Income Taxes (Tables)

12 Months Ended

Dec. 31, 2024

Schedule of Components of Income Tax Expense

The following table presents the components of income tax expense (benefit):


(Dollars in thousands)
Years ended December 31,	2024	2023	2022
Current Tax Expense:
Federal	$5,166	$10,494	$16,127
State	812	1,501	2,202
Total current tax expense	5,978	11,995	18,329
Deferred Tax (Benefit) Expense:
Federal	(14,618)	412	1,012
State	(2,119)	(4,102)	148
Total deferred tax (benefit) expense (1)	(16,737)	(3,690)	1,160
Total income tax (benefit) expense	($10,759)	$8,305	$19,489

(1) The deferred income tax benefit recognized in 2024 was largely associated with loans that were reclassified to held for sale and written down to fair value in December 2024.

Schedule of Effective Income Tax Rate Reconciliation

The following table presents the reasons for the differences:


Years ended December 31,	2024			2023			2022
(Dollars in thousands)	Amount	Rate		Amount	Rate		Amount	Rate
Tax (benefit) expense at Federal statutory rate	($8,152)	21.0	%	$11,861	21.0	%	$19,146	21.0	%
(Decrease) increase in taxes resulting from:
State income tax (benefit) expense, net of federal tax benefit	(1,460)	3.8		1,107	2.0		1,856	2.1
BOLI	(639)	1.6		(732)	(1.3)		(544)	(0.6)
Tax-exempt income, net	(460)	1.2		(543)	(1.0)		(721)	(0.8)
Investments in low-income housing tax credits and other benefits, net	(420)	1.1		(357)	(0.6)		(261)	(0.3)


Share-based compensation	151	(0.4)		29	0.1		(68)	(0.1)
Revaluation of net deferred tax assets for changes in state tax rates	323	(0.8)		(4,093)	(7.2)		—	—
State valuation allowance adjustment, net	1,628	(4.2)		2,153	3.8		—	—
State net operating loss carryforward, net of federal tax	(1,528)	3.9		(1,312)	(2.3)		—	—
Other	(202)	0.5		192	0.2		81	0.1
Total income tax (benefit) expense	($10,759)	27.7	%	$8,305	14.7	%	$19,489	21.4	%

Schedule of Deferred Tax Assets and Liabilities

The following table presents the approximate tax effects of temporary differences that give rise to deferred tax assets and deferred tax liabilities:


(Dollars in thousands)
December 31,	2024	2023
Deferred Tax Assets:
Net unrealized losses on available for sale debt securities	$33,646	$38,823
Loss on portfolio loans reclassified to held for sale	15,093	—
Allowance for credit losses on loans	10,595	10,470
Operating lease liabilities	7,469	8,167
Deferred compensation liabilities	5,439	5,258
State net operating loss carryforwards	2,840	1,312
Cash flow hedges	2,595	5,250
Deferred loan origination fees	1,857	2,356
Share-based compensation	1,779	1,806

Capital loss carryforward	1,550	—
Defined benefit pension obligations	1,246	1,425
Nonaccrual interest	606	511
Other	1,462	1,583
Deferred tax assets	86,177	76,961
Less: valuation allowance	(3,780)	(2,153)
Deferred tax assets, net of valuation allowance	82,397	74,808
Deferred Tax Liabilities:
Operating lease ROU assets	(6,803)	(7,488)
Deferred loan origination costs	(6,784)	(7,365)
Depreciation of premises and equipment	(1,956)	(1,897)
Loan servicing rights	(1,936)	(2,171)
Amortization of intangibles	(729)	(946)


Deferred compensation assets	(577)	(467)
Contract cost incentives	(529)	(440)
Other	(61)	(226)
Deferred tax liabilities	(19,375)	(21,000)
Net deferred tax asset	$63,022	$53,808