Note

Leases

During the

first

quarter of

2019,

the Company adopted ASU

2016

02,

“Leases”. As of

March 31, 2020,

the Company had recorded operating Right of Use (“ROU”) assets of

$8,909,359

and corresponding operating ROU liabilities of

$8,971,587.

December 31, 2019,

operating ROU assets were

$9,052,941

with corresponding liabilities of

$9,105,503.

Additionally, as of

March 31, 2020,

the Company had financing ROU assets and liabilities of

$407,603

compared to balances of

$438,580

as of

December 31, 2019.

We maintain operating leases on land and buildings for certain branch facilities and our headquarters. Financing leases are primarily for equipment used at banking facilities. Most leases include options to renew, with renewal terms extending between

one

twenty

years. The exercise of renewal options is based on judgement of management as to whether or

not

the renewal option is reasonably certain to be exercised. Factors in determining whether or

not

the renewal option is reasonably certain to be exercised include, but are

not

limited to, the value of the leasehold improvements, the value of the renewal rate compared to market rates and the presence of factors that would cause significant economic penalty to the Company if the option is

not

exercised.

Expenses for finance leases are included in other interest expense and occupancy expense line items, whereas, operating leases are expensed entirely in the occupancy expense line item. Leases with a term of less than

twelve

months are

not

recorded on the balance sheet and are expensed on a straight-line basis over the lease term. Discount rates used for the purpose of valuing the leases were based on rates available to the Company on fixed rate borrowings for similar lease terms.

The components of lease expense and their impact on the statement of income for the

three

months ended

March 31, 2020

and

2019

are as follows:

	Three months ended
	March 31,			March 31,
	2020			2019
	(In Thousands)
Finance lease cost:
Amortization of right-of-use assets	$	30,977		$	27,645
Interest on lease liabilities		2,096			1,720
Operating lease cost		272,335			270,042
Sublease income		(12,300	)		(10,300	)

Total lease costs	$	293,108		$	289,107

Additional lease information:
Weighted-average remaining lease term - financing leases (in years)	3.3
Weighted-average remaining lease term - operating leases (in years)	14.9
Weighted-average discount rate - financing leases	1.96	%
Weighted-average discount rate - operating leases	5.62	%

The following table sets forth, as of

March 31, 2020,

the future minimum lease cash payments and a reconciliation of the undiscounted cash flows to the lease liability:

		Financing			Operating			Total
					(In Thousands)
Remainder of:	2020	$	99		$	783		$	882
	2021		132			1,020			1,152
	2022		127			1,011			1,138
	2023		53			1,002			1,055
	2024		10			856			866
	Thereafter		-			8,979			8,979
Total undiscounted future minimum lease cash payments		$	421		$	13,651		$	14,072
	Present value discount		(13	)		(4,679	)		(4,692	)
	Lease liability	$	408		$	8,972		$	9,380