Leasing
The Company’s lessee arrangements predominantly consist of operating leases for premises and equipment; the Company’s financing leases are not significant. The table below summarizes lease-related balances that the Company reported on its consolidated balance sheets and lease terms:
| | | | | | | | | | | |
| December 31, |
| 2025 | | 2024 |
| (dollars in thousands) |
| Lease balances | | | |
| Right of use assets | $ | 31,281 | | | $ | 30,187 | |
| Lease liabilities | 32,557 | | | 31,522 | |
| Lease terms | | | |
| Operating leases | | | |
| Year through which lease terms extend | 2049 | | 2049 |
| Weighted average remaining lease term | 23.8 | | 25.1 |
| Weighted average discount rate | 3.91 | % | | 3.80 | % |
| Finance leases | | | |
| Year through which lease terms extend | 2038 | | 2027 |
| Weighted average remaining lease term | 3.1 | | 2.1 |
| Weighted average discount rate | 1.49 | % | | 1.49 | % |
Lease Costs
The following table presents lease costs, which are included in net occupancy and equipment expenses on the Consolidated Statements of Income:
| | | | | | | | | | | |
| December 31, |
| 2025 | | 2024 |
| (dollars in thousands) |
| Lease costs | | | |
| Operating lease costs | $ | 3,506 | | | $ | 3,633 | |
| Finance lease costs | 5 | | | 5 | |
| Short-term lease costs | 680 | | | 493 | |
| Total lease costs | $ | 4,191 | | | $ | 4,132 | |
Lease Cash Flow
Cash paid for amounts included in the measurement of lease liabilities was as follows:
| | | | | | | | | | | |
| December 31, |
| 2025 | | 2024 |
| (dollars in thousands) |
| Cash flows related to leases | | | |
| Cash paid for amounts included in the measurement of lease liabilities: | | | |
| Operating cash flows from operating leases | $ | 3,539 | | | $ | 3,585 | |
| Financing cash flows from finance leases | 5 | | | 5 | |
| Operating lease cash flows - liability reduction | 2,902 | | | 2,570 | |
| ROU assets obtained during the period in exchange for operating lease liabilities | 3,938 | | | 606 | |
| ROU assets obtained during the period in exchange for financing lease liabilities | - | | | - | |
Lease Maturity Analysis
The Company’s undiscounted operating lease liabilities are scheduled to mature as follows:
| | | | | |
| As of December 31, |
| 2025 |
| (dollars in thousands) |
| Rent commitments | |
| 2026 | $ | 3,440 | |
| 2027 | 3,085 | |
| 2028 | 2,837 | |
| 2029 | 2,676 | |
| 2030 | 2,332 | |
| Thereafter | 36,184 | |
| Total undiscounted cash flows | 50,555 | |
| Less: Amounts representing interest | (17,997) | |
| Present value of future minimum lease payments | $ | 32,557 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.