NOTE 6 – LEASES
Operating leases in which the Company is the lessee are
recorded as operating lease right of use (“ROU”) assets and operating
liabilities, included in other assets and liabilities, respectively,
on its consolidated statement of financial condition.
Operating lease ROU assets represent the Company’s
right to use an underlying asset during the lease term
and operating lease
liabilities represent the Company’s
obligation to make lease payments arising from the lease.
ROU assets and operating lease
liabilities are recognized at lease commencement based
on the present value of the remaining lease payments using a
discount rate that
represents the Company’s
incremental borrowing rate at the lease commencement
Operating lease expense, which is comprised
of amortization of the ROU asset and the implicit interest accreted
on the operating lease liability,
is recognized on a straight-line basis
over the lease term, and is recorded in occupancy expense
in the consolidated statements of income.
The Company’s operating
leases primarily relate to banking offices with remaining
lease terms from
leases are not complex and do not contain residual value
guarantees, variable lease payments, or significant assumptions
made in applying the requirements of Topic
Operating leases with an initial term of 12 months or less are not recorded on the
balance sheet and the related lease expense is recognized on a straight-line basis over the lease term.
At March 31, 2021, the operating
lease ROU assets and liabilities were $
The Company does not have any finance leases or
any significant lessor agreements.
The table below summarizes our lease expense and other
information related to the Company’s
At March 31, 2021, the Company had additional operating
lease payments for
banking offices that have not yet commenced
million based on the initial contract term of
Payments for the banking offices are expected to commence after
the construction period ends, which is expected to occur during the second quarter of 2022 and the third quarter of 2022.
A related party is the lessor in an operating lease with
The Company’s minimum
payment is $
through 2024, for an aggregate remaining obligation of
million at March 31, 2021.