Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

Components of the Company's Income Tax Expense (Benefit)

The components of the Company’s income tax expense (benefit) are as follows:

	Year Ended December 31,
	2020			2019		2018
	(Dollars in thousands)
Current taxes:
Federal	$	25,974		$	26,247	$	23,700
State		7,443			7,288		7,083
Deferred taxes		(9,491	)		1,148		3,155
Total income taxes	$	23,926		$	34,683	$	33,938

Reconciliation of Tax Expense at the Federal Statutory Tax Rate

A reconciliation of tax expense at the federal statutory tax rate applied to income before taxes is presented in the following table. The federal statutory tax rate was 21% in 2020, 2019 and 2018:

	Year Ended December 31,
	2020			2019			2018
	(Dollars in thousands)
Tax expense at the federal statutory tax rate	$	25,937		$	35,377		$	33,546
Increase (decrease) in tax expense from:
Tax-exempt income, net		(507	)		(581	)		(510	)
Modified endowment life contracts		(508	)		(519	)		(558	)
Share based compensation excess tax benefit		(412	)		(765	)		(917	)
Tax deductible dividends paid on ESOP		(453	)		—			—
State tax expense, net of federal tax benefit		5,606			5,757			5,595
Utilization of tax credits:
New markets tax credits, net of tax expense		(3,121	)		(3,547	)		(1,422	)
Low-income housing tax credits, net of amortization		(1,273	)		(1,266	)		(1,273	)
Other tax credits		(320	)		—			—
Other, net		(1,023	)		227			(523	)
Total tax expense	$	23,926		$	34,683		$	33,938

Summary of Net Deferred Tax Asset Reported in Other Assets

The net deferred tax asset consisted of the following and is reported in other assets:

	December 31,
	2020			2019
	(Dollars in thousands)
Provision for credit losses	$	22,500		$	13,763
Write-downs of other real estate owned		143			181
Deferred compensation		2,325			2,268
Stock-based compensation		1,672			1,514
Investments in partnership interests		4,695			3,677
Other		405			903
Gross deferred tax assets		31,740			22,306
Unrealized net gains on securities		(2,513	)		(1,187	)
Premium on securities of banks acquired		(144	)		(153	)
Intangibles		(6,135	)		(6,757	)
Basis difference related to tax credits		(2,127	)		(2,015	)
Depreciation		(11,529	)		(10,349	)
Prepaid expense deducted		(1,208	)		(1,000	)
Other		(178	)		(180	)
Gross deferred tax liabilities		(23,834	)		(21,641	)
Net deferred tax asset	$	7,906		$	665