LEASES

12 Months Ended

Dec. 31, 2019

Leases

LEASES

11. LEASES

We adopted ASU 2016-02, Leases on January 1, 2019, which resulted in the recognition of operating leases on the balance sheet in 2019 and forward. See note 1.C. for more information on the adoption of the ASU. Right-of-use assets are included in the other assets line item and lease liabilities are included in the other liabilities line item of the consolidated balance sheet. We determine if a contract contains a lease at inception and recognize operating lease right-of-use assets and operating lease liabilities based on the present value of the future minimum lease payments at the commencement date. Collateralized advance rates from an existing borrowing facility are obtained at the commencement date of each lease and serve as our incremental borrowing rate to determine the present value of future payments. Lease agreements may include options to extend or terminate. The options are exercised at our discretion and are included in operating lease liabilities if it is reasonably certain the option will be exercised. Lease agreements have lease and non-lease components, which are accounted for as a single lease component. Lease expense is recognized on a straight-line basis over the lease term.

The Company’s operating lease obligations are for branch office facilities. Our leases have remaining terms of one to 15 years. Expenses associated with leases totaled $6.9 million in 2018 and $6.8 million in 2017. The components of lease expense and other lease information as of and during the year ended December 31, 2019 are as follows:

(in thousands)	2019
Operating lease cost	$	5,772
Cash paid for amounts included in measurement of lease liabilities
Operating cash flows from operating leases	$	5,711
Right-of-use assets obtained in exchange for new operating lease liabilities	$	1,388
Reduction to right-of-use assets resulting from reduction to lease liabilities	$	1,279

(in thousands)	2019
Operating lease right-of-use assets	$	22,335
Operating lease liabilities	$	24,475
Weighted-average remaining lease term - operating leases		4.69	years
Weighted-average discount rate - operating leases		2.33	%

Future minimum lease payments under non-cancellable leases as of December 31, 2019 and 2018 were as follows:

(in thousands)	2019		(in thousands)	2018
2020	$	5,983	2019	$	5,911
2021		5,968	2020		6,019
2022		5,904	2021		5,924
2023		4,386	2022		5,884
2024		2,334	2023		4,459
Thereafter		1,366	Thereafter		3,968
Total future minimum lease payments	$	25,941	Total future minimum lease payments	$	32,165
Less imputed interest		(1,466)
Total operating lease liability	$	24,475