XML 41 R27.htm IDEA: XBRL DOCUMENT
v3.25.0.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2024
Income Tax Disclosure [Abstract] |
INCOME TAXES | INCOME TAXES The following table presents the composition of income tax expense (benefit) for the years ended December 31:
(dollars in thousands) | 2024 |  | 2023 |  | 2022
Federal |  |  |  |  |
Current | $ | 32,536 |  |  | $ | 33,070 |  |  | $ | 35,514 |
Deferred | (31) |  |  | 459 |  |  | (2,801) |
Total Federal | 32,505 |  |  | 33,529 |  |  | 32,713 |
State |  |  |  |  |
Current | 1,313 |  |  | 352 |  |  | 828 |
Deferred | (265) |  |  | 142 |  |  | (131) |
Total State | 1,048 |  |  | 494 |  |  | 697 |
Total Federal and State(1) | $ | 33,553 |  |  | $ | 34,023 |  |  | $ | 33,410 |
[1]With the adoption of PAM on January 1, 2024, the amortization related to LIHTC and HTC equity investments is recognized in income tax expense in the Consolidated Statements of Net Income in 2024 and other noninterest expense in 2023 and 2022. The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before income taxes. We ordinarily generate an annual effective tax rate that is less than the statutory rate of 21 percent primarily due to benefits resulting from certain partnership investments, such as low income housing and historic rehabilitation projects, tax-exempt interest, excludable dividend income and tax-exempt income on BOLI. The following table presents a reconciliation of the statutory tax rate to the effective tax rate for the years ended December 31:
| 2024 |  | 2023 |  | 2022
Statutory tax rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
Tax-exempt interest | (0.8) | % |  | (0.8) | % |  | (1.0) | %
Low income housing tax credits | (0.2) | % |  | (1.5) | % |  | (0.7) | %
Bank owned life insurance | (0.3) | % |  | (0.2) | % |  | (0.2) | %
Other | 0.7 | % |  | 0.5 | % |  | 0.7 | %
Effective Tax Rate(1) | 20.4 | % |  | 19.0 | % |  | 19.8 | %
[1]With the adoption of PAM on January 1, 2024, the amortization related to LIHTC and HTC equity investments is recognized in income tax expense in the Consolidated Statements of Net Income in 2024 and other noninterest expense in 2023 and 2022. The following table presents significant components of our temporary differences as of the dates presented:
| December 31,
(dollars in thousands) | 2024 |  | 2023
Deferred Tax Assets: |  |  |
Allowance for credit losses and other reserves | $ | 22,953 |  |  | $ | 24,465 |
Net unrealized holding losses on securities available-for-sale | 15,431 |  |  | 17,452 |
Lease liabilities | 10,271 |  |  | 10,572 |
State net operating loss carryforwards | 3,782 |  |  | 3,464 |
Net unrealized losses on interest rate swaps | 2,063 |  |  | 3,137 |
Cumulative adjustment to funded status of pension | 3,606 |  |  | 3,987 |
Low income housing partnerships and other investments | — |  |  | 174 |
Other employee benefits | 4,688 |  |  | 3,740 |
Depreciation on premises and equipment | 5 |  |  | — |
Capital loss carryforward | 1,300 |  |  | 2,092 |
Other | 1,243 |  |  | 1,202 |
Deferred Tax Assets | 65,342 |  |  | 70,285 |
Less: Valuation allowance | (3,782) |  |  | (3,464) |
Total Deferred Tax Assets | 61,560 |  |  | 66,821 |
Deferred Tax Liabilities: |  |  |
Right-of-use lease assets | (8,825) |  |  | (9,127) |
Deferred loan income, net | (5,216) |  |  | (4,633) |
Prepaid pension | (3,131) |  |  | (3,360) |
Purchase accounting adjustments | (1,650) |  |  | (1,823) |
Mortgage servicing rights | (61) |  |  | (1,350) |
Depreciation on premises and equipment | — |  |  | (1,182) |
Other partnership investments(1) | (491) |  |  | — |
Other | (113) |  |  | (78) |
Total Deferred Tax liabilities | (19,487) |  |  | (21,553) |
Net Deferred Tax Asset | $ | 42,073 |  |  | $ | 45,268 |
(1)With the adoption of PAM on January 1, 2024, the LIHTC and HTC equity investments no longer have a deferred tax impact.
We establish a valuation allowance when it is more likely than not that we will not be able to realize the benefit of the deferred tax assets. Except for Pennsylvania net operating losses, or NOLs, we have determined that no valuation allowance is needed for deferred tax assets because it is more likely than not that these assets will be realized through future reversals of existing temporary differences and through future taxable income. The valuation allowance is reviewed quarterly and adjusted based on management’s assessments of realizable deferred tax assets. Gross deferred tax assets were reduced by a valuation allowance of $3.8 million in 2024 compared to $3.5 million in 2023 related to Pennsylvania income tax NOLs. The Pennsylvania NOL carryforwards total $75.8 million and will expire in the years 2025-2044. Unrecognized Tax Benefits The following table reconciles the change in Federal and State gross unrecognized tax benefits, or UTB, for the years ended December 31:
(dollars in thousands) | 2024 |  | 2023 |  | 2022
Balance at beginning of year | $ | 1,940 |  |  | $ | 1,648 |  |  | $ | 1,331 |
Prior period tax positions | 146 |  |  | (434) |  |  | — |
Current period tax positions | — |  |  | 726 |  |  | 317 |
Balance at End of Year | $ | 2,086 |  |  | $ | 1,940 |  |  | $ | 1,648 |
Amount That Would Affect the Effective Tax Rate if Recognized | $ | 1,648 |  |  | $ | 1,551 |  |  | $ | 1,148 |
As of December 31, 2024, we had $2.1 million of unrecognized gross tax benefits. Gross tax benefits do not reflect the federal tax effect associated with state income tax amounts. The total amount of the net unrecognized tax benefits at December 31, 2024 that would have affected the effective tax rate, if recognized, was $1.6 million. We classify interest and penalties as an element of tax expense. We monitor changes in tax statutes and regulations to determine if significant changes will occur over the next 12 months. As of December 31, 2024, no significant changes to UTB are projected; however, tax audit examinations are possible. As of December 31, 2024, all income tax returns filed for the tax years 2021 - 2023 remain subject to examination by the respective taxing authorities. The Bank's income tax returns for the audit years January 1, 2020 through December 31, 2022 are currently under audit by the New York Department of Taxation. This audit remains open as of December 31, 2024.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income tax. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 231 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482663/740-10-55-231 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12C -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12B -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477891/740-270-50-1 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB Topic 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org/1943274/2147480990/946-20-50-13 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/740/tableOfContent Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-14 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-21 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482685/740-10-50-17 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration