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Income Taxes | 12 Months Ended
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Dec. 31, 2023
Income Tax Disclosure [Abstract] |
Income Taxes | Note 17. Income Taxes The following table presents the differences between the provision for income taxes at the federal statutory rate and the amounts computed as reported for the periods stated.
|  | For the years ended December 31, |
(Dollars in thousands) |  | 2023 |  |  | 2022 |  |  | 2021 |
Income tax at federal statutory rate |  | $ | (12,358 | ) |  |  | 21.0 | % |  | $ | 4,750 |  |  |  | 21.0 | % |  | $ | 14,317 |  |  |  | 21.0 | %
Increase (decrease) resulting from: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
State income taxes, net of federal tax effect |  |  | 72 |  |  |  | (0.1 | %) |  |  | 388 |  |  |  | 1.7 | % |  |  | 1,499 |  |  |  | 2.2 | %
Tax-exempt interest income |  |  | (50 | ) |  |  | 0.1 | % |  |  | (121 | ) |  |  | (0.5 | %) |  |  | (105 | ) |  |  | (0.2 | %)
Income from life insurance |  |  | (251 | ) |  |  | 0.4 | % |  |  | (283 | ) |  |  | (1.3 | %) |  |  | (196 | ) |  |  | (0.3 | %)
Impairment of goodwill |  |  | 5,348 |  |  |  | (9.1 | %) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Merger-related expenses |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 250 |  |  |  | 0.4 | %
Other permanent differences |  |  | 168 |  |  |  | (0.3 | %) |  |  | 554 |  |  |  | 2.4 | % |  |  | (64 | ) |  |  | (0.1 | %)
(Benefit) provision for income taxes |  | $ | (7,071 | ) |  |  | 12.0 | % |  | $ | 5,288 |  |  |  | 23.3 | % |  | $ | 15,701 |  |  |  | 23.0 | %
The following table presents the significant components of the provision for income taxes for the periods stated.
|  | For the years ended December 31, |
(Dollars in thousands) |  | 2023 |  |  | 2022 |  |  | 2021 |
Current tax provision (benefit) |  |  |  |  |  |  |  |  |
Federal |  | $ | 165 |  |  | $ | 4,762 |  |  | $ | 12,832 |
State |  |  | (181 | ) |  |  | 546 |  |  |  | 946 |
Total current tax (benefit) provision |  |  | (16 | ) |  |  | 5,308 |  |  |  | 13,778 |
Deferred tax provision (benefit) |  |  |  |  |  |  |  |  |
Federal |  |  | (7,048 | ) |  |  | 185 |  |  |  | 971 |
State |  |  | (7 | ) |  |  | (205 | ) |  |  | 952 |
Total deferred tax (benefit) provision |  |  | (7,055 | ) |  |  | (20 | ) |  |  | 1,923 |
(Benefit) provision for income taxes |  | $ | (7,071 | ) |  | $ | 5,288 |  |  | $ | 15,701 |
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The following table presents significant components of deferred tax assets and liabilities as of the dates stated.
|  | December 31, |
(Dollars in thousands) |  | 2023 |  |  | 2022 |
Deferred tax assets relating to: |  |  |  |  |  |
Allowance for credit losses |  | $ | 7,857 |  |  | $ | 6,869 |
Compensation differences |  |  | 1,349 |  |  |  | 1,340 |
Reserve for unfunded loan commitments and sold loan buy backs |  |  | 904 |  |  |  | 640 |
Acquisition accounting adjustments |  |  | 862 |  |  |  | 1,522 |
Net operating loss |  |  | 5,161 |  |  |  | — |
Pass-through entities |  |  | 624 |  |  |  | 114 |
Unrealized losses on securities available for sale |  |  | 12,822 |  |  |  | 13,149 |
Other |  |  | 5,061 |  |  |  | 2,017 |
Total deferred tax assets |  |  | 34,640 |  |  |  | 25,651 |
Deferred tax liabilities relating to: |  |  |  |  |  |
Premises and equipment, net |  |  | (2,102 | ) |  |  | (2,191 | )
Core deposit and customer-based intangible assets |  |  | (807 | ) |  |  | (1,179 | )
Mortgage servicing rights |  |  | (5,935 | ) |  |  | (6,478 | )
Unrealized gains on other investments |  |  | (2,224 | ) |  |  | (3,491 | )
Other |  |  | (2,016 | ) |  |  | (85 | )
Total deferred tax liabilities |  |  | (13,084 | ) |  |  | (13,424 | )
Deferred tax asset, net |  | $ | 21,556 |  |  | $ | 12,227 |
Deferred income tax assets and liabilities are measured at the enacted tax rate for the period in which they are expected to reverse; therefore, as of December 31, 2023, they have been measured using the federal income tax rate enacted o f 21% and applicable state income tax rates. The Company’s deferred tax asset was $34.6 million and $25.7 million at December 31, 2023 and 2022, respectively. As of December 31, 2023, management concluded that the Company’s deferred tax assets were fully realizable, and accordingly, no valuation allowance was recorded. The Company will continue to monitor deferred tax assets to evaluate whether it will be able to realize the full benefit of the deferred tax asset or whether there is need for a valuation allowance. Significant negative trends in asset credit quality, losses from operations, or other factors could impact the realization of the deferred tax asset in the future. At December 31, 2023, the Company had an estimated federal net operating loss of approximately $24.4 million, which originated in the year ended December 31, 2023 and can be carried forward indefinitely. As of December 31, 2023 and 2022, the Company had no uncertain tax positions.

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