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Leases
 12 Months Ended
Dec. 31, 2022
Lessee Disclosure [Abstract]  
Leases LEASES
Old National determines if an arrangement is or contains a lease at contract inception.  Operating leases are included in operating lease right-of-use assets and operating lease liabilities in our consolidated balance sheets.  Finance leases are included in premises and equipment and other borrowings in our consolidated balance sheets.
Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.  Right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.  In determining the present value of lease payments, we use the implicit lease rate when readily determinable.  As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date.  The incremental borrowing rate is the rate of interest that we would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment.
Old National has operating and finance leases for land, office space, banking centers, and equipment.  These leases are generally for periods of 5 to 20 years with various renewal options.  We include certain renewal options in the measurement of our right-of-use 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.
Old National 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.  For certain equipment leases, Old National accounts for the lease and non-lease components as a single lease component using the practical expedient available for that class of assets.
Old National does not have any material sub-lease agreements.
The components of lease expense were as follows:
Affected Line
Item in the
Statement of Income		Years Ended December 31,
(dollars in thousands)202220212020
Operating lease costOccupancy/Equipment expense$29,368 $12,336 $23,548 
Finance lease cost:
Amortization of right-of-use assetsOccupancy expense2,672 2,356 1,044 
Interest on lease liabilitiesInterest expense415 431 364 
Sub-lease incomeOccupancy expense(448)(438)(512)
Total$32,007 $14,685 $24,444 
Supplemental balance sheet information related to leases was as follows:
December 31,
(dollars in thousands)20222021
Operating Leases
Operating lease right-of-use assets$189,714 $69,560 
Operating lease liabilities211,964 76,236 
Finance Leases
Premises and equipment, net10,799 16,451 
Other borrowings13,469 17,233 
Weighted-Average Remaining Lease Term (in Years)
Operating leases9.110.4
Finance leases7.27.6
Weighted-Average Discount Rate
Operating leases2.88 %3.34 %
Finance leases3.30 %3.02 %
Supplemental cash flow information related to leases was as follows:
Years Ended December 31,
(dollars in thousands)202220212020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$30,340 $13,823 $15,906 
Operating cash flows from finance leases415 431 364 
Financing cash flows from finance leases2,475 2,057 819 
The following table presents a maturity analysis of the Company’s lease liability by lease classification at December 31, 2022:
(dollars in thousands)Operating
Leases		Finance
Leases
2023$30,951 $2,600 
202429,939 2,643 
202528,635 2,645 
202627,639 1,400 
202726,604 1,381 
Thereafter98,539 4,525 
Total undiscounted lease payments242,307 15,194 
Amounts representing interest(30,343)(1,725)
Lease liability$211,964 $13,469 
Leases LEASES
Old National determines if an arrangement is or contains a lease at contract inception.  Operating leases are included in operating lease right-of-use assets and operating lease liabilities in our consolidated balance sheets.  Finance leases are included in premises and equipment and other borrowings in our consolidated balance sheets.
Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.  Right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.  In determining the present value of lease payments, we use the implicit lease rate when readily determinable.  As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date.  The incremental borrowing rate is the rate of interest that we would have to pay to borrow on a collateralized basis over a similar term in an amount equal to the lease payments in a similar economic environment.
Old National has operating and finance leases for land, office space, banking centers, and equipment.  These leases are generally for periods of 5 to 20 years with various renewal options.  We include certain renewal options in the measurement of our right-of-use 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.
Old National 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.  For certain equipment leases, Old National accounts for the lease and non-lease components as a single lease component using the practical expedient available for that class of assets.
Old National does not have any material sub-lease agreements.
The components of lease expense were as follows:
Affected Line
Item in the
Statement of Income		Years Ended December 31,
(dollars in thousands)202220212020
Operating lease costOccupancy/Equipment expense$29,368 $12,336 $23,548 
Finance lease cost:
Amortization of right-of-use assetsOccupancy expense2,672 2,356 1,044 
Interest on lease liabilitiesInterest expense415 431 364 
Sub-lease incomeOccupancy expense(448)(438)(512)
Total$32,007 $14,685 $24,444 
Supplemental balance sheet information related to leases was as follows:
December 31,
(dollars in thousands)20222021
Operating Leases
Operating lease right-of-use assets$189,714 $69,560 
Operating lease liabilities211,964 76,236 
Finance Leases
Premises and equipment, net10,799 16,451 
Other borrowings13,469 17,233 
Weighted-Average Remaining Lease Term (in Years)
Operating leases9.110.4
Finance leases7.27.6
Weighted-Average Discount Rate
Operating leases2.88 %3.34 %
Finance leases3.30 %3.02 %
Supplemental cash flow information related to leases was as follows:
Years Ended December 31,
(dollars in thousands)202220212020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$30,340 $13,823 $15,906 
Operating cash flows from finance leases415 431 364 
Financing cash flows from finance leases2,475 2,057 819 
The following table presents a maturity analysis of the Company’s lease liability by lease classification at December 31, 2022:
(dollars in thousands)Operating
Leases		Finance
Leases
2023$30,951 $2,600 
202429,939 2,643 
202528,635 2,645 
202627,639 1,400 
202726,604 1,381 
Thereafter98,539 4,525 
Total undiscounted lease payments242,307 15,194 
Amounts representing interest(30,343)(1,725)
Lease liability$211,964 $13,469