Leases

12 Months Ended

Dec. 31, 2020

(9.)

LEASES

Accounting Standards Codification (“ASC”) 842, Leases (“ASC 842”), establishes a right of use model that requires a lessee to record a right of use asset and a lease liability for all leases with terms longer than 12 months. The Company is obligated under a number of non-cancellable operating lease agreements for land, buildings and equipment with terms, including renewal options reasonably certain to be exercised, extending through 2047. One building lease is subleased for terms extending through 2021.

The following table represents the consolidated statements of financial condition classification of the Company’s right of use assets and lease liabilities as of December 31 (in thousands):

		2020			2019
	Balance Sheet Location
Operating Lease Right of Use Assets:
Gross carrying amount	Other assets	$	23,697		$	23,224
Accumulated amortization	Other assets		(3,741	)		(1,861	)
Net book value		$	19,956		$	21,363

Operating Lease Liabilities:
Right of use lease obligations	Other liabilities	$	21,507		$	22,800

The weighted average remaining lease term for operating leases was 21.5 years at December 31, 2020 and the weighted-average discount rate used in the measurement of operating lease liabilities was 3.82%. The Company utilizes its incremental borrowing rate at lease inception, on a collateralized basis, over a similar term for the discount rate.

The following table represents lease costs and other lease information for the years ended December 31 (in thousands):

	2020			2019			2018
Lease Costs:
Operating lease costs	$	2,673		$	2,758		$	-
Variable lease costs ⁽¹⁾		410			428			-
Sublease income		(46	)		(46	)		-
Net lease costs	$	3,037		$	3,140		$	-

Other information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	2,599		$	2,641		$	-
Initial recognition of operating lease right of use assets	$	-		$	23,275		$	-
Initial recognition of operating lease liabilities	$	-		$	23,985		$	-
Right of use assets obtained in exchange for new operating lease liabilities	$	477		$	620		$	-

⁽¹⁾	Variable lease costs primarily represent variable payments such as common area maintenance, insurance, taxes and utilities.

Rent expense relating to operating leases, included in occupancy and equipment expense in the statements of income, was $2.9 million in 2018.

(9.)	LEASES (Continued)

Future minimum payments under non-cancellable operating leases with initial or remaining terms of one year or more are as follows at December 31, 2020 (in thousands):

Year ended December 31,
2021	$	2,423
2022		1,941
2023		1,558
2024		1,264
2025		1,190
Thereafter		24,792
Total future minimum operating lease payments		33,168
Amounts representing interest		(11,661	)
Present value of net future minimum operating lease payments	$	21,507