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Lease

9 Months Ended

Sep. 30, 2019

(12)	*Lease.* We adopted ASU 2016-02, Leases on January 1, 2019, which initially resulted in the recognition of one operating lease on the condensed consolidated balance sheet in 2019 and forward. See Note 1 – Recent Pronouncements for more information on the adoption of the ASU. We determine if a contract contains a lease at inception and recognize operating lease right-of-use assets and operating lease liabilities based on the present value of the future minimum lease payments at the adoption date. During September 2019, the lessor of the new branch location made the location available to the Company for use. Accordingly, the Company recognized an additional operating lease right-of-use asset and operating lease liability that amounted to $863,000. As our leases do not provide implicit rates, we use our incremental borrowing rate based on the information available at the adoption date in determining the present value of future payments. Lease agreements that have lease and non-lease components, are accounted for as a single lease component. Lease expense is recognized on a straight-line basis over the lease term.

	The Company’s operating lease obligation is for two of the Company’s branch locations. Our leases have a weighted-average remaining lease term of approximately 8.6 years and do not offer options to extend the leases. The components of lease expense and other lease information are as follows (dollars in thousands):

	Three Month Period Ended September 30, 2019		Nine Month Period Ended September 30, 2019

Operating Lease Cost	$	19	$	57
Cash paid for amounts included in measurement of lease liabilities	$	18	$	54

	Three Month Period Ended September 30, 2018		Nine Month Period Ended September 30, 2018

Operating Lease Expense Recognized	$	22	$	67
Cash paid for amounts included in measurement of lease liabilities	$	N/A	$	N/A

N/A – Not applicable during 2018. The Company adopted ASU 2016-02 Leases on January 1, 2019.

	At September 30, 2019

Operating lease right-of-use assets	$	1,092
Operating lease liabilities	$	1,095
Weighted-average remaining lease term		8.6 years
Weighted-average discount rate		2.1	%

Future minimum lease payments under non-cancellable leases, reconciled to our discounted operating lease liabilities are as follows (in thousands):

	At September 30, 2019
Remainder of 2019	$	40
2020	$	158
2021	$	163
2022	$	161
2023	$	92
Thereafter	$	583
Total future minimum lease payments	$	1,197
Less imputed interest	$	(102	)
Total operating lease liability	$	1,095