Income Tax

12 Months Ended

Dec. 31, 2011

Income Tax Disclosure [Abstract]

Income Tax

Income Tax

The components of income tax expense (benefit) are as follows:

	Years Ended December 31,
	2011			2010			2009
	(in thousands)
Current tax (benefit) expense	$	21,688		$	(13,547	)	$	(8,893	)
Deferred tax expense (benefit)	(3,783		)	15,838			(85		)
Total	$	17,905		$	2,291		$	(8,978	)

Significant components of the Company’s deferred tax assets and liabilities are as follows:

	December 31,
	2011			2010
	(in thousands)
Deferred tax assets:
Allowance for loan and lease losses	$	20,910		$	22,942
Supplemental executive retirement plan	6,564			6,185
Stock option and restricted stock	989			1,295
OREO costs	3,209			1,910
AMT credit carryforwards	—			2,318
Nonaccrual interest	222			310
Security impairment	1,041			—
Other	632			1,890
Total deferred tax assets	33,567			36,850
Deferred tax liabilities:
Asset purchase tax basis difference	(14,812		)	(22,559		)
FHLB stock dividends	(1,977		)	(2,019		)
Purchase accounting	(1,030		)	(1,373		)
Deferred loan fees	(1,517		)	(1,214		)
Unrealized gain on investment securities	(14,291		)	(7,186		)
Depreciation	(1,517		)	(646		)
Total deferred tax liabilities	(35,144		)	(34,997		)
Net deferred tax asset (liability)	$	(1,577	)	$	1,853

A reconciliation of the Company’s effective income tax rate with the federal statutory tax rate is as follows:

	Years Ended December 31,
	2011					2010					2009
	Amount			Percent		Amount			Percent		Amount			Percent
	(dollars in thousands)
Income tax based on statutory rate	$	23,080		35	%	$	11,576		35	%	$	(4,531	)	35	%
Reduction resulting from:
Tax credits	(608		)	(1	)%	(808		)	(2	)%	(687		)	5	%
Tax exempt instruments	(3,824		)	(6	)%	(3,744		)	(11	)%	(3,072		)	24	%
Life insurance proceeds	(766		)	(1	)%	(735		)	(2	)%	(708		)	5	%
Bargain purchase	(1,036		)	(2	)%	(5,383		)	(16	)%	—			—	%
Other, net	1,059			2	%	1,385			3	%	20			—	%
Income tax provision (benefit)	$	17,905		27	%	$	2,291		7	%	$	(8,978	)	69	%

As of December 31, 2011 and 2010, we had no unrecognized tax positions. Our policy is to recognize interest and penalties on unrecognized tax benefits in “Provision for income taxes” in the Consolidated Statements of Income. There were no amounts related to interest and penalties recognized for the years ended December 31, 2011 and 2010. The tax years subject to examination by federal and state taxing authorities are the years ending December 31, 2010, 2009, and 2008.