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LEASES | 6 Months Ended
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Jun. 30, 2019
Leases [Abstract] |
LEASES | LEASES 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. On January 1, 2019, the Company adopted ASU No. 2016-02, “Leases (Topic 842)” and all subsequent ASUs that modified Topic 842. For the Company, Topic 842 primarily affected the accounting treatment for operating lease agreements in which the Company is the lessee. See Note 1 to the Consolidated Financial Statements regarding transition guidance related to the new standard. Substantially all of the leases in which the Company is the lessee are comprised of real estate property for branches, ATM locations, and office space. Most of the Company’s leases are classified as operating leases, and therefore, were previously not recognized on the Company’s Consolidated Balance Sheets. With the adoption of Topic 842, operating lease agreements are required to be recognized on the Consolidated Balance Sheets as a right-of-use (“ROU”) asset and a corresponding lease liability. The Company’s finance leases (previously referred to as a capital lease) was previously required to be recorded on the Company’s Consolidated Balance Sheets. As these leases were previously required to be recorded on the Company’s Consolidated Balance Sheets, Topic 842 did not materially impact the accounting for the leases. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. ROU 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, the Company utilized the implicit lease rate when readily determinable. As most of the Company’s leases do not provide an implicit rate, the Company used our incremental borrowing rate based on the information available at commencement date. The incremental borrowing rate is the rate of interest that the Company 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. The weighted average discount rate used to discount operating lease liabilities and finance lease liabilities at June 30, 2019 was 3.36% and 5.00%, respectively. The Company made a policy election to exclude the recognition requirements of Topic 842 to all classes of leases with original terms of 12 months or less. Instead, the short-term lease payments are recognized in profit or loss on a straight-line basis over the lease term. At June 30, 2019 lease expiration dates ranged from 1 month to 21 years. The weighted average remaining lease term for operating and finance leases at June 30, 2019 was 10.6 years and 15.5 years, respectively. The following table represents the Consolidated Balance Sheets classification of the Company’s ROU assets and lease liabilities:
(In thousands) |  |  |  | June 30, 2019
Lease Right-of-Use Assets |  | Classification |  |
Operating lease right-of-use assets (1) |  | Other assets |  | $ | 80,591 |
Finance lease right-of-use assets |  | Premises and equipment, net |  | 7,981 |
Total Lease Right-of-Use Assets |  |  |  | $ | 88,572 |
Lease Liabilities |  |  |  |
Operating lease liabilities (1) |  | Other liabilities |  | $ | 85,045 |
Finance lease liabilities |  | Other liabilities |  | 11,123 |
Total Lease Liabilities |  |  |  | $ | 96,168 |
(1) Includes assets and liabilities classified as discontinued operations. The Company 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. The Company does not have any material sub-lease agreements. Lease expense for operating leases for the three and six months ended June 30, 2019 was $3.6 million and $7.0 million, respectively. Variable lease components, such as consumer price index adjustments, are expensed as incurred and not included in ROU assets and operating lease liabilities. Supplemental cash flow information related to leases was as follows:
|  | Three Months Ended |  | Six Months Ended
(In thousands) |  | June 30, 2019 |  | June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |
Operating cash flows from operating leases (1) |  | $ | 3,657 |  |  | $ | 7,155 |
Operating cash flows from finance leases |  | 159 |  |  | 318 |
Financing cash flows from finance leases |  | 98 |  |  | 196 |
Right-of-use assets obtained in exchange for lease obligations: |  |  |  |
Operating leases (1) |  | 8,052 |  |  | 87,641 |
Finance leases |  | — |  |  | — |
(1) Includes cash flows related to discontinued operations. The following table presents a maturity analysis of the Company’s lease liability by lease classification at June 30, 2019:
(In thousands) |  | Operating Leases |  | Finance Leases
2019 |  | $ | 7,130 |  |  | $ | 508 |
2020 |  | 13,403 |  |  | 1,031 |
2021 |  | 12,157 |  |  | 1,031 |
2022 |  | 10,981 |  |  | 1,031 |
2023 |  | 9,048 |  |  | 1,037 |
Thereafter |  | 48,570 |  |  | 11,296 |
Total undiscounted lease payments (1) |  | 101,289 |  |  | 15,934 |
Less amounts representing interest (1) |  | (16,244 | ) |  | (4,811 | )
Lease liability (1) |  | $ | 85,045 |  |  | $ | 11,123 |
LEASES | LEASES 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. On January 1, 2019, the Company adopted ASU No. 2016-02, “Leases (Topic 842)” and all subsequent ASUs that modified Topic 842. For the Company, Topic 842 primarily affected the accounting treatment for operating lease agreements in which the Company is the lessee. See Note 1 to the Consolidated Financial Statements regarding transition guidance related to the new standard. Substantially all of the leases in which the Company is the lessee are comprised of real estate property for branches, ATM locations, and office space. Most of the Company’s leases are classified as operating leases, and therefore, were previously not recognized on the Company’s Consolidated Balance Sheets. With the adoption of Topic 842, operating lease agreements are required to be recognized on the Consolidated Balance Sheets as a right-of-use (“ROU”) asset and a corresponding lease liability. The Company’s finance leases (previously referred to as a capital lease) was previously required to be recorded on the Company’s Consolidated Balance Sheets. As these leases were previously required to be recorded on the Company’s Consolidated Balance Sheets, Topic 842 did not materially impact the accounting for the leases. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. ROU 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, the Company utilized the implicit lease rate when readily determinable. As most of the Company’s leases do not provide an implicit rate, the Company used our incremental borrowing rate based on the information available at commencement date. The incremental borrowing rate is the rate of interest that the Company 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. The weighted average discount rate used to discount operating lease liabilities and finance lease liabilities at June 30, 2019 was 3.36% and 5.00%, respectively. The Company made a policy election to exclude the recognition requirements of Topic 842 to all classes of leases with original terms of 12 months or less. Instead, the short-term lease payments are recognized in profit or loss on a straight-line basis over the lease term. At June 30, 2019 lease expiration dates ranged from 1 month to 21 years. The weighted average remaining lease term for operating and finance leases at June 30, 2019 was 10.6 years and 15.5 years, respectively. The following table represents the Consolidated Balance Sheets classification of the Company’s ROU assets and lease liabilities:
(In thousands) |  |  |  | June 30, 2019
Lease Right-of-Use Assets |  | Classification |  |
Operating lease right-of-use assets (1) |  | Other assets |  | $ | 80,591 |
Finance lease right-of-use assets |  | Premises and equipment, net |  | 7,981 |
Total Lease Right-of-Use Assets |  |  |  | $ | 88,572 |
Lease Liabilities |  |  |  |
Operating lease liabilities (1) |  | Other liabilities |  | $ | 85,045 |
Finance lease liabilities |  | Other liabilities |  | 11,123 |
Total Lease Liabilities |  |  |  | $ | 96,168 |
(1) Includes assets and liabilities classified as discontinued operations. The Company 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. The Company does not have any material sub-lease agreements. Lease expense for operating leases for the three and six months ended June 30, 2019 was $3.6 million and $7.0 million, respectively. Variable lease components, such as consumer price index adjustments, are expensed as incurred and not included in ROU assets and operating lease liabilities. Supplemental cash flow information related to leases was as follows:
|  | Three Months Ended |  | Six Months Ended
(In thousands) |  | June 30, 2019 |  | June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |
Operating cash flows from operating leases (1) |  | $ | 3,657 |  |  | $ | 7,155 |
Operating cash flows from finance leases |  | 159 |  |  | 318 |
Financing cash flows from finance leases |  | 98 |  |  | 196 |
Right-of-use assets obtained in exchange for lease obligations: |  |  |  |
Operating leases (1) |  | 8,052 |  |  | 87,641 |
Finance leases |  | — |  |  | — |
(1) Includes cash flows related to discontinued operations. The following table presents a maturity analysis of the Company’s lease liability by lease classification at June 30, 2019:
(In thousands) |  | Operating Leases |  | Finance Leases
2019 |  | $ | 7,130 |  |  | $ | 508 |
2020 |  | 13,403 |  |  | 1,031 |
2021 |  | 12,157 |  |  | 1,031 |
2022 |  | 10,981 |  |  | 1,031 |
2023 |  | 9,048 |  |  | 1,037 |
Thereafter |  | 48,570 |  |  | 11,296 |
Total undiscounted lease payments (1) |  | 101,289 |  |  | 15,934 |
Less amounts representing interest (1) |  | (16,244 | ) |  | (4,811 | )
Lease liability (1) |  | $ | 85,045 |  |  | $ | 11,123 |

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- 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
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- 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
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