Annual report pursuant to Section 13 and 15(d)

INCOME TAXES (Tables)

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INCOME TAXES (Tables)
12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Schedule of Deferred Tax Assets and Liabilities

Significant components of the Company’s net deferred tax assets and liabilities consist of the following as of December 31, (dollars in thousands):

    

2023

    

2022

Deferred tax assets:

 

  

 

  

AFS securities

$

81,507

$

96,732

ACL

 

32,505

 

27,260

NOL carryforwards

 

28,113

 

38,932

Lease liabilities

 

18,283

 

11,982

Cash flow hedges

11,422

14,517

Employee compensation and benefit plans

 

8,935

 

5,739

Other

 

10,695

 

9,361

Total deferred tax assets

191,460

204,523

Deferred tax liabilities:

 

  

 

  

Premises and equipment

59,561

59,173

Lease ROU asset

16,427

8,846

Intangibles

 

6,037

 

7,778

Other

 

4,751

 

4,561

Total deferred tax liabilities

 

86,776

 

80,358

Net deferred tax assets

$

104,684

$

124,165

Summary of NOL and Other Carryforwards

The NOL and other carryforwards at December 31, were as follows (dollars in thousands):

Expiration

    

2023

    

Year

NOL carryforwards – federal (1) (2)

$

50,757

 

2031-2037

NOL carryforwards – federal (1)

19,902

N/A

NOL carryforwards – states

208,427

2028-2038

NOL carryforwards – states

152,304

N/A

Other carryforwards – federal

3,329

2029

N/A – not applicable as the NOL can be carried forward indefinitely

(1) The Company acquired a portion of these carryforwards and will be subject to limitations that could limit the Company’s utilization in future periods.

(2) Included in this balance are recognized built in loss carryforwards that are subject to the same limitations as net operating loss carryforwards.

Summary of Components of Income Tax Expense

The components of income tax expense (benefit) for the years ended December 31, were as follows (dollars in thousands):

    

2023

    

2022

    

2021

Current income tax expense:

Federal

$

33,374

$

19,285

$

10,291

State

2,538

1,104

1,039

Total current income tax expense

35,912

20,389

11,330

Deferred tax expense (benefit):

Federal

3,646

25,145

44,405

State

(1,475)

(90)

(893)

Total deferred income tax expense (1)

2,171

25,055

43,512

Total income tax expense

$

38,083

$

45,444

$

54,842

(1) Does not reflect the deferred tax effects of unrealized gains and losses on AFS securities, unrealized gains and losses for AFS securities transferred to HTM, unrealized gains and losses on BOLI or changes in fair values of cash flow hedges that are included in Accumulated Other Comprehensive (Loss) Income. Refer to Note 11 “Stockholders’ Equity” in this Form 10-K for additional information.

Schedule of Income Tax Expense, Difference in Income Tax Rate to Pretax Income

Income tax expense for 2023, 2022, and 2021 varies from the amount computed by applying the statutory U.S. federal income tax rate to income before income taxes. A reconciliation between the expected and actual income tax expense, and resulting effective tax rate, is presented in the following table for the years ended December 31, (dollars in thousands):

    

2023

    

2022

    

2021

Expected federal income tax expense

$

50,361

$

58,790

$

66,939

Increase (decrease) in taxes resulting from:

 

  

 

  

 

  

State income tax expense (benefit), net of federal effect

 

530

 

782

 

(72)

Tax-exempt income, net of expense disallowance

(11,123)

(11,615)

(9,820)

Bank owned life insurance

(2,469)

(2,415)

(2,412)

Other, net

 

784

 

(98)

 

207

Total income tax expense

$

38,083

$

45,444

$

54,842

Effective income tax rate

15.9%

16.2%

17.2%