Income Taxes (Tables)

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Provision for Federal and State Income Taxes

The provision for federal and state income taxes included in the accompanying consolidated statements of income consists of the following:

	For the Years Ended December 31,
(Dollars in thousands)	2013		2012		2011
Current:
Federal	$	4,172	$	2,753	$	2,829
State		591		258		334
Deferred:
Federal		922		2,397		1,480
State		11		143		133
	$	5,696	$	5,551	$	4,776

Income Tax Provision Differences from Expected Statutory Provision

The provision for income taxes differs from the expected statutory provision as follows:

	For the Years Ended December 31,
(Dollars in thousands)	2013			2012			2011
Expected provision at statutory rate		35.0	%		35.0	%		35.0	%
Difference resulting from:
Tax exempt interest income		(11.7	)		(12.1	)		(14.0	)
Increase in value of bank owned life insurance assets		(3.9	)		(3.5	)		(2.4	)
Other, including state income taxes, valuation allowance and rate differential		1.8			1.6			1.6
		21.2	%		21.0	%		20.2	%

Components of Deferred Tax Assets and Liabilities

The assets and liabilities giving rise to the Corporation’s deferred tax assets and liabilities are as follows:

	At December 31,
(Dollars in thousands)	2013			2012
Deferred tax assets:
Loan and lease loss	$	8,785		$	8,753
Deferred compensation		2,675			2,613
Actuarial adjustments on retirement benefits*		4,568			7,551
Interest on nonaccrual loans		2,268			1,839
State net operating losses		1,743			1,441
Other-than-temporary impairments on equity securities		759			1,218
Alternative minimum tax credits**		1,367			1,590
Net unrealized holding losses on securities available-for-sale*		792			—
Other		280			—
Gross deferred tax assets		23,237			25,005
Valuation allowance		(1,630	)		(1,432	)
Total deferred tax asset, net of valuation allowance		21,607			23,573
Deferred tax liabilities:
Market discount		1,722			1,624
Retirement plans		5,602			5,100
Intangible assets		2,212			1,567
Net unrealized holding gains on securities available-for-sale and swaps*		—			3,825
Other		—			60
Total deferred tax liabilities		9,536			12,176
Net deferred tax assets	$	12,071		$	11,397

* Represents the amount of deferred taxes recorded in accumulated other comprehensive income (loss).

** The alternative minimum tax credits have an indefinite life.