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Leases
 12 Months Ended
Dec. 31, 2022
Leases [Abstract]  
Leases Leases
A lease is defined as a contract that conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. Substantially all of the leases in which the Company is the lessee are comprised of real estate property for branch offices, ATM locations and corporate office space. All of our leases are classified as operating leases and are included in operating lease right-of-use ("ROU") assets and operating lease liabilities in the consolidated balance sheet.
ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. In determining the present value of the lease payments, we use the implicit lease rate if available. If the implicit lease rate is not available, we use the incremental borrowing rate at commencement date. The incremental borrowing rate is the rate of interest that we would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment.
As of December 31, 2022, the Company had $24.5 million of operating lease ROU assets and $29.3 million of operating lease liabilities compared to $30.6 million of operating lease ROU assets and $35.5 million of operating lease liabilities at December 31, 2021 on the Company’s Consolidated Balance Sheet. The Company has elected not to recognize ROU assets and lease liabilities arising from short-term leases, leases with initial terms of twelve months or less or equipment leases (deemed immaterial) on the Consolidated Balance Sheets.
Our leases contain terms and conditions of options to extend or terminate the lease which are recognized as part of the ROU assets and lease liabilities when an economic benefit to exercise the option exists and there is a 90% probability that the Company will exercise the option. If these criteria are not met, the options are not included in our ROU assets and lease liabilities.
As of December 31, 2022, our leases do not contain material residual value guarantees or impose restrictions or covenants related to dividends or the Company’s ability to incur additional financial obligations. In 2022, the Company did not enter into new leases or renew/extend any leases and had two leases expire (two branches were closed).
The following table presents lease costs and other lease information.
Years Ended
(dollars in thousands)December 31, 2022December 31, 2021
Lease cost  
Operating lease cost (cost resulting from lease payments)$7,145 $8,104 
Variable lease cost (cost excluded from lease payments)1,008 876 
Sublease income(241)(348)
Net lease cost$7,912 $8,632 
Operating lease - operating cash flows (fixed payments)$7,368 $6,046 
Right-of-use assets - operating leases$24,544 $30,555 
Operating lease liabilities$29,267 $35,501 
Weighted average lease term - operating leases5.5yrs6.26yrs
Weighted average discount rate - operating leases2.91 %3.05 %
Future minimum payments for operating leases with initial or remaining terms of one year or more as of December 31, 2022 were as follows:
(dollars in thousands)
Twelve Months Ended:  
December 31, 2023$7,256 
December 31, 20246,890 
December 31, 20255,987 
December 31, 20262,894 
December 31, 20272,502 
Thereafter5,776 
Total Future Minimum Lease Payments31,305 
Amounts Representing Interest(2,038)
Present Value of Net Future Minimum Lease Payments$29,267