Investments is Low Income Housing Tax Credits Investments in Low Income Housing Tax Credits

9 Months Ended

Sep. 30, 2016

Equity Method Investments and Joint Ventures [Abstract]

Investments in Low Income Housing Projects [Text Block]

LOW INCOME HOUSING PROJECT INVESTMENTS

The Company has invested in low income housing projects that generate Low Income Housing Tax Credits (“LIHTC”) which provide the Company with tax credits and operating loss tax benefits over a period of approximately 15 years. None of the original investment is expected to be repaid. The investment in LIHTC projects is being accounted for using the proportional amortization method, under which the Company amortizes the initial cost of the investment in proportion to the amount of the tax credits and other tax benefits received and recognizes the net investment benefit in the income statement as a component of income tax expense (benefit).

The following table presents the Company's investments in low income housing projects as of the dates indicated:

	September 30, 2016		December 31, 2015
	(Dollars in thousands)
Original investment value	$	42,362	$	42,199
Current recorded investment	35,566		38,151
Unfunded liability obligation	9,297		14,607
Tax credits and benefits (1)	5,311		3,632
Amortization of investments (2)	3,669		2,450
Net income tax benefit (3)	1,642		1,182

(1) This amount reflects anticipated tax credits and tax benefits for the full year ended December 31, 2016.

(2) The amortization amount reduces the tax credits and benefits anticipated for the full year ended December 31, 2016.

(3) This amount represents the net tax benefit expected to be realized for the full year ended December 31, 2016 in determining the Company's effective tax rate.