INCOME TAXES

12 Months Ended

Dec. 31, 2021

INCOME TAXES [Abstract]

INCOME TAXES

12. INCOME TAXES

The components of income tax expense (benefit) was as follows:

	Years Ended December 31,
	2021		2020			2019
Current expense
Federal	$	12,834	$	12,590		$	6,923
State		220		248			224
Deferred expense
Federal		1,453		(1,588	)		334
Total	$	14,507	$	11,250		$	7,481

Effective tax rates differ from the federal statutory rate of 21% applied to income before income taxes due to the following:

	Years Ended December 31,
	2021			2020			2019
Federal statutory rate times financial statement income	$	15,355		$	11,887		$	7,707
Effect of:
Tax-exempt income		(978	)		(863	)		(348	)
State taxes, net of federal benefit		174			196			177
Earnings from bank owned life insurance		(262	)		(280	)		(272	)
Non-deductible expenses		281			248			190
Other, net		(63	)		62			27
Total	$	14,507		$	11,250		$	7,481

Year-end deferred tax assets and liabilities were due to the following:

	December 31,
	2021			2020
Deferred tax assets
Allowance for loan loss	$	8,840		$	9,566
Deferred compensation		5,772			5,215
Other real estate owned		—			251
Nonaccrual loans		21			59
Other		202			221
Total deferred tax assets		14,835			15,312
Deferred tax liabilities
Depreciation		(2,496	)		(2,432	)
Intangibles		(586	)		(847	)
Prepaid expenses		(547	)		(439	)
Mortgage servicing rights		(4,137	)		(1,900	)
Unrealized gain on available-for-sale securities		(2,438	)		(5,688	)
Other		(1,593	)		(1,545	)
Total deferred tax liabilities		(11,797	)		(12,851	)
Net deferred tax asset	$	3,038		$	2,461