John P. Barnes
expected run-off in the transactional portion of our New York multi-family portfolio. Despite the modest decline in the loan balances for the quarter, given our diversified business mix and strong commercial loan pipelines, at quarter-end, we remain confident the company can achieve the 2018 growth goal of 4% to 6% that we announced in January.
Moving onto deposits, average balances were $32.8 billion for the quarter, also a decline of less than 1% from the fourth quarter. We remain focused on gathering deposits across both, our retail and business -- commercial businesses. As I discussed last quarter, we will continue to enhance technology and marketing capabilities to better serve clients. We are also investing in digital marketing capabilities with new tools and usage of data. We are aligning technology-based offerings with our expert bankers across business lines including mobile and online capabilities putting human interaction at the center. Therefore, we were excited to launch our new retail checking campaign in February, which is themed where the technology is as helpful as the people.
A campaign is promoting quality of our customer service and the relevant effectiveness and convenience of our technology. Also during the quarter, branch associates once again recognized People's United for its commitment to service with five excellence awards in middle market banking, both nationally and in the Northeast. It's an honor to be recognized as it reflects the success of our unwavering commitment to service and the ability to offer a full suite of products that help clients achieve their financial goals. Our solutions-oriented approach to banking continues to differentiate People's United.
Finally, our prudent capital management has enabled us to grow the business organically and invest strategically in the franchise, while also providing a consistent cash return capital to shareholders. As such, we are proud to announce the Company's 25th consecutive annual common dividend increase, we remain committed to our strategy of annually increasing the common dividend while also continuing to reduce our common dividend payout ratio by growing earnings. It's important to note that the common dividend payout ratio was 56.3% for the first quarter down from 78.3% a year ago.
With that, I'll pass it to David to discuss the first quarter in more detail.
Thank you, Jack. Turning to slide three. Net interest income of $295.8 million increased $3.5 million or 1% on a linked-quarter basis. The loan portfolio contributed $10.7 million of the increase to net interest income due to higher yields on new business and the upward repricing of floating rate loans. Net interest income also benefited $2.7 million from higher average balances in the securities portfolio. The largest offset to these increases was a $6.1 million reduction in net interest income from higher deposit and borrowings cost. In addition, two fewer calendar days in the quarter lowered net interest income by $3.8 million.
As displayed on slide four, net interest margin of 3.05% was two basis points lower than the fourth quarter. Excluding the unfavorable impact of tax reform on