12. LEASES

 

The Company leases office space and certain computers and related equipment.  From time to time, the Company subleases office space to other tenants.  Under the requirements of ASC 842, the Company determines if an arrangement is a lease at the inception date of the contract. Then, the Company measures the lease liability using an incremental borrowing rate that was calculated for each operating lease based on the term of the lease, the U.S. Treasury term interest rate, and an estimated spread to borrow on a secured basis.

 

Rent expense is recognized on a straight-line basis over the lease term and is included in business development, occupancy, and equipment expense.

 

As of  March 31, 2025, all of the leases to which the Company was a party were operating leases.  The weighted average remaining term of the leases was 9.2 years.  The weighted average discount rate for the leases was 5.97%. 

 

Maturities of operating lease liability payments consisted of the following.

FUTURE MATURITY OF LEASE LIABILITIES

(Dollars in Thousands)

During the three months ended March 31, 2025 and 2024, total cash payments of $361 and $686, respectively, were recorded as a reduction in the operating lease obligation.  No cash payments were made to acquire right of use assets.

For the three months ended March 31, 2025, rent expense, net of sublease income of $23, was $654. For the three months ended March 31, 2024, rent expense, net of sublease income of $23, was $634.