6. OPERATING LEASES

We lease space under non-cancelable operating leases for 21 branch locations, three off-site ATM locations, one administrative building and a warehouse. Many of our leases include both lease (e.g., fixed payments including rent, taxes, and insurance costs) and non-lease components (e.g., common-area or other maintenance costs). Payments for taxes and insurance as well as non-lease components are not included in the accounting of the lease component, but are separately accounted for in occupancy expense. The Company recognized lease expense of $2.227 million for the year ended December 31, 2019. On January 1, 2019, we adopted a new accounting standard which required the recognition of certain operating leases on our balance sheet as lease right–of-use assets (reported as a component of other assets) and related lease liabilities (reported as a component of other liabilities). See Note 2–Summary of Significant Accounting Policies. Lease expense for the years ending December 31, 2018, and 2017 prior to the adoption of ASU 2016‑02, was $2.257 million and $2.482 million, respectively. Most leases include one or more renewal options available to exercise. The exercise of lease renewal options is typically at the Company’s sole discretion; therefore, the majority of renewals to extend the lease terms are not included in our right-of-use assets and lease liabilities as they are not reasonably certain of exercise. We regularly evaluate the renewal options and when they are reasonably certain of exercise, we include the renewal period in our lease term. As most of our leases do not provide an implicit rate, we used our incremental borrowing rate in determining the present value of the lease payments.

There were no sale and leaseback transactions, leveraged leases, or lease transactions with related parties during the year ending December 31, 2019.

At December 31, 2019, the Company’s right-of-use assets and operating lease liabilities were $8.308 million and $8.915 million, respectively. The weighted average remaining lease term for the lease liabilities was 7.1 years, and the weighted average discount rate of remaining payments was 5.5 percent. There were no lease liabilities from new right-of-use assets obtained during the year ending December 31, 2019. Cash paid on operating leases was $2.199 million for the year ending December 31, 2019.

Future undiscounted lease payments for operating leases with initial terms of one year or more as of December 31, 2019 are as follows (dollars in thousands):


Year Ending December 31,
2020	$	2,235
2021		2,023
2022		1,574
2023		1,113
2024		749
Thereafter		3,196
Total undiscounted lease payments	$	10,890
Less: imputed interest		(1,975)
Net lease liabilities	$	8,915

The Company generally has options to renew its properties facilities after the initial leases expire. The renewal options range from one to ten years.