LEASES

12 Months Ended

Dec. 31, 2025

Operating Leases

The Corporation leases certain branch properties under long-term, operating lease agreements. The leases expire at various dates through 2033 and generally include renewal options. As of December 31, 2025, the weighted average remaining lease term was 6.11 years with a weighted average discount rate of 3.53%. Rent expense was $1.0 million for each of the years ended December 31, 2025 and 2024. Certain leases provide for increases in future minimum annual rent payments as defined in the lease agreements. The Corporation’s operating lease agreements contain both lease and non-lease components, which are generally accounted for separately. The Corporation’s lease agreements do not contain any residual value guarantees.

Leased branch properties as of December 31, 2025 and December 31, 2024 classified as operating leases consist of the following (in thousands):


	2025		2024
Operating lease right-of-use asset	$	5,446	$	5,648
Less: accumulated amortization	(771)		(772)

Add: lease modifications	80		570
Operating lease right-of-use-assets, net	$	4,755	$	5,446

The following is a schedule by year of the undiscounted cash flows of the operating lease liabilities, excluding CAM charges, as of December 31, 2025 (in thousands):


Year	Amount
2026	$	965
2027	977
2028	845
2029	830
2030	705
2031 and thereafter	1,163
Total minimum lease payments	5,485
Less: amount representing interest	(548)
Present value of net minimum lease payments	$	4,937

As of December 31, 2025, the Corporation had no operating leases that were signed, but had not yet commenced.

Finance Leases

The Corporation leases certain buildings under finance leases. In May, 2024, the Corporation added $0.9 million in right-of-use assets and finance lease liabilities. The lease arrangements require monthly payments through 2044. As of December 31, 2025, the weighted average remaining lease term was 10.73 years with a weighted average discount rate of 4.08%. The Corporation has included these leases in premises and equipment as of December 31, 2025 and December 31, 2024.

The following is a schedule by year of future minimum lease payments under the capitalized lease, together with the present value of net minimum lease payments as of December 31, 2025 (in thousands):


Year	Amount
2026	$	502
2027	505
2028	505
2029	511
2030	318
2031 and thereafter	2,119
Total minimum lease payments	4,460
Less: amount representing interest	(1,016)
Present value of net minimum lease payments	$	3,444

As of December 31, 2025, the Corporation had no finance leases that were signed, but had not yet commenced.

Subsequent to December 31, 2025, the Corporation signed lease agreements for a branch in West Seneca and a representative office in Buffalo.

LEASES