INCOME TAXES

12 Months Ended

Dec. 31, 2016

Income Tax Disclosure [Abstract]

INCOME TAXES

Note 15 – Income Taxes

The following table provides the components of income tax expense for the years ended December 31:

(In thousands)			2016		2015		2014
Current income taxes:
Federal			$	18,699	$	17,890	$	13,671
State				4,692		4,140		3,103
	Total current			23,391		22,030		16,774
Deferred income taxes:
Federal				516		10		554
State				(167)		(13)		254
	Total deferred			349		(3)		808
		Total income tax expense	$	23,740	$	22,027	$	17,582

The Company does not have uncertain tax positions that are deemed material, and did not recognize any adjustments for unrecognized tax benefits.

Temporary differences between the amounts reported in the financial statements and the tax bases of assets and liabilities result in deferred taxes. Deferred tax assets and liabilities, shown as the sum of the appropriate tax effect for each significant type of temporary difference, are presented in the following table at December 31 for the years indicated:

(In thousands)				2016		2015
Deferred Tax Assets:
	Allowance for loan losses			$	17,517	$	16,231
	Employee benefits				2,034		1,852
	Pension plan OCI				5,433		5,175
	Deferred loan fees and costs				457		315
	Non-qualified stock option expense				555		522
	Losses on other real estate owned				43		32
	Other than temporary impairment				322		322
	Loan and deposit premium/discount				187		293
	Reserve for recourse loans				199		199
	Other				9		9
		Gross deferred tax assets			26,756		24,950
Deferred Tax Liabilities:
	Unrealized gains on investments available-for-sale				(1,065)		(4,319)
	Pension plan costs				(3,550)		(1,709)
	Depreciation				(1,179)		(1,338)
	Intangible assets				(1,721)		(1,542)
	Bond accretion				(133)		(228)
	Other				(155)		(18)
		Gross deferred tax liabilities			(7,803)		(9,154)
			Net deferred tax asset	$	18,953	$	15,796

The reconcilements between the statutory federal income tax rate and the effective rate for the years ended December 31 are presented in the following table:

(Dollars in thousands)			2016				2015				2014
					Percentage of				Percentage of				Percentage of
					Pre-Tax				Pre-Tax				Pre-Tax
			Amount		Income		Amount		Income		Amount		Income
Income tax expense at federal statutory rate			$	25,194	35.0	%	$	23,584	35.0	%	$	19,523	35.0	%
Increase (decrease) resulting from:
	Tax exempt income, net			(3,606)	(5.0)			(3,457)	(5.1)			(3,468)	(6.2)
	Bank-owned life insurance			(862)	(1.1)			(900)	(1.3)			(855)	(1.5)
	State income taxes, net of federal income tax benefits			2,965	4.1			2,687	4.0			2,182	3.9
	Other, net			49	-			113	0.1			200	0.4
		Total income tax expense and rate	$	23,740	33.0	%	$	22,027	32.7	%	$	17,582	31.6	%

The variability in the effective tax rate over the three year period was due primarily to the proportion of tax exempt income compared to income before taxes for each year.