Note 9 - Other Assets

12 Months Ended

Dec. 31, 2023

Notes to Financial Statements

Other Assets Disclosure [Text Block]

(9) Other Assets

A summary of major components of other assets follows:

December 31, (in thousands)	2023		2022
Cash surrender value of life insurance other than BOLI	$	17,843	$	15,496
Net deferred tax asset		47,236		54,145
Investments in tax credit partnerships		175,056		13,969
Swap assets		5,133		10,727
Prepaid assets		5,873		5,721
WM&T fees receivable		4,205		3,354
Mortgage servicing rights		13,082		15,219
Other real estate owned		10		677
Other		18,922		15,680
Total other assets	$	287,360	$	134,988

Bancorp maintains life insurance policies other than BOLI in conjunction with its non-qualified defined benefit retirement and non-qualified compensation plans.

Bancorp periodically invests in certain partnerships that generate federal income tax credits. The tax benefit of these investments exceeds to amortization expense associated with them, resulting in a positive impact on net income. The investments in such partnerships are recorded in Other assets on the consolidated balance sheets, while the corresponding contribution requirements are recorded in Other liabilities. While contributions are made periodically over the life of the respective investments, which can be up to 10 years depending on the type of investment, the majority of contributions associated with a respective investment are made within the first few years after entering the partnership. Bancorp invested in several larger tax credit partnerships during 2023, which have served as an economical means of fulfilling CRA requirements.

Bancorp enters into interest rate swap transactions with borrowers who desire to hedge exposure to rising interest rates, while at the same time entering into an offsetting interest rate swap, with substantially matching terms, with another approved independent counterparty. These are undesignated derivative instruments and are recognized on the balance sheet at fair value. For additional information, see the footnote titled “Derivative Financial Instruments.”

For additional information related to MSRs, see the footnote titled “Mortgage Banking Activities.”