Premises and Equipment

12 Months Ended

Dec. 31, 2017

Property, Plant and Equipment [Abstract]

Premises and Equipment Disclosure [Text Block]

Note 6 - Premises and Equipment

Premises and equipment are summarized as follows:

	Estimated
	Useful Life
	(Years)	2017		2016
	(dollars in thousands)
Land	-	$	2,403	$	2,403
Buildings	10-25		16,092		16,027
Furniture, fixtures and equipment	3-7		30,077		29,039
Leasehold improvements	10-20		13,775		12,908
Subtotal			62,347		60,377
Less: accumulated depreciation and amortization			40,154		37,700
Subtotal			22,193		22,677
Less: fair value adjustment for acquired leases			(534)		(602)
Total premises and equipment, net		$	21,659	$	22,075

Depreciation and amortization expense of premises and equipment was $3.2 million, $2.7 million and $2.3 million for 2017, 2016 and 2015, respectively.

Capital Leases: As a result of the Merger, the Company acquired a lease agreement for a building under a capital lease. The lease arrangement requires monthly payments through 2028.

The Company has included this lease in premises and equipment as follows:

	2017		2016
	(dollars in thousands)
Capital Lease	$	3,408	$	3,422
Less: accumulated amortization		1,526		1,369
	$	1,882	$	2,053

The following is a schedule by year of future minimum lease payments under the capitalized lease, together with the present value of net minimum lease payments at December 31, 2017 (dollars in thousands):

2018	$	294
2019		321
2020		321
2021		321
2022		321
Thereafter		2,056
Total minimum lease payments		3,634
Less amount representing interest		1,000
Present value of net minimum lease payments	$	2,634

Operating Leases: Occupancy and equipment expense includes rentals for premises and equipment of $2.3 million in 2017, $2.5 million in 2016 and $2.1 million in 2015. At December 31, 2017, the Company was obligated under a number of non-cancelable leases for premises and equipment, many of which provide for increased rentals based upon increases in real estate taxes and the cost of living index. These leases, most of which have renewal provisions, are principally operating leases.

Future minimum lease payments under these leases are as follows (dollars in thousands):

2018	$	2,821
2019		2,713
2020		2,382
2021		1,998
2022		1,376
Thereafter		4,981