Income Taxes (Tables)

12 Months Ended

Dec. 31, 2022

Income Tax Disclosure [Abstract]

Components of Consolidated Income Tax Expense

The components of consolidated income tax expense are as follows (in thousands):

	Year Ended December 31,
	2022		2021		2020
Current tax expense
Federal	$	34,155	$	28,763	$	22,104
State	22,355		18,221		14,586
	$	56,510	46,984		36,690
Deferred tax expense
Federal	(5,224)		(872)		(9,500)
State	(2,798)		(64)		(4,654)
	(8,022)		(936)		(14,154)
Total tax expense	$	48,488	$	46,048	$	22,536

Schedule of Components of Investments in Qualified Affordable Housing Projects

The Company recognized, as components of tax expense, tax credits and other tax benefits, and amortization expense relating to our investments in Qualified Affordable Housing Projects as follows for the periods indicated (in thousands):

	Year Ended December 31,
	2022		2021		2020
Tax credits and other tax benefits – decrease in tax expense	$	(6,370)	$	(4,224)	$	(4,200)
Amortization – increase in tax expense	$	6,178	$	3,604	$	3,581

Reconciliation of Effective Tax Rate and Statutory Federal Income Tax Rate

The effective tax rate and the statutory federal income tax rate are reconciled as follows:

	Year Ended December 31,
(in thousands)	2022		2021		2020
Federal statutory income tax rate	21.0	%	21.0	%	21.0	%
State income taxes, net of federal tax benefit	7.9		7.9		7.7
Tax-exempt interest on municipal obligations	(0.7)		(0.5)		(0.9)
Tax-exempt life insurance related income	(0.4)		(0.5)		(0.8)
Low income housing tax credits	(3.7)		(2.6)		(4.8)
Low income housing tax credit amortization	3.6		2.2		4.1
Equity compensation	(0.2)		(0.1)		0.4
Non-deductible merger expenses	0.1		0.1		—
Other	0.3		0.6		(0.9)
Effective Tax Rate	27.9	%	28.1	%	25.8	%

Company's Net Deferred Tax Asset Recorded in Other Assets

The temporary differences, tax effected, which give rise to the Company’s net deferred tax asset recorded in other assets are as follows as of December 31 for the years indicated (in thousands):

	December 31,
	2022		2021
Deferred tax assets:
Allowance for losses and reserve for unfunded commitments	$	32,519	$	26,361
Deferred compensation	1,696		1,758
Other accrued expenses	2,720		1,994
Additional unfunded status of the supplemental retirement plans	16,036		13,693
Operating lease liability	8,575		7,769
State taxes	3,649		3,251
Share based compensation	1,132		952
Nonaccrual interest	643		937
Acquisition cost basis	14,640		506
Unrealized loss on securities	85,897		116
Tax credits	852		513
Net operating loss carryforwards	2,098		1,131
Other	120		813
Total deferred tax assets	170,577		59,794
Deferred tax liabilities:
Securities income	(777)		(762)
Depreciation	(8,270)		(6,198)
Right of use asset	(7,941)		(7,588)
Funded pension liability	(4,110)		(709)
Securities accretion	(1,265)		(846)
Mortgage servicing rights valuation	(1,976)		(1,726)
Core deposit intangible	(4,778)		(3,248)
Junior subordinated debt	(1,293)		(1,422)
Prepaid expenses and other	(991)		(488)
Total deferred tax liability	(31,401)		(22,987)
Net deferred tax asset	$	139,176	$	36,807