Income Taxes (Tables)

12 Months Ended

Dec. 31, 2025

Income tax expense consisted of the following for the year ended December 31, 2025. The Company does not have pretax income from continuing foreign operations or foreign tax expense.


	2025		2024		2023

	(Dollars in thousands)
Currently tax expense:
Federal	$	14,797	$	9,639	$	15,888
State	8,424		6,029		9,241
Total current tax	23,221		15,668		25,129
Deferred tax expense (benefit):
Federal	(2,199)		582		616
State	(1,063)		(104)		231
Total deferred tax	(3,262)		478		847
Income tax expense	$	19,959	$	16,146	$	25,976

Schedule of Effective Tax Rate

The effective tax rate differs from the Federal statutory rate for the years ended December 31, as follows:


	2025				2024				2023
	(Dollars in thousands)
	Amount		Percent		Amount		Percent		Amount		Percent
Income before income tax expense	$	67,789	N/A		$	56,674	N/A		$	90,419	N/A
Income tax expense components:
Statutory Federal income tax rate	14,235		21.0	%	11,902		21.0	%	18,988		21.0	%
State income taxes, net of federal tax benefit (1)	5,818		8.6	%	4,675		8.3	%	7,478		8.3	%
Tax credits:
Low income housing credits, net of investment losses	(197)		(0.3)	%	(124)		(0.2)	%	(139)		(0.2)	%
Nontaxable or nondeductible items:
Merger related costs	424		0.6	%	—		—	%	—		—	%
Non-taxable interest income	(165)		(0.2)	%	(177)		(0.3)	%	(187)		(0.2)	%
Increase in cash surrender value of life insurance	(465)		(0.7)	%	(440)		(0.8)	%	(426)		(0.5)	%
Stock option/restricted stock windfall tax benefit	(77)		(0.1)	%	280		(0.2)	%	54		0.1	%
Other, net	386		0.5	%	30		0.7	%	208		0.2	%
Income tax expense and effective tax rate	$	19,959	29.4	%	$	16,146	28.5	%	$	25,976	28.7	%

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

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Schedule of Income Taxes Paid, Net of Refunds Received

Income taxes paid, net of refunds received, for the year ended December 31 were as follows:


	2025		2024
	(Dollars in thousands)
Federal	$	13,700	$	7,800
State and local:
California	7,650		5,100
Other states	108		319
Total income tax expense	$	21,458	$	13,219

Schedule of Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities that result from the tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes at December 31, are as follows:


	2025		2024

	(Dollars in thousands)
Deferred tax assets:
Allowance for credit losses on loans	$	14,687	$	14,380
Lease accounting	8,363		8,979
Defined postretirement benefit obligation	7,583		7,451
Accrued expenses	5,510		3,241
State income taxes	1,688		1,266
Stock compensation	1,427		1,647
Premises and equipment	1,230		1,267
California net operating loss carryforwards	986		986
Federal net operating loss carryforwards	894		1,148
Split-dollar life insurance benefit plan	79		75
Nonaccrual interest	59		97
Securities available-for-sale	—		1,483
Other	225		296
Total deferred tax assets	42,731		42,316

Deferred tax liabilities:
Lease accounting	(8,363)		(8,979)
Loan fees	(2,385)		(2,265)
Intangible liabilities	(1,002)		(1,337)
Prepaid expenses	(757)		(1,531)
Securities available-for-sale	(159)		—
FHLB stock	(156)		(156)
I/O strips	(5)		(19)
Other	(213)		(212)
Total deferred tax liabilities	(13,040)		(14,499)
Net deferred tax assets	$	29,691	$	27,817

Schedule of Carrying Amount of Low Income Tax Housing Investment

The following table reflects the carrying amounts of the low income housing investments included in accrued interest receivable and other assets, and the future commitments included in accrued interest payable and other liabilities for the periods indicated:


	December 31, 2025		December 31, 2024

	(Dollars in thousands)
Low income housing investments	$	4,709	$	2,201
Future commitments	$	2,695	$	475