12. Leases

All of the Company’s leases are classified as operating leases and primarily consist of real estate leases for corporate offices, data centers, and other facilities. As of March 31, 2019, the weighted-average remaining lease term on these leases is approximately nine years and the weighted-average discount rate used to measure the lease liabilities is approximately 4.05%. For the three months ended March 31, 2019, right-of-use assets under operating leases was $136 million. The Company’s lease agreements do not contain any residual value guarantees, restrictions or covenants.

The following table presents balances reported in the condensed consolidated statements of financial condition related to the Company’s leases:


	March 31, 2019
	(in millions)
Right-of-use assets1	$	131
Lease liabilities1	$	132

(1)

Right-of-use assets are included in other assets and lease liabilities are included in accounts payable, accrued expenses and other liabilities in the Company’s condensed consolidated statements of financial condition.

The following table presents balances reported in the condensed consolidated statements of comprehensive income related to the Company’s leases:


	Three Months Ended
	March 31, 2019
	(in millions)
Operating lease cost	$	6
Variable lease cost		1
Total lease cost	$	7

The following table reconciles the undiscounted cash flows of the Company’s leases as of March 31, 2019 to the present value of its operating lease payments:


	March 31, 2019
	(in millions)
2019 (remaining)	$	14
2020		19
2021		16
2022		16
2023		15
2024		13
Thereafter		70
Total undiscounted operating lease payments		163
Less: imputed interest		(31)
Present value of operating lease liabilities	$	132

The Company’s minimum annual lease commitments as of December 31, 2018, in accordance with ASC Topic 840, were as follows:


	December 31, 2018
Year	(in millions)
2019	$	18
2020		19
2021		16
2022		16
2023		15
Thereafter		83
	$	167