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Income Taxes | 6 Months Ended
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Jun. 30, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES The provision for income taxes is comprised of the following components for the periods indicated below:
| Three Months Ended June 30, |  |  |  | Six Months Ended June 30, |  |
(In thousands) | 2020 |  | 2019 |  | 2020 |  | 2019
Income taxes currently payable | $ | 9,391 |  |  | $ | 12,757 |  |  | $ | 31,671 |  |  | $ | 23,074 |
Deferred income taxes | 6,202 |  |  | 2,859 |  |  | 4,616 |  |  | 4,940 |
Provision for income taxes | $ | 15,593 |  |  | $ | 15,616 |  |  | $ | 36,287 |  |  | $ | 28,014 |
The tax effects of temporary differences between the tax basis of assets and liabilities and their financial reporting amounts that give rise to deferred income tax assets and liabilities, and their approximate tax effects, are as follows:
| June 30, |  | December 31,
(In thousands) | 2020 |  | 2019
Deferred tax assets: |  |  |
Loans acquired | $ | 13,756 |  |  | $ | 20,783 |
Allowance for credit losses | 57,244 |  |  | 16,732 |
Valuation of foreclosed assets | 2,636 |  |  | 2,626 |
Tax NOLs from acquisition | 16,816 |  |  | 18,118 |
Deferred compensation payable | 2,890 |  |  | 2,750 |
Accrued equity and other compensation | 6,845 |  |  | 6,677 |
Acquired securities | — |  |  | 3,393 |
Right-of-use lease liability | 8,738 |  |  | 10,221 |
Allowance for unfunded commitments | 6,122 |  |  | — |
Other | 5,655 |  |  | 7,886 |
Gross deferred tax assets | 120,702 |  |  | 89,186 |
Deferred tax liabilities: |  |  |
Goodwill and other intangible amortization | (39,876) |  |  | (41,221) |
Accumulated depreciation | (36,731) |  |  | (36,554) |
Right-of-use lease asset | (8,701) |  |  | (10,176) |
Unrealized gain on available-for-sale securities | (16,183) |  |  | (3,720) |
Deferred loan fees and costs | (2,884) |  |  | (3,018) |
Acquired securities | (820) |  |  | — |
Other | (5,113) |  |  | (4,633) |
Gross deferred tax liabilities | (110,308) |  |  | (99,322) |
Net deferred tax asset (liability) | $ | 10,394 |  |  | $ | (10,136) |
A reconciliation of income tax expense at the statutory rate to the Company’s actual income tax expense is shown for the periods indicated below:
| Three Months Ended June 30, |  |  |  | Six Months Ended June 30, |  |
(In thousands) | 2020 |  | 2019 |  | 2020 |  | 2019
Computed at the statutory rate (21%) | $ | 15,620 |  |  | $ | 14,955 |  |  | $ | 36,180 |  |  | $ | 27,575 |
Increase (decrease) in taxes resulting from: |  |  |  |  |  |  |
State income taxes, net of federal tax benefit | 2,296 |  |  | 1,420 |  |  | 4,359 |  |  | 2,765 |
Discrete items related to ASU 2016-09 | 43 |  |  | (81) |  |  | 69 |  |  | (107) |
Tax exempt interest income | (1,421) |  |  | (1,024) |  |  | (2,842) |  |  | (1,985) |
Tax exempt earnings on BOLI | (212) |  |  | (215) |  |  | (531) |  |  | (394) |
Federal tax credits | (1,034) |  |  | (729) |  |  | (2,068) |  |  | (1,458) |
Other differences, net | 301 |  |  | 1,290 |  |  | 1,120 |  |  | 1,618 |
Actual tax provision | $ | 15,593 |  |  | $ | 15,616 |  |  | $ | 36,287 |  |  | $ | 28,014 |
The Company follows ASC Topic 740, Income Taxes, which prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Benefits from tax positions should be recognized in the financial statements only when it is more likely than not that the tax position will be sustained upon examination by the appropriate taxing authority that would have full knowledge of all relevant information. A tax position that meets the more-likely-than-not recognition threshold is measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not recognition threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met. ASC Topic 740 also provides guidance on the accounting for and disclosure of unrecognized tax benefits, interest and penalties. The Company has no history of expiring net operating loss carryforwards and is projecting significant pre-tax and financial taxable income in future years. The Company expects to fully realize its deferred tax assets in the future. The amount of unrecognized tax benefits may increase or decrease in the future for various reasons including adding amounts for current tax year positions, expiration of open income tax returns due to the statutes of limitation, changes in management’s judgment about the level of uncertainty, status of examinations, litigation and legislative activity and the addition or elimination of uncertain tax positions. Section 382 of the Internal Revenue Code imposes an annual limit on the ability of a corporation that undergoes an “ownership change” to use its U.S. net operating losses to reduce its tax liability. The Company has engaged in two tax-free reorganization transactions in which acquired net operating losses are limited pursuant to Section 382. In total, approximately $77.8 million of federal net operating losses subject to the IRC Section 382 annual limitation are expected to be utilized by the Company, of which $46.8 million is related to the Reliance acquisition that closed during second quarter 2019. All of the acquired Reliance net operating losses are expected to be fully utilized by 2027, with the remaining acquired net operating loss carryforwards expected to be fully utilized by 2036. The Company files income tax returns in the U.S. federal jurisdiction. The Company’s U.S. federal income tax returns are open and subject to examinations from the 2016 tax year and forward. The Company’s various state income tax returns are generally open from the 2016 and later tax return years based on individual state statute of limitations.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
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