Note 5 - Premises and Equipment

12 Months Ended

Dec. 31, 2021

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, 2021 and 2020:

	2021		2020
	(dollars in thousands)
Land	$	12,513	$	13,403
Buildings (useful lives 15 to 39 years)		70,555		67,844
Furniture and equipment (useful lives 3 to 15 years)		47,822		42,667
Premises and equipment		130,890		123,914
Less accumulated depreciation		52,360		51,221
Premises and equipment, net	$	78,530	$	72,693

Note 5. Premises and Equipment (continued)

As a lessee, the Company has entered into operating leases for certain branch locations.  Total lease expenses were $636 thousand and $662 thousand for the year ended December 31, 2021 and 2020, respectively.

At December 31, 2021 and 2020, 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 $1.3 million and $1.7 million, respectively. No new ROU assets were capitalized during the year ended December 31, 2021 or 2020.

At December 31, 2021, the contractual maturities of operating lease liabilities were as follows:

	Amount
Year ending December 31:	(dollars in thousands)
2022		269
2023		200
2024		144
2025		153
2026		159
Thereafter		544
	$	1,469

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 $4.0 million and $5.1 million for the years ended December 31, 2021 and 2020, respectively.  At December 31, 2021 and 2020, the Company’s net investment in direct financing leases was $44.2 million and $65.3 million, respectively.

As of December 31, 2021, the contractual maturities of sales-type and direct financing lease receivables were as follows:

	Amount
Year ending December 31:	(dollars in thousands)
2022		2,590
2023		12,461
2024		14,319
2025		14,508
2026		5,019
Thereafter		465
Total lease payments receivable	$	49,362
Unguaranteed residual values		165
Unearned lease/residual income		(4,336)
	$	45,191
Plus deferred origination costs, net of fees		568
	$	45,759
Less allowance		(1,546)
Total lease payments receivable	$	44,213

The