XML 39 R27.htm IDEA: XBRL DOCUMENT
v3.25.0.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | Note 15. 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) |  | 2024 |  |  | 2023 |
Income tax at federal statutory rate |  | $ | (3,466 | ) |  |  | 21.0 | % |  | $ | (12,358 | ) |  |  | 21.0 | %
(Decrease) increase resulting from: |  |  |  |  |  |  |  |  |  |  |  |
State income taxes, net of federal tax effect |  |  | (398 | ) |  |  | 2.4 | % |  |  | 72 |  |  |  | (0.1 | %)
Tax-exempt interest income |  |  | (29 | ) |  |  | 0.2 | % |  |  | (50 | ) |  |  | 0.1 | %
Tax-exempt BOLI income |  |  | (180 | ) |  |  | 1.1 | % |  |  | (251 | ) |  |  | 0.4 | %
Taxable gain and nondeductible penalties due to BOLI surrender |  |  | 2,215 |  |  |  | (13.4 | %) |  |  | — |  |  |  | — |
Impairment of goodwill |  |  | — |  |  |  | — |  |  |  | 5,348 |  |  |  | (9.1 | %)
Equity compensation |  |  | 278 |  |  |  | (1.7 | %) |  |  | 156 |  |  |  | (0.3 | %)
Other permanent differences |  |  | 458 |  |  |  | (2.8 | %) |  |  | 12 |  |  |  | (— | %)
Total benefit for income taxes |  | $ | (1,122 | ) |  |  | 6.8 | % |  | $ | (7,071 | ) |  |  | 12.0 | %
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) |  | 2024 |  |  | 2023 |
Current tax provision (benefit) |  |  |  |  |  |
Federal |  | $ | 5,046 |  |  | $ | 165 |
State |  |  | 18 |  |  |  | (181 | )
Total current tax provision (benefit) |  |  | 5,064 |  |  |  | (16 | )
Deferred tax benefit |  |  |  |  |  |
Federal |  |  | (5,785 | ) |  |  | (7,048 | )
State |  |  | (401 | ) |  |  | (7 | )
Total deferred tax benefit |  |  | (6,186 | ) |  |  | (7,055 | )
Total benefit for income taxes |  | $ | (1,122 | ) |  | $ | (7,071 | )
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) |  | 2024 |  |  | 2023 |
Deferred tax assets relating to: |  |  |  |  |  |
Allowance for credit losses |  | $ | 5,138 |  |  | $ | 7,857 |
Compensation differences |  |  | 1,391 |  |  |  | 1,349 |
Reserves for unfunded loan commitments, sold loan buy backs, and MSR assets sale recourse obligations |  |  | 721 |  |  |  | 904 |
Purchase accounting adjustments |  |  | 772 |  |  |  | 862 |
Net operating loss |  |  | 10,375 |  |  |  | 5,161 |
Pass-through entities |  |  | — |  |  |  | 624 |
Unrealized losses on securities available for sale |  |  | 12,392 |  |  |  | 12,822 |
Other |  |  | 2,398 |  |  |  | 5,061 |
Total deferred tax assets |  |  | 33,187 |  |  |  | 34,640 |
Deferred tax liabilities relating to: |  |  |  |  |  |
Premises and equipment, net |  |  | (2,424 | ) |  |  | (2,102 | )
Core deposit and other intangible assets |  |  | (554 | ) |  |  | (807 | )
MSR assets |  |  | (86 | ) |  |  | (5,935 | )
Unrealized gains on other investments |  |  | (512 | ) |  |  | (2,224 | )
Pass-through entities |  |  | (463 | ) |  |  | — |
Other |  |  | (1,836 | ) |  |  | (2,016 | )
Total deferred tax liabilities |  |  | (5,875 | ) |  |  | (13,084 | )
Deferred tax asset, net |  | $ | 27,312 |  |  | $ | 21,556 |
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, 2024, 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 $33.2 million and $34.6 million at December 31, 2024 and 2023, respectively. As of December 31, 2024, 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. As of December 31, 2024, the Company had an estimated gross federal net operating loss of approximately $48.1 million, which can be carried forward indefinitely, the tax effect of which is included in the $10.4 million deferred tax asset for net operating losses. However, due to the Private Placements, the Company experienced an ownership change on April 3, 2024, for federal income tax purposes, which, among other effects, will subject its pre-change net operating losses to annual limitations under Section 382 of the Internal Revenue Code. Following the ownership change, the Company recognized estimated built-in tax losses of $22.8 million, a component of the $48.1 million estimated gross federal net operating loss as of and for the year ended December 31, 2024. The estimated annual limitation was $1.4 million for 2024 and $1.8 million for subsequent tax years. As of December 31, 2024 and 2023, the Company had no uncertain tax positions. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2020.

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