NOTE 4 - LEASES

3 Months Ended

Mar. 31, 2021

Note 4 - Leases

NOTE 4 - LEASES

NOTE 4 - LEASES

The Bank leases facilities and equipment with various expiration dates through 2036. The facilities leases have varying renewal options, generally require fixed annual rent, and provide that real estate taxes, insurance, and maintenance are to be paid by Salisbury. The Bank does not have any leases with related parties and equipment leases are not material to Salisbury's consolidated financial statements.

The following table provides the assets and liabilities as of March 31, 2021 and December 31, 2020, as well as the costs of operating and financial leases which are included in the Bank's consolidated income statement for the three months ended March 31, 2021 and 2020.

(in thousands, except lease term and discount rate)	Classification		March 31, 2021		December 31, 2020
Assets
Operating	Other assets	$	1,128	$	1,182
Finance	Bank premises and equipment 1		1,377		1,402
Total Leased Assets		$	2,505	$	2,584
Liabilities
Operating	Other liabilities	$	1,128	$	1,182
Finance	Finance lease		1,658		1,673
Total lease liabilities		$	2,796	$	2,855
1 Net of accumulated depreciation of $319 thousand.

Lease cost	Classification		Three Months Ended March 31, 2021		Three Months Ended March 31, 2020
Operating leases	Premises and equipment	$	80	$	62
Finance leases:
Amortization of leased assets	Premises and equipment		25		25
Interest on finance leases	Interest expense		32		36
Total lease cost		$	137	$	123

	March 31, 2021		December 31, 2020
Weighted Average Remaining Lease Term
Operating leases	8.2 years		7.6 years
Financing leases	14.2 years		14.2 years
Weighted Average Discount Rate 1
Operating leases	3.8	%	3.7	%
Financing leases	8.3	%	8.4	%
1 Salisbury uses the FHLB five year Advance rate as the discount rate, as our leases do not provide an implicit rate.

The following is a schedule by years of the present value of the net minimum lease payments as of March 31, 2021.

Future minimum lease payments (in thousands)		Operating Leases			Finance Leases
2021	$	186		$	144
2022		199			195
2023		146			197
2024		129			200
2025		137			203
Thereafter		462			1,778
Total future minimum lease payments		1,259			2,717
Less amount representing interest		(131	)		(1,059	)
Total present value of net future minimum lease payments	$	1,128		$	1,658