Income Taxes

6 Months Ended

Jun. 30, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

(In Thousands)

The following table is a summary of the Company’s temporary differences between the tax basis of assets and liabilities and their financial reporting amounts that give rise to deferred income tax assets and liabilities and their approximate tax effects as of the dates presented.

	June 30,		December 31,
	2021		2020
Deferred tax assets
Allowance for credit losses	$	53,316	$	53,597
Loans	4,123		5,526
Deferred compensation	12,280		13,114
Investment in partnerships	114		—
Impairment of assets	655		1,067
Net operating loss carryforwards	1,477		1,857
Lease liabilities under operating leases	16,804		17,732
Other	4,043		3,539
Total deferred tax assets	92,812		96,432
Deferred tax liabilities
Net unrealized gains on securities	6,501		8,434
Investment in partnerships	—		793
Fixed assets	1,942		3,285
Mortgage servicing rights	20,211		14,623
Junior subordinated debt	2,200		2,245
Intangibles	3,524		3,882
Lease right-of-use asset	15,907		16,833
Other	903		1,672
Total deferred tax liabilities	51,188		51,767
Net deferred tax assets	$	41,624	$	44,665

For the six months ended June 30, 2021 and 2020, the Company recorded a provision for income taxes totaling $24,387 and $5,410, respectively. The provision for income taxes includes both federal and state income taxes and differs from the statutory rate due to favorable permanent differences. During the second quarter of 2021 the Company recognized a one-time state tax credit investment of $3,460 which reduced income taxes as a discrete item. The effective tax rate, excluding discrete items, was 22.21% and 19.64% for the six months ended June 30, 2021 and 2020, respectively.

The Company and its subsidiaries file a consolidated U.S. federal income tax return. The Company is currently open to audit under the statute of limitations by the Internal Revenue Service and state departments of revenue for the years ending December 31, 2017 through December 31, 2019.