the quarter of $0.9 million.
The effective tax rate was 25.4% in the fourth quarter.
And going forward, we continue to expect an effective tax rate to be in the 24% to 26% range.
And during the fourth quarter, we repurchased 305,000 shares at a total cost of $8.4 million or an average cost per share of $27.64.
Yesterday, our board of directors approved a new share repurchase authorization of up to $30 million.
Finally, our board of directors also declared a quarterly cash dividend of $0.26 per share, which was an increase of $0.01 or 4% from the prior quarter.
We increased our quarterly cash dividend by 4%.
We will continue share repurchases under our new $30 million board-approved authorization.

Summary:
Net income for the fourth quarter was $22.3 million or $0.80 per diluted share, an increase of $1.5 million or $0.06 per diluted share from the prior quarter.
Net interest income for the fourth quarter was $53.1 million, which decreased by $3 million from the prior quarter due to less PPP fee income as the forgiveness process winds down.
Yesterday, our board of directors approved a new share repurchase authorization of up to $30 million.
Finally, our board of directors also declared a quarterly cash dividend of $0.26 per share, which was an increase of $0.01 or 4% from the prior quarter.
We will continue share repurchases under our new $30 million board-approved authorization.