INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2024

INCOME TAXES [Abstract]

Provision for Income Taxes

The provision for income taxes consists of the following (in thousands):

	Year Ended December 31,
	2024			2023			2022
Currently payable		$	4,094		$	3,109		$	6,471
Deferred tax liability (asset)			1,771			595			(36	)
Provision for income taxes		$	5,865		$	3,704		$	6,435

Deferred Tax Assets and Liabilities

The following temporary differences gave rise to the net deferred tax asset and liabilities at December 31, 2024 and 2023, respectively (in thousands):

	2024		2023
Deferred tax assets:
Allowance for credit losses	$	5,449	$	5,868
Deferred compensation		648		597
Allowance for losses on available-for-sale securities		130		147
Pension and other retirement obligation		-		166
Interest on non-accrual loans		1,588		1,263
Incentive plan accruals		682		662
Other real estate owned		16		16
Unrealized losses on available-for-sale securities		7,061		7,506
Low income housing tax credits		15		44
NOL carry forward		1,458		2,468
Unrealized losses on equity securities		-		24
Non-PCD loan interest rate		4,200		4,795
Right of use asset		2,120		2,349
Accrued vacation		308		281
Other		334		428
Total	$	24,009	$	26,614

Deferred tax liabilities:
Premises and equipment	$	(745	)	$	(679	)
Investment securities accretion		(611	)		(432	)
Loan fees and costs		(933	)		(859	)
Goodwill and core deposit intangibles		(2,804	)		(2,889	)
Pension and other retirement obligation		(152	)		-
Mortgage servicing rights		(160	)		(201	)
Unrealized gains on equity securities		(3	)		-
Unrealized gains on interest rate swap		(890	)		(1,143	)
Borrowings fair value adjustment		(254	)		(511	)
Right of use asset		(2,093	)		(2,334	)
Other		(165	)		(227	)
Total		(8,810	)		(9,275	)
Deferred tax (liability) asset, net	$	15,199		$	17,339

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 (dollars in thousands):

	Year Ended December 31,
	2024			2023			2022
Provision at statutory rates on pre-tax income	$	7,070		$	4,514		$	7,450
Effect of tax-exempt income		(854	)		(895	)		(835	)
Low income housing tax credits		(688	)		(585	)		(141	)
Low income housing expense		339			399			-
Bank owned life insurance		(354	)		(263	)		(179	)
Nondeductible interest		308			251			74
Nondeductible merger and acquisition expenses		-			247			61
Change in tax rate		-			-			-
Other items		44			36			5
Provision for income taxes	$	5,865		$	3,704		$	6,435
Statutory tax rates		21	%		21	%		21	%
Effective tax rates		17.4	%		17.2	%		18.1	%