PREMISES AND EQUIPMENT

12 Months Ended

Dec. 31, 2014

(5)	PREMISES AND EQUIPMENT

Premises and equipment at December 31, 2014 and 2013 are as follows (amounts in thousands):

	2014		2013
Land	$	4,803	$	4,803
Buildings		35,067		34,379
Projects in progress		132		-
Equipment and furniture		40,088		34,920
Leasehold improvements		6,094		6,041
		86,184		80,143
Less accumulated depreciation and amortization		53,897		50,104
	$	32,287	$	30,039

Depreciation expense was $3.9 million, $3.2 million and $2.9 million for 2014, 2013 and 2012, respectively.

Operating Leases: The Corporation leases certain branch properties under operating leases. Rent Expense was $2.0 million, $1.3 million, and $1.1 million for 2014, 2013, and 2012, respectively. Rent commitments, before considering renewal options that generally are present, were as follows (amounts in thousands):

Year	Estimated Expense
2015	$	1,429
2016		1,166
2017		1,143
2018		1,147
2019		834
2020 and thereafter		4,154
Total	$	9,873

Capital Leases: The Corporation leases certain buildings under capital leases. The lease arrangements require monthly payments through 2030.

The Corporation has included these leases in premises and equipment as follows:

	2014		2013
Buildings	$	3,537	$	-
Accumulated depreciation		-		-
	$	3,537	$	-

The following is a schedule by year of future minimum lease payments under the capitalized lease, together with the present value of net minimum lease payments as of December 31, 2014 (amounts in thousands):

Year	Amount
2015	$	234
2016		234
2017		234
2018		234
2019		234
2020 and thereafter		2,644
Total minimum lease payments		3,814
Less amount representing interest		838
Present value of net minimum lease payments	$	2,976

- Definition

The entire disclosure for long-lived, physical assets used in the normal conduct of business and not intended for resale. Includes, but is not limited to, accounting policies and methodology, roll forwards, depreciation, depletion and amortization expense, including composite depreciation, accumulated depreciation, depletion and amortization expense, useful lives and method used, income statement disclosures, assets held for sale and public utility disclosures.

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