Leases

12 Months Ended

Dec. 31, 2024

Note 6 – Leases

Effective October 1, 2021, the Bank entered into an operating lease for its administrative offices at 4601 Wilshire Boulevard in Los Angeles.

The ROU asset represents our right to use the underlying asset during the lease term. Operating lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized based on the present value of the remaining lease payments using a discount rate that represents our incremental borrowing rate at the date of implementation of the new accounting standard. The ROU asset totaled $420 thousand and $655 thousand as of December 31, 2024 and 2023, respectively, and was included in other assets on the consolidated statements of financial condition. The lease liability totaled $420 thousand and $655 thousand as of December 31, 2024 and 2023, respectively, and was included in accrued expenses and other liabilities on the consolidated statements of financial condition.

The operating lease has one 5-year extension option at the then fair market rate. As this extension option is not reasonably certain of exercise, it is not included in the lease term. The Bank has no finance leases.

The Company recognized rent expense of $242 thousand in 2024 and $305 thousand in 2023.

Additional information regarding our operating leases is summarized below for the periods indicated (dollars in thousands):

	Year Ended December 31, 2024			Year Ended December 31, 2023
Cash paid for amounts included in the measurement of lease liabilities for operating leases	$	242		$	242
ROU assets obtained in exchange for lease liabilities		–			–
Weighted average remaining lease term in months		21			33
Weighted average discount rate		5.5	%		5.5	%

The future minimum payments for operating leases with remaining terms of one year or more as of December 31, 2024 were as follows (in thousands):

Year ended December 31, 2025	$	242
Year ended December 31, 2026		182
Total future minimum lease payments		424
Amounts representing interest		(4	)
Present value of net future minimum lease payments	$	420