OPERATING LEASES

12 Months Ended

Dec. 31, 2023

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


	Year Ended December 31,
		2023		2022		2021		Statement of Operations Classification
		(In thousands)
Lease costs		$	10,414	$	10,467	$	11,417	Occupancy and equipment
Variable lease costs		1,452		1,529		1,881		Occupancy and equipment
Short-term lease costs		529		565		859		Occupancy and equipment
Lease income		(123)		(226)		(442)		Occupancy and equipment
Total lease costs		$	12,272	$	12,335	$	13,715

Operating Lease Assets and Liabilities


	December 31,
	2023		2022		Statement of Financial Condition Classification
	(In thousands)
Right-of-use assets	$	21,725	$	25,363	Operating lease right-of-use assets
Lease Liabilities	$	24,029	$	27,370	Operating leases liabilities


	December 31,
	2023		2022
	(In thousands)
Weighted-average remaining lease term	5.1 years		5.1 years
Weighted-average discount rate	7.0	%	6.8	%

Future minimum payments for operating leases with initial or remaining terms of one year or more as of December 31, 2023 were as follows:


	Minimum Rent
As of December 31, 2023	(In thousands)
2024	$	8,298
2025	6,122
2026	4,019
2027	3,180
2028	2,383
Thereafter	5,150
Total lease payments	$	29,152
Less imputed interest	5,123
Present value of lease liabilities	$	24,029

OFG, as lessor, leases and subleases real property to tenants under operating leases. As of December 31, 2023, no material lease concessions have been granted to tenants. As of December 31, 2023, OFG, as lessee, has not requested any lease concessions.