INCOME TAX (Tables)

12 Months Ended

Dec. 31, 2017

INCOME TAXES

Schedule of income tax expense (benefit)

Year Ended December 31	2017		2016		2015
Income tax expense
Currently payable	$	9,691	$	8,455	$	4,726
Deferred		5,776		4,135		5,697
Tax rate change – 2017 Tax Cuts & Jobs Act		(2,505)		—		—
Change in valuation allowance		(26)		(453)		(190)
Total income tax expense	$	12,936	$	12,137	$	10,233

Schedule of differences between effective tax rates and the federal statutory rate applied to income before income taxes

		2017			2016			2015
Federal statutory income tax rate		35	%		35	%		35	%
Federal statutory income tax	$	21,831		$	17,661		$	16,021
Tax exempt interest		(5,258)			(4,799)			(4,676)
Effect of state income taxes		103			75			169
Non-deductible expenses		615			436			193
Tax exempt income on life insurance		(773)			(530)			(537)
Tax credits		(720)			(397)			(501)
Change in valuation allowance		(26)			(453)			(190)
Captive insurance premiums		(289)			(335)			(361)
Tax rate change - Tax Cuts & Jobs Act		(2,505)			—			—
Stock based compensation		(364)			—			—
Low income housing proportional amortization		497			419			363
Other		(175)			60			(248)
Income tax expense	$	12,936		$	12,137		$	10,233

Schedule of components of the net deferred tax asset (liability)

December 31	2017		2016
Assets
Allowance for loan losses	$	5,514	$	8,590
Net operating loss carryforward		3,563		3,876
Credit carryforwards		3,538		6,439
OREO write-downs		519		583
Other		2,198		3,456
Total assets		15,332		22,944
Liabilities
Depreciation		(3,196)		(6,041)
Mortgage servicing rights		(1,786)		(2,717)
Unrealized gain on securities AFS		(1,358)		(1,658)
Intangibles		(1,478)		(434)
Deferred loan fees/costs		(1,479)		(2,058)
Other		(2,419)		(3,725)
Total liabilities		(11,716)		(16,633)
Less: Valuation allowance		(3,087)		(2,934)
Net deferred tax asset/(liability)	$	529	$	3,377