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Income Taxes | 12 Months Ended
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Dec. 31, 2022
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES The current and deferred amounts of income tax expense consist of the following.
|  | Year Ended December 31, |
|  | 2022 |  |  | 2021 |  |  | 2020 |
|  | (Dollars in thousands) |
Current provision: |  |  |  |  |  |  |  |  |
Federal |  | $ | 60,763 |  |  | $ | 44,514 |  |  | $ | 48,328 |
State |  |  | 35,427 |  |  |  | 27,526 |  |  |  | 28,469 |
|  |  | 96,190 |  |  |  | 72,040 |  |  |  | 76,797 |
Deferred provision: |  |  |  |  |  |  |  |  |
Federal |  |  | (2,496 | ) |  |  | 8,782 |  |  |  | (2,997 | )
State |  |  | (772 | ) |  |  | 4,305 |  |  |  | (1,439 | )
|  |  | (3,268 | ) |  |  | 13,087 |  |  |  | (4,436 | )
Total |  | $ | 92,922 |  |  | $ | 85,127 |  |  | $ | 72,361 |
Income tax asset consists of the following.
|  | December 31, |
|  | 2022 |  |  | 2021 |
|  | (Dollars in thousands) |
Current: |  |  |  |  |  |
Federal |  | $ | 1,740 |  |  | $ | 5,452 |
State |  |  | 658 |  |  |  | 2,150 |
|  |  | 2,398 |  |  |  | 7,602 |
Deferred: |  |  |  |  |  |
Federal |  |  | 117,698 |  |  |  | 16,500 |
State |  |  | 66,588 |  |  |  | 8,501 |
|  |  | 184,286 |  |  |  | 25,001 |
Total |  | $ | 186,684 |  |  | $ | 32,603 |
Temporary differences between the amounts reported in the financial statements and the tax bases of assets and liabilities resulted in deferred taxes. The components of the net deferred tax asset are as follows.
|  | December 31, |
|  | 2022 |  |  | 2021 |
|  | (Dollars in thousands) |
Deferred tax assets: |  |  |  |  |  |
Bad debt and credit loss deduction |  | $ | 29,648 |  |  | $ | 23,228 |
Net operating loss carryforward |  |  | 4,701 |  |  |  | — |
Deferred compensation |  |  | 6,768 |  |  |  | 6,367 |
PCI loans |  |  | 51 |  |  |  | 657 |
California franchise tax |  |  | — |  |  |  | 3,873 |
Accrued expense |  |  | 5,678 |  |  |  | 5,071 |
Unrealized loss on investment securities, net |  |  | 159,229 |  |  |  | 423 |
Acquired loan discounts |  |  | 4,288 |  |  |  | 5,863 |
Lease liability |  |  | 7,541 |  |  |  | 6,472 |
Other, net |  |  | 2,251 |  |  |  | 1,784 |
Gross deferred tax asset |  |  | 220,155 |  |  |  | 53,738 |
Deferred tax liabilities: |  |  |  |  |  |
California franchise tax |  |  | 6,568 |  |  |  | — |
Depreciation |  |  | 3,762 |  |  |  | 3,443 |
Intangibles - acquisitions |  |  | 11,591 |  |  |  | 12,812 |
FHLB Stock |  |  | 2,545 |  |  |  | 2,525 |
Deferred income |  |  | 4,177 |  |  |  | 3,825 |
Right of use asset |  |  | 7,226 |  |  |  | 6,132 |
Unrealized gain on investment securities, net |  |  | — |  |  |  | — |
Gross deferred tax liability |  |  | 35,869 |  |  |  | 28,737 |
Net deferred tax asset |  | $ | 184,286 |  |  | $ | 25,001 |
Annual Effective Tax Rate The annual consolidated effective tax rate for the periods presented, is reconciled to the U.S. statutory income rate as follows.
|  | Year Ended December 31, |
|  | 2022 |  |  | 2021 |  |  | 2020 |
|  | Amount |  |  | Percent |  |  | Amount |  |  | Percent |  |  | Amount |  |  | Percent |
|  | (Dollars in thousands) |
Federal income tax at statutory rate |  | $ | 68,953 |  |  |  | 21.0 | % |  | $ | 62,506 |  |  |  | 21.0 | % |  | $ | 52,399 |  |  |  | 21.0 | %
State franchise taxes, net of federal benefit |  |  | 27,256 |  |  |  | 8.3 | % |  |  | 24,600 |  |  |  | 8.3 | % |  |  | 20,950 |  |  |  | 8.4 | %
Tax-exempt income |  |  | (3,290 | ) |  |  | (1.0 | )% |  |  | (3,165 | ) |  |  | (1.1 | )% |  |  | (3,191 | ) |  |  | (1.3 | )%
Tax credits |  |  | (1,617 | ) |  |  | (0.5 | )% |  |  | (1,640 | ) |  |  | (0.6 | )% |  |  | (1,946 | ) |  |  | (0.8 | )%
Other, net |  |  | 1,620 |  |  |  | 0.5 | % |  |  | 2,826 |  |  |  | 1.0 | % |  |  | 4,149 |  |  |  | 1.7 | %
Provision for income taxes |  | $ | 92,922 |  |  |  | 28.3 | % |  | $ | 85,127 |  |  |  | 28.6 | % |  | $ | 72,361 |  |  |  | 29.0 | %
There were no significant unrecognized tax benefits at December 31, 2022 and 2021. We do not expect the total amount of unrecognized tax benefits to significantly increase or decrease within the next twelve months. The Company is subject to income taxes in the federal, California, Arizona, and three other non-material jurisdictions. The Company is no longer subject to examinations by taxing jurisdictions for periods before 2019, with the exception of California, for which the Company is no longer subject to examination for years before 2013. At December 31, 2022, the Company has net operating loss (NOLs) carryforwards of approximately $14.8 million for federal and California tax purposes as a result of the acquisition of Suncrest Bank. The federal and California NOLs of $12.7 and $9.8 million, respectively, are subject to annual IRC Section 382 limitations of $3.4 million and have no ex piration for federal tax purposes but will expire in 2032 for California if not utilized. The balance of the NOLs are subject to annual IRC Section 382 limitations of $300,000 and will begin to expire in 2030. The Company considered the need for a valuation allowance on its deferred tax assets for the year ended December 31, 2022. The Company considered income in prior periods, projected future income, and projected future reversals of deferred tax items in making the determination that the deferred tax assets are more likely than not to be realized.

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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 https://asc.fasb.org/extlink&oid=121826272&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 https://asc.fasb.org/extlink&oid=122134291&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 https://asc.fasb.org/extlink&oid=121826272&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 https://asc.fasb.org/extlink&oid=122134291&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 https://asc.fasb.org/extlink&oid=121826272&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 https://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 https://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 https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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