Note 5 - Premises and Equipment

12 Months Ended

Dec. 31, 2020

Notes to Financial Statements

Premises and Equipment

Note 5. Premises and Equipment

The following summarizes the components of premises and equipment as of December 31, 2020 and 2019:

	2020		2019
	(dollars in thousands)
Land	$	13,403	$	13,632
Buildings (useful lives 15 to 50 years)		67,844		66,070
Furniture and equipment (useful lives 3 to 10 years)		42,667		40,228
Premises and equipment		123,914		119,930
Less accumulated depreciation		51,221		46,071
Premises and equipment, net	$	72,693	$	73,859

As a lessee, the Company has entered into operating leases for certain branch locations.  Total lease expenses were $662 thousand and $732 thousand for the year ended December 31, 2020 and 2019, respectively.

At December 31, 2020 and 2019, the Company’s ROU assets (included in other assets on the consolidated balance sheets) and operating lease liabilities (included in other liabilities on the consolidated balance sheets) were both $1.7 million and $1.9 million, respectively. No new ROU assets were capitalized during the year ended December 31, 2020 or 2019.

At December 31, 2020, the contractual maturities of operating lease liabilities were as follows:

	Amount
Year ending December 31:	(dollars in thousands)
2021		323
2022		256
2023		200
2024		144
2025		153
Thereafter		703
	$	1,779

Note 5. Premises and Equipment (continued)

As a lessor, the Company leases certain types of commercial vehicles and industrial equipment to its customers. The Company recognized lease-related revenue, primarily interest income from direct financing leases of $5.1 million and $6.1 million for the year ended December 31, 2020 and 2019, respectively. At December 31, 2020 and 2019, the Company’s net investment in direct financing leases was $65.3 million and $88.3 million, respectively.

As of December 31, 2020, the contractual maturities of sales-type and direct financing lease receivables were as follows:

	Amount
Year ending December 31:	(dollars in thousands)
2021		3,879
2022		14,983
2023		21,059
2024		17,248
2025		14,780
Thereafter		991
Total lease payments receivable	$	72,940
Unguaranteed residual values		239
Unearned lease/residual income		(7,163)
	$	66,016
Plus deferred origination costs, net of fees		1,072
	$	67,088
Less allowance		(1,764)
Total lease payments receivable	$	65,324

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