OPERATING LEASES

6 Months Ended

Jun. 30, 2022

Substantially all leases in which OFG is the lessee are comprised of real estate property for branches, ATM locations, and office space with terms extending through 2038. OFG’s leases do not contain residual value guarantees or material variable lease payments. All leases are classified as operating leases and are included on the consolidated statements of financial condition as a right-of-use asset and a corresponding lease liability. OFG leases to others certain space in its principal offices for terms extending through 2024; all are operating leases.

Operating Lease Cost


	Quarter Ended June 30,				Six-Month Period Ended June 30,
	2022		2021		2022		2021		Statement of Operations Classification
	(In thousands)
Lease costs	$	2,663	$	2,851	$	5,218	$	6,224	Occupancy and equipment
Variable lease costs	285		495		832		988		Occupancy and equipment
Short-term lease cost	282		126		537		146		Occupancy and equipment
Lease income	(53)		(112)		(129)		(232)		Occupancy and equipment
Total lease cost	$	3,177	$	3,360	$	6,458	$	7,126

Operating Lease Assets and Liabilities


	June 30,		December 31,
	2022		2021		Statement of Financial Condition Classification
	(In thousands)
Right-of-use assets	$	27,699	$	28,846	Operating lease right-of-use assets
Lease Liabilities	$	29,538	$	30,498	Operating leases liabilities


	June 30, 2022
	(In thousands)
Weighted-average remaining lease term	5.3 years
Weighted-average discount rate	6.6	%

Future minimum payments for operating leases with initial or remaining terms of one year or more as of June 30, 2022 were as follows:


	Minimum Rent
As of June 30, 2022	(In thousands)
2022	$	4,733
2023	8,771
2024	6,441
2025	4,612
2026	3,033
Thereafter	7,923
Total lease payments	$	35,513
Less imputed interest	5,975
Present value of lease liabilities	$	29,538

OFG, as lessor, leases and subleases real property to lessee tenants under operating leases. As of June 30, 2022, no material lease concessions have been granted to lessees. As of June 30, 2022, OFG, as lessee, has not requested any lease concessions.