Leases

9 Months Ended

Sep. 30, 2023

Leases [Abstract]

Leases

LEASES (Dollars In Thousands)

Arrow is a lessee in its leases, which are mainly for financial services locations in addition to leases for corporate vehicles. These leases generally require Arrow to pay third-party expenses on behalf of the Lessor, which are referred to as variable payments. Under some leases, Arrow pays the variable payments to the lessor, and in other leases, Arrow pays the variable payments directly to the applicable third party. None of Arrow's current leases include any residual value guarantees or any subleases, and there are no significant rights and obligations of Arrow for leases that have not commenced as of the reporting date.

Arrow leases two of its branch offices, at market rates, from Stewart’s Shops Corp.  Mr. Gary C. Dake, President of Stewart’s Shops Corp., serves as a Director on the Board of Directors of Arrow and its two subsidiary banks.

The following includes quantitative data related to Arrow's leases as of and for the nine months ended September 30, 2023 and September 30, 2022:

		Nine Months Ended
Finance Lease Amounts:	Classification	September 30, 2023			September 30, 2022
Right-of-Use Assets	Premises and Equipment, Net	$	4,504		$	4,681
Lease Liabilities	Finance Leases	5,080			5,131
Operating Lease Amounts:
Right-of-Use Assets	Other Assets	$	4,978		$	5,889
Lease Liabilities	Other Liabilities	5,179			6,082
Other Information:
Cash Paid For Amounts Included In The Measurement Of Lease Liabilities:
Operating Outgoing Cash Flows From Finance Leases		$	143		$	145
Operating Outgoing Cash Flows From Operating Leases		781			1,041
Financing Outgoing Cash Flows From Finance Leases		39			38
Right-of-Use Assets Obtained In Exchange For New Finance Lease Liabilities		—			—
Right-of-Use Assets Obtained In Exchange For New Operating Lease Liabilities		19			—
Weighted-average Remaining Lease Term - Finance Leases (Yrs.)		26.54			27.50
Weighted-average Remaining Lease Term - Operating Leases (Yrs.)		11.45			11.36
Weighted-average Discount Rate—Finance Leases		3.75		%	3.75		%
Weighted-average Discount Rate—Operating Leases		3.01		%	2.87		%

Lease cost information for Arrow's leases is as follows:
	Three Months Ended				Nine Months Ended
	September 30, 2023		September 30, 2022		September 30, 2023		September 30, 2022
Lease Cost:
Finance Lease Cost:
Reduction of Right-of-Use Assets	$	44	$	44	$	132	$	133
Interest on Lease Liabilities	46		48		143		145
Operating Lease Cost	195		305		786		925
Short-term Lease Cost	11		9		46		32
Variable Lease Cost	58		86		179		253
Total Lease Cost	$	354	$	492	$	1,286	$	1,488

Future Lease Payments at September 30, 2023 are as follows:
	Operating Leases		Financing Leases
Twelve Months Ended:
9/30/2024	$	733	$	247
9/30/2025	653		259
9/30/2026	590		268
9/30/2027	561		268
9/30/2028	486		268
Thereafter	3,212		7,063
Total Undiscounted Cash Flows	$	6,235	$	8,373
Less: Net Present Value Adjustment	1,056		3,293
Lease Liability	$	5,179	$	5,080

Leases

LEASES (Dollars In Thousands)

Arrow is a lessee in its leases, which are mainly for financial services locations in addition to leases for corporate vehicles. These leases generally require Arrow to pay third-party expenses on behalf of the Lessor, which are referred to as variable payments. Under some leases, Arrow pays the variable payments to the lessor, and in other leases, Arrow pays the variable payments directly to the applicable third party. None of Arrow's current leases include any residual value guarantees or any subleases, and there are no significant rights and obligations of Arrow for leases that have not commenced as of the reporting date.

Arrow leases two of its branch offices, at market rates, from Stewart’s Shops Corp.  Mr. Gary C. Dake, President of Stewart’s Shops Corp., serves as a Director on the Board of Directors of Arrow and its two subsidiary banks.

The following includes quantitative data related to Arrow's leases as of and for the nine months ended September 30, 2023 and September 30, 2022:

		Nine Months Ended
Finance Lease Amounts:	Classification	September 30, 2023			September 30, 2022
Right-of-Use Assets	Premises and Equipment, Net	$	4,504		$	4,681
Lease Liabilities	Finance Leases	5,080			5,131
Operating Lease Amounts:
Right-of-Use Assets	Other Assets	$	4,978		$	5,889
Lease Liabilities	Other Liabilities	5,179			6,082
Other Information:
Cash Paid For Amounts Included In The Measurement Of Lease Liabilities:
Operating Outgoing Cash Flows From Finance Leases		$	143		$	145
Operating Outgoing Cash Flows From Operating Leases		781			1,041
Financing Outgoing Cash Flows From Finance Leases		39			38
Right-of-Use Assets Obtained In Exchange For New Finance Lease Liabilities		—			—
Right-of-Use Assets Obtained In Exchange For New Operating Lease Liabilities		19			—
Weighted-average Remaining Lease Term - Finance Leases (Yrs.)		26.54			27.50
Weighted-average Remaining Lease Term - Operating Leases (Yrs.)		11.45			11.36
Weighted-average Discount Rate—Finance Leases		3.75		%	3.75		%
Weighted-average Discount Rate—Operating Leases		3.01		%	2.87		%

Lease cost information for Arrow's leases is as follows:
	Three Months Ended				Nine Months Ended
	September 30, 2023		September 30, 2022		September 30, 2023		September 30, 2022
Lease Cost:
Finance Lease Cost:
Reduction of Right-of-Use Assets	$	44	$	44	$	132	$	133
Interest on Lease Liabilities	46		48		143		145
Operating Lease Cost	195		305		786		925
Short-term Lease Cost	11		9		46		32
Variable Lease Cost	58		86		179		253
Total Lease Cost	$	354	$	492	$	1,286	$	1,488

Future Lease Payments at September 30, 2023 are as follows:
	Operating Leases		Financing Leases
Twelve Months Ended:
9/30/2024	$	733	$	247
9/30/2025	653		259
9/30/2026	590		268
9/30/2027	561		268
9/30/2028	486		268
Thereafter	3,212		7,063
Total Undiscounted Cash Flows	$	6,235	$	8,373
Less: Net Present Value Adjustment	1,056		3,293
Lease Liability	$	5,179	$	5,080