NOTE 5: Leases

The Corporation’s leases comprise primarily leases of real estate and office equipment in which the Corporation is the lessee, and all of which are classified as operating leases. Lease cost for the three months ended March 31, 2019 is set forth in the table below.


	Three Months Ended
(Dollars in thousands)	March 31, 2019
Operating lease cost	$	414
Short-term lease cost		39
Variable lease cost		14
Total lease cost	$	467

Variable lease payments primarily represent payments for common area maintenance related to real estate leases and taxes and fees related to equipment leases.

Cash paid for amounts included in the measurement of lease liabilities during the three months ended March 31, 2019 was $306,000. As of March 31, the weighted average remaining lease term and discount rate for the Corporation’s leases were 3.0 years and 3.3%, respectively. Right-of-use assets of $3.67 million were included in other assets and lease liabilities of $3.68 million were included in other liabilities as of March 31, 2019. During the three months ended March 31, 2019, the Corporation obtained right-of-use assets in exchange for lease liabilities of $821,000.

The Corporation adopted ASC 842 effective January 1, 2019. Prior to January 1, 2019, the Corporation measured lease expense in accordance with FASB Accounting Standards Codification (ASC) Topic 840. During the three months ended March 31, 2018, the Corporation recognized lease expense of $439,000.

Certain of the Corporation’s leases contain options to extend the lease term beyond the initial term. Options to extend the lease term are recognized as part of the Corporation’s lease liabilities and right-of-use assets at the commencement of a lease to the extent the Corporation is reasonably certain to exercise such options.

Maturities of the Corporation’s lease liabilities are set forth in the table below.


	As of
(Dollars in thousands)	March 31, 2019
2019	$	1,131
2020		1,392
2021		758
2022		236
2023		109
Thereafter		249
Total		3,875
Imputed interest		(193)
Lease liabilities	$	3,682

The table above excludes payments of $4.94 million related to two lease agreements that have been executed where the Corporation has not obtained control of the real estate properties under lease as of March 31, 2019 and has therefore not recognized a lease liability or right-of-use asset.