Leases

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Leases

Leases

Mid Penn has operating and finance leases for certain premises and equipment.

Operating and finance lease ROU assets, as well as operating lease liabilities, are presented as separate line items on the Consolidated Balance Sheet, while finance lease liabilities are classified as a component of long-term debt.

Supplemental consolidated balance sheet information for each of the lease classifications as of December 31 was as follows:

	2023						2022
(Dollars in thousands)	Operating Leases			Finance Lease			Operating Leases			Finance Lease
ROU	$	8,953		$	2,727		$	8,798		$	2,907
Lease liability	9,285			3,197			9,725			3,290
Weighted average remaining lease term (in years)	5.60			15.17			6.30			16.17
Weighted average discount rate	3.66		%	3.81		%	3.25		%	3.81		%

Interest expense on finance lease liabilities is included in other interest expense, while all other lease costs are included in occupancy expense on Mid Penn’s Consolidated Statements of Income. Following is a summary of lease costs during the years ended December 31:

(In thousands)	2023		2022		2021
Finance lease cost:
Amortization of ROU asset	$	180	$	180	$	180
Interest expense on lease liability	123		127		130
Total finance lease cost	303		307		310
Operating lease cost	2,081		2,057		2,002
Short-term and equipment lease costs	—		—		29
Sublease income	(29)		(24)		(27)
Total lease costs	$	2,355	$	2,340	$	2,314

The rental expense paid to related parties was $274 thousand for each of 2023, 2022 and 2021.

Supplemental cash flow information related to operating and finance leases for the years ended December 31 was as follows:

(In thousands)	2023		2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	123	$	127
Operating cash flows from operating leases	2,556		2,939
Financing cash flows from finance leases	93		90

A maturity analysis of operating and finance lease liabilities and a reconciliation of the undiscounted cash flows to the total operating and finance lease liability amounts is presented below.

	December 31, 2023
(In thousands)	Operating Leases		Finance Lease
Lease payments due:
2024	$	2,432	$	252
2025	1,998		259
2026	1,757		260
2027	1,508		260
2028	771		260
2029 and thereafter	1,795		2,954
Total lease payments	10,261		4,245
Less: imputed interest	(976)		(1,048)
Present value of lease liabilities	$	9,285	$	3,197

The future minimum payments to related parties are $274 thousand for 2024, $185 thousand for 2025, $178 thousand for 2026, 2027 and 2028 and $2.6 million thereafter.

There were no sale and leaseback transactions or leveraged leases as of December 31, 2023. There were no leases that had not commenced as of December 31, 2023.

Leases

Leases

Mid Penn has operating and finance leases for certain premises and equipment.

Operating and finance lease ROU assets, as well as operating lease liabilities, are presented as separate line items on the Consolidated Balance Sheet, while finance lease liabilities are classified as a component of long-term debt.

Supplemental consolidated balance sheet information for each of the lease classifications as of December 31 was as follows:

	2023						2022
(Dollars in thousands)	Operating Leases			Finance Lease			Operating Leases			Finance Lease
ROU	$	8,953		$	2,727		$	8,798		$	2,907
Lease liability	9,285			3,197			9,725			3,290
Weighted average remaining lease term (in years)	5.60			15.17			6.30			16.17
Weighted average discount rate	3.66		%	3.81		%	3.25		%	3.81		%

Interest expense on finance lease liabilities is included in other interest expense, while all other lease costs are included in occupancy expense on Mid Penn’s Consolidated Statements of Income. Following is a summary of lease costs during the years ended December 31:

(In thousands)	2023		2022		2021
Finance lease cost:
Amortization of ROU asset	$	180	$	180	$	180
Interest expense on lease liability	123		127		130
Total finance lease cost	303		307		310
Operating lease cost	2,081		2,057		2,002
Short-term and equipment lease costs	—		—		29
Sublease income	(29)		(24)		(27)
Total lease costs	$	2,355	$	2,340	$	2,314

The rental expense paid to related parties was $274 thousand for each of 2023, 2022 and 2021.

Supplemental cash flow information related to operating and finance leases for the years ended December 31 was as follows:

(In thousands)	2023		2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	123	$	127
Operating cash flows from operating leases	2,556		2,939
Financing cash flows from finance leases	93		90

A maturity analysis of operating and finance lease liabilities and a reconciliation of the undiscounted cash flows to the total operating and finance lease liability amounts is presented below.

	December 31, 2023
(In thousands)	Operating Leases		Finance Lease
Lease payments due:
2024	$	2,432	$	252
2025	1,998		259
2026	1,757		260
2027	1,508		260
2028	771		260
2029 and thereafter	1,795		2,954
Total lease payments	10,261		4,245
Less: imputed interest	(976)		(1,048)
Present value of lease liabilities	$	9,285	$	3,197

The future minimum payments to related parties are $274 thousand for 2024, $185 thousand for 2025, $178 thousand for 2026, 2027 and 2028 and $2.6 million thereafter.

There were no sale and leaseback transactions or leveraged leases as of December 31, 2023. There were no leases that had not commenced as of December 31, 2023.