Income Tax

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Tax

Income Tax

	December 31 2021		December 31 2020		December 31 2019
Income tax expense
Currently payable
Federal	$	11,742	$	16,914	$	11,143
State	1,303		2,377		140
Deferred
Federal	2,056		(7,970)		1,787
State	255		(1,451)		233
Total income tax expense	$	15,356	$	9,870	$	13,303
Reconciliation of federal statutory to actual tax expense
Federal statutory income tax at 21%	$	21,514	$	16,457	$	16,767
Tax exempt interest	(5,362)		(4,090)		(2,977)
Tax exempt income	(604)		(531)		(587)
Stock compensation	(250)		(160)		(324)
Other tax exempt income	(404)		(334)		(313)
State tax	1,231		733		295
Tax credit investments	(981)		(2,284)		—
Nondeductible and other	212		79		442
Actual tax expense	$	15,356	$	9,870	$	13,303

	December 31 2021		December 31 2020
Assets
Allowance for loan losses	$	13,707	$	13,966
Net operating loss and tax credits (from acquisitions)	—		3
Director and employee benefits	2,094		2,035
Other	1,785		3,139
Total assets	17,586		19,143
Liabilities
Depreciation	(4,540)		(4,374)
State tax	(261)		(315)
Federal Home Loan Bank stock dividends	(371)		(363)
Difference in basis of intangible assets	(3,476)		(2,921)
Fair value adjustment on acquisitions	(3,435)		(3,284)
Unrealized gain on AFS securities and fair value hedge	(1,953)		(7,404)
Other	(222)		(294)
Total liabilities	(14,258)		(18,955)
Net deferred tax asset/(liability)	$	3,328	$	188

Retained earnings of the Bank include approximately $12.8 million for which no deferred income tax liability has been recognized. This amount represents an allocation of previously acquired institutions income to bad debt deductions as of December 31, 1987 for tax purposes only. Reductions of amounts so allocated for purposes other than tax bad debt losses including redemption of bank stock or excess dividends, or loss of “bank” status would create income for tax purposes only, which would be subject to the then-current corporate income tax rate. The

unrecorded deferred income tax liability on the above amount for the Company was approximately $2.7 million at December 31, 2021.

The Company files income tax returns in the U.S. federal jurisdiction. With a few exceptions, the Company is no longer subject to U.S. federal, state and local or non-U.S. income tax examinations by tax authorities for years before 2018.