INCOME TAXES

12 Months Ended

Dec. 31, 2014

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

NOTE 12—INCOME TAXES

The current and deferred amounts of income tax expense for the years ended December 31, 2014, 2013 and 2012, respectively, are as follows (dollars in thousands):

	2014				2013				2012
Current:
Federal		$	7,715			$	5,658			$	5,506
State			946				87				259
Subtotal			8,661				5,745				5,765
Deferred:
Federal			223				1,906				1,085
State			(39	)			(167	)			827
Subtotal			184				1,739				1,912
Income tax expense		$	8,845			$	7,484			$	7,677

Reconciliation between the amount of reported income tax expense and the amount computed by applying the statutory Federal income tax rate is as follows (dollars in thousands):

	2014				2013				2012
Income before income tax expense		$	27,410			$	27,409			$	25,184
Federal statutory rate			35	%			35	%			35	%
Computed “expected” Federal income tax expense			9,593				9,593				8,814
State tax, net of Federal tax benefit			589				(53	)			706
Bank owned life insurance			(456	)			(477	)			(356	)
Tax-exempt interest and dividends			(1,511	)			(1,645	)			(1,228	)
Bargain gain on Saddle River Valley Bank acquisition			—				—				(314	)
Other, net			630				66				55
Income tax		$	8,845			$	7,484			$	7,677

The tax effects of temporary differences that give rise to significant portions of the deferred tax asset and deferred tax liability at December 31, 2014 and 2013 are presented in the following table:

	2014			2013
	(Dollars in Thousands)
Deferred tax assets:
Impaired assets		$	—		$	1,221
Allowance for loan losses			5,681			4,118
Pension actuarial losses			2,980			2,206
Purchase accounting			9,221			—
Deferred compensation			1,066			—
Accrued rent			476			—
Other			594			466
NJ NOL			902			399
NJ AMA credits			—			137
Total deferred tax assets		$	20,920		$	8,547
Deferred tax liabilities:
Employee benefit plans		$	1,199		$	1,281
Depreciation			886			416
Market discount accretion			91			200
Deferred loan costs, net of fees			317			385
Prepaid expenses			393			—
Other			64			—
Purchase accounting			—			522
Unrealized gains on securities available-for-sale			2,403			547
Total deferred tax liabilities			5,353			3,351
Net deferred tax asset		$	15,567		$	5,196

At December 31, 2014, the Company has approximately $15.4 million state income tax loss carry forwards which expire in 2034.

In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, the projected future taxable income, and tax planning strategies in making this assessment. During 2014 and 2013, based on the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, the Company believes the net deferred tax assets are more likely than not to be realized.

The Company’s federal income tax returns are open and subject to examination from the 2010 tax return year and forward. The Company’s state income tax returns are generally open from the 2010 and later tax return years based on individual state statutes of limitations.