Leases:

The Company has operating leases for branch office locations, vehicles, land and certain office equipment such as printers and copiers. The leases have remaining lease terms of up to 17.1 years, some of which had options to extend the lease for up to 15 years, while the Fairlawn lending building lease was terminated in April of 2025. The Fairview Park building lease was scheduled to terminate in April of 2025, but has been extended until April of 2027. This lease location has an initial right of use asset and lease liability recorded of $124,000. The Beachwood branch lease located at 24755 Chagrin Blvd. was terminated effective January 31, 2025, and the Branch was moved into a new location at 22835 Chagrin Blvd on February 3, 2025.  This new lease location was effective in December of 2024, with an initial right of use asset and lease liability recorded of $971,000.

The right of use assets and lease liabilities were $7.8 million and $8.0 million as of June 30, 2025, respectively, and $9.7 million and $9.9 million at December 31, 2024, respectively. The right of use assets are included in other assets while the lease liabilities are included in other liabilities on the balance sheet.

Lease expense for the three and six month periods ended June 30, 2025 and 2024 was $351,000 and $644,000, respectively. Lease expense for the three and six month periods ended June 30, 2024 was $327,000 and $658,000, respectively. The weighted-average remaining lease term for all leases was 8.93 years as of June 30, 2025. The weighted-average discount rate was 3.46% for all leases as of June 30, 2025.

Maturities of lease liabilities are as follows as of June 30, 2025: