Leases

6 Months Ended

Jun. 30, 2022

Leases

Leases

Note 15:  Leases

Busey as the Lessee

The Company has operating leases consisting primarily of equipment leases and real estate leases for banking centers, ATM locations, and office space.  The following table summarizes lease-related information and balances the Company reported in its unaudited Consolidated Balance Sheets for the periods presented (dollars in thousands):

	As of
	June 30,			December 31,
	2022			2021
Lease balances
Right of use assets	$	8,615		$	10,533
Lease liabilities		8,655			10,591
Supplemental information
Year through which lease terms extend		2031			2031
Weighted average remaining lease term (in years)		6.25			6.47
Weighted average discount rate		2.04	%		2.16	%

The following table represents lease costs and cash flows related to leases for the periods presented (dollars in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Lease costs
Operating lease costs	$	582	$	608	$	1,199	$	1,172
Variable lease costs		94		126		222		300
Short-term lease costs		6		16		10		34
Total lease cost (1)	$	682	$	750	$	1,431	$	1,506
Cash flows related to leases
Cash paid for amounts included in the measurement of lease liabilities:
Operating lease cash flows – Fixed payments	$	738	$	590	$	1,369	$	1,136
Operating lease cash flows – Liability reduction		692		546		1,277		1,041
Right of use assets obtained during the period in exchange for operating lease liabilities		—		1,462		55		1,610

(1) Lease costs are included in net occupancy and equipment expense in the unaudited Consolidated Statements of Income.

The Company was obligated under noncancelable operating leases for office space and other commitments, as follows (dollars in thousands):

	As of
	June 30, 2022
Rent commitments
Remainder of 2022	$	1,066
2023		1,833
2024		1,500
2025		1,265
2026		995
2027		701
Thereafter		1,853
Total undiscounted cash flows		9,213
Less: Amounts representing interest		558
Present value of net future minimum lease payments	$	8,655

Busey as the Lessor

Busey occasionally leases parking lots and office space to outside parties.  Further, in connection with the acquisition of CAC in the second quarter of 2021, the Company acquired office buildings in Glenview, IL and Northbrook, IL, along with operating leases for space within these buildings that is rented to third parties.  Revenues recorded in connection with these leases and reported in other income on our unaudited Consolidated Statements of Income are summarized as follows (dollars in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Rental income	$	143	$	87	$	373	$	131