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OPERATING LEASES
 3 Months Ended
Mar. 31, 2023
Leases [Abstract]  
LEASES
13. OPERATING LEASES

We lease certain land and buildings for our bank branches and ATMs. In some instances, a lease may contain renewal options to extend the term of the lease. Renewal options that are likely to be exercised have been recognized as part of our right-of-use assets and lease liabilities in accordance with ASC 842, "Leases". Certain leases also contain variable payments that are primarily determined based on common area maintenance costs and Hawaii state tax rates. All leases are operating leases and we do not include any short term leases in the calculation of the right-of-use assets and lease liabilities. The most significant assumption related to the Company’s application of ASC 842 was the discount rate assumption. As most of the Company’s lease agreements do not provide for an implicit interest rate, the Company uses the collateralized interest rate that the Company would have to pay to borrow over a similar term to estimate the Company’s lease liability.
Total lease cost, cash flow information, weighted-average remaining lease term and weighted-average discount rate is summarized below for the period indicated:

Three Months Ended March 31,
(dollars in thousands)20232022
Lease cost:
Operating lease cost$1,325 $1,390 
Variable lease cost888 830 
Less: Sublease income(17)(12)
Total lease cost$2,196 $2,208 
Other information:
Operating cash flows from operating leases$(1,390)$(1,506)
Weighted-average remaining lease term - operating leases  11.22 years 11.49 years
Weighted-average discount rate - operating leases3.96 %3.92 %

The following is a schedule of annual undiscounted cash flows for our operating leases and a reconciliation of those cash flows to the operating lease liabilities for the remainder of fiscal year 2023, the next five succeeding fiscal years and all years thereafter:
(dollars in thousands)Undiscounted Cash FlowsLease Liability Discount on Cash FlowsLease Liability
Year Ending December 31,
2023 (remainder)$3,736 $994 $2,742 
20244,467 1,210 3,257 
20254,181 1,085 3,096 
20264,118 965 3,153 
20274,108 840 3,268 
20283,509 723 2,786 
Thereafter19,682 2,908 16,774 
Total $43,801 $8,725 $35,076 

In addition, the Company, as lessor, leases certain properties that it owns. All of these leases are operating leases. The following represents lease income related to these leases that was recognized for the period indicated:

Three Months Ended March 31,
(dollars in thousands)20232022
Total rental income recognized$562 $951 
Based on the Company's leases as lessor as of March 31, 2023, estimated lease payments for the remainder of fiscal year 2023, the next five succeeding fiscal years and all years thereafter are as follows:

(dollars in thousands)
Year Ending December 31,
2023 (remainder)$1,008 
20241,189 
20251,074 
2026939 
2027882 
2028532 
Thereafter1,839 
Total $7,463 
LEASES
13. OPERATING LEASES

We lease certain land and buildings for our bank branches and ATMs. In some instances, a lease may contain renewal options to extend the term of the lease. Renewal options that are likely to be exercised have been recognized as part of our right-of-use assets and lease liabilities in accordance with ASC 842, "Leases". Certain leases also contain variable payments that are primarily determined based on common area maintenance costs and Hawaii state tax rates. All leases are operating leases and we do not include any short term leases in the calculation of the right-of-use assets and lease liabilities. The most significant assumption related to the Company’s application of ASC 842 was the discount rate assumption. As most of the Company’s lease agreements do not provide for an implicit interest rate, the Company uses the collateralized interest rate that the Company would have to pay to borrow over a similar term to estimate the Company’s lease liability.
Total lease cost, cash flow information, weighted-average remaining lease term and weighted-average discount rate is summarized below for the period indicated:

Three Months Ended March 31,
(dollars in thousands)20232022
Lease cost:
Operating lease cost$1,325 $1,390 
Variable lease cost888 830 
Less: Sublease income(17)(12)
Total lease cost$2,196 $2,208 
Other information:
Operating cash flows from operating leases$(1,390)$(1,506)
Weighted-average remaining lease term - operating leases  11.22 years 11.49 years
Weighted-average discount rate - operating leases3.96 %3.92 %

The following is a schedule of annual undiscounted cash flows for our operating leases and a reconciliation of those cash flows to the operating lease liabilities for the remainder of fiscal year 2023, the next five succeeding fiscal years and all years thereafter:
(dollars in thousands)Undiscounted Cash FlowsLease Liability Discount on Cash FlowsLease Liability
Year Ending December 31,
2023 (remainder)$3,736 $994 $2,742 
20244,467 1,210 3,257 
20254,181 1,085 3,096 
20264,118 965 3,153 
20274,108 840 3,268 
20283,509 723 2,786 
Thereafter19,682 2,908 16,774 
Total $43,801 $8,725 $35,076 

In addition, the Company, as lessor, leases certain properties that it owns. All of these leases are operating leases. The following represents lease income related to these leases that was recognized for the period indicated:

Three Months Ended March 31,
(dollars in thousands)20232022
Total rental income recognized$562 $951 
Based on the Company's leases as lessor as of March 31, 2023, estimated lease payments for the remainder of fiscal year 2023, the next five succeeding fiscal years and all years thereafter are as follows:

(dollars in thousands)
Year Ending December 31,
2023 (remainder)$1,008 
20241,189 
20251,074 
2026939 
2027882 
2028532 
Thereafter1,839 
Total $7,463