Income Taxes (Table)

12 Months Ended

Dec. 31, 2016

Schedule of Effective Income Tax Rate Reconciliation

Income tax expense in the consolidated statements of income for the years ended December 31, 2016 and 2015, includes the following (in thousands):



	2016			2015
Current tax expense
Federal	$	2,503		$	77
State	531			167
Deferred tax expense (benefit) related to:
Provision for loan losses	(320		)	(250		)
Depreciation	203			(12		)
Fair value adjustments	356			469
Nonaccrual interest	(26		)	121
Foreclosed real estate	117			1,008
Core deposit intangible	(117		)	(89		)
Other	115			150
Total income tax expense	$	3,362		$	1,641

Schedule of Deferred Tax Assets and Liabilities

The income tax expense is different from the expected tax expense computed by multiplying income before income tax expense by the statutory income tax rates. The reasons for this difference are as follows (in thousands):



	2016			2015
Federal income tax expense computed at the statutory rate	$	3,115		$	1,071
State income taxes, net of federal tax benefit	393			176
Nondeductible acquisition expenses	—			295
Other	(146		)	99
Total income tax expense	$	3,362		$	1,641

Schedule of Components of Income Tax Expense (Benefit)

The components of the net deferred tax asset as of December 31, 2016 and 2015, were as follows (in thousands):



	2016		2015
Deferred tax assets:
Allowance for loan losses	$	1,932	$	1,667
Fair value adjustments	3,744		4,219
Foreclosed real estate	539		656
Deferred compensation	415		253
State net operating loss carryforward	—		339
Other	561		618
Total deferred tax assets	7,191		7,752
Deferred tax liabilities:
Accumulated depreciation	1,903		1,699
Core deposit intangible	946		1,063
Other	639		743
Total deferred tax liabilities	3,488		3,505
Net deferred tax asset	$	3,703	$	4,247