Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

Income Taxes

Schedule of Provision for Income Taxes

The components of the provision for income taxes for the past three years are as follows:

	For the years ended December 31,
(In thousands)	2022		2021		2020
Federal - current provision	$	10,354	$	9,837	$	7,828
Federal - deferred benefit		(1,103)		(944)		(2,043)
Total federal provision		9,251		8,893		5,785
State - current provision		3,815		3,630		2,737
State - deferred benefit		(102)		(512)		(1,047)
Total state provision		3,713		3,118		1,690
Total provision for income taxes	$	12,964	$	12,011	$	7,475

Schedule of Effective Income Tax Rate Reconciliation

Reconciliation between the reported income tax provision and the amount computed by multiplying income before taxes by the statutory Federal income tax rate for the past three years is as follows:

	For the years ended December 31,
(In thousands, except percentages)	2022			2021			2020
Federal income tax provision at statutory rate	$	10,798		$	10,107		$	6,535
Increases (decreases) resulting from:
Stock option and restricted stock		(297)			(173)			(93)
Bank owned life insurance		(134)			(145)			(129)
Tax-exempt interest		(4)			(6)			(13)
Meals and entertainment		10			7			9
Captive insurance premium		(306)			(262)			(193)
State income taxes, net of federal income tax effect		2,933			2,463			1,335
Other, net		(36)			20			24
Provision for income taxes	$	12,964		$	12,011		$	7,475
Effective tax rate		25.2	%		25.0	%		24.0	%

Schedule of Deferred Tax Assets and Liabilities

The components of the net deferred tax asset at December 31, 2022 and 2021 are as follows:

(In thousands)	December 31, 2022		December 31, 2021
Deferred tax assets:
Allowance for loan losses	$	6,871	$	6,299
SERP		1,575		1,277
Stock-based compensation		1,133		1,010
Deferred compensation		1,183		912
Depreciation		648		451
Deferred fees and loan costs, net		408		443
EVP retirement plan		—		153
Net unrealized securities losses		1,652		—
Commitment reserve		147		113
Net other deferred tax assets		154		525
Gross deferred tax assets		13,771		11,183
Deferred tax liabilities:
Goodwill		432		428
Prepaid insurance		478		474
Deferred servicing fees		47		99
Net unrealized securities gains		—		9
Bond accretion		30		17
Interest rate swaps		439		116
Total deferred tax liabilities		1,426		1,143
Net deferred tax asset	$	12,345	$	10,040