Leases

12 Months Ended

Dec. 31, 2020

LEASES

The Corporation adopted ASU No. 2016-02 - Leases (Topic 842), as amended, as of January 1, 2019 for certain retail branches, office space, land and equipment. The Corporation elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed the Corporation to carry forward the historical lease classification. Operating leases are included in the operating lease right-of use ("ROU") asset, which is included in other assets and the lease liability is included in other liabilities in our balance sheets. The Corporation does not have any finance leases.

ROU assets represent the Corporation's right to use an underlying asset for the lease term and lease liabilities represent the Corporation's obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Corporation uses its incremental borrowing rate at commencement date in determining the present value of lease payments when the rate implicit in a lease is not known. The Corporation's incremental borrowing rate is based on the FHLB amortizing advance rate, adjusted for the lease term and other factors. Lease terms may include options to extend or terminate the lease. The exercise of such lease renewal options is at the Corporation's sole discretion and is not included in the present value of lease obligations unless it is reasonably certain that the option will be exercised. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. Certain of the Corporation's lease agreements include rental payments adjusted periodically for inflation. The Corporation's lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Supplemental balance sheet information related to leases is presented in the table below as of December 31, 2020 and 2019:


	December 31, 2020			December 31, 2019
Operating lease assets	$	18,247		$	20,747
Total lease assets	$	18,247		$	20,747

Operating lease liabilities	$	20,058		$	21,421
Total Lease liabilities	$	20,058		$	21,421

Weighted average remaining lease term (years)
Operating leases	8.0			8.9
Weighted average discount rate
Operating leases	3.3		%	3.4		%

The table below presents the components of lease expense for the period indicated.


	Twelve Months Ended December 31, 2020		Twelve Months Ended December 31, 2019
Lease Cost:
Operating lease cost	$	3,724	$	3,617
Short-term lease cost	247		204
Variable lease cost	842		948
Sublease income	$	(43)	(13)
Total lease cost	$	4,770	4,756

Supplemental cash flow information related to leases is presented in the tables below.


Maturity of lease liabilities	Operating Leases
2021	$	3,542
2022	3,394
2023	2,992
2024	2,921
2025	2,687
2026 and after	7,716
Total lease payments	$	23,252
Less: Present value discount	3,194
Present value of lease liabilities	$	20,058


Other Information	Twelve Months Ended December 31, 2020		Twelve Months Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	3,629	$	3,422
ROU assets obtained in exchange for new operating lease liabilities	$	1,601	$	23,529