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INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2016
INCOME TAXES [Abstract]  
Provision for income taxes (benefit)
The provision for income taxes consists of the following (in thousands):
 
 
Year Ended December 31,
 
 
 
2016
  
2015
  
2014
 
Currently payable
 
$
2,672
  
$
2,913
  
$
3,081
 
Deferred tax liability (asset)
  
362
   
(192
)
  
478
 
Provision for income taxes
 
$
3,034
  
$
2,721
  
$
3,559
 
Deferred tax assets
The following temporary differences gave rise to the net deferred tax asset and liabilities at December 31, 2016 and 2015, respectively (in thousands):
 
 
2016
  
2015
 
Deferred tax assets:
      
    Allowance for loan losses
 
$
4,518
  
$
4,238
 
    Deferred compensation
  
757
   
772
 
    Merger & acquisition costs
  
16
   
20
 
    Allowance for losses on available-for-sale securities
  
250
   
436
 
    Pension and other retirement obligation
  
1,454
   
1,483
 
    Interest on non-accrual loans
  
1,259
   
1,001
 
    Incentive plan accruals
  
421
   
362
 
    Other real estate owned
  
152
   
136
 
    Low income housing tax credits
  
94
   
63
 
    NOL carry forward
  
709
   
950
 
    AMT Credit Carryforward
  
8
   
152
 
    Other
  
156
   
157
 
          Total
 
$
9,794
  
$
9,770
 
 
        
Deferred tax liabilities:
        
    Premises and equipment
 
$
(998
)
 
$
(919
)
    Investment securities accretion
  
(189
)
  
(177
)
    Loan fees and costs
  
(369
)
  
(154
)
    Goodwill and core deposit intangibles
  
(3,573
)
  
(3,594
)
    Mortgage servicing rights
  
(233
)
  
(238
)
    Unrealized gains on available-for-sale securities
  
(673
)
  
(1,135
)
    Other
  
(17
)
  
(44
)
           Total
  
(6,052
)
  
(6,261
)
Deferred tax asset, net
 
$
3,742
  
$
3,509
 
Reconciliation of statutory tax rates to effective tax rates
The total provision for income taxes is different from that computed at the statutory rates due to the following items (in thousands):
 
 
Year Ended December 31,
 
 
 
2016
  
2015
  
2014
 
Provision at statutory rates on
         
  pre-tax income
 
$
5,328
  
$
4,878
  
$
5,761
 
Effect of tax-exempt income
  
(1,943
)
  
(1,915
)
  
(1,865
)
Low income housing tax credits
  
(198
)
  
(198
)
  
(198
)
Bank owned life insurance
  
(234
)
  
(214
)
  
(172
)
Nondeductible interest
  
55
   
61
   
60
 
Nondeductible merger and acquisition expenses
  
-
   
102
   
-
 
Other items
  
26
   
7
   
(27
)
Provision for income taxes
 
$
3,034
  
$
2,721
  
$
3,559
 
Statutory tax rates
  
34
%
  
34
%
  
34
%
Effective tax rates
  
19.4
%
  
19.0
%
  
21.0
%