Quarterly report pursuant to Section 13 or 15(d)

FEDERAL INCOME TAXES (Tables)

v3.19.3
FEDERAL INCOME TAXES (Tables)
9 Months Ended
Sep. 30, 2019
FEDERAL INCOME TAXES [Abstract]  
Income Tax Expense
Income tax expense was as follows (dollars in thousands):

   
Three Months
Ended
September 30,
2019
   
Three Months
Ended
September 30,
2018
   
Nine Months
Ended
September 30,
2019
   
Nine Months
Ended
September 30,
2018
 
Current
 
$
1,971
   
$
1,432
   
$
5,290
   
$
3,663
 
Deferred
   
(89
)
   
138
     
222
     
565
 
   
$
1,882
   
$
1,570
   
$
5,512
   
$
4,228
 
Difference between Financial Statement Tax Expense and Amount Computed by Applying Statutory Federal Tax Rate to Pretax Income
The difference between the financial statement tax expense and amount computed by applying the statutory federal tax rate to pretax income was reconciled as follows (dollars in thousands):

   
Three Months
Ended
September 30,
2019
   
Three Months
Ended
September 30,
2018
   
Nine Months
Ended
September 30,
2019
   
Nine Months
Ended
September 30,
2018
 
Statutory rate
   
21
%
   
21
%
   
21
%
   
21
%
Statutory rate applied to income before taxes
 
$
2,108
   
$
1,769
   
$
6,157
   
$
4,948
 
Deduct
                               
Tax-exempt interest income
   
(183
)
   
(171
)
   
(523
)
   
(533
)
Bank-owned life insurance
   
(53
)
   
(50
)
   
(155
)
   
(150
)
Other, net
   
10
     
22
     
33
     
(37
)
   
$
1,882
   
$
1,570
   
$
5,512
   
$
4,228
 
Deferred Tax Assets and Liabilities
The net deferred tax asset recorded included the following amounts of deferred tax assets and liabilities (dollars in thousands):

   
September 30,
2019
   
December 31,
2018
 
Deferred tax assets
           
Allowance for loan losses
 
$
3,601
   
$
3,544
 
Nonaccrual loan interest
   
195
     
268
 
Valuation allowance on other real estate owned
   
184
     
218
 
Unrealized loss on securities available for sale
   
     
606
 
Other
   
259
     
302
 
Gross deferred tax assets
   
4,239
     
4,938
 
Valuation allowance
   
(92
)
   
(92
)
Total net deferred tax assets
   
4,147
     
4,846
 
Deferred tax liabilities
               
Depreciation
   
(1,099
)
   
(1,005
)
Prepaid expenses
   
(200
)
   
(200
)
Unrealized gain on securities available for sale
   
(455
)
   
 
Other
   
(296
)
   
(261
)
Gross deferred tax liabilities
   
(2,050
)
   
(1,466
)
Net deferred tax asset
 
$
2,097
   
$
3,380