Quarterly report pursuant to Section 13 or 15(d)

FEDERAL INCOME TAXES (Tables)

v3.20.2
FEDERAL INCOME TAXES (Tables)
6 Months Ended
Jun. 30, 2020
FEDERAL INCOME TAXES [Abstract]  
Income Tax Expense
Income tax expense was as follows (dollars in thousands):

   
Three Months
Ended
June 30, 2020
   
Three Months
Ended
June 30, 2019
   
Six Months
Ended
June 30, 2020
   
Six Months
Ended
June 30, 2019
 
Current
 
$
2,970
   
$
1,851
   
$
4,671
   
$
3,319
 
Deferred
   
(1,211
)
   
65
     
(1,483
)
   
311
 
   
$
1,759
   
$
1,916
   
$
3,188
   
$
3,630
 
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
June 30, 2020
   
Three Months
Ended
June 30, 2019
   
Six Months
Ended
June 30, 2020
   
Six Months
Ended
June 30, 2019
 
Statutory rate
   
21
%
   
21
%
   
21
%
   
21
%
Statutory rate applied to income before taxes
 
$
1,974
   
$
2,083
   
$
3,620
   
$
4,049
 
Deduct
                               
Tax-exempt interest income
   
(177
)
   
(173
)
   
(355
)
   
(340
)
Bank-owned life insurance
   
(48
)
   
(52
)
   
(99
)
   
(102
)
Other, net
   
10
     
58
     
22
     
23
 
   
$
1,759
   
$
1,916
   
$
3,188
   
$
3,630
 
Deferred Tax Assets and Liabilities
The net deferred tax asset recorded included the following amounts of deferred tax assets and liabilities (dollars in thousands):

   
June 30,
2020
   
December 31,
2019
 
Deferred tax assets
           
Allowance for loan losses
 
$
3,330
   
$
3,612
 
Net deferred loan fees
   
1,748
     
 
Nonaccrual loan interest
   
154
     
182
 
Valuation allowance on other real estate owned
   
83
     
76
 
Other
   
299
     
248
 
Gross deferred tax assets
   
5,614
     
4,118
 
Valuation allowance
   
(92
)
   
(92
)
Total net deferred tax assets
   
5,522
     
4,026
 
Deferred tax liabilities
               
Depreciation
   
(1,124
)
   
(1,053
)
Prepaid expenses
   
(171
)
   
(172
)
Unrealized gain on securities available for sale
   
(1,213
)
   
(406
)
Net deferred loan costs
   
     
(67
)
Other
   
(260
)
   
(250
)
Gross deferred tax liabilities
   
(2,768
)
   
(1,948
)
Net deferred tax asset
 
$
2,754
   
$
2,078