Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

Schedule of Components of Income Tax Expense (Benefit)

Income tax expense reflects the following expense (benefit) components:


	Years ended December 31,
(In thousands)	2022		2021		2020
Current:
Federal	$	170,779	$	109,621	$	73,172
State and local	52,579		20,374		17,417
Total current	223,358		129,995		90,589
Deferred:
Federal	(45,421)		(9,844)		(23,799)
State and local	(24,243)		4,846		(7,437)
Total deferred	(69,664)		(4,998)		(31,236)

Total federal	125,358		99,777		49,373
Total state and local	28,336		25,220		9,980
Income tax expense	$	153,694	$	124,997	$	59,353

Schedule of Effective Income Tax Rate Reconciliation

The following table reflects a reconciliation of reported income tax expense to the amount that would result from applying the federal statutory rate of 21.0%:


	Years ended December 31,
	2022				2021				2020
(In thousands)	Amount		Percent		Amount		Percent		Amount		Percent
Income tax expense at federal statutory rate	$	167,575	21.0	%	$	112,111	21.0	%	$	58,795	21.0	%
Reconciliation to reported income tax expense:
SALT expense, net of federal	32,259		4.1		19,924		3.7		7,884		2.8
Tax-exempt interest income, net	(35,371)		(4.4)		(6,814)		(1.3)		(7,181)		(2.6)
Increase in cash surrender value of life insurance	(6,122)		(0.8)		(3,030)		(0.6)		(3,058)		(1.1)

Non-deductible FDIC Deposit insurance premiums	5,581		0.7		2,064		0.4		2,172		0.8
Low income housing tax credits and other benefits, net	(7,627)		(1.0)		(615)		(0.1)		(289)		(0.1)
Non-deductible compensation expense	7,948		1.0		786		0.1		454		0.2
Non-deductible merger-related expenses, excluding compensation	2,717		0.3		3,451		0.7		—		—
SALT DTA valuation allowance adjustment, net	(9,874)		(1.2)		—		—		—		—
Other, net	(3,392)		(0.4)		(2,880)		(0.5)		576		0.2
Income tax expense and effective tax rate	$	153,694	19.3	%	$	124,997	23.4	%	$	59,353	21.2	%

Schedule of Deferred Tax Assets and Liabilities

The following table reflects the significant components of the DTAs, net:


	At December 31,
(In thousands)	2022		2021
Deferred tax assets:
ACL on loans and leases	$	161,932	$	78,905
Net operating loss and credit carry forwards	72,035		64,366
Compensation and employee benefit plans	55,093		22,840
Lease liabilities under operating leases	64,899		38,130
Net unrealized loss on AFS securities	233,978		—
Other	38,314		12,790
Gross deferred tax assets	626,251		217,031
Valuation allowance	(29,176)		(37,374)
Total deferred tax assets, net of valuation allowance	$	597,075	$	179,657
Deferred tax liabilities:
Net unrealized gain on AFS securities	$	—	$	1,885

ROU assets under operating leases	51,822		31,580
Equipment financing leases	74,295		21,193

Goodwill and other intangible assets	56,223		5,690
Purchase accounting and fair value adjustments	11,529		—
Other	31,572		9,904
Gross deferred tax liabilities	225,441		70,252
Deferred tax assets, net	$	371,634	$	109,405

Summary of Positions for which Significant Change in Unrecognized Tax Benefits is Reasonably Possible

The following table reflects a reconciliation of the beginning and ending balances of UTBs:


	Years ended December 31,
(In thousands)	2022		2021		2020
Beginning balance	$	4,249	$	4,252	$	4,813
Additions as a result of tax positions taken during the current year	223		294		87
Additions as a result of tax positions taken during prior years	8,807		434		572
Reductions as a result of tax positions taken during prior years	(503)		(186)		(694)
Reductions relating to settlements with taxing authorities	(2,110)		(267)		(130)
Reductions as a result of lapse of statute of limitation periods	(791)		(278)		(396)
Ending balance	$	9,875	$	4,249	$	4,252