INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2023

The provision for income taxes is comprised of the following components:


	Years Ended December 31
	2023		2022		2021
	(Dollars in thousands)
Current expense
Federal	$	51,771	$	60,216	$	21,539
State	21,123		24,979		11,054
Total current expense	72,894		85,195		32,593
Deferred expense (benefit)
Federal	1,336		(970)		3,032
State	1,402		(284)		58
Total deferred expense (benefit)	2,738		(1,254)		3,090
Total expense	$	75,632	$	83,941	$	35,683

Schedule of Income Tax Rate Reconciliation

The difference between the statutory federal income tax rate and the effective income tax rate reported for the last three years is detailed below:


	Years Ended December 31
	2023				2022				2021
	(Dollars in thousands)
Computed statutory federal income tax provision	$	66,178	21.00	%	$	73,028	21.00	%	$	32,902	21.00	%
State taxes, net of federal tax benefit	17,992		5.71	%	19,728		5.67	%	8,754		5.59	%
Low Income Housing Project Investments	(3,740)		(1.19)	%	(3,364)		(0.97)	%	(2,308)		(1.47)	%
Nontaxable interest, net	(3,508)		(1.11)	%	(3,191)		(0.92)	%	(1,022)		(0.65)	%
Increase in cash surrender value of life insurance	(2,133)		(0.68)	%	(1,885)		(0.54)	%	(1,405)		(0.90)	%
Increase (decrease) in uncertain positions	(655)		(0.21)	%	(1,035)		(0.30)	%	50		0.03	%
Revaluation of net deferred tax assets	255		0.08	%	—		—	%	—		—	%
Stock-based compensation	(127)		(0.04)	%	(202)		(0.06)	%	(372)		(0.24)	%
Change in valuation allowance	109		0.03	%	52		0.01	%	26		0.02	%
Other tax credits	(76)		(0.02)	%	—		—	%	—		—	%

Merger and other related costs (non-deductible)	—		—	%	—		—	%	630		0.40	%
Other, net	1,337		0.43	%	810		0.25	%	(1,572)		(1.00)	%
Total expense	$	75,632	24.00	%	$	83,941	24.14	%	$	35,683	22.78	%

Schedule of Net Deferred Tax Asset

The tax-effected components of the net deferred tax asset at December 31 of the years presented were as follows:


	2023		2022
	(Dollars in thousands)
Deferred tax assets
Accrued expenses not deducted for tax purposes	$	14,646	$	16,162
Allowance for credit losses	38,774		42,748

Derivatives fair value adjustment	7,825		14,328
Employee and director equity compensation	1,660		1,388

Foreign Tax Credit Carryforward	89		89
Loan basis difference fair value adjustment	1,811		2,273
Net operating loss carry-forward	633		606
Net unrealized loss on securities available for sale	29,536		38,968
Operating lease liability	15,387		17,069


Other	587		791
Gross deferred tax assets	$	110,948	$	134,422
Valuation allowance	(467)		(358)
Total deferred tax assets net of valuation allowance	$	110,481	$	134,064
Deferred tax liabilities
Core deposit and other intangibles	$	2,865	$	4,137
Deferred loan fees, net	8,160		8,281
Derivatives fair value adjustment	—		—
Fixed assets	16,606		18,132
Goodwill	11,291		11,432



Prepaid pension	3,482		3,469
Right of use asset	14,781		16,565
Other	1,884		2,112
Gross deferred tax liabilities	$	59,069	$	64,128
Total net deferred tax asset	$	51,412	$	69,936

Reconciliation of Unrecognized Tax Benefits

The Company accounts for uncertainties in income taxes by providing a tax reserve for certain positions. The following is a reconciliation of the beginning and ending amount of unrecognized tax benefits:


	(Dollars in thousands)
Balance at December 31, 2020	$	474
Reduction of tax positions for prior years	$	(29)
Increase for current year tax positions	$	2,433
Balance at December 31, 2021	$	2,878
Reduction of tax positions for prior years	(1,047)
Increase for prior year tax position	128
Increase for current year tax positions	761
Balance at December 31, 2022	2,720
Reduction of tax positions for prior years	(959)


Balance at December 31, 2023	$	1,761

Schedule of changes in accrued interest and penalties related to uncertain tax positions

The following table summarizes the changes in accrued interest and penalties related to uncertain tax positions for the periods presented:


	As of December 31
	2023		2022		2021
	(Dollars in thousands)
Beginning Balance	$	585	$	920	$	95
Expense (benefit) recognized in provision for income taxes	104		(335)		69
Acquired obligation for interest and penalties (1)	—		—		756
Ending Balance	$	689	$	585	$	920