Annual report pursuant to Section 13 and 15(d)

FEDERAL INCOME TAXES (Tables)

v2.4.0.8
FEDERAL INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2013
FEDERAL INCOME TAXES [Abstract]  
Income tax expense (benefit)
Income tax expense (benefit) was as follows (dollars in thousands):
 
 
  
2013
    
2012
    
2011
  
Current
  
$
120
    
$
275
    
$
(198
)
Deferred (benefit) expense
    
4,150
      
---
      
198
  
Valuation allowance - change in estimate
    
---
      
(18,858
)
    
---
  
 
  
$
4,270
    
$
(18,583
)
  
$
---
  
 
Difference between financial statement tax expense (benefit) 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):
 
 
  
2013
    
2012
    
2011
  
Statutory rate
    
35
%
    
35
%
    
35
%
Statutory rate applied to income before taxes
  
$
4,837
    
$
5,917
    
$
2,040
  
Add (deduct)
                        
Change in valuation allowance
    
---
      
(24,026
)
    
(1,624
)
Tax-exempt interest income
    
(244
)
    
(103
)
    
(10
)
Bank-owned life insurance
    
(250
)
    
(297
)
    
(330
)
Other, net
    
(73
)
    
(74
)
    
(76
)
 
  
$
4,270
    
$
(18,583
)
  
$
---
  

Deferred tax assets and liabilities
The net deferred tax asset recorded included the following amounts of deferred tax assets and liabilities (dollars in thousands):
 
 
  
2013
    
2012
  
Deferred tax assets
  
   
 
Allowance for loan losses
  
$
7,279
    
$
8,309
  
Nonaccrual loan interest
    
782
      
1,023
  
Valuation allowance on other real estate owned
    
5,847
      
6,356
  
Net operating loss carryforward
    
1,743
      
4,188
  
Unrealized loss on securities available for sale
    
1,053
      
---
  
Other
    
1,808
      
1,794
  
Gross deferred tax assets
    
18,512
      
21,670
  
Valuation allowance
    
---
      
---
  
Total net deferred tax assets
    
18,512
      
21,670
  
 
                
Deferred tax liabilities
                
Depreciation
    
(1,620
)
    
(1,693
)
Unrealized gain on securities available for sale
    
---
      
(517
)
Prepaid expenses
    
(308
)
    
(308
)
Other
    
(384
)
    
(372
)
Gross deferred tax liabilities
    
(2,312
)
    
(2,890
)
Net deferred tax asset
  
$
16,200
    
$
18,780