Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income tax expense is as follows for the years indicated (in thousands):



	Year Ended December 31,
	2019		2018		2017
Current	$	38,082	$	17,185	$	5,451
Deferred	14,909		32,630		60,951
Increase in valuation allowance	—		—		413
Expense due to enactment of federal tax reform	—		—		38,198
Total income tax expense	$	52,991	$	49,815	$	105,013

Schedule of differences between the provision for income taxes and statutory federal income tax rate

The differences between the provision for income taxes and the amount computed by applying the statutory federal income tax rate of 21% in 2019 and 2018 and 35% in 2017 to income before income taxes are as follows for the years indicated (in thousands):



	Year Ended December 31,
	2019			2018			2017
Pretax income at statutory rates	$	50,130		$	45,344		$	60,492
Add (deduct):
State taxes, net of federal benefit	7,168			6,765			4,139
Bank owned life insurance earnings	(1,127		)	(747		)	(1,141		)
Adjustment to reserve for uncertain tax positions	84			80			59
Tax-exempt interest revenue	(1,827		)	(1,229		)	(1,199		)
Equity compensation	(375		)	(892		)	(799		)
Transaction costs	16			78			408
Tax credit investments	(464		)	(29		)	(89		)
Change in state statutory tax rate	—			583			81
Increase in valuation allowance	—			—			413
Release of disproportionate tax effects related to de-designated cash flow hedges	—			—			3,400
Expense due to enactment of federal tax reform	—			—			38,198
Other	(614		)	(138		)	1,051
Total income tax expense	$	52,991		$	49,815		$	105,013

Schedule of summarizes the sources and expected tax consequences of future taxable deductions (revenue)

The following summarizes the sources and expected tax consequences of future taxable deductions (revenue) which comprise the net deferred tax asset as of the dates indicated (in thousands):



	December 31,
	2019		2018
Deferred tax assets:
Allowance for loan losses	$	14,910	$	14,604
Net operating loss carryforwards	27,568		39,204
Deferred compensation	9,363		8,535
Loan purchase accounting adjustments	6,599		8,658
Reserve for losses on foreclosed properties	20		61
Nonqualified share based compensation	2,041		1,190
Accrued expenses	3,958		3,536
Investment in partnerships	67		426
Unamortized pension actuarial losses and prior service cost	1,739		1,606
Unrealized losses on securities available-for-sale	—		8,092
Unrealized losses on cash flow hedges	—		86
Lease liability	5,327		—
Other	2,038		1,235
Total deferred tax assets	73,630		87,233
Deferred tax liabilities:
Unrealized gains on securities available-for-sale	7,943		—
Acquired intangible assets	2,530		2,772
Premises and equipment	3,002		1,291
Loan origination costs	3,538		3,734
True tax leases	7,783		6,020
Prepaid expenses	373		398
Servicing assets	4,428		2,862
Derivatives	1,075		525
Right-of-use asset	4,809		—
Uncertain tax positions	1,792		2,036
Total deferred tax liabilities	37,273		19,638
Less valuation allowance	2,298		3,371
Net deferred tax asset	$	34,059	$	64,224

Schedule of reconciliation of the beginning and ending unrecognized tax benefit related to uncertain tax positions

A reconciliation of the beginning and ending unrecognized tax benefit related to uncertain tax positions is as follows for the years indicated (in thousands):



	2019			2018			2017
Balance at beginning of year	$	3,264		$	3,163		$	3,892
Additions based on tax positions related to the current year	481			470			441
Decreases resulting from a lapse in the applicable statute of limitations	(375		)	(369		)	(351		)
Remeasurement due to enactment of federal tax reform	—			—			(819		)
Balance at end of year	$	3,370		$	3,264		$	3,163