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8. Income Taxes
 12 Months Ended
Dec. 31, 2013
Income Tax Disclosure [Abstract]  
Income Taxes

The provision for income taxes is summarized as follows:

 

(Dollars in thousands)            
  2013   2012   2011  
Current $ 1,345   1,800   2,141  
Deferred   534   (213 ) (678 )
Total $ 1,879   1,587   1,463  

 

The differences between the provision for income taxes and the amount computed by applying the statutory federal income tax rate to earnings before income taxes are as follows:

 

(Dollars in thousands)            
  2013   2012   2011  
Pre-tax income at statutory rate (34%) $ 2,914   2,509   2,251  
Differences:              
Tax exempt interest income   (1,481 ) (1,168 ) (1,052 )
Nondeductible interest and other expense   141   52   62  
Cash surrender value of life insurance   (147 ) (149 ) (101 )
State taxes, net of federal benefits   428   324   233  
Nondeductible capital losses   -     -     49  
Other, net   24   19   21  
Total $ 1,879   1,587   1,463  

 

The following summarizes the tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities.  The net deferred tax asset is included as a component of other assets at December 31, 2013 and 2012.

 

(Dollars in thousands)      
  2013   2012
Deferred tax assets:      
Allowance for loan losses $ 5,205   5,560
Accrued retirement expense   1,489   1,409
Other real estate   218   628
Other   413   362
Unrealized loss on available for sale securities   747   -  
Total gross deferred tax assets   8,072   7,959
         
Deferred tax liabilities:        
Deferred loan fees   581   794
Premises and equipment   530   417
Unrealized gain on available for sale securities   -     3,581
Total gross deferred tax liabilities   1,111   4,792
Net deferred tax asset $ 6,961   3,167