Note 5 - Premises and Equipment

12 Months Ended

Jun. 30, 2023

Notes to Financial Statements

Property, Plant and Equipment Disclosure [Text Block]

NOTE 5—PREMISES AND EQUIPMENT

Major classifications of premises and equipment were as follows as of June 30:

	2023			2022
Land	$	2,417		$	1,685
Land improvements		414			318
Building and leasehold improvements		15,973			15,608
Furniture, fixture and equipment		7,600			7,206
Total premises and equipment		26,404			24,816
Accumulated depreciation and amortization		(9,222	)		(8,296	)
Premises and equipment, net	$	17,182		$	16,521

Depreciation expenses were $1,051 and $991 for the years ended June 30, 2023 and 2022, respectively.

As of June 30, 2023, the Corporation leased real estate for seven office locations and various equipment under operating lease agreements. The lease agreements have maturity dates ranging from one year or less to May 31, 2035, including extension periods. Lease agreements for two locations have a lease term of 12 months or less and are therefore considered short-term leases. Most leases include one or more options to renew. The exercise of lease renewal options is typically at our sole discretion. The majority of renewals to extend the lease terms are included in our right-of-use assets and lease liabilities as they are reasonably certain of exercise. As most of our leases do not provide an implicit rate, we use the fully collateralized FHLB borrowing rate, commensurate with the lease terms based on the information available at the lease commencement date in determining the present value of the lease payments. The weighted average remaining life of the lease term for the leases with a term over 12 months was 7.87 years as of June 30, 2023 and the weighted-average discount rate was 1.95%.

Rent expense for all the operating leases was $254 and $228 for the twelve-month periods ended June 30, 2023 and 2022, respectively. The right-of-use asset, included in premises and equipment, and the lease liability, included in other liabilities, were $921 and $951 as of June 30, 2023.

Total estimated rental commitments for the operating leases with a term over 12 months were as follows as of June 30, 2023:

Period Ending June 30
2024	$	177
2025		145
2026		125
2027		115
2028		115
Thereafter		342
Total undiscounted cash flows	$	1,019
Less: present value discount	$	(68	)
Total lease liabilities	$	951