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Leases

3 Months Ended

Mar. 31, 2022

NOTE 8 – Leases

Effective January 1, 2019, the Company adopted ASU 2016-02, “Leases (Topic 842)”. As of March 31, 2022, we leased seven of our offices under various operating lease agreements. The lease agreements have maturity dates ranging from August 2028 to February 2032, some of which include options for multiple five-year extensions. The weighted average remaining life of the lease term for these leases was 7.63 years as of March 31, 2022.

The discount rate used in determining the lease liability for each individual lease was the FHLB fixed advance rate which corresponded with the remaining lease term as of January 1, 2019 for leases that existed at adoption and as of the lease commencement date for leases subsequently entered into. The weighted average discount rate for leases was 2.28% as of March 31, 2022.

The total operating lease costs were $778,000 and $714,000 for the three months ended March 31, 2022 and 2021, respectively. The right-of-use (ROU) asset, included in property and equipment, and lease liability, included in other liabilities, was $24.1 million and $25.6 million as of March 31, 2022, respectively, compared to $26.6 million and $28.0 million as of December 31, 2021, respectively. The ROU asset and lease liability are recognized at lease commencement by calculating the present value of lease payments over the lease term.

Maturities of lease liabilities as of March 31, 2022 were as follows:


	Operating
(dollars in thousands)	Leases
2022	$	848
2023		1,938
2024		1,990
2025		2,045
2026		2,096
Thereafter		24,093
Total undiscounted lease payments		33,010
Discount effect of cash flows		7,443
Total lease liability	$	25,567