Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Reconciliation from Federal Statutory Income Tax Rate to Effective Tax Rate

Reconciliation from the federal statutory income tax rate to the effective tax rate is as follows:

	For the Years Ended December 31,
	2019			2018			2017
Federal statutory tax rate		21.0	%		21.0	%		35.0	%
Tax reform remeasurement		0.0	%		0.0	%		8.6	%
Net tax-exempt interest income on securities and loans of state and political subdivisions		(3.3	%)		(3.2	%)		(6.0	%)
State income taxes, net of federal tax effect		1.7	%		1.7	%		1.3	%
Bank-owned life insurance		(0.6	%)		(0.8	%)		(1.1	%)
General business credits		(2.2	%)		(1.6	%)		(1.7	%)
All other—net		1.2	%		0.9	%		0.2	%
Effective tax rate		17.8	%		18.0	%		36.3	%

Provision for Income Taxes Applicable to Income Before Taxes

The provision for income taxes applicable to income before taxes consists of the following:

	For the Years Ended December 31,
(in thousands)	2019		2018		2017
Current:
Federal	$	22,540	$	20,707	$	24,634
State		3,977		3,542		2,061
Deferred:
Tax reform remeasurement		—		—		12,765
Federal		7,736		6,864		13,329
State		88		299		1,018
Total	$	34,341	$	31,412	$	53,807

Schedule of Income Tax Amounts were Recorded in Shareholder's Equity as Elements of Other Comprehensive Income

The following income tax amounts were recorded in shareholders’ equity as elements of other comprehensive income:

(in thousands)		2019				2018				2017
Securities and defined benefit pension plan unrecognized items		$	11,570			$	(1,250	)		$	345

Schedule of Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities consist of the following:

	December 31,
(in thousands)	2019			2018			2017
Deferred tax assets:
Allowance for loan losses	$	12,788		$	11,207		$	10,389
Compensation and benefits		7,144			5,851			2,536
Security gains		3,031			3,707			821
Purchase accounting adjustments		—			—			1,565
Non-accrual interest income		1,297			1,388			1,389
Tax credit carryforwards		149			—			5,204
Net operating loss carryforwards		6,923			4,854			6,062
Fair value adjustments on securities available-for-sale		—			6,345			3,962
Lease accrual		13,787			—			—
Other		2,314			2,125			1,118
Gross deferred tax assets		47,433			35,477			33,046
Deferred tax liabilities:
Depreciation and amortization		(4,014	)		(1,020	)		(1,883	)
Accretion on securities		(339	)		(461	)		(266	)
Deferred fees and costs		(2,388	)		(1,641	)		(2,989	)
Purchase accounting adjustments		(2,787	)		(1,003	)		—
Fair value adjustments on securities available-for-sale		(5,749	)		—			—
Partnership adjustments		(521	)		(680	)		(674	)
Lease - right of use assets		(13,064	)
Other		(40	)		(367	)		(120	)
Gross deferred tax liabilities		(28,902	)		(5,172	)		(5,932	)
Net deferred tax assets	$	18,531		$	30,305		$	27,114

Schedule of Unrecognized Tax Benefits (Excluding Interest and Federal Income Tax Benefit of Unrecognized State Tax Benefits)

A reconciliation of the beginning and ending amount of unrecognized tax benefits (excluding interest and the federal income tax benefit of unrecognized state tax benefits) is as follows:

	For the Years Ended December 31,
(in thousands)	2019			2018			2017
Balance at beginning of year	$	465		$	467		$	436
Additions based on tax positions related to the current year		58			68			101
Reductions for tax positions of prior years		—			—			—
Reductions due to the statute of limitations		(89	)		(70	)		(70	)
Settlements		—			—			—
Balance at end of year	$	434		$	465		$	467