Note 10 - Leases

12 Months Ended

Dec. 31, 2019

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

NOTE

1

0

Leases

On

January 1, 2019,

the Company adopted

ASU

2016

-

02,

Leases (Topic

842

)

and a

$4.5

million right-of-use asset and an offsetting lease payment obligation liability were recorded on the consolidated balance sheet in other assets and other liabilities, respectively.

Operating lease right-of-use assets represent our right to use an underlying asset during the lease term and operating lease liabilities represent our obligation to make lease payments arising from the lease. Right-of-use assets and operating lease liabilities are recognized at lease commencement based on the present value of the remaining lease payments using a discount rate that represents the Company’s incremental borrowing rate at the lease commencement date. Because the Company only has operating leases and the right-of-use asset is offset by a lease payment obligation liability, the lease payments are the only amount that is recorded in occupancy expense in the consolidated statements of comprehensive income.

The Company’s leases relate to office space and Bank branches with remaining lease terms between

32

and

64

months. Certain leases contain extension options which typically range from

3

to

10

years. Because these extension options are

not

considered reasonably certain of exercise, they are

not

included in the lease term. As of

December 31, 2019,

operating lease right-of-use assets and liabilities were

$4.0

million.

The table below summarizes our net lease cost:

(Dollars in thousands)	For the Year Ended December 31, 2019
Operating lease cost	$	889

The table below summarizes other information related to our operating leases:

(Dollars in thousands)	Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	889
Weighted-average remaining lease term – operating leases, in years		4.7
Weighted-average discount rate – operating leases		2.19	%

The table below summarizes the maturity of remaining lease liabilities:

(Dollars in thousands)	December 31, 2019
2020	$	887
2021		896
2022		932
2023		807
2024		729
2025 and thereafter		15
Total lease payments		4,266
Less: Interest		(221	)
Present value of lease liabilities	$	4,045