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Leases
12 Months Ended
Dec. 31, 2022
Leases [Abstract]  
Leases
4.
 
LEASES
The
 
Company
 
enters
 
into
 
leases
 
in
 
the
 
normal
 
course
 
of
 
business
 
primarily
 
for
 
banking
 
centers
 
and
 
back-office
operations. As of
 
December 31, 2022, the
 
Company leased nine
 
of the ten
 
banking centers and
 
the headquarter building.
The Company
 
is obligated
 
under non-cancelable
 
operating leases
 
for these
 
premises
 
with expiration
 
dates ranging
 
from
2026 to 2036, many of these leases have extension
 
clauses which the Company could exercise which
 
would extend these
dates.
 
The Company
 
has classified
 
all leases as
 
operating leases.
 
Lease expense
 
for operating
 
leases are
 
recognized on
 
a
straight-line basis over
 
the lease term.
 
Right-of-use (“ROU”)
 
assets represent the
 
right to use
 
the underlying
 
asset for the
lease
 
term
 
and
 
lease
 
liabilities
 
represent
 
the
 
obligation
 
to
 
make
 
lease
 
payments
 
arising
 
from
 
the
 
lease.
 
The
 
Company
elected the short-term
 
lease recognition exemption
 
for all leases
 
that qualify,
 
meaning those
 
with terms under
 
12 months.
ROU assets or lease liabilities are not to be recognized
 
for short-term leases.
ROU assets and
 
lease liabilities are
 
recognized at the lease
 
commencement date based on
 
the estimated present value
of lease payments
 
over the
 
lease term.
 
In the Comp
 
any’s Consolidated
 
Balance Sheets,
 
ROU assets
 
are reported
 
under
other assets while lease liabilities are classified under
 
accrued interest and other liabilities.
 
As
 
most
 
of
 
the
 
Company’s
 
leases
 
do
 
not
 
provide
 
an
 
implicit
 
rate,
 
the
 
incremental
 
borrowing
 
rate
 
based
 
on
 
the
information available
 
at commencement
 
date is
 
used. The
 
Company’s incremental
 
borrowing rate
 
is based
 
on the
 
FHLB
advance rate matching or nearing the lease term.
 
The following table presents the ROU assets and lease liabilities
 
as of December 31, 2022 and 2021 (in thousands):
2022
2021
ROU assets:
Operating leases
 
$
14,395
$
14,185
Lease liabilities:
Operating leases
 
$
14,395
$
14,185
The weighted average remaining lease term and weighted average
 
discount rate as of December 31, 2022 and 2021:
2022
2021
Weighted average remaining lease term (in years):
Operating leases
6.98
8.28
Weighted average discount rate:
Operating leases
 
2.94
%
2.32
%
Future lease payment obligations and a reconciliation to lease
 
liability as of December 31, 2022 (in thousands):
2023
$
3,158
2024
3,236
2025
3,312
2026
2,383
2027
951
Thereafter
3,478
Total
 
future minimum lease payments
16,518
Less: interest component
(2,123)
Total
 
lease liability
$
14,395