LEASING ACTIVITIES

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

LEASING ACTIVITIES

NOTE 17 LEASING ACTIVITIES

During 2021, the Bank repurchased its branch office located in Lebanon, Virginia, for $1.3 million. This branch had previously been sold and leased back in September 2019. As a result of the repurchase, the lease with a remaining term of 12.9 years was cancelled.

At December 31, 2021, the Bank leases four branch offices and sublets a lot adjacent to another branch office. The lease agreements have maturity dates ranging from May 2032 to December 2041. It is assumed that there are currently no circumstances in which the leases would be terminated prior to expiration. The weighted average remaining life of the lease terms at December 31, 2021, was 10.61 years.

The discount rate used in determining the lease liability for each individual lease was the FHLB fixed advance rate which corresponded to the lease term for each transaction. This methodology is expected to be used for any other subsequent lease agreements. The weighted average discount rate for the leases at December 31, 2021 was 3.24%.

The Company’s operating lease costs for the years ended December 31, 2021 and 2020, as a result of the transactions discussed above, was $528 thousand and $552 thousand, respectively.

The Company’s other operating leases were evaluated and determined to be immaterial to the financial statements. At December 31, 2021, future minimum rental commitments under the non-cancellable operating leases discussed above are as follows (dollars are in thousands):

2022	$	441
2023		455
2024		455
2025		455
2026		455
Thereafter		2,698
Total lease payments		4,959
Less imputed interest		897
Total	$	4,062