Leases

9 Months Ended

Sep. 30, 2022

Leases

Leases

NOTE 7 — Leases

The Company recognizes the present value of its operating lease payments related to its office facilities and retail branch as operating lease assets and corresponding lease liabilities on the Consolidated Statements of Financial Condition. These operating lease assets represent the Company’s right to use an underlying asset for the lease term, and the lease liability represents the Company’s obligation to make lease payments over the lease term. As these leases do not provide an implicit rate, the Company used its incremental borrowing rate, the rate of interest to borrow on a collateralized basis for a similar term, at the lease commencement date in order to determine present value.

Short-term lease payments, those leases with original terms of 12 months or less, are recognized in the Consolidated Statements of Income, on a straight-line basis over the lease term. Certain leases may include one or more options to renew. The exercise of lease renewal options is typically at the Company’s discretion and are included in the operating lease liability if it is reasonably certain that the renewal option will be exercised. Certain real estate leases may contain lease and non-lease components, such as common area maintenance charges, real estate taxes, and insurance, which are generally accounted for separately and are not included in the measurement of the lease liability since they are generally able to be segregated. The Company does not sublease any of its leased properties and does not lease properties from any related parties.

As of September 30, 2022, right of use (“ROU”) lease assets and related lease liabilities were $2.0 million and $2.6 million, respectively. As of December 31, 2021, ROU lease assets and related lease liabilities were $2.4 million and $3.0 million, respectively. ROU assets are included within Other assets and related lease liabilities are included within Accrued expenses and other liabilities on the Consolidated Statements of Financial Condition.

Maturities of the Company’s operating lease liabilities at September 30, 2022 are as follows:

		Operating Lease
		Liabilities
		(In thousands)
2022	$	157
2023		636
2024		652
2025		668
2026		627
Thereafter		—
Total operating lease payments	$	2,740
Less: interest		176
Present value of operating lease liabilities	$	2,564

	As of September 30,
	2022			2021
Weighted-average remaining lease term		4.17	years		5.12	years
Weighted-average discount rate		3.08	%		3.05	%

The components of total lease cost are as follows:

	For the Three Months Ended				For the Nine Months Ended
	September 30,
	2022		2021		2022		2021
	(In thousands)
Operating lease cost	$	135	$	142	$	419	$	425
Short-term lease cost		—		—		—		13
Total lease cost	$	135	$	142	$	419	$	438
Cash paid for operating leases	$	162	$	161	$	490	$	503