XML 34 R20.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2018
Income Tax Disclosure [Abstract] |
Income Taxes | Note 12 - Income Taxes The current and deferred amounts of income tax expense for 2018, 2017 and 2016 are as follows (dollars in thousands):
|  | 2018 |  |  | 2017 |  |  | 2016 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 8,902 |  |  | $ | 21,090 |  |  | $ | 10,173 |
State |  |  | 954 |  |  |  | 505 |  |  |  | (366) |
Subtotal |  |  | 9,856 |  |  |  | 21,595 |  |  |  | 9,807 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 2,455 |  |  |  | 3,876 |  |  |  | 2,682 |
State |  |  | (1,529) |  |  |  | (177) |  |  |  | (713) |
Subtotal |  |  | 926 |  |  |  | 3,699 |  |  |  | 1,969 |
Income tax expense |  | $ | 10,782 |  |  | $ | 25,294 |  |  | $ | 11,776 |
The Tax Cuts and Jobs Act of 2017 (“the Act”) was signed into law on December 22, 2017. As a result of the Act, the Company recorded a net tax charge of $4.8 million primarily due to a re-measurement of deferred tax assets and liabilities. On July 1, 2018 New Jersey Governor Phil Murphy signed Assembly Bill 4202 (“the Bill”) into law. The legislation imposes a temporary surtax on corporations earning New Jersey allocated income in excess of $1 million of 2.5% for tax years beginning on or after January 1, 2018 through December 31, 2019, and of 1.5% for tax years beginning on or after January 1, 2020 through December 31, 2021. The legislation also requires combined filing for members of an affiliated group for tax years beginning on or after January 1, 2019, changing New Jersey’s current status as a separate return state, and limits the deductibility of dividends received. These changes are not temporary. Although regulations implementing the legislative changes have not yet been issued, it is possible that the Company will lose the benefit of at least certain of its tax management strategies, and, if so, our total tax expense will likely increase. As a result of the Bill the Company recorded a net tax benefit of $0.6 million primarily due to a re-measurement of deferred tax assets and liabilities. Actual income tax expense differs from the tax computed based on pre-tax income and the applicable statutory federal tax rate for the following reasons (dollars in thousands):
|  | 2018 |  |  | 2017 |  |  | 2016 |
Income before income tax expense |  | $ | 71,134 |  |  | $ | 68,514 |  |  | $ | 42,858 |
Federal statutory rate |  |  | 21 | % |  |  | 35 | % |  |  | 35 | %
Computed “expected” Federal income tax expense |  |  | 14,938 |  |  |  | 23,980 |  |  |  | 15,000 |
State tax, net of federal tax benefit |  |  | 1,104 |  |  |  | 213 |  |  |  | (701) |
Impact of “the Act” |  |  | (790) |  |  |  | 5,623 |  |  |  | - |
Impact of “the Bill” |  |  | (618) |  |  |  | - |  |  |  | - |
Bank owned life insurance |  |  | (650) |  |  |  | (1,113) |  |  |  | (896) |
Tax-exempt interest and dividends |  |  | (1,521) |  |  |  | (2,123) |  |  |  | (1,714) |
Tax benefits from stock based compensation |  |  | (1,100) |  |  |  | (348) |  |  |  | - |
Other, net |  |  | (581) |  |  |  | (938) |  |  |  | 87 |
Income tax expense |  | $ | 10,782 |  |  | $ | 25,294 |  |  | $ | 11,776 |
The tax effects of temporary differences that give rise to significant portions of the deferred tax asset and deferred tax liability at December 31, 2018 and 2017 are presented in the following table:
|  | 2018 |  |  | 2017 |
|  | (dollars in thousands) |
Deferred tax assets |  |  |  |  |  |  |  |
Allowance for loan losses |  |  | 10,358 |  |  |  | 8,848 |
Purchase accounting |  |  | 307 |  |  |  | 2,310 |
Pension actuarial losses |  |  | 2,203 |  |  |  | 1,647 |
New Jersey net operating loss |  |  | 2,796 |  |  |  | 1,310 |
Deferred compensation |  |  | 1,234 |  |  |  | 1,184 |
Unrealized losses on securities and swaps |  |  | 1,620 |  |  |  | 483 |
Deferred loan costs, net of fees |  |  | 19 |  |  |  | 474 |
Accrued rent |  |  | 426 |  |  |  | 459 |
Capital lease |  |  | 232 |  |  |  | 211 |
Nonaccrual interest |  |  | 95 |  |  |  | 158 |
Other |  |  | - |  |  |  | 7 |
Total deferred tax assets |  | $ | 19,290 |  |  | $ | 17,091 |
Deferred tax liabilities |  |  |  |  |  |  |  |
Employee benefit plans |  | $ | (2,167) |  |  | $ | (1,501) |
Depreciation |  |  | (512) |  |  |  | (434) |
Prepaid expenses |  |  | (185) |  |  |  | (174) |
Market discount accretion |  |  | (414) |  |  |  | (60) |
Unrealized gains on securities and swaps |  |  | (366) |  |  |  | (224) |
Other |  |  | (198) |  |  |  | (28) |
Total deferred tax liabilities |  |  | (3,842) |  |  |  | (2,421) |
Net deferred tax assets |  | $ | 15,448 |  |  | $ | 14,670 |
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 for state purposes is dependent upon the generation of future taxable income during periods in which those temporary differences become deductible, while for Federal purposes the deferred tax assets can also be realized through tax carrybacks. Management considers the scheduled reversal of deferred tax liabilities, the projected future taxable income, and tax planning strategies in making this assessment. During 2018 and 2017, based on the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, the Company believes the net deferred tax assets are more likely than not to be realized. There are no unrecorded tax benefits and the Company does not expect the total amount of unrecognized income tax benefits to significantly increase in the next twelve months. The Company’s federal income tax returns are open and subject to examination from the 2015 tax return year and forward. The Company’s state income tax returns are generally open from the 2014 and later tax return years based on individual state statutes of limitations.

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 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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration