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Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2020
Income Tax Disclosure [Abstract]  
Components of Provision for Income Taxes
The components of our provision for income taxes for 2020, 2019 and 2018 were as follows:
Year ended December 31,
(Dollars in thousands)202020192018
Current provision:
Federal$299,882 $296,400 $249,358 
State140,794 132,357 123,264 
Deferred expense (benefit):
Federal5,296 (1,530)(11,777)
State1,615 (1,542)(9,284)
Income tax expense$447,587 $425,685 $351,561 
Reconciliation between Federal Statutory Income Tax Rate and Effective Income Tax Rate
Our effective tax rate is calculated by dividing income tax expense by the sum of income before income tax expense and the net income attributable to noncontrolling interests. The reconciliation between the federal statutory income tax rate and our effective income tax rate for 2020, 2019 and 2018, is as follows:
December 31,
(Dollars in thousands)202020192018
Federal statutory income tax rate21.0 %21.0 %21.0 %
State income taxes, net of the federal tax effect6.8 7.0 7.2 
Meals and entertainment0.1 0.4 0.3 
Disallowed officers' compensation0.2 0.2 0.2 
FDIC premiums0.3 0.2 0.5 
Share-based compensation expense on incentive stock options and ESPP(0.3)(0.6)(1.4)
Qualified affordable housing project tax credits(0.5)(0.3)(0.3)
Tax-exempt interest income(0.8)(0.6)(0.6)
Other, net0.2 (0.1)(0.4)
Effective income tax rate 27.0 %27.2 %26.5 %
Deferred Tax Assets (Liabilities)
Deferred tax assets and liabilities at December 31, 2020 and 2019, consisted of the following:
December 31,
(Dollars in thousands)20202019
Deferred tax assets:
Allowance for credit losses$158,161 $103,267 
Share-based compensation expense15,531 14,233 
State income taxes16,640 16,097 
Accrued compensation44,112 22,578 
Lease liability69,714 60,635 
Other accruals 10,018 12,383 
Net operating loss7,501 6,386 
Goodwill and intangibles3,165 3,141 
Foreign tax credit carryforward 9,028 — 
SBA loan fees6,115 — 
Other8,110 7,923 
Deferred tax assets348,095 246,643 
Valuation allowance(7,094)(5,919)
Net deferred tax assets after valuation allowance341,001 240,724 
Deferred tax liabilities:
Derivative equity warrant assets(71,019)(45,533)
Net unrealized gains on cash flow hedge derivatives(49,772)— 
Net unrealized gains on AFS debt securities(185,634)(33,480)
Non-marketable and other equity securities(118,712)(54,239)
Premises and equipment and other intangibles(23,721)(16,459)
Right-of-use asset and deferred rent assets(52,057)(50,493)
Other(12,340)(12,087)
Deferred tax liabilities (513,255)(212,291)
Net deferred tax (liabilities) assets $(172,254)$28,433 
Changes in Unrecognized Tax Benefit (Including Interest and Penalties)
A summary of changes in our unrecognized tax benefit (including interest and penalties) for December 31, 2020, 2019 and 2018 is as follows:
(Dollars in thousands)Reconciliation of Unrecognized Tax BenefitInterest and PenaltiesTotal
Balance at December 31, 2017$11,505 $1,178 $12,683 
Additions for tax positions for current year
4,171 — 4,171 
Additions for tax positions for prior years
631 823 1,454 
Reduction for tax positions for prior years
(1,865)(243)(2,108)
Lapse of the applicable statute of limitations
(435)(86)(521)
Reduction as a result of settlement
(1,318)(222)(1,540)
Balance at December 31, 2018$12,689 $1,450 $14,139 
Additions for tax positions for current year
3,712 — 3,712 
Additions for tax positions for prior years
63 826 889 
Reduction for tax positions for prior years
(884)(524)(1,408)
Lapse of the applicable statute of limitations
(1,826)(569)(2,395)
Reduction as a result of settlement
(1,142)(17)(1,159)
Balance at December 31, 2019$12,612 $1,166 $13,778 
Additions for tax positions for current year5,051 — 5,051 
Additions for tax positions for prior years1,765 1,224 2,989 
Reduction for tax positions for prior years(730)(69)(799)
Lapse of the applicable statute of limitations(1,100)(323)(1,423)
Reduction as a result of settlement(1,108)(219)(1,327)
Balance at December 31, 2020$16,490 $1,779 $18,269