Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

The provision for federal and state income taxes included in the accompanying consolidated statements of income consists of the following:

The provision for income taxes differs from the expected statutory provision as follows:



	For the Years Ended December 31,
(Dollars in thousands)	2014		2013		2012
Expected provision at statutory rate	35.0	%	35.0	%	35.0	%
Difference resulting from:
Tax exempt interest income	(11.2	)	(11.7	)	(12.1	)
Increase in value of bank owned life insurance assets	(1.9	)	(3.9	)	(3.5	)
Other, including state income taxes, valuation allowances and rate differentials	3.2		1.8		1.6
	25.1	%	21.2	%	21	%

The assets and liabilities giving rise to the Corporation’s deferred tax assets and liabilities are as follows:



	At December 31,
(Dollars in thousands)	2014			2013
Deferred tax assets:
Loan and lease loss	$	7,358		$	8,785
Deferred compensation	2,492			2,675
Actuarial adjustments on retirement benefits*	8,625			4,568
Interest on nonaccrual loans	—			2,268
State net operating losses	1,621			1,743
Other-than-temporary impairments on equity securities	577			759
Alternative minimum tax credits**	1,067			1,367
Net unrealized holding losses on securities available-for-sale*	—			792
Other	1,125			280
Gross deferred tax assets	22,865			23,237
Valuation allowance	(1,461		)	(1,630		)
Total deferred tax assets, net of valuation allowance	21,404			21,607
Deferred tax liabilities:
Market discount	2,224			1,722
Retirement plans	5,700			5,602
Intangible assets	2,308			2,212
Net unrealized holding gains on securities available-for-sale and swaps*	837			—
Total deferred tax liabilities	11,069			9,536
Net deferred tax assets	$	10,335		$	12,071

*Represents the amount of deferred taxes recorded in accumulated other comprehensive loss.

** The alternative minimum tax credits have an indefinite life.