LCNB CORP Leases Disclosure
NOTE 8 - LEASES
LCNB has capitalized operating leases for its Union Village, Fairfield, Barron Street, and Worthington offices, for the land at its Oxford and Oakwood offices, for the Milford Lending Office, for certain office equipment, and for its ATMs. The Oakwood lease has a remaining term of 11.6 years with options to renew for six additional periods of years each. The Oxford lease has a remaining term of 34.5 years with no renewal options. The other leases have remaining terms of less than year up to years, some of which contain options to renew the leases for additional -year periods.
Lease expenses for offices are included in the Consolidated Statements of Income in occupancy expense, net and lease expenses for equipment and ATMs are included in equipment expenses. Components of lease expense for the years ended December 31 are as follows (in thousands):
| 2024 | 2023 | 2022 | ||||||||||
| Operating lease expense | $ | 959 | 890 | 616 | ||||||||
| Short-term lease expense | 47 | 70 | 243 | |||||||||
| Variable lease expense | 41 | 8 | 4 | |||||||||
| Other | 38 | 29 | 11 | |||||||||
| Total lease expense | $ | 1,085 | 997 | 874 | ||||||||
Other information related to leases at December 31 are as follows (dollars in thousands):
| 2024 | 2023 | 2022 | ||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: | ||||||||||||
| Operating cash flows from operating leases | $ | 1,011 | 911 | 623 | ||||||||
| Right-of-use assets obtained in exchange for new operating lease liabilities | $ | 167 | — | 370 | ||||||||
| Weighted average remaining lease term in years for operating leases | 33.2 | 33.0 | 33.4 | |||||||||
| Weighted average discount rate for operating leases | 3.67 | % | 3.53 | % | 3.46 | % | ||||||
Future payments due under operating leases as of December 31, 2024 are as follows (in thousands):
| 2025 | $ | 554 | ||
| 2026 | 381 | |||
| 2027 | 353 | |||
| 2028 | 274 | |||
| 2029 | 278 | |||
| Thereafter | 9,714 | |||
| 11,554 | ||||
| Less effects of discounting | 5,439 | |||
| Operating lease liabilities recognized | $ | 6,115 |
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.