Leases (Tables)

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Summary of Operating and Finance Lease Right-of-Use Assets and Related Lease Liabilities

Below is a summary of the operating and finance lease right-of-use assets and related lease liabilities, as well as the weighted average lease term (in years) and weighted average discount rate for each of the lease classifications as of September 30, 2019.

(Dollars in thousands)	September 30, 2019
	Operating Leases			Finance Lease
Right of use asset	$	10,416		$	3,492
Lease liability	$	11,534		$	3,571
Weighted average remaining lease term  (in years)		9.17			19.42
Weighted average discount rate		3.43	%		3.81	%

Summary of Lease Costs

A summary of lease costs during the three and nine months ended September 30, 2019 are presented below.  Interest expense on finance lease liabilities is included in other interest expense, while all other lease costs are included in occupancy expense on Mid Penn’s Consolidated Statements of Income.

(Dollars in thousands)	Three Months Ended			Nine Months Ended
	September 30, 2019			September 30, 2019
Finance lease cost:
Amortization of right-of-use asset	$	45		$	105
Interest expense on lease liability		34			80
Total finance lease cost		79			185
Operating lease cost		515			1,545
Short-term lease cost		—			—
Variable lease cost		—			—
Sublease income		(6	)		(18	)
Total lease costs	$	588		$	1,712

Summary of Cash Paid for Amounts Included in Measurement of Lease Liabilities

A summary of cash paid for amounts included in the measurement of lease liabilities is presented below.

(Dollars in thousands)	Nine Months Ended
	September 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	80
Operating cash flows from operating leases		1,633
Financing cash flows from finance leases		26

Summary of Maturity Analysis of Operating and Finance Lease Liabilities and Reconciliation of Undiscounted Cash Flows

A maturity analysis of operating and finance lease liabilities and a reconciliation of the undiscounted cash flows to the total operating and finance lease liability amounts is presented below.

(Dollars in thousands)	September 30, 2019
	Operating Leases			Finance Lease
Lease payments due:
Within one year	$	530		$	54
After one but within two years		1,965			216
After two but within three years		1,603			217
After three but within four years		1,464			217
After four but within five years		1,245			217
After five years		6,691			4,244
Total undiscounted cash flows		13,498			5,165
Discount on cash flows		(1,964	)		(1,594	)
Total lease liability	$	11,534		$	3,571

Schedule of Future Minimum Rental Payments of Operating Leases

The following summary reflects the future minimum rental payments by year under Mid Penn’s operating leases as of December 31, 2018, including a breakdown of the sublease rental income and future minimum payments owned to related parties.

(Dollars in thousands)
	Lease Obligation		Sublease Rental Income		Net Rental Expense
2019		2,171		81		2,090
2020		1,970		81		1,889
2021		1,603		20		1,583
2022		1,464		—		1,464
2023		1,245		—		1,245
thereafter		6,691		—		6,691
	$	15,144	$	182	$	14,962