Income Tax Matters (Tables)

12 Months Ended

Dec. 31, 2017

Significant Components of Income Tax Expense (Benefit)

The significant components of income tax expense for the years ended December 31, 2017, 2016 and 2015 are summarized as follows:

	2017		2016		2015
	(dollars in thousands)
Current tax expense:
Federal	$	1,022	$	674	$	389
State		96		129		81
Total		1,118		803		470
Deferred tax expense:
Federal		680		47		228
State		11		45		108
Total		691		92		336
Net provision for income taxes	$	1,809	$	895	$	806

Provision for Income Taxes and the Amounts Computed by Applying the Statutory Federal Income Tax Rate of 34% to Income Before Income Taxes

The difference between the provision for income taxes and the amounts computed by applying the statutory federal income tax rate of 34% to income before income taxes is summarized below:

	2017			2016			2015
	(dollars in thousands)
Tax computed at the statutory federal rate	$	1,163		$	1,056		$	956
Increases (decrease) resulting from:
Tax exempt interest, net		(238	)		(298	)		(280	)
State income taxes, net of federal benefit		71			115			125
Revalue of deferred tax assets		806			—			—
Other		7			22			5
Provision for income taxes	$	1,809		$	895		$	806

Significant Components of Deferred Taxes

Significant components of deferred taxes at December 31, 2017, 2016 and 2015 are as follows:

	2017			2016			2015
	(dollars in thousands)
Deferred tax assets relating to:
Allowance for loan losses	$	569		$	974		$	1,057
Deferred compensation		936			1,243			1,080
Other		173			396			555
Net unrealized loss on securities available for sale		335			678			109
Total deferred tax assets		2,013			3,291			2,801
Deferred tax liabilities relating to:
Premises and equipment		(213	)		(295	)		(319	)
Deferred loans fees and costs		(148	)		(233	)		(213	)
Loan servicing		(116	)		(193	)		(176	)
Total deferred tax liabilities		(477	)		(721	)		(708	)
Net recorded deferred tax asset	$	1,536		$	2,570		$	2,093