Leases

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

Leases

Leases:

As of March 31, 2023, the Company was the lessee in 60 operating leases and 1 finance lease of certain branch, mortgage and operations locations with original terms greater than one year. Leases with initial terms of less than one year and equipment leases are not included on the consolidated balance sheets in accordance with U.S. GAAP.

Many leases include one or more options to renew, with renewal terms that can extend the lease up to an additional 20 years or more. Certain lease agreements contain provisions to periodically adjust rental payments for inflation. Renewal options that management is reasonably certain to renew and fixed rent escalations are included in the right-of-use asset and lease liability.

Information related to the Company's leases is presented below as of March 31, 2023 and December 31, 2022:

		March 31,			December 31,
	Classification	2023			2022
Right-of-use assets:
Operating leases	Operating lease right-of-use assets	$	57,054		$	60,043
Finance leases	Premises and equipment, net	1,339			1,367
Total right-of-use assets		$	58,393		$	61,410
Lease liabilities:
Operating leases	Operating lease liabilities	$	67,345		$	69,754
Finance leases	Borrowings	1,397			1,420
Total lease liabilities		$	68,742		$	71,174
Weighted average remaining lease term (in years) -     operating		11.9			12.1
Weighted average remaining lease term (in years) -     finance		12.1			12.4
Weighted average discount rate - operating		3.21		%	3.08		%
Weighted average discount rate - finance		1.76		%	1.76		%

The components of total lease expense included in the consolidated statements of income were as follows:

		Three Months Ended March 31,
	Classification	2023		2022
Operating lease costs:
Amortization of right-of-use asset	Occupancy and equipment	$	1,815	$	1,710
Short-term lease cost	Occupancy and equipment	121		111
Variable lease cost	Occupancy and equipment	298		256
Gain on lease modifications and terminations	Occupancy and equipment	(72)		(18)
Finance lease costs:
Interest on lease liabilities	Interest expense on borrowings	6		9
Amortization of right-of-use asset	Occupancy and equipment	28		37
Sublease income	Occupancy and equipment	(281)		(195)
Total lease cost		$	1,915	$	1,910

During the three months ended March 31, 2023 and 2022, the Company recorded $72 and $18 in gains on lease modifications and terminations on certain vacated locations that were consolidated as a result of previous business combinations, respectively.

The Company does not separate lease and non-lease components and instead elects to account for them as a single lease component. Variable lease cost primarily represents variable payments such as common area maintenance, utilities, and property taxes.

A maturity analysis of operating and finance lease liabilities and a reconciliation of undiscounted cash flows to the total lease liability as of March 31, 2023 is as follows:

	Operating		Finance
	Leases		Lease
Lease payments due:
March 31, 2024	$	6,596	$	89
March 31, 2025	7,956		120
March 31, 2026	7,885		121
March 31, 2027	7,715		123
March 31, 2028	7,326		125
Thereafter	45,839		977
Total undiscounted future minimum lease payments	83,317		1,555
Less: imputed interest	(15,972)		(158)
Lease liability	$	67,345	$	1,397

Leases

Leases:

As of March 31, 2023, the Company was the lessee in 60 operating leases and 1 finance lease of certain branch, mortgage and operations locations with original terms greater than one year. Leases with initial terms of less than one year and equipment leases are not included on the consolidated balance sheets in accordance with U.S. GAAP.

Many leases include one or more options to renew, with renewal terms that can extend the lease up to an additional 20 years or more. Certain lease agreements contain provisions to periodically adjust rental payments for inflation. Renewal options that management is reasonably certain to renew and fixed rent escalations are included in the right-of-use asset and lease liability.

Information related to the Company's leases is presented below as of March 31, 2023 and December 31, 2022:

		March 31,			December 31,
	Classification	2023			2022
Right-of-use assets:
Operating leases	Operating lease right-of-use assets	$	57,054		$	60,043
Finance leases	Premises and equipment, net	1,339			1,367
Total right-of-use assets		$	58,393		$	61,410
Lease liabilities:
Operating leases	Operating lease liabilities	$	67,345		$	69,754
Finance leases	Borrowings	1,397			1,420
Total lease liabilities		$	68,742		$	71,174
Weighted average remaining lease term (in years) -     operating		11.9			12.1
Weighted average remaining lease term (in years) -     finance		12.1			12.4
Weighted average discount rate - operating		3.21		%	3.08		%
Weighted average discount rate - finance		1.76		%	1.76		%

The components of total lease expense included in the consolidated statements of income were as follows:

		Three Months Ended March 31,
	Classification	2023		2022
Operating lease costs:
Amortization of right-of-use asset	Occupancy and equipment	$	1,815	$	1,710
Short-term lease cost	Occupancy and equipment	121		111
Variable lease cost	Occupancy and equipment	298		256
Gain on lease modifications and terminations	Occupancy and equipment	(72)		(18)
Finance lease costs:
Interest on lease liabilities	Interest expense on borrowings	6		9
Amortization of right-of-use asset	Occupancy and equipment	28		37
Sublease income	Occupancy and equipment	(281)		(195)
Total lease cost		$	1,915	$	1,910

During the three months ended March 31, 2023 and 2022, the Company recorded $72 and $18 in gains on lease modifications and terminations on certain vacated locations that were consolidated as a result of previous business combinations, respectively.

The Company does not separate lease and non-lease components and instead elects to account for them as a single lease component. Variable lease cost primarily represents variable payments such as common area maintenance, utilities, and property taxes.

A maturity analysis of operating and finance lease liabilities and a reconciliation of undiscounted cash flows to the total lease liability as of March 31, 2023 is as follows:

	Operating		Finance
	Leases		Lease
Lease payments due:
March 31, 2024	$	6,596	$	89
March 31, 2025	7,956		120
March 31, 2026	7,885		121
March 31, 2027	7,715		123
March 31, 2028	7,326		125
Thereafter	45,839		977
Total undiscounted future minimum lease payments	83,317		1,555
Less: imputed interest	(15,972)		(158)
Lease liability	$	67,345	$	1,397