Our intent is to meet the full suite of our clients’ needs and therefore maintain a disciplined focus on overall returns. On a year-over-year basis, net interest income was also stable as 8% average earning asset growth offset the 24 basis points of margin compression.
Looking at the full year, net interest margin declined more than we had anticipated at the beginning of last year as wholesale banking loan growth was stronger than expected and yields continued to compress. In addition, the yield curve flattened significantly in 2014 with 10 year rates declining 80 to 90 basis points from already low levels. Looking forward, we expect first quarter net interest margin to decline approximately 7 to 9 basis points from the current level driven primarily by lower commercial loan swap income.
In addition, all things being equal, net interest income will decline by approximately $50 million from the fourth quarter to the first quarter, given lower commercial loan swap income and two fewer days coming up. We have been and will continue to carefully manage the usage and duration of our overall balance sheet in light of the continued low interest rate environment, while also being cognizant of controlling interest rate risk in advance of what we expect will eventually be higher interest rates.
Moving on to slide 6. Adjusted non-interest income increased $9 million from the prior quarter, driven primarily by higher investment banking and mortgage related income. Investment banking income increased $21 million due to higher syndicated finance and M&A revenues.
Mortgage production income increased $16 million on improved gain on sale margins and higher refinance activity, both as a result of lower rates in the quarter. Mortgage servicing income increased $8 million sequentially as a result of a larger servicing portfolio and higher seasonal payment activity in the fourth quarter. Trust and investment management income was down $9 million compared to the prior quarter, driven primarily by certain seasonal and nonrecurring fees earned in the third quarter. In addition, service charges for deposits declined $7 million, again, largely driven by seasonal trends. Lastly, we incurred $5 million of net securities losses in the quarter, resulting from a minor repositioning of the investment portfolio.
Compared to the fourth quarter of last year, adjusted non-interest income decreased $15 million due to the loss of Ridge Worth fee income, partially offset by an increase in mortgage-related revenue. Finally, full year non-interest income excluding the gain on sale of Ridge Worth and its associated revenues was up 4% year-over-year which reflects the positive momentum we’re creating in our CIB business as well as retail investment services, private wealth and credit card.
Moving to slide 7. Adjusted non-interest expense which excludes the impact of the legal provision was stable to the prior quarter. Personnel expense was down $60 million sequentially, driven primarily by lower accruals on certain incentive and medical costs. While quarterly incentive and benefits costs can be variable, for the full year incentive compensation increased, due to improved business performance in 2014, consistent with our pay for performance philosophy.
Outside processing and software costs increased $22 million due to higher utilization of third party services, in addition to normal quarterly variability. Other non-interest expense increased $26 million due primarily to higher legal and consulting costs in the fourth quarter. Adjusted cyclical costs were stable to the prior quarter and down $32 million relative to the prior year.
Going forward, we do not anticipate these costs to be a meaningful driver of changes in our expense base, with the exception of occasional variability in operating losses. Compared to the fourth quarter of last year, adjusted non-interest expense was down 7%, driven by a combination of our efficiency efforts, lower cyclical costs and the sale of Ridge Worth.
