XML 32 R19.htm IDEA: XBRL DOCUMENT
v3.19.2

Leases Leases | 6 Months Ended
--- | ---
Jun. 30, 2019
Leases [Abstract] |
Leases | Leases Pinnacle Financial has entered into various operating leases, primarily for office space and branch facilities, and through acquisition assumed a single finance lease for a branch facility. Upon adoption of FASB ASU 2016-02 Leases on January 1, 2019, Pinnacle Financial began recognizing right-of-use assets and lease liabilities related to its operating leases. Prior to ASU 2016-02, such assets and liabilities were recognized only for capital leases (referred to as finance leases under the amendments of ASU 2016-02). In accordance with the optional transition method allowed by ASU 2016-11, comparative prior period information included within this note is presented in accordance with guidance in effect during those periods. Right-of-use assets and lease liabilities related to Pinnacle Financial's operating and finance leases are as follows at June 30, 2019 (in thousands):
| Balance Sheet Location | June 30, 2019
Right-of-use assets |  |
Operating leases (1) | Other assets | $ | 72,719 |
Finance leases | Premises and equipment, net | 2,100 |
Total right-of-use assets |  | $ | 74,819 |
Lease liabilities |  |
Operating leases | Other liabilities | $ | 80,697 |
Finance leases | Other liabilities | 3,359 |
Total lease liabilities |  | $ | 84,056 |
(1) Presented net of tenant improvement allowances of $1.7 million and purchase accounting fair value adjustments of $2.8 million. Lease costs during the three and six months ended June 30, 2019 related to these leases were as follows (in thousands):
| Three Months Ended June 30, 2019 | Six Months Ended June 30, 2019
Operating lease cost | $ | 3,532 |  | $ | 6,972 |
Short-term lease cost | 14 |  | 28 |
Finance lease cost: |  |
Interest on lease liabilities | 61 |  | 123 |
Amortization of right-of-use asset | 57 |  | 113 |
Sublease income | (312 | ) | (561 | )
Net lease cost | $ | 3,352 |  | $ | 6,675 |
Rent expense related to leases during the three and six months ended June 30, 2018 was $3.1 million and $6.3 million, respectively. Cash flows related to leases during the three and six months ended June 30, 2019 were as follows (in thousands):
| Three Months Ended June 30, 2019 | Six Months Ended June 30, 2019
Operating cash flows related to operating leases | $ | 3,380 |  | $ | 6,761 |
Operating cash flows related to finance leases | 61 |  | 123 |
Financing cash flows related to finance leases | 57 |  | 112 |
Lease liabilities are determined based on lease term discounted at an effective rate of interest. Certain lease agreements contain renewal options which are considered in the determination of the lease term if they are deemed reasonably certain to be exercised. Discount rates used to determine the present value of lease payments are based on secured borrowing rates as of the commencement date of the lease. The following table presents the weighted average remaining lease term and weighted average discount rate used to determine lease liabilities at June 30, 2019 (in thousands):
| June 30, 2019
Weighted average remaining lease term: |
Operating leases | 10.60 years |
Finance leases | 9.33 years |
Weighted average discount rate: |
Operating leases | 3.34 | %
Finance leases | 7.22 | %
The following table presents a maturity analysis of undiscounted cash flows due under operating leases and finance leases and a reconciliation to total operating lease liabilities and finance lease liabilities at June 30, 2019 (in thousands):
| Operating Leases | Finance Leases
2019 (1) | $ | 6,776 |  | $ | 235 |
2020 | 12,538 |  | 470 |
2021 | 12,110 |  | 470 |
2022 | 9,725 |  | 470 |
2023 | 8,874 |  | 479 |
Thereafter | 48,305 |  | 2,548 |
| 98,328 |  | 4,672 |
Less: Imputed interest | (17,631 | ) | (1,313 | )
Total lease liabilities | $ | 80,697 |  | $ | 3,359 |
(1) Includes the period from July 1, 2019 - December 31, 2019. At December 31, 2018, the future minimum lease payments due under operating leases and capital leases, and a reconciliation to total capital lease liabilities were as follows (in thousands):
| Operating Leases | Capital Leases
2019 | $ | 12,889 |  | $ | 470 |
2020 | 11,805 |  | 470 |
2021 | 11,527 |  | 470 |
2022 | 9,410 |  | 470 |
2023 | 8,820 |  | 479 |
Thereafter | 43,730 |  | 2,548 |
Future minimum lease payments | $ | 98,181 |  | 4,907 |
Less: Imputed interest |  | (1,437 | )
Total capital lease liabilities |  | $ | 3,470 |
Leases | Leases Pinnacle Financial has entered into various operating leases, primarily for office space and branch facilities, and through acquisition assumed a single finance lease for a branch facility. Upon adoption of FASB ASU 2016-02 Leases on January 1, 2019, Pinnacle Financial began recognizing right-of-use assets and lease liabilities related to its operating leases. Prior to ASU 2016-02, such assets and liabilities were recognized only for capital leases (referred to as finance leases under the amendments of ASU 2016-02). In accordance with the optional transition method allowed by ASU 2016-11, comparative prior period information included within this note is presented in accordance with guidance in effect during those periods. Right-of-use assets and lease liabilities related to Pinnacle Financial's operating and finance leases are as follows at June 30, 2019 (in thousands):
| Balance Sheet Location | June 30, 2019
Right-of-use assets |  |
Operating leases (1) | Other assets | $ | 72,719 |
Finance leases | Premises and equipment, net | 2,100 |
Total right-of-use assets |  | $ | 74,819 |
Lease liabilities |  |
Operating leases | Other liabilities | $ | 80,697 |
Finance leases | Other liabilities | 3,359 |
Total lease liabilities |  | $ | 84,056 |
(1) Presented net of tenant improvement allowances of $1.7 million and purchase accounting fair value adjustments of $2.8 million. Lease costs during the three and six months ended June 30, 2019 related to these leases were as follows (in thousands):
| Three Months Ended June 30, 2019 | Six Months Ended June 30, 2019
Operating lease cost | $ | 3,532 |  | $ | 6,972 |
Short-term lease cost | 14 |  | 28 |
Finance lease cost: |  |
Interest on lease liabilities | 61 |  | 123 |
Amortization of right-of-use asset | 57 |  | 113 |
Sublease income | (312 | ) | (561 | )
Net lease cost | $ | 3,352 |  | $ | 6,675 |
Rent expense related to leases during the three and six months ended June 30, 2018 was $3.1 million and $6.3 million, respectively. Cash flows related to leases during the three and six months ended June 30, 2019 were as follows (in thousands):
| Three Months Ended June 30, 2019 | Six Months Ended June 30, 2019
Operating cash flows related to operating leases | $ | 3,380 |  | $ | 6,761 |
Operating cash flows related to finance leases | 61 |  | 123 |
Financing cash flows related to finance leases | 57 |  | 112 |
Lease liabilities are determined based on lease term discounted at an effective rate of interest. Certain lease agreements contain renewal options which are considered in the determination of the lease term if they are deemed reasonably certain to be exercised. Discount rates used to determine the present value of lease payments are based on secured borrowing rates as of the commencement date of the lease. The following table presents the weighted average remaining lease term and weighted average discount rate used to determine lease liabilities at June 30, 2019 (in thousands):
| June 30, 2019
Weighted average remaining lease term: |
Operating leases | 10.60 years |
Finance leases | 9.33 years |
Weighted average discount rate: |
Operating leases | 3.34 | %
Finance leases | 7.22 | %
The following table presents a maturity analysis of undiscounted cash flows due under operating leases and finance leases and a reconciliation to total operating lease liabilities and finance lease liabilities at June 30, 2019 (in thousands):
| Operating Leases | Finance Leases
2019 (1) | $ | 6,776 |  | $ | 235 |
2020 | 12,538 |  | 470 |
2021 | 12,110 |  | 470 |
2022 | 9,725 |  | 470 |
2023 | 8,874 |  | 479 |
Thereafter | 48,305 |  | 2,548 |
| 98,328 |  | 4,672 |
Less: Imputed interest | (17,631 | ) | (1,313 | )
Total lease liabilities | $ | 80,697 |  | $ | 3,359 |
(1) Includes the period from July 1, 2019 - December 31, 2019. At December 31, 2018, the future minimum lease payments due under operating leases and capital leases, and a reconciliation to total capital lease liabilities were as follows (in thousands):
| Operating Leases | Capital Leases
2019 | $ | 12,889 |  | $ | 470 |
2020 | 11,805 |  | 470 |
2021 | 11,527 |  | 470 |
2022 | 9,410 |  | 470 |
2023 | 8,820 |  | 479 |
Thereafter | 43,730 |  | 2,548 |
Future minimum lease payments | $ | 98,181 |  | 4,907 |
Less: Imputed interest |  | (1,437 | )
Total capital lease liabilities |  | $ | 3,470 |

X
- References No definition available. + Details
Name: | us-gaap_LeasesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeFinanceLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeOperatingLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration