Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Schedule of Components of Income Tax Expense (Benefit)

The components of the provision for income taxes are as follows:


	2021		2020		2019
	(in thousands)
Current tax expense:
Federal	$	35,692	$	38,397	$	32,610
State	10,646		7,389		5,204
	46,338		45,786		37,814
Deferred tax (benefit) expense:
Federal	11,081		(18,131)		(1,271)
State	1,329		(3,460)		1,106
	12,410		(21,591)		(165)
Total income tax expense	$	58,748	$	24,195	$	37,649

Schedule of Effective Income Tax Rate Reconciliation

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


	2021		2020		2019
Statutory tax rate	21.0	%	21.0	%	21.0	%
Tax credit investments	(3.0)		(5.7)		(4.6)
Tax-exempt income	(3.0)		(4.9)		(3.9)
Bank owned life insurance	(0.5)		(0.7)		(0.4)
State income taxes, net of federal benefit	2.6		1.1		0.2
Change in valuation allowance	—		—		1.8

Executive compensation	0.1		—		—

FDIC Premium	0.3		0.3		—
Penalties	—		0.2		—
Other, net	0.1		0.7		0.2
Effective income tax rate	17.6	%	12.0	%	14.3	%

Schedule of Deferred Tax Assets and Liabilities

The net DTA recorded by the Corporation is included in other assets and consists of the following tax effects of temporary differences as of December 31:


	2021		2020
	(in thousands)
Deferred tax assets:
Allowance for credit losses	$	62,465	$	67,059
Tax credit carryforwards	27,192		39,294
State loss carryforwards	23,996		20,401
Lease Liability	21,034		—
Tax credit investments	11,203		10,159
Other accrued expenses	10,633		9,801
Deferred compensation	9,190		8,486
Stock-based compensation	3,499		3,289
Postretirement and defined benefit plans	—		1,553


Other	7,348		12,107
Total gross deferred tax assets	$	176,560	$	172,149
Deferred tax liabilities:
Equipment lease financing	$	41,049	$	44,216
Right-of-use-asset	18,671		—
Unrealized holding gains on AFS securities	10,432		23,978
Premises and equipment	9,151		8,876
MSRs	8,016		6,414
Acquisition premiums/discounts	5,466		5,466
Intangible assets	1,272		1,205
Postretirement and defined benefit plans	1,243		—
Other	13,492		15,811
Total gross deferred tax liabilities	108,792		105,966
Net deferred tax asset, before valuation allowance	67,768		66,183
Valuation allowance	(23,996)		(20,401)
Net deferred tax asset	$	43,772	$	45,782

Summary of Changes in Unrecognized Tax Benefits

The following table summarizes the changes in unrecognized tax benefits for the years ended December 31:


	2021		2020		2019
	(in thousands)
Balance at beginning of year	$	2,151	$	2,517	$	2,726

Current period tax positions	120		95		292

Lapse of statute of limitations	(598)		(461)		(501)
Balance at end of year	$	1,673	$	2,151	$	2,517

Summary of TCIs and Related Unfunded Commitments

The following table presents the balances of the Corporation's TCIs and related unfunded commitments as of December 31:



		2021		2020
Included in other assets:		( in thousands)
Affordable housing tax credit investments, net		$	161,052	$	152,203
Other tax credit investments, net		42,987		59,224
	Total TCIs, net	$	204,039	$	211,427
Included in other liabilities:
Unfunded affordable housing tax credit commitments		$	49,364	$	31,562
Other tax credit liabilities		33,941		49,491
	Total unfunded tax credit commitments and liabilities	$	83,305	$	81,053

The following table presents other information relating to the Corporation's TCIs for the years ended December 31:


		2021		2020		2019
		( in thousands)
Components of income taxes:
Tax credits and benefits		(28,141)		(32,940)		(35,184)
Amortization of tax credits and benefits, net of tax benefits		17,378		20,429		22,184
Deferred tax expense		639		921		954
	Total reduction in income tax expense	$	(10,124)	$	(11,590)	$	(12,046)
Amortization of TCIs:


	Total amortization of TCIs	$	6,187	$	6,126	$	6,021