Leases

12 Months Ended

Dec. 31, 2025

Leases

Leases

10.   Leases

As of December 31, 2025, the Company leases real estate for seven branch offices and two administrative offices under various lease agreements. All of our leases are classified as operating leases.

The Bank closed its Middletown branch, effective January 27, 2026, as part of its ongoing strategy to enhance operational efficiency and position the Bank for long-term growth.

The calculated amount of the right-of-use (“ROU”) assets and lease liabilities are impacted by the length of the lease term and the discount rate used to present value the minimum lease payments. The Company’s leases have maturities which range from 2024 to 2048, some of which include lessee options to extend the lease term. If the Company considers the exercising of a renewal option to be reasonably certain, the Company will include the extended term in the calculation of the ROU asset and lease liability. The weighted average remaining life of the lease terms for these leases was 15.2 and 15.7 years as of December 31, 2025 and 2024, respectively. As most of our leases do not provide an implicit rate, the Company used its incremental borrowing rate, which is the rate of interest to borrow on a collateralized basis for a similar term, at the lease commencement date. The Company calculated a weighted average discount rate of 4.12% and 3.91% in determining the lease liability as of December 31, 2025 and 2024, respectively.

For the years ended December 31, 2025 and 2024, total operating lease costs were $797 and $782, respectively, and were included in occupancy and other expense. The ROU asset, included in other assets, was $6,045 and $7,307 as of December 31, 2025 and 2024, respectively. The corresponding lease liability, included in accrued expenses and other liabilities was $6,144 and $7,386 as of December 31, 2025 and 2024, respectively.

Future minimum payments for operating leases with initial terms of one year or more as of December 31, 2025 were as follows:

Years ending December 31:
2026	$	692
2027		644
2028		648
2029		654
2030		604
Thereafter		5,497
Total future minimum lease payments		8,739
Amounts representing interest		(2,595)
Present Value of Net Future Minimum Lease Payments	$	6,144