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Leases

12 Months Ended

Dec. 31, 2022

NOTE 7 – Leases

The Company had operating right-of-use assets, included in property and equipment, of $23.6 million and $26.6 million as of December 31, 2022 and 2021, respectively. The Company had lease liabilities, included in other liabilities, of $25.8 million and $28.0 million as of December 31, 2022 and 2021, respectively. We maintain operating leases on land and buildings for various office spaces. The lease agreements have maturity dates ranging from April 2025 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 6.89 years and 7.92 years as of December 31, 2022 and 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.

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 in to. The weighted average discount rate for leases was 2.86% and 2.28% as of December 31, 2022 and 2021, respectively.

Total operating lease costs were $2.7 million and $3.0 million for the years ended December 31, 2022 and 2021, respectively.

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


	Operating
(dollars in thousands)	Leases
2023	$	2,016
2024		2,068
2025		2,124
2026		2,177
2027		2,234
Thereafter		22,203
Total undiscounted lease payments		32,822
Discount effect of cash flows		6,995
Total lease liability	$	25,827