Lease Commitments

12 Months Ended

Dec. 31, 2025

Note 11 - Lease Commitments

The Company is the lessee in various noncancellable operating leases for land, buildings, and equipment. Certain leases contain provisions for variable lease payments that are linked to the consumer price index. Lease cost consists of:


	For the Year Ended December 31,
(In thousands)	2025		2024		2023
Operating lease cost	$	12,311	$	10,622	$	10,667
Variable lease cost	2,504		3,023		2,827
Short-term lease cost	564		556		919
Sublease income	(703)		(574)		(639)
Total lease cost	$	14,676	$	13,627	$	13,774

The following table provides supplemental information related to leases:


	As of and For the Year Ended December 31,
(In thousands, except for weighted-average data)	2025			2024
Operating lease ROUAs	$	57,925		$	40,935
Operating lease liabilities	62,322			44,717
Cash paid during the year for amounts included in the measurement of operating lease liabilities	11,764			10,600
ROUAs recorded during the year in exchange for new or renewed operating lease obligations	16,540			2,815
ROUAs obtained during the year through bank acquisition	9,906			—
Weighted-average remaining lease term for operating leases	7.3 years			6.4 years
Weighted-average discount rate for operating leases	5.17		%	5.10		%

The Company’s lease agreements often include one or more options to renew at the Company’s discretion. If, at lease inception, the Company considers the exercising of a renewal option to be reasonably certain, the Company includes the extended term in the calculation of the lease liability. Maturities of lease liabilities as of December 31, 2025 are as follows:




(In thousands)	Payments Due
2026	$	12,712
2027	11,724
2028	10,448
2029	7,936
2030	7,274
Thereafter	17,790
Total undiscounted cash flows	67,884
Less: Net present value adjustment	(5,562)
Total	$	62,322

Sale-Leaseback Transaction Accounted for as Financing Obligation

Through the acquisition of VBI, the Company assumed a financing obligation related to branch properties that did not qualify for sale accounting under ASC Topic 842-40, Sale and Leaseback, and recognized the obligation in accordance with ASC 805, Business Combinations. At the date of acquisition, the $17.8 million financing obligation was recorded at fair value, which was $8.3 million higher than the contractual lease amount. The premium is amortized over the 20‑year term, with the resulting accretion recognized within Interest Expense in the Consolidated Statements of Income. At December 31, 2025, the remaining balance, $17.6 million, was reflected within Long-term debt, net on the Consolidated Balance Sheets.