Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income Taxes

Schedule of the components of income taxes

The components of income taxes consist of (dollars in thousands):

	Years Ended December 31,
	2021		2020		2019
Income tax expense
Current expense:
Federal	$	20,261	$	21,027	$	22,479
State		8,448		12,144		8,910
Deferred expense:
Federal		3,644		(3,657)		(380)
State		1,021		(1,652)		476
Total income tax expense	$	33,374	$	27,862	$	31,485

Schedule of the reconciliation of federal and state income taxes at statutory rates to the income taxes included in the statements of income

	Years Ended December 31,
	2021		2020		2019
Percent of pretax income
Income tax at federal statutory rate	21.0	%	21.0	%	21.0	%
Effect of:
Tax-exempt interest, net	(1.1)	%	(1.6)	%	(1.7)	%
Stock incentive	—	%	0.2	%	(0.1)	%
State income taxes, net	4.5	%	6.5	%	5.5	%
Income on bank owned life insurance	(0.7)	%	(0.9)	%	(0.9)	%
Tax credit investments	(3.6)	%	(3.2)	%	(1.3)	%
Other, net	1.2	%	(0.3)	%	0.9	%
Effective income tax rate	21.3	%	21.7	%	23.4	%

Schedule of the deferred tax assets and liabilities

Net deferred taxes, reported in other assets or other liabilities in the accompanying Consolidated Balance Sheets, include the following amounts of deferred tax assets and liabilities (dollars in thousands):

	As of December 31,
	2021		2020
Deferred taxes
Deferred tax assets:
ACL	$	25,884	$	30,332
Unrealized loss on cash flow hedge		273		871
Unrealized losses on securities available for sale		9,199		—
Stock-based compensation		4,204		2,975
Deferred compensation		55		66
Purchase accounting adjustments		1,213		4,470
Accrued vacation		398		610
Lease liabilities		2,893		2,142
Employee costs		2,847		1,598
Other		390		431
Total deferred tax assets		47,356		43,495
Deferred tax liabilities:
Unrealized gain on securities available for sale		—		(14,151)
Basis in premises and equipment		(1,347)		(348)
Affordable housing partnerships and other investments		(3,696)		(1,995)
Purchase accounting adjustments		(1,362)		(1,835)
Mortgage servicing assets		(2,853)		(3,418)
Basis in core deposit, customer intangible assets, and asset purchase goodwill		(9,485)		(12,714)
Deferred loan origination costs		(2,454)		(2,654)
Right of use assets		(2,877)		(2,130)
Unrealized gain on equity securities		(1,099)		(276)
Other		(560)		(405)
Total deferred tax liabilities		(25,733)		(39,926)
Net deferred tax asset	$	21,623	$	3,569