LEASING ACTIVITIES

12 Months Ended

Dec. 31, 2025

Leasing Activities

LEASING ACTIVITIES

NOTE 18 LEASING ACTIVITIES

As of December 31, 2025, the Bank leases four branch offices, one administrative office, one loan production office, and sublets a lot adjacent to another branch office. The lease agreements have maturity dates ranging from December 2028 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 as of December 31, 2025 is 6.30 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 as of December 31, 2025 was 3.36%.

The Company’s operating lease costs were approximately $557,000 and $558,000 for the years ended December 31, 2025 and 2024, respectively.

The Company’s other operating leases were evaluated and determined to be immaterial to the financial statements.

As of December 31, 2025, future minimum rental commitments under the non-cancellable operating leases discussed above are as follows (dollars in thousands):

2026	$	576
2027		598
2028		603
2029		492
2030		492
Thereafter		755
Total lease payments		3,516
Less imputed interest		518
Total	$	2,998