Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income tax expense (benefit) consists of the following (in thousands):



	Years Ended December 31,
	2019			2018			2017
Federal tax expense (benefit):
Current	$	8,543		$	8,540		$	10,113
Deferred	376			(742		)	14,290
	8,919			7,798			24,403
State and local tax expense (benefit):
Current	4,067			1,985			1,672
Deferred	(199		)	(151		)	903
	3,868			1,834			2,575
Total income tax expense	$	12,787		$	9,632		$	26,978

Reconciliation Between the Amount of Reported Total Income Tax Expense and The Amount Computed by Multiplying the Applicable Statutory Income Tax Rate

Reconciliation between the amount of reported total income tax expense and the amount computed by multiplying the applicable statutory income tax rate for the years ended December 31, 2019, 2018, and 2017, is as follows (dollars in thousands):



	Years Ended December 31,
	2019			2018			2017
Tax expense at statutory rate	$	11,135		$	10,439		$	18,111
Applicable statutory federal income tax rate	21		%	21		%	35		%
Increase (decrease) in taxes resulting from:
State tax, net of federal income tax	3,056			1,448			1,674
Impact of 2017 federal tax reform	—			—			10,453
Bank owned life insurance	(1,475		)	(778		)	(1,885		)
ESOP fair market value adjustment	187			196			404
Incentive stock options	81			146			247
Uncertain tax position	—			—			132
Excess tax benefits from employee share based payments	(110		)	(1,939		)	(2,309		)
Other, net	(87		)	120			151
Income tax expense	$	12,787		$	9,632		$	26,978

Tax Effects of Temporary Differences that Give Rise to Significant Portions of the Deferred Tax Assets and Deferred Tax Liabilities

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2019 and 2018, are as follows (in thousands):



	December 31,
	2019			2018
Deferred tax assets:
Allowance for loan losses	$	7,985		$	7,317
Capitalized leases	—			13
Deferred compensation	3,498			3,426
Accrued salaries	738			737
Postretirement benefits	376			375
Equity awards	2,164			3,045
Unrealized actuarial losses on post-retirement benefits	(21		)	18
Straight-line rent	1,277			1,051
Asset retirement obligation	70			67
Reserve for accrued interest receivable	578			602
Reserve for loan commitments	216			146
Employee Stock Ownership Plan	615			551
Other	244			261
Depreciation	2,414			2,383
Fair value adjustments of acquired loans	3,713			3,934
Fair value adjustments of pension benefit obligations	160			154
Unrealized losses on debt securities available-for-sale	—			3,575
Total gross deferred tax assets	24,027			27,655
Deferred tax liabilities:
Unrealized gains on debt securities available for sale	1,786			—
Fair value adjustments of acquired securities	20			28
Fair value adjustments of deposit liabilities	219			285
Deferred loan fees	2,224			1,984
Other	30			33
Total gross deferred tax liabilities	4,279			2,330
Net deferred tax asset	$	19,748		$	25,325

Schedule of Unrecognized Tax Benefits Roll Forward

A reconciliation of the Company’s uncertain tax positions are as follows (in thousands):



	December 31,
	2019			2018			2017
Beginning balance	$	530		$	482		$	459
Settlements based on tax positions related to prior years	(530		)	(238		)	(109		)
Additions based on tax positions related to prior years	190			286			132
Ending balance	$	190		$	530		$	482