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LEASES
 3 Months Ended
Mar. 31, 2022
Leases [Abstract]  
LEASES LEASES
Operating lease assets represent the Corporation's right to use an underlying asset during the lease term and operating lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at lease commencement based on the present value of the remaining lease payments using a discount rate that represents our incremental borrowing rate at the lease commencement date. Operating lease cost, which is comprised of amortization of the operating lease asset and the implicit interest accreted on the operating lease liability, is recognized on a straight-line basis over the lease term, and is recorded in net occupancy expense in the condensed consolidated statements of income.

The Corporation leases certain full-service branch offices, land and equipment. Leases with an initial term of twelve months or less are not recorded on the balance sheet. Most leases include one or more options to renew and the exercise of the lease renewal options are at the Corporation's sole discretion. The Corporation includes lease extension and termination options in the lease term if, after considering relevant economic factors, it is reasonably certain the Corporation will exercise the option. Certain lease agreements of the Corporation include rental payments adjusted periodically for changes in the consumer price index.

LeasesClassificationMarch 31, 2022December 31, 2021
Assets:
Operating lease assetsOperating lease assets$25,698 $19,928 
Finance lease assets
Premises and equipment, net (1)
340 358 
Total leased assets$26,038 $20,286 
Liabilities:
Operating lease liabilitiesOperating lease liabilities$26,955 $21,159 
Finance lease liabilitiesAccrued interest payable and other liabilities448 469 
Total leased liabilities$27,403 $21,628 
(1) Finance lease assets are recorded net of accumulated amortization of $876 thousand as of March 31, 2022 and $858 thousand as of December 31, 2021.

The components of the Corporation's net lease expense for the three months ended March 31, 2022 and 2021, respectively, were as follows:
Three months ended March 31,
Lease CostClassification20222021
Operating lease costNet occupancy expense$492 $440 
Variable lease costNet occupancy expense13 17 
Finance lease cost:
Amortization of leased assetsNet occupancy expense18 18 
Interest on lease liabilitiesInterest expense - borrowed funds5 6 
Sublease income (1)
Net occupancy expense(17)(19)
Net lease cost$511 $462 
(1) Sublease income excludes rental income from owned properties.
The following table sets forth future minimum rental payments under noncancellable leases with initial terms in excess of one year as of March 31, 2022:
Maturity of Lease Liabilities as of March 31, 2022
Operating Leases (1)
Finance LeasesTotal
2022$1,487 $79 $1,566 
20231,919 105 2,024 
20241,880 105 1,985 
20251,873 105 1,978 
20261,845 105 1,950 
After 202630,620 030,620 
Total lease payments39,624 499 40,123 
Less: Interest12,669 51 12,720 
Present value of lease liabilities$26,955 $448 $27,403 
(1) Operating lease payments include payments related to options to extend lease terms that are reasonably certain of being exercised and exclude $6.6 million of legally binding minimum lease payments for leases signed, but not yet commenced.

Lease terms and discount rates related to the Corporation's lease liabilities as of March 31, 2022 and December 31, 2021 were as follows:
Lease Term and Discount RateMarch 31, 2022December 31, 2021
Weighted-average remaining lease term (years)
Operating leases22.318.8
Finance leases4.75.0
Weighted-average discount rate
Operating leases3.42 %3.42 %
Finance leases4.49 %4.49 %

Other information related to the Corporation's lease liabilities as of March 31, 2022 and 2021 was as follows:
Other InformationMarch 31, 2022March 31, 2021
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases$283 $223 
LEASES LEASES
Operating lease assets represent the Corporation's right to use an underlying asset during the lease term and operating lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at lease commencement based on the present value of the remaining lease payments using a discount rate that represents our incremental borrowing rate at the lease commencement date. Operating lease cost, which is comprised of amortization of the operating lease asset and the implicit interest accreted on the operating lease liability, is recognized on a straight-line basis over the lease term, and is recorded in net occupancy expense in the condensed consolidated statements of income.

The Corporation leases certain full-service branch offices, land and equipment. Leases with an initial term of twelve months or less are not recorded on the balance sheet. Most leases include one or more options to renew and the exercise of the lease renewal options are at the Corporation's sole discretion. The Corporation includes lease extension and termination options in the lease term if, after considering relevant economic factors, it is reasonably certain the Corporation will exercise the option. Certain lease agreements of the Corporation include rental payments adjusted periodically for changes in the consumer price index.

LeasesClassificationMarch 31, 2022December 31, 2021
Assets:
Operating lease assetsOperating lease assets$25,698 $19,928 
Finance lease assets
Premises and equipment, net (1)
340 358 
Total leased assets$26,038 $20,286 
Liabilities:
Operating lease liabilitiesOperating lease liabilities$26,955 $21,159 
Finance lease liabilitiesAccrued interest payable and other liabilities448 469 
Total leased liabilities$27,403 $21,628 
(1) Finance lease assets are recorded net of accumulated amortization of $876 thousand as of March 31, 2022 and $858 thousand as of December 31, 2021.

The components of the Corporation's net lease expense for the three months ended March 31, 2022 and 2021, respectively, were as follows:
Three months ended March 31,
Lease CostClassification20222021
Operating lease costNet occupancy expense$492 $440 
Variable lease costNet occupancy expense13 17 
Finance lease cost:
Amortization of leased assetsNet occupancy expense18 18 
Interest on lease liabilitiesInterest expense - borrowed funds5 6 
Sublease income (1)
Net occupancy expense(17)(19)
Net lease cost$511 $462 
(1) Sublease income excludes rental income from owned properties.
The following table sets forth future minimum rental payments under noncancellable leases with initial terms in excess of one year as of March 31, 2022:
Maturity of Lease Liabilities as of March 31, 2022
Operating Leases (1)
Finance LeasesTotal
2022$1,487 $79 $1,566 
20231,919 105 2,024 
20241,880 105 1,985 
20251,873 105 1,978 
20261,845 105 1,950 
After 202630,620 030,620 
Total lease payments39,624 499 40,123 
Less: Interest12,669 51 12,720 
Present value of lease liabilities$26,955 $448 $27,403 
(1) Operating lease payments include payments related to options to extend lease terms that are reasonably certain of being exercised and exclude $6.6 million of legally binding minimum lease payments for leases signed, but not yet commenced.

Lease terms and discount rates related to the Corporation's lease liabilities as of March 31, 2022 and December 31, 2021 were as follows:
Lease Term and Discount RateMarch 31, 2022December 31, 2021
Weighted-average remaining lease term (years)
Operating leases22.318.8
Finance leases4.75.0
Weighted-average discount rate
Operating leases3.42 %3.42 %
Finance leases4.49 %4.49 %

Other information related to the Corporation's lease liabilities as of March 31, 2022 and 2021 was as follows:
Other InformationMarch 31, 2022March 31, 2021
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases$283 $223