Annual report pursuant to Section 13 and 15(d)

FEDERAL INCOME TAXES (Tables)

v3.22.0.1
FEDERAL INCOME TAXES (Tables)
12 Months Ended
Dec. 31, 2021
FEDERAL INCOME TAXES [Abstract]  
Income Tax Expense
Income tax expense was as follows (dollars in thousands):

   
2021
   
2020
 
Current
 
$
5,615
   
$
7,318
 
Deferred
   
1,095
     
(603
)
Change in valuation allowance
   
     
(92
)
   
$
6,710
   
$
6,623
 
Reconciliation of 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):

   
2021
   
2020
 
Statutory rate
   
21
%
   
21
%
Statutory rate applied to income before taxes
 
$
7,502
   
$
7,726
 
Adjust for:
               
Tax-exempt interest income
   
(642
)
   
(700
)
Bank-owned life insurance
   
(217
)
   
(184
)
Change in valuation allowance
   
     
(92
)
Other, net
   
67
     
(127
)
   
$
6,710
   
$
6,623
 
Deferred Tax Assets and Liabilities
The net deferred tax asset recorded included the following amounts of deferred tax assets and liabilities (dollars in thousands):

   
2021
   
2020
 
Deferred tax assets
           
Allowance for loan losses
 
$
3,337
   
$
3,656
 
Net deferred loan fees
 

275
     
822
 
Nonaccrual loan interest
   
57
     
120
 
Valuation allowance on other real estate owned and property held for sale
   
6
     
41
 
Unrealized loss on securities available for sale
   
79
     
 
Other
   
311
     
499
 
Gross deferred tax assets
   
4,065
     
5,138
 
Valuation allowance
   
     
Total net deferred tax assets
   
4,065
     
5,138
 
                 
Deferred tax liabilities
               
Depreciation
 
$
(1,199
)
 
$
(1,285
)
Prepaid expenses
   
(288
)
   
(170
)
Unrealized gain on securities available for sale
   
   
(1,120
)
Net deferred loan costs
   
     
Other
   
(415
)
   
(504
)
Gross deferred tax liabilities
   
(1,902
)
   
(3,079
)
Net deferred tax asset
 
$
2,163
   
$
2,059