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Leases | Note 4: Leases The Company’s leases primarily include bank branches located in Kansas City, Missouri; Tulsa, Oklahoma; Dallas, Texas; Frisco, Texas; Fort Worth, Texas; Phoenix, Arizona; Denver, Colorado; and Colorado Springs, Colorado. The remaining lease terms on these branch leases range from less than two years to 18 years with certain options to renew. Renewal terms can extend the lease term between five years and 20 years. The exercise of lease renewal options is at the Company’s sole discretion. When it is reasonably certain that the Company will exercise its option to renew or extend the lease term, that option is included in the estimated value of the right of use (“ROU”) asset and lease liability. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. As of June 30, 2024, the Company recognized one finance lease and the remaining Company leases were classified as operating leases. The ROU asset is included in “Other assets” on the consolidated statements of financial condition, and was $28 million and $30 million at June 30, 2024 and December 31, 2023, respectively. Certain adjustments to the ROU asset may be required for items such as initial direct costs paid or incentives received. The lease liability is located in “Interest payable and other liabilities” on the consolidated statements of financial condition and was $32 million and $34 million at June 30, 2024 and December 31, 2023, respectively. As of June 30, 2024, the remaining weighted-average lease term was 10.3 years, and the weighted-average discount rate was 2.77% utilizing the Company’s incremental Federal Home Loan Bank (“FHLB”) borrowing rate for borrowings of a similar term at the date of lease commencement. The following table presents components of operating lease expense in the accompanying consolidated statements of operations for the three- and six-month periods ended June 30, 2024 and 2023:
Future minimum commitments under and leases as of June 30, 2024 were as follows:
Supplemental cash flow information Operating cash flows paid for operating leases included in the measurement of lease liabilities were $1.9 million and $1.8 million, respectively, for the six months ended June 30, 2024 and 2023. Operating cash flows paid for finance lease amounts included in the measurement of lease liabilities were $0.2 million for both the six months ended June 30, 2024 and 2023. During the six months ended June 30, 2024, the Company did not record any ROU assets that were exchanged for operating lease liabilities. |