ECB Bancorp, Inc. /MD/ Leases Disclosure
NOTE 6 – LEASES
The Company has operating leases for office space and two branch locations. These leases have remaining lease terms of year to years and certain of these leases have options to extend the lease for up to years. The options to extend have been included in the lease term if it was determined that it was reasonably certain that the Company will exercise the option.
All of the Company's leases are classified as operating leases. The right-of-use assets and corresponding lease liabilities are classified within “other assets” and “other liabilities,” respectively, in the accompanying consolidated balance sheets.
As of the dates indicated, the Company had the following related to operating leases:
| As of December 31, 2025 | As of December 31, 2024 | |||||||
| (Dollars in thousands) | ||||||||
|
| $ | 1,633 | $ | 1,149 | ||||
|
| 1,693 | 1,200 | ||||||
Lease expense for the years ended December 31, 2025 and December 31, 2024 amounted to $203,000 and $200,000, respectively.
The calculated amount of the right-of-use assets and lease liabilities are impacted by the length of the lease term and the discount rate used to present value the minimum lease payments. The Company's lease agreements include options to renew at the Company's discretion. If at lease inception, the Company considers the exercising of a renewal option to be reasonably certain, the Company will include the extended term in the calculation of the right-of-use assets and lease liabilities. The weighted average remaining lease term for operating leases at December 31, 2025 and 2024 was 10.0 years and 7.6 years, respectively. The weighted average discount rate was 4.58% and 4.28% at December 31, 2025 and 2024, respectively.
The following table sets forth the remaining minimum rental payments related to operating leases outstanding as of December 31, 2025.
| As of December 31, 2025 | ||||
| Year | (in thousands) | |||
| 2026 | $ | 237 | ||
| 2027 | 249 | |||
| 2028 | 213 | |||
| 2029 | 205 | |||
| 2030 | 208 | |||
| Thereafter | 1,064 | |||
| Total minimum lease payments | 2,176 | |||
| Less: amount representing interest | 483 | |||
| Present value of future minimum lease payments | $ | 1,693 | ||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 25, 2026 | Showing above |
| 2024 | Mar 26, 2025 | |
| 2023 | Mar 29, 2024 | |
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.