A lease is defined as a contract, or part of a contract, that conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. For contracts where First Financial is a lessee, the recipient of the right to control, substantially all of those agreements are for real estate property for branches, ATM locations and office space.

Substantially all of the Company's lessee contracts are classified as operating leases. Under Accounting Topic 842, operating lease agreements are required to be recognized on the Consolidated Balance Sheets as an ROU asset and a corresponding lease liability. The Company's right to use an asset over the life of a lease is recorded as an ROU asset in Accrued interest and other assets on the Consolidated Balance Sheets and was $49.8 million and $48.6 million at March 31, 2026 and December 31, 2025, respectively. Certain adjustments to the ROU asset may be required for items such as initial direct costs paid or incentives received. First Financial recorded a $59.2 million and $58.1 million lease liability in Accrued interest and other liabilities on the Consolidated Balance Sheets at March 31, 2026 and December 31, 2025, respectively.

First Financial has operating and finance leases for land, office space and banking centers. These leases are generally for periods of 5 to 30 years with various renewal options. Certain renewal options are included in the measurement of the ROU assets and lease liabilities if they are reasonably certain to be exercised. Variable lease payments that are dependent on an index or a rate are initially measured using the index or rate at the commencement date and are included in the measurement of

the lease liability. Variable lease payments that are not dependent on an index or a rate are excluded from the measurement of the lease liability and are recognized in profit and loss when incurred. Variable lease payments are defined as payments made for the right to use an asset that vary because of changes in facts or circumstances occurring after the commencement date, other than the passage of time. The Company has elected not to recognize short-term leases (terms of one year or less) as lease liabilities and right-of use assets; related expenses are recognized on a straight-line basis over the lease term. Additionally, the Company has elected to apply the risk-free discount rate for leases in which there is no implicit discount rate.

First Financial has lease agreements with lease and non-lease components, which are generally accounted for separately. For real estate leases, non-lease components and other non-components, such as common area maintenance charges, real estate taxes, and insurance are not included in the measurement of the lease liability since they are generally able to be segregated. First Financial does not have any material sub-lease agreements.


	Three months ended
	March 31,
(Dollars in thousands)		2026		2025
Operating lease cost		$	2,488	$	2,013
Finance lease cost:
Amortization of right-of-use assets		25		27
Interest on lease liabilities		12		14

Variable lease cost		774		760
Total lease cost		$	3,299	$	2,814


(Dollars in thousands)	Operating leases		Finance leases
2026 (remaining nine months)	$	7,547	$	114
2027	9,302		154
2028	8,947		159
2029	8,160		160
2030	7,807		111
Thereafter	30,615		697
Total lease payments	72,378		1,395
Less imputed interest	(13,185)		(271)
Total	$	59,193	$	1,124


(Dollars in thousands)	March 31, 2026			December 31, 2025
Operating leases
Operating lease right-of-use assets	$	49,846		$	48,647
Operating lease liabilities	59,193			58,112

Finance leases
Premises and equipment	$	885		$	910
Long-term debt	1,124			1,149

Weighted-average remaining lease term
Operating leases	10.3 years			10.7 years
Finance leases	10.0 years			10.2 years

Weighted-average discount rate
Operating leases	3.54		%	3.53		%
Finance leases	4.42		%	4.42		%


	Three months ended
	March 31,
(Dollars in thousands)		2026		2025
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases		$	2,607	$	2,096
Operating cash flows from finance leases		12		14
Financing cash flows from finance leases		26		24
ROU assets obtained in exchange for lease obligations
Operating leases		3,136		363
Finance leases		0		(272)