Premises And Equipment

12 Months Ended

Dec. 31, 2011

NOTE 5: PREMISES AND EQUIPMENT

The components of premises and equipment included in the accompanying consolidated balance sheets are as follows:


					Estimated Useful Lives (In years)

(In thousands)	2011		2010
Land	$	544	$	600	N/A
Bank premises		10,712		11,070	39
Leasehold improvements		6,627		6,380	5– 20
Furniture, equipment, and software		16,376		16,538	3– 7
		34,259		34,588
Less: accumulated depreciation and amortization		20,027		20,223
	$	14,232	$	14,365

Depreciation and amortization expense related to premises and equipment amounted to $1.89 million, $1.70 million and $1.59 million in 2011, 2010 and 2009, respectively.

We occupy certain banking offices under non-cancellable operating lease agreements expiring at various dates over the next 20 years. The majority of leases have multiple options with escalation clauses for increases associated with the cost of living or other variable expenses over time. Rent expense on these properties totaled $1.02 million, $1.02 million and $1.01 million for the years ended December 31, 2011, 2010 and 2009, respectively. Minimum lease payments on these properties subsequent to December 31, 2011 are as follows: 2012 – $1.04 million; 2013 – $818 thousand; 2014 – $672 thousand; 2015 –$650 thousand; 2016 - $534 thousand and $3.02 million thereafter. We entered into a sale leaseback arrangement for our principal office in South Burlington, Vermont, in June 2008. Deferred gains on the sale leaseback transaction resulted in a $423 thousand offset to rent expense per year through 2015 and $1.06 million thereafter.

We had no intangibles on our balance sheet at any point during 2011 or 2010, therefore no amortization was recorded during 2011 or 2010. Amortization for intangibles is expected to be zero for 2012.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

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