Leases

9 Months Ended

Sep. 30, 2022

Leases [Abstract]

Leases

NOTE 8 – Leases

The Company enters into leases in the normal course of business. As of September 30, 2022, we leased six of our offices under various operating lease agreements. All of our leases are operating leases under applicable accounting standards and 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 7.19 years as of September 30, 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 at implementation of the accounting standard and as of the lease commencement date for leases subsequently entered into. The weighted average discount rate for leases was 2.27% as of September 30, 2022.

The total operating lease costs were $582,000 and $711,000 for the three months ended September 30, 2022 and 2021, respectively, and $2.1 million for the nine months ended September 30, 2022 and 2021. The right-of-use (ROU) asset, included in property and equipment, and lease liability, included in other liabilities, was $23.6 million and $25.8 million as of September 30, 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 September 30, 2022 were as follows:

	Operating
(dollars in thousands)	Leases
2022	$	485
2023		1,971
2024		2,024
2025		2,078
2026		2,130
Thereafter		24,193
Total undiscounted lease payments		32,881
Discount effect of cash flows		7,099
Total lease liability	$	25,782