Note 12 - Income Taxes

12 Months Ended

Dec. 31, 2014

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

12.     Income Taxes

     For the years ended December 31, 2014, 2013, and 2012, the current and deferred amounts of the income tax expense are summarized as follows:

	Year Ended December 31,
	2014		2013			2012
	(In thousands)
Current:
Federal	$	36,180	$	62,254		$	44,263
State		14,481		23,295			17,081
Total Current	$	50,661	$	85,549		$	61,344
Deferred:
Federal		23,783		(11,162	)		3,755
State		7,521		(3,952	)		1,029
Total Deferred	$	31,304	$	(15,114	)	$	4,784
Total income tax expense/(benefit)	$	81,965	$	70,435		$	66,128

Temporary differences between the amounts reported in the financial statements and the tax basis of assets and liabilities give rise to deferred taxes. Net deferred tax assets at December 31, 2014, and at December 31, 2013, are included in other assets in the accompanying Consolidated Balance Sheets and are as follows:

	As of December 31,
	2014			2013
	(In thousands)
Deferred Tax Assets
Loan loss allowance, due to differences in computation of bad debts	$	66,999		$	89,560
Share-based compensation		12,808			13,573
Accrual for bonuses		4,585			3,380
Non-accrual interest		3,735			3,968
Accrual for litigation		2,918			2,415
Write-down on equity securities and venture capital investments		2,697			2,857
Write-down on other real estate owned		1,357			8,595
State tax		3,253			6,493
Unrealized loss on interest rate swaps		1,739			-
Unrealized loss on securities available-for-sale, net		2,301			21,569
Other, net		2,179			4,214
Gross deferred tax assets		104,571			156,624
Deferred Tax Liabilities
Basis difference in acquired assets		(3,321	)		(3,138	)
Dividends on Federal Home Loan Bank common stock		(1,927	)		(2,986	)
Other, net		(3,075	)		(2,773	)
Gross deferred tax liabilities		(8,323	)		(8,897	)
Valuation allowance		-			(1,263	)
Net deferred tax assets	$	96,248		$	146,464

Amounts for the current year are based upon estimates and assumptions and could vary from amounts shown on the tax returns as filed.

In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent on the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the projected future taxable income and tax planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more likely than not the Company will realize all benefits related to these deductible temporary differences.

The Company had income tax refunds receivables of $18.1 million at December 31, 2014, and $8.6 million at December 31, 2013. These income tax receivables are included in other assets in the accompanying Consolidated Balance Sheets. At December 31, 2014, the Company had Federal net operating loss carry forwards of approximately $0.8 million which expire through 2022. The Federal net operating loss carry-forwards were acquired in connection with the Company’s acquisition of United Heritage Bank.

At both December 31, 2014 and 2013, there were no unrecognized tax benefits. The Company’s tax returns are open for audits by the Internal Revenue Service back to 2011 and by the California Franchise Tax Board back to 2003. The Company is under audit by the California Franchise Tax Board for the years 2003 to 2007. As the Company is presently under audit by a number of tax authorities, it is reasonably possible that unrecognized tax benefits could change significantly over the next twelve months. The Company does not expect that any such changes would have a material impact on its annual effective tax rate.

      Income tax expense results in effective tax rates that differ from the statutory Federal income tax rate for the years indicated as follows:

	Year Ended December 31,
	2014					2013					2012
	(In thousands)
Tax provision at Federal statutory rate	$	76,928		35.0	%	$	67,752		35.0	%	$	64,248		35.0	%
State income taxes, net of Federal income tax benefit		14,324		6.6			12,573		6.5			11,772		6.4
Interest on obligations of state and political subdivisions, which are exempt from Federal taxation		-		-			(348	)	(0.2	)		(1,456	)	(0.8	)
Low income housing and other tax credits		(10,014	)	(4.6	)		(10,056	)	(5.2	)		(9,353	)	(5.1	)
Other, net		727		0.3			514		0.3			917		0.5
Total income tax expense	$	81,965		37.3	%	$	70,435		36.4	%	$	66,128		36.0	%