LEASES

3 Months Ended

Mar. 31, 2024

The Bank as a lessee has operating leases primarily consisting of real estate arrangements where the Company operates its headquarters, branches and business production offices. All leases identified as in scope are accounted for as operating leases as of March 31, 2024. These leases are typically long-term leases and generally are not complicated arrangements or structures. Several of the leases contain renewal options at a rate comparable to the fair market value based on comparable analysis to similar properties in the Bank’s geographies.

Real estate operating leases are presented as a right-of-use (“ROU”) asset and a related operating lease liability on the Consolidated Statements of Financial Condition. The ROU asset represents the Company’s right to use the underlying asset for the lease term and the operating lease liabilities represent the obligation to make lease payments arising from the lease. The Company applied its incremental borrowing rate (“IBR”) as the discount rate to the remaining lease payments to derive a present value calculation for initial measurement of the operating lease liability. The IBR reflects the interest rate the Company would have to pay to borrow on a collateralized basis over a similar term for an amount equal to the lease payments. Lease expense is recognized on a straight-line basis over the lease term.

The following table summarizes our lease cost and other operating lease information:


	Three Months Ended March 31, 2024		Three Months Ended March 31, 2023
(In thousands)
Operating lease cost	$	1,840	$	1,777


Cash paid for amounts included in the measurement of operating leases liability	$	4,186	$	2,813



Note: Sublease income and variable income or expense considered immaterial

The weighted average remaining lease term on operating leases at March 31, 2024 and March 31, 2023 was 2.9 years and 3.6 years, respectively.

The weighted average discount rate used for the operating lease liability was 3.15% and 3.24% at March 31, 2024 and March 31, 2023, respectively.

The following table presents the remaining commitments for operating lease payments for the next five years and thereafter, as well as a reconciliation to the discounted operating leases liability recorded in the Consolidated Statements of Financial Condition as of March 31, 2024:


(In thousands)	As of March 31, 2024
2024	$	8,076
2025	10,797
2026	8,881
2027	747
2028	—
Thereafter	—
Total undiscounted operating lease payments	28,501
Less: present value adjustment	1,251
Total Operating leases liability	$	27,250