INCOME TAXES

The provision for federal income taxes consists of (in thousands):



	2015			2014	2013
Income taxes currently payable	$	4,280		3,194	2,750
Deferred income tax provision (benefit)	(58		)	192	192
Provision for income taxes	$	4,222		3,386	2,942

A reconciliation between the statutory income tax and the Company's effective tax rate follows:



	2015		2014		2013
Statutory tax rate	34.0	%	34.0	%	34.0	%
Increase (decrease) resulting from -
Tax exempt interest	(6.0	)%	(6.8	)%	(7.2	)%
Tax exempt income on bank owned life insurance	(1.4	)%	(1.7	)%	(2.0	)%
Other – net	0.3	%	—	%	0.3	%
Effective tax rate	26.9	%	25.5	%	25.1	%

Deferred tax assets and liabilities at December 31 consist of the following (in thousands):



	2015			2014
Deferred tax assets:
Allowance for loan losses	$	1,064		1,061
Net unrealized losses on investment securities available-for-sale	246			470
Fair value adjustment on loans acquired from merger with First Capital	847			1,184
Write-down of other real estate owned	338			196
Pension and deferred compensation	971			849
Other	440			274
	3,906			4,034
Deferred tax liabilities:
Depreciation of premises and equipment	(1,332		)	(1,280	)
Amortization of intangibles	(840		)	(950	)
Deferred loan fees	(2		)	(3	)
FHLB stock dividends	(349		)	(349	)
Fair value adjustment on securities acquired from merger with First Capital	(70		)	(143	)
	(2,593		)	(2,725	)
Net deferred tax assets (liabilities)	$	1,313		1,309

As of December 31, 2015 and 2014 there were no unrecognized tax benefits and the Company does not anticipate the total amount of unrecognized tax benefits will significantly change within the next twelve months. There were no amounts recognized for interest and penalties in the consolidated statements of income for the three-year period ended December 31, 2015.

The Company is no longer subject to examination by federal tax authorities for years before 2012.