Leases

12 Months Ended

Jun. 30, 2020

Leases [Abstract]

Leases

Leases

As Lessee - Operating Leases

Company operating leases primarily include office space and bank branches. Certain leases include one or more options to renew, with renewal terms that can extend the lease term up to 15 additional years. The exercise of lease renewal options is at our sole discretion. When it is reasonably certain that we will exercise our option to renew or extend the lease term, that option is included in estimating the value of the ROU and lease liability. At June 30, 2020, we did not have any leases that had not yet commenced for which we had created a ROU asset and a lease liability. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Most of our lease agreements include periodic rate adjustments for inflation. The depreciable life of ROU assets and leasehold improvements are limited to the shorter of the useful life or the expected lease term. Leases with an initial term of 12 months or less are not recorded on our Consolidated Balance Sheets; we recognize lease expenses for these leases over the lease term.

The following tables present supplemental balance sheet information related to operating leases. ROU assets are included in other assets and lease liabilities are included in other liabilities.

Supplemental Balance Sheet Information:	June 30, 2020
ROU assets	$	4,601
Lease liabilities	4,590
Weighted-average remaining lease terms	5.02
Weighted-average discount rate	2.97		%

The following schedule summarizes aggregate future minimum lease payments under these operating leases at June 30, 2020:

Fiscal year ending June 30:
2021	$	1,242
2022	1,115
2023	1,063
2022	593
2023	287
Thereafter	676
Total of future minimum payments	$	4,976

The following table presents components of operating lease expense for the year ended June 30, 2020:

	Year Ended June 30, 2020
Operating lease cost (included in occupancy expense)	$	1,821
Sublease income (included in other, net noninterest income)	(242		)
Total operating lease expense, net	1,579

As Lessee - Finance Lease

The Company currently leases land for one of its branch office locations under a finance lease. The ROU asset for the finance lease totaled $2,052 at June 30, 2020 and is included in other assets. As of June 30, 2019, the amount was recorded in premises and equipment, net. The corresponding lease liability totaled $1,843 at June 30, 2020 and is included in other liabilities. For the year ended June 30, 2020, interest expense on the lease liability totaled $97. The finance lease has a maturity date of July 2028 and a discount rate of 5.18%. Upon adoption of ASC 842, the capital lease obligation for June 30, 2019 was also reclassified to other liabilities.

The following schedule summarizes aggregate future minimum lease payments under this finance lease obligation at June 30, 2020:

Fiscal year ending June 30:
2021	$	134
2022	134
2023	134
2023	145
2024	146
Thereafter	1,848
Total minimum lease payments	2,541
Less: amount representing interest	(698		)
Present value of net minimum lease payments	$	1,843

Supplemental lease cash flow information for the year ended June 30, 2020:

ROU assets - noncash additions (operating leases)	$	5,296
ROU assets - noncash addition (finance lease)	2,052
Cash paid for amounts included in the measurement of lease liabilities (operating leases)	2,142
Cash paid for amounts included in the measurement of lease liabilities (finance leases)	134

As Lessor - General

The Company leases equipment to commercial end users under operating and finance lease arrangements. Our equipment finance leases consist mainly of construction, transportation, medical, and manufacturing equipment. Many of our operating and finance leases offer the lessee the option to purchase the equipment at fair value or for a nominal fixed purchase option; and most of the leases that do not have a nominal purchase option include renewal provisions resulting in some leases continuing beyond initial contractual terms. Our leases do not include early termination options, and continued rent payments are due if leased equipment is not returned at the end of the lease.

As Lessor - Operating Leases

Operating lease income is recognized as a component of noninterest income on a straight-line basis over the lease term. Lease terms range from 1 to 5 years. Assets related to operating leases are included in other assets and the corresponding depreciation expense is recorded on a straight-line basis as a component of other noninterest expense. The net book value of leased assets totaled $21,595 and $9,995 with a residual value of $12,370 and $5,800 as of June 30, 2020 and 2019, respectively. For the years ended June 30, 2020 and 2019, equipment finance operating lease income totaled $3,356 and $936, respectively. For the years ended June 30, 2020 and 2019, depreciation expense totaled $2,394 and $633, respectively.

The following schedule summarizes aggregate future minimum operating lease payments to be received at June 30, 2020:

Fiscal year ending June 30:
2021	$	4,732
2022	3,643
2023	2,061
2024	649
2025	104
Thereafter	—
Total of future minimum payments	$	11,189

As Lessor - Finance Leases

Finance lease income is recognized as a component of loan interest income over the lease term. The finance leases are included as a component of the equipment finance class of financing receivables under the commercial loan segment. For the years ended June 30, 2020 and 2019, total interest income on equipment finance leases totaled $1,595 and $775, respectively.

The following table presents components of finance lease net investment included within equipment finance class of financing receivables:

	June 30, 2020
Lease receivables	$	44,927

The following schedule summarizes aggregate future minimum finance lease payments to be received at June 30, 2020:

Fiscal year ending June 30:
2021	$	11,453
2022	11,054
2023	10,697
2024	8,813
2025	4,848
Thereafter	2,667
Total minimum payments	49,532
Less: amount representing interest	(4,605		)
Total	$	44,927

Leases

Leases

As Lessee - Operating Leases

Company operating leases primarily include office space and bank branches. Certain leases include one or more options to renew, with renewal terms that can extend the lease term up to 15 additional years. The exercise of lease renewal options is at our sole discretion. When it is reasonably certain that we will exercise our option to renew or extend the lease term, that option is included in estimating the value of the ROU and lease liability. At June 30, 2020, we did not have any leases that had not yet commenced for which we had created a ROU asset and a lease liability. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Most of our lease agreements include periodic rate adjustments for inflation. The depreciable life of ROU assets and leasehold improvements are limited to the shorter of the useful life or the expected lease term. Leases with an initial term of 12 months or less are not recorded on our Consolidated Balance Sheets; we recognize lease expenses for these leases over the lease term.

The following tables present supplemental balance sheet information related to operating leases. ROU assets are included in other assets and lease liabilities are included in other liabilities.

Supplemental Balance Sheet Information:	June 30, 2020
ROU assets	$	4,601
Lease liabilities	4,590
Weighted-average remaining lease terms	5.02
Weighted-average discount rate	2.97		%

The following schedule summarizes aggregate future minimum lease payments under these operating leases at June 30, 2020:

Fiscal year ending June 30:
2021	$	1,242
2022	1,115
2023	1,063
2022	593
2023	287
Thereafter	676
Total of future minimum payments	$	4,976

The following table presents components of operating lease expense for the year ended June 30, 2020:

	Year Ended June 30, 2020
Operating lease cost (included in occupancy expense)	$	1,821
Sublease income (included in other, net noninterest income)	(242		)
Total operating lease expense, net	1,579

As Lessee - Finance Lease

The Company currently leases land for one of its branch office locations under a finance lease. The ROU asset for the finance lease totaled $2,052 at June 30, 2020 and is included in other assets. As of June 30, 2019, the amount was recorded in premises and equipment, net. The corresponding lease liability totaled $1,843 at June 30, 2020 and is included in other liabilities. For the year ended June 30, 2020, interest expense on the lease liability totaled $97. The finance lease has a maturity date of July 2028 and a discount rate of 5.18%. Upon adoption of ASC 842, the capital lease obligation for June 30, 2019 was also reclassified to other liabilities.

The following schedule summarizes aggregate future minimum lease payments under this finance lease obligation at June 30, 2020:

Fiscal year ending June 30:
2021	$	134
2022	134
2023	134
2023	145
2024	146
Thereafter	1,848
Total minimum lease payments	2,541
Less: amount representing interest	(698		)
Present value of net minimum lease payments	$	1,843

Supplemental lease cash flow information for the year ended June 30, 2020:

ROU assets - noncash additions (operating leases)	$	5,296
ROU assets - noncash addition (finance lease)	2,052
Cash paid for amounts included in the measurement of lease liabilities (operating leases)	2,142
Cash paid for amounts included in the measurement of lease liabilities (finance leases)	134

As Lessor - General

The Company leases equipment to commercial end users under operating and finance lease arrangements. Our equipment finance leases consist mainly of construction, transportation, medical, and manufacturing equipment. Many of our operating and finance leases offer the lessee the option to purchase the equipment at fair value or for a nominal fixed purchase option; and most of the leases that do not have a nominal purchase option include renewal provisions resulting in some leases continuing beyond initial contractual terms. Our leases do not include early termination options, and continued rent payments are due if leased equipment is not returned at the end of the lease.

As Lessor - Operating Leases

Operating lease income is recognized as a component of noninterest income on a straight-line basis over the lease term. Lease terms range from 1 to 5 years. Assets related to operating leases are included in other assets and the corresponding depreciation expense is recorded on a straight-line basis as a component of other noninterest expense. The net book value of leased assets totaled $21,595 and $9,995 with a residual value of $12,370 and $5,800 as of June 30, 2020 and 2019, respectively. For the years ended June 30, 2020 and 2019, equipment finance operating lease income totaled $3,356 and $936, respectively. For the years ended June 30, 2020 and 2019, depreciation expense totaled $2,394 and $633, respectively.

The following schedule summarizes aggregate future minimum operating lease payments to be received at June 30, 2020:

Fiscal year ending June 30:
2021	$	4,732
2022	3,643
2023	2,061
2024	649
2025	104
Thereafter	—
Total of future minimum payments	$	11,189

As Lessor - Finance Leases

Finance lease income is recognized as a component of loan interest income over the lease term. The finance leases are included as a component of the equipment finance class of financing receivables under the commercial loan segment. For the years ended June 30, 2020 and 2019, total interest income on equipment finance leases totaled $1,595 and $775, respectively.

The following table presents components of finance lease net investment included within equipment finance class of financing receivables:

	June 30, 2020
Lease receivables	$	44,927

The following schedule summarizes aggregate future minimum finance lease payments to be received at June 30, 2020:

Fiscal year ending June 30:
2021	$	11,453
2022	11,054
2023	10,697
2024	8,813
2025	4,848
Thereafter	2,667
Total minimum payments	49,532
Less: amount representing interest	(4,605		)
Total	$	44,927

Leases

Leases

As Lessee - Operating Leases

Company operating leases primarily include office space and bank branches. Certain leases include one or more options to renew, with renewal terms that can extend the lease term up to 15 additional years. The exercise of lease renewal options is at our sole discretion. When it is reasonably certain that we will exercise our option to renew or extend the lease term, that option is included in estimating the value of the ROU and lease liability. At June 30, 2020, we did not have any leases that had not yet commenced for which we had created a ROU asset and a lease liability. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Most of our lease agreements include periodic rate adjustments for inflation. The depreciable life of ROU assets and leasehold improvements are limited to the shorter of the useful life or the expected lease term. Leases with an initial term of 12 months or less are not recorded on our Consolidated Balance Sheets; we recognize lease expenses for these leases over the lease term.

The following tables present supplemental balance sheet information related to operating leases. ROU assets are included in other assets and lease liabilities are included in other liabilities.

Supplemental Balance Sheet Information:	June 30, 2020
ROU assets	$	4,601
Lease liabilities	4,590
Weighted-average remaining lease terms	5.02
Weighted-average discount rate	2.97		%

The following schedule summarizes aggregate future minimum lease payments under these operating leases at June 30, 2020:

Fiscal year ending June 30:
2021	$	1,242
2022	1,115
2023	1,063
2022	593
2023	287
Thereafter	676
Total of future minimum payments	$	4,976

The following table presents components of operating lease expense for the year ended June 30, 2020:

	Year Ended June 30, 2020
Operating lease cost (included in occupancy expense)	$	1,821
Sublease income (included in other, net noninterest income)	(242		)
Total operating lease expense, net	1,579

As Lessee - Finance Lease

The Company currently leases land for one of its branch office locations under a finance lease. The ROU asset for the finance lease totaled $2,052 at June 30, 2020 and is included in other assets. As of June 30, 2019, the amount was recorded in premises and equipment, net. The corresponding lease liability totaled $1,843 at June 30, 2020 and is included in other liabilities. For the year ended June 30, 2020, interest expense on the lease liability totaled $97. The finance lease has a maturity date of July 2028 and a discount rate of 5.18%. Upon adoption of ASC 842, the capital lease obligation for June 30, 2019 was also reclassified to other liabilities.

The following schedule summarizes aggregate future minimum lease payments under this finance lease obligation at June 30, 2020:

Fiscal year ending June 30:
2021	$	134
2022	134
2023	134
2023	145
2024	146
Thereafter	1,848
Total minimum lease payments	2,541
Less: amount representing interest	(698		)
Present value of net minimum lease payments	$	1,843

Supplemental lease cash flow information for the year ended June 30, 2020:

ROU assets - noncash additions (operating leases)	$	5,296
ROU assets - noncash addition (finance lease)	2,052
Cash paid for amounts included in the measurement of lease liabilities (operating leases)	2,142
Cash paid for amounts included in the measurement of lease liabilities (finance leases)	134

As Lessor - General

The Company leases equipment to commercial end users under operating and finance lease arrangements. Our equipment finance leases consist mainly of construction, transportation, medical, and manufacturing equipment. Many of our operating and finance leases offer the lessee the option to purchase the equipment at fair value or for a nominal fixed purchase option; and most of the leases that do not have a nominal purchase option include renewal provisions resulting in some leases continuing beyond initial contractual terms. Our leases do not include early termination options, and continued rent payments are due if leased equipment is not returned at the end of the lease.

As Lessor - Operating Leases

Operating lease income is recognized as a component of noninterest income on a straight-line basis over the lease term. Lease terms range from 1 to 5 years. Assets related to operating leases are included in other assets and the corresponding depreciation expense is recorded on a straight-line basis as a component of other noninterest expense. The net book value of leased assets totaled $21,595 and $9,995 with a residual value of $12,370 and $5,800 as of June 30, 2020 and 2019, respectively. For the years ended June 30, 2020 and 2019, equipment finance operating lease income totaled $3,356 and $936, respectively. For the years ended June 30, 2020 and 2019, depreciation expense totaled $2,394 and $633, respectively.

The following schedule summarizes aggregate future minimum operating lease payments to be received at June 30, 2020:

Fiscal year ending June 30:
2021	$	4,732
2022	3,643
2023	2,061
2024	649
2025	104
Thereafter	—
Total of future minimum payments	$	11,189

As Lessor - Finance Leases

Finance lease income is recognized as a component of loan interest income over the lease term. The finance leases are included as a component of the equipment finance class of financing receivables under the commercial loan segment. For the years ended June 30, 2020 and 2019, total interest income on equipment finance leases totaled $1,595 and $775, respectively.

The following table presents components of finance lease net investment included within equipment finance class of financing receivables:

	June 30, 2020
Lease receivables	$	44,927

The following schedule summarizes aggregate future minimum finance lease payments to be received at June 30, 2020:

Fiscal year ending June 30:
2021	$	11,453
2022	11,054
2023	10,697
2024	8,813
2025	4,848
Thereafter	2,667
Total minimum payments	49,532
Less: amount representing interest	(4,605		)
Total	$	44,927

Leases

Leases

As Lessee - Operating Leases

Company operating leases primarily include office space and bank branches. Certain leases include one or more options to renew, with renewal terms that can extend the lease term up to 15 additional years. The exercise of lease renewal options is at our sole discretion. When it is reasonably certain that we will exercise our option to renew or extend the lease term, that option is included in estimating the value of the ROU and lease liability. At June 30, 2020, we did not have any leases that had not yet commenced for which we had created a ROU asset and a lease liability. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Most of our lease agreements include periodic rate adjustments for inflation. The depreciable life of ROU assets and leasehold improvements are limited to the shorter of the useful life or the expected lease term. Leases with an initial term of 12 months or less are not recorded on our Consolidated Balance Sheets; we recognize lease expenses for these leases over the lease term.

The following tables present supplemental balance sheet information related to operating leases. ROU assets are included in other assets and lease liabilities are included in other liabilities.

Supplemental Balance Sheet Information:	June 30, 2020
ROU assets	$	4,601
Lease liabilities	4,590
Weighted-average remaining lease terms	5.02
Weighted-average discount rate	2.97		%

The following schedule summarizes aggregate future minimum lease payments under these operating leases at June 30, 2020:

Fiscal year ending June 30:
2021	$	1,242
2022	1,115
2023	1,063
2022	593
2023	287
Thereafter	676
Total of future minimum payments	$	4,976

The following table presents components of operating lease expense for the year ended June 30, 2020:

	Year Ended June 30, 2020
Operating lease cost (included in occupancy expense)	$	1,821
Sublease income (included in other, net noninterest income)	(242		)
Total operating lease expense, net	1,579

As Lessee - Finance Lease

The Company currently leases land for one of its branch office locations under a finance lease. The ROU asset for the finance lease totaled $2,052 at June 30, 2020 and is included in other assets. As of June 30, 2019, the amount was recorded in premises and equipment, net. The corresponding lease liability totaled $1,843 at June 30, 2020 and is included in other liabilities. For the year ended June 30, 2020, interest expense on the lease liability totaled $97. The finance lease has a maturity date of July 2028 and a discount rate of 5.18%. Upon adoption of ASC 842, the capital lease obligation for June 30, 2019 was also reclassified to other liabilities.

The following schedule summarizes aggregate future minimum lease payments under this finance lease obligation at June 30, 2020:

Fiscal year ending June 30:
2021	$	134
2022	134
2023	134
2023	145
2024	146
Thereafter	1,848
Total minimum lease payments	2,541
Less: amount representing interest	(698		)
Present value of net minimum lease payments	$	1,843

Supplemental lease cash flow information for the year ended June 30, 2020:

ROU assets - noncash additions (operating leases)	$	5,296
ROU assets - noncash addition (finance lease)	2,052
Cash paid for amounts included in the measurement of lease liabilities (operating leases)	2,142
Cash paid for amounts included in the measurement of lease liabilities (finance leases)	134

As Lessor - General

The Company leases equipment to commercial end users under operating and finance lease arrangements. Our equipment finance leases consist mainly of construction, transportation, medical, and manufacturing equipment. Many of our operating and finance leases offer the lessee the option to purchase the equipment at fair value or for a nominal fixed purchase option; and most of the leases that do not have a nominal purchase option include renewal provisions resulting in some leases continuing beyond initial contractual terms. Our leases do not include early termination options, and continued rent payments are due if leased equipment is not returned at the end of the lease.

As Lessor - Operating Leases

Operating lease income is recognized as a component of noninterest income on a straight-line basis over the lease term. Lease terms range from 1 to 5 years. Assets related to operating leases are included in other assets and the corresponding depreciation expense is recorded on a straight-line basis as a component of other noninterest expense. The net book value of leased assets totaled $21,595 and $9,995 with a residual value of $12,370 and $5,800 as of June 30, 2020 and 2019, respectively. For the years ended June 30, 2020 and 2019, equipment finance operating lease income totaled $3,356 and $936, respectively. For the years ended June 30, 2020 and 2019, depreciation expense totaled $2,394 and $633, respectively.

The following schedule summarizes aggregate future minimum operating lease payments to be received at June 30, 2020:

Fiscal year ending June 30:
2021	$	4,732
2022	3,643
2023	2,061
2024	649
2025	104
Thereafter	—
Total of future minimum payments	$	11,189

As Lessor - Finance Leases

Finance lease income is recognized as a component of loan interest income over the lease term. The finance leases are included as a component of the equipment finance class of financing receivables under the commercial loan segment. For the years ended June 30, 2020 and 2019, total interest income on equipment finance leases totaled $1,595 and $775, respectively.

The following table presents components of finance lease net investment included within equipment finance class of financing receivables:

	June 30, 2020
Lease receivables	$	44,927

The following schedule summarizes aggregate future minimum finance lease payments to be received at June 30, 2020:

Fiscal year ending June 30:
2021	$	11,453
2022	11,054
2023	10,697
2024	8,813
2025	4,848
Thereafter	2,667
Total minimum payments	49,532
Less: amount representing interest	(4,605		)
Total	$	44,927