OPERATING LEASES

3 Months Ended

Sep. 30, 2022

OPERATING LEASES - LESSOR

First Financial provides financing for various types of equipment through a variety of leasing arrangements. Operating leases are carried at cost less accumulated depreciation in the Consolidated Balance Sheets. Operating leases were $84.9 million and $60.8 million at September 30, 2022 and December 31, 2021, respectively, net of accumulated depreciation of $35.9 million and $25.5 million at September 30, 2022 and December 31, 2021, respectively. The Company recorded lease income of $7.0 million and $17.3 million related to lease payments for operating leases in leasing business revenue in the Consolidated Statement of Income for the three and nine months ended September 30, 2022, respectively. Depreciation expense related to operating lease equipment was $5.7 million and $14.3 million for the three and nine months ended September 30, 2022, respectively.

First Financial performs assessments of the recoverability of long-lived assets when events or changes in circumstances indicate that their carrying values may not be recoverable. First Financial recognized no impairment losses associated with operating lease assets for the three or nine months ended September 30, 2022. Recognized impairment losses, if any, would be recorded in Leasing business income in the Consolidated Statements of Income.

The future lease payments receivable from operating leases as of September 30, 2022 are as follows:



(Dollars in thousands)	Undiscounted cash flows
2022 (remaining three months)	$	6,998
2023	25,445
2024	18,286
2025	8,906
2026	3,736
Thereafter	749
Total operating lease payments	$	64,120