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Leases

3 Months Ended

Mar. 31, 2022

Note 9 — Leases

As of March 31, 2022 and December 31, 2021, we had operating right-of-use (“ROU”) assets of $118.4 million and $110.3 million, respectively, and operating lease liabilities of $125.9 million and $115.9 million, respectively. We maintain operating leases on land and buildings for some of our operating centers, branch facilities and ATM locations. Most leases include one or more options to renew, with renewal terms extending up to 22 years. The exercise of renewal options is based on the sole judgment of management and what they consider to be reasonably certain given the environment today. Factors in determining whether an option is reasonably certain of exercise include, but are not limited to, the value of leasehold improvements, the value of renewal rate compared to market rates, and the presence of factors that would cause a significant economic penalty to us if the option is not exercised. Leases with an initial term of 12 months or less are not recorded on the balance sheet and instead are recognized in lease expense on a straight-line basis over the lease term.

The Company also holds a small number of finance leases assumed in connection to the CSFL merger. These leases are all real estate leases. Terms and conditions are similar to those real estate operating leases described above. Lease classifications from the acquired institutions were retained.


	Three Months Ended
(Dollars in thousands)	March 31,
	2022		2021
Lease Cost Components:
Amortization of ROU assets - finance leases	$	117	$	117
Interest on lease liabilities - finance leases		13		15
Operating lease cost (cost resulting from lease payments)		4,333		4,343
Short-term lease cost		143		135
Variable lease cost (cost excluded from lease payments)		437		648
Total lease cost	$	5,043	$	5,258
Supplemental Cash Flow and Other Information Related to Leases:
Finance lease - operating cash flows	$	13	$	15
Finance lease - financing cash flows		108		106
Operating lease - operating cash flows (fixed payments)		4,181		4,140
Operating lease - operating cash flows (net change asset/liability)		(3,303)		(3,220)
New ROU assets - operating leases		12,428		1,298
New ROU assets - finance leases		—		—
Weighted - average remaining lease term (years) - finance leases		6.17		7.16
Weighted - average remaining lease term (years) - operating leases		10.47		11.30
Weighted - average discount rate - finance leases		1.7%		1.7%
Weighted - average discount rate - operating leases		3.0%		3.3%

Operating lease payments due:
2022 (excluding the quarter ended March 31, 2022)	$	12,844
2023		16,367
2024		14,987
2025		13,559
2026		12,997
Thereafter		79,262
Total undiscounted cash flows		150,016
Discount on cash flows		(24,097)
Total operating lease liabilities	$	125,919

As of March 31, 2022, we determined that the number and dollar amount of our equipment leases was immaterial. As of March 31, 2022, we have no additional operating leases that have not yet commenced.