Leases

12 Months Ended

Dec. 31, 2025

Note 6 – Leases

The Company accounts for leases in accordance with ASC Topic 842. 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 comprise real estate for branch offices, ATM locations and corporate office space. Substantially 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 operating lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and operating lease 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, 2025 and December 31, 2024, the Company had $28.5 million and $18.5 million of operating lease ROU assets respectively, and $35.3 million and $23.8 million of operating lease liabilities respectively, on the Company’s Consolidated Balance Sheet. The Company elects not to recognize ROU assets and operating 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 Sheet.

The leases contain 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 operating lease liabilities.

As of December 31, 2025, 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.

On January 1, 2025, the Company commenced a new lease for its new headquarters at 7500 Old Georgetown Road in downtown Bethesda, MD. The lease expires on July 31, 2037.

The tables below present lease costs and other lease information.


	For the Year Ended December 31,
(dollars in thousands)		2025		2024
Lease cost:
Operating lease cost (cost resulting from lease payments)		$	7,272	$	6,124
Variable lease cost (cost excluded from lease payments)		521		694
Sublease income		—		(40)
Net lease cost		$	7,793	$	6,778
Operating lease - operating cash flows (fixed payments)		$	5,789	$	6,524


	As of December 31,
(dollars in thousands)	2025		2024
Right-of-use assets - operating leases	$	28,451	$	18,494
Operating lease liabilities	$	35,256	$	23,815
Weighted average lease term - operating leases (in years)	9.12		6.78
Weighted average discount rate - operating leases	3.60%		3.03%

The table below presents the future minimum payments for operating leases with initial or remaining terms of one year or more.


(dollars in thousands)	As of December 31, 2025
Twelve months ended:
December 31, 2026	$	4,728
December 31, 2027	4,924
December 31, 2028	4,877
December 31, 2029	4,441
December 31, 2030	3,867
Thereafter	19,415
Total future minimum lease payments	42,252
Amounts representing interest	(6,996)
Present value of net future minimum lease payments	$	35,256