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Commitments and Contingencies
 12 Months Ended
Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and Contingencies
Leases
 
We lease premises under long-term non-cancelable operating leases with remaining terms of approximately 6 months to 11 years, most of which include escalation clauses and one or more options to extend the lease term, and some of which contain lease termination clauses. Lease terms may include certain renewal options that were considered reasonably certain to be exercised.

We lease certain equipment under finance leases with initial terms of 3 years to 5 years. The equipment finance leases do not contain renewal options, bargain purchase options or residual value guarantees.

The following table shows the balances of operating and finance lease right-of-use assets and lease liabilities as of December 31, 2021 and 2020.
(in thousands)December 31, 2021December 31, 2020
Operating leases:
Operating lease right-of-use assets$23,604 $25,612 
Operating lease liabilities25,429 27,062 
Finance leases:
Finance lease right-of-use assets499 365 
Accumulated amortization(93)(307)
Finance lease right-of-use assets, net1
$406 $58 
Finance lease liabilities2
$419 $58 
1 Included in premises and equipment in the consolidated statements of condition.
2 Included in borrowings and other obligations in the consolidated statements of condition.

The following table shows supplemental disclosures of noncash investing and financing activities for the years ended December 31, 2021, 2020 and 2019.
(in thousands)202120202019
Right-of-use assets obtained in exchange for operating lease liabilities$2,376 $18,633 $1,661 
Right-of-use assets obtained in exchange for finance lease liabilities$444 $18 $31 
Reclassification of deferred rent and unamortized lease incentives from other liabilities to operating lease right-of-use assets upon adoption of ASC 842$— $— $1,967 

The following table shows components of operating and finance lease cost for the years ended December 31, 2021, 2020 and 2019.
(in thousands)202120202019
Operating lease cost1
$4,823 $4,498 $4,144 
Variable lease cost— 5 — 
Total operating lease cost$4,823 $4,503 $4,144 
Finance lease cost:
Amortization of right-of-use assets2
$96 $169 $172 
Interest on finance lease liabilities3
2 3 8 
Total finance lease cost$98 $172 $180 
Total lease cost$4,921 $4,675 $4,324 
1 Included in occupancy and equipment expense in the consolidated statements of comprehensive income.
2 Included in depreciation and amortization in the consolidated statements of comprehensive income.
3 Included in interest on borrowings and other obligations in the consolidated statements of comprehensive income.
The following table shows the future minimum lease payments, weighted average remaining lease terms, and weighted average discount rates under operating and finance lease arrangements as of December 31, 2021.
(in thousands)December 31, 2021
YearOperating LeasesFinance Leases
2022$5,203 $127 
20234,377 117 
20243,667 113 
20253,152 66 
20262,354 — 
Thereafter8,330 — 
Total minimum lease payments27,083 423 
Amounts representing interest (present value discount)(1,654)(4)
Present value of net minimum lease payments (lease liability)$25,429 $419 
Weighted average remaining term (in years)7.03.5
Weighted average discount rate1.69 %0.63 %

Litigation Matters

Bancorp may be party to legal actions that arise from time to time in the normal course of business. Bancorp's management is not aware of any pending legal proceedings to which either it or the Bank may be a party or has recently been a party that will have a material adverse effect on the financial condition or results of operations of Bancorp or the Bank.

The Bank is responsible for a proportionate share of certain litigation indemnifications provided to Visa U.S.A. ("Visa") by its member banks in connection with Visa's lawsuits related to anti-trust charges and interchange fees ("Covered Litigation"). Our proportionate share of the litigation indemnification liability does not change or transfer upon the sale of our Class B Visa shares to member banks. Visa established an escrow account to pay for settlements or judgments in the Covered Litigation. Under the terms of the U.S. retrospective responsibility plan, when Visa funds the litigation escrow account, it triggers a conversion rate reduction of the Class B common stock to shares of Class A common stock, effectively reducing the aggregate value of the Class B common stock held by Visa's member banks like us.

In 2012, Visa had reached a $4.0 billion interchange multidistrict litigation class settlement agreement with plaintiffs representing a class of U.S. retailers. The escrow balance of $1.1 billion as of December 31, 2021, combined with funds previously deposited with the court, are expected to cover the settlement payment obligations.

The outcome of the Covered Litigation affects the conversion rate of Visa Class B common stock held by us to Visa Class A common stock, as discussed above and in Note 2, Investment Securities. The final conversion rate is subject to change depending on the final settlement payments, and the full effect on member banks is still uncertain. Litigation is ongoing and until the court approval process is complete, there is no assurance that Visa will resolve the claims as contemplated by the amended class settlement agreement, and additional lawsuits may arise from individual merchants who opted out of the class settlement. However, until the escrow account is fully depleted and the conversion rate of Class B to Class A common stock is reduced to zero, no future cash settlement payments are required by the member banks, such as us, on the Covered Litigation. Therefore, we are not required to record any contingent liabilities for the indemnification related to the Covered Litigation, as we consider the probability of losses to be remote. For further information, including a discussion of a reduction to our holdings of Class B Visa shares, refer to Note 2, Investment Securities.