Income Taxes (Tables)

12 Months Ended

Dec. 31, 2025

Schedule of Components of Income Tax Expense (Benefit)

The components of income tax expense (benefit) are as follows:


	For the Years Ended December 31,
(In thousands)	2025		2024		2023
Current:
Federal	$	140	$	5,162	$	5,964
State	240		612		1,087
Foreign	71		160		(193)
Deferred:
Federal	6,244		(891)		(242)
State	952		(156)		(42)
Total income tax expense	$	7,647	$	4,887	$	6,574

Income tax expense (benefit) broken out between Federal, state and foreign is as follows:


	For the Years Ended December 31,
(In thousands)	2025		2024		2023
Federal	$	6,384	$	4,271	$	5,722
State	1,192		456		1,045
Foreign	71		160		(193)
Total income tax expense	$	7,647	$	4,887	$	6,574

The Company adopted ASU 2023-09 on a prospective basis on January 1, 2025. The following table presents required disclosure pursuant to ASU 2023-09 and reconciles the expected income tax expense (benefit) and effective tax rate, computed by applying the effective statutory rate of 21% for the year ended December 31, 2025 as follows:


	For the Year Ended December 31, 2025
(In thousands)	Amount		Percent
U.S federal statutory tax rate	$	8,112	21.0	%
State and local income taxes, net of federal income tax effect (1)	942		2.4	%
Foreign tax effects	71		0.2	%

Tax credits	(431)		(1.1)	%



Nontaxable or nondeductible items:
Tax-exempt income	(1,246)		(3.3)	%
Share-based compensation adjustment	160		0.4	%
Other, net	39		0.1	%
Total income tax expense	$	7,647	19.7	%


(1)			State taxes in Missouri and California made up the majority (greater than 50%) of the tax effect in this category.

The following table presents the required disclosures prior to the Company's adoption of ASU 2023-09 and reconciles the expected income tax expense (benefit), computed by applying the effective federal statutory rate of 21% for each year to income before income tax expense is as follows:


	For the Years Ended
(In thousands)	2024		2023
Expected income tax expense	$	4,898	$	7,278
(Reductions) increases resulting from:
Tax-exempt income	(1,045)		(1,104)
State taxes, net of federal benefit	355		801
Share-based compensation adjustment	316		298
Early surrender of bank-owned life insurance	279		—
Federal tax credits	(397)		(643)
Other, net	481		(56)
Total income tax expense	$	4,887	$	6,574

Income tax expense in 2025 totaled $7.6 million compared to $4.9 million in 2024 and $6.6 million in 2023. When measured as a percent of pre-tax income, the Company’s effective tax rate was 19.7% in 2025, 20.8% in 2024, and 19.1% in 2023.

The tax effects of temporary differences which give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below:


	December 31,
(In thousands)	2025		2024
Deferred tax assets:
Allowance for credit losses	$	3,236	$	3,188
Supplemental executive retirement plan accrual	2,286		2,345
Stock compensation	2,819		2,623
Unrealized loss on investment securities available-for-sale (1)	8,266		14,205
Research and development expenses	—		760
Lease liability	1,073		1,774
Other	497		718
Total deferred tax assets	$	18,177	$	25,613
Deferred tax liabilities:
Premises and equipment	$	(988)	$	(986)
ASC 715 supplemental executive retirement plan asset	(249)		(249)
Research and development expenses	(4,711)		—
Intangible assets	(968)		(1,900)

Right of use asset	(1,038)		(1,677)
Prepaid expenses	(991)		(936)
Other	(541)		(391)
Total deferred tax liabilities	$	(9,486)	$	(6,139)
Net deferred tax assets	$	8,691	$	19,474

(1)The deferred tax asset associated with the unrealized losses on investment securities is mainly a result of changes in interest rates, and the unrealized losses are considered to be temporary as the fair value is expected to recover as the investment securities approach their respective maturity dates. The issuers of the investment securities are of high credit quality and all principal amounts are expected to be paid when the investment securities mature. The Company does not intend to sell and it is more likely than not that the Company will not be required to sell the securities prior to their anticipated recovery.

A valuation allowance would be provided on deferred tax assets when it is more likely than not that some portion of the assets will not be realized. The Company has not established a valuation allowance at December 31, 2025 or 2024, due to management’s belief that it is more likely than not that the deferred tax asset is realizable.

Schedule of Unrecognized Tax Benefits Roll Forward

The reconciliation of the beginning unrecognized tax benefits balance to the ending balance is presented in the following table:


(In thousands)	2025		2024		2023
Balance at January 1	$	1,257	$	1,397	$	1,252
Changes in unrecognized tax benefits as a result of tax positions taken during a prior year	(52)		(151)		99
Changes in unrecognized tax benefits as a result of tax position taken during the current year	181		262		300
Reductions to unrecognized tax benefits as a result of a lapse of the applicable statute of limitations	(195)		(251)		(254)

Balance at December 31	$	1,191	$	1,257	$	1,397

Schedule of Cash Flow, Supplemental Disclosures

The Company adopted ASU 2023-09 on a prospective basis on January 1, 2025. The following table represents net income taxes paid (refunded), disaggregated by federal, state, and foreign taxes, including income taxes paid (refunded) in individual jurisdictions that are equal to or greater than 5% of total income taxes paid:


	For the Year Ended December 31,
(In thousands)	2025
U.S. federal income taxes paid	$	4,103
State income taxes paid
California income taxes paid	290
Other state income taxes paid	645
Total state income taxes paid	935


Total foreign income taxes paid	98
Total income taxes paid	$	5,136