Leases

6 Months Ended

Jun. 30, 2020

Leases [Abstract]

Leases

NOTE 9: LEASES

The Company leases certain facilities for its corporate offices and branch operations under non-cancelable operating leases that expire through 2026. All leases were classified as operating leases and therefore, were previously not recognized on the Company’s consolidated balance sheet. With the adoption of Topic 842, operating lease agreements are required to be recognized on the consolidated balance sheet as a right-of-use (“ROU”) asset and a corresponding lease liability.

Certain leases include options to renew, with renewal terms that can extend the lease term. The depreciable life of leased assets is limited by the expected lease term.

Supplemental lease information at or for the six months ended June 30, 2020 is as follows:

(dollars in thousands)
Balance Sheet:
Operating lease asset classified as other assets	$	16,943
Operating lease liability classified as other liabilities		18,265
Income Statement:
Operating lease cost classified as occupancy and equipment expense	$	2,959
Weighted average lease term, in years		3.94
Weighted average discount rate		5.29	%
Operating cash flows	$	2,905

The calculated amount of the ROU assets and lease liabilities in the table above are impacted by the length of the lease term and the discount rate used to present value the minimum lease payments. The Company’s lease agreements often include one or more options to renew at the Company’s discretion. Topic 842 requires the use of the rate implicit in the lease whenever this rate is readily determinable. As this rate is rarely determinable, the Company utilizes its incremental borrowing rate at lease inception, on a collateralized basis, over a similar term. For operating leases existing prior to January 1, 2019, the rate for the remaining lease term as of January 1, 2019 was used.

The table below summarizes the maturity of remaining lease liabilities at June 30, 2020:

(dollars in thousands)
2020	$	3,236
2021		6,292
2022		5,344
2023		2,526
2024 and after		4,345
Total future minimum lease payments	$	21,743
Discount on cash flows		(3,478)
Total lease liability	$	18,265