Leases

6 Months Ended

Jun. 30, 2021

Leases [Abstract]

Leases

Leases:

As of June 30, 2021, the Company was the lessee in 58 operating leases and 1 finance lease of certain branch, mortgage and operations locations, of which 44 operating leases and 1 finance lease currently have remaining terms varying from greater than one year to 34 years. Leases with initial terms of less than one year are not recorded on the consolidated balance sheets. The Company also does not include equipment leases and leases in which the Company is the lessor on the consolidated balance sheets as these are insignificant.

Many leases include one or more options to renew, with renewal terms that can extend the lease up to an additional 20 years or more. Certain lease agreements contain provisions to periodically adjust rental payments for inflation. Renewal options that management is reasonably certain to renew and fixed rent escalations are included in the right-of-use asset and lease liability.

During the year ended December 31, 2020, the Company entered into a lease for a new corporate headquarters building located in downtown Nashville. The building is currently under construction and anticipated to be completed in late 2022.

Upon commencement, the Company estimates recording a ROU asset and operating lease liability of approximately $29,000 and $30,000, respectively, in connection with this lease.

Information related to the Company's leases is presented below as of June 30, 2021 and December 31, 2020:

		June 30,			December 31,
	Classification	2021			2020
Right-of-use assets:
Operating leases	Operating lease right-of-use assets	$	45,423		$	49,537
Finance leases	Premises and equipment, net	1,533			1,588
Total right-of-use assets		$	46,956		$	51,125
Lease liabilities:
Operating leases	Operating lease liabilities	$	50,396		$	55,187
Finance leases	Borrowings	1,555			1,598
Total lease liabilities		$	51,951		$	56,785
Weighted average remaining lease term (in years) -    operating		12.3			12.2
Weighted average remaining lease term (in years) - finance		13.9			14.4
Weighted average discount rate - operating		2.72		%	2.65		%
Weighted average discount rate - finance		1.76		%	1.76		%

The components of total lease expense included in the consolidated statements of income were as follows:

		Three Months Ended				Six Months Ended
		June 30,				June 30,
	Classification	2021		2020		2021		2020
Operating lease costs:
Amortization of right-of-use asset	Occupancy and equipment	$	2,171	$	1,389	$	4,110	$	2,678
Short-term lease cost	Occupancy and equipment	102		30		189		166
Variable lease cost	Occupancy and equipment	241		160		476		298
Gain on lease modifications and     terminations	Occupancy and equipment	(787)		—		(787)		—
Finance lease costs:
Interest on lease liabilities	Interest expense on borrowings	8		—		14		—
Amortization of right-of-use asset	Occupancy and equipment	27		—		55		—
Total lease cost		$	1,762	$	1,579	$	4,057	$	3,142

During the three and six months ended June 30, 2021, the Company recorded a $787 gain on lease modifications and terminations on certain vacated locations that were consolidated as a result of acquisitions.

The Company does not separate lease and non-lease components and instead elects to account for them as a single lease component. Variable lease cost primarily represents variable payments such as common area maintenance, utilities, and property taxes.

A maturity analysis of operating and finance lease liabilities and a reconciliation of undiscounted cash flows to the total lease liability as of June 30, 2021 is as follows:

	Operating		Finance
	Leases		Lease
Lease payments due:
June 30, 2022	$	7,734	$	115
June 30, 2023	6,759		117
June 30, 2024	5,696		119
June 30, 2025	5,002		121
June 30, 2026	4,675		122
Thereafter	30,976		1,164
Total undiscounted future minimum lease payments	60,842		1,758
Less: imputed interest	(10,446)		(203)
Lease liability	$	50,396	$	1,555

Leases

Leases:

As of June 30, 2021, the Company was the lessee in 58 operating leases and 1 finance lease of certain branch, mortgage and operations locations, of which 44 operating leases and 1 finance lease currently have remaining terms varying from greater than one year to 34 years. Leases with initial terms of less than one year are not recorded on the consolidated balance sheets. The Company also does not include equipment leases and leases in which the Company is the lessor on the consolidated balance sheets as these are insignificant.

Many leases include one or more options to renew, with renewal terms that can extend the lease up to an additional 20 years or more. Certain lease agreements contain provisions to periodically adjust rental payments for inflation. Renewal options that management is reasonably certain to renew and fixed rent escalations are included in the right-of-use asset and lease liability.

During the year ended December 31, 2020, the Company entered into a lease for a new corporate headquarters building located in downtown Nashville. The building is currently under construction and anticipated to be completed in late 2022.

Upon commencement, the Company estimates recording a ROU asset and operating lease liability of approximately $29,000 and $30,000, respectively, in connection with this lease.

Information related to the Company's leases is presented below as of June 30, 2021 and December 31, 2020:

		June 30,			December 31,
	Classification	2021			2020
Right-of-use assets:
Operating leases	Operating lease right-of-use assets	$	45,423		$	49,537
Finance leases	Premises and equipment, net	1,533			1,588
Total right-of-use assets		$	46,956		$	51,125
Lease liabilities:
Operating leases	Operating lease liabilities	$	50,396		$	55,187
Finance leases	Borrowings	1,555			1,598
Total lease liabilities		$	51,951		$	56,785
Weighted average remaining lease term (in years) -    operating		12.3			12.2
Weighted average remaining lease term (in years) - finance		13.9			14.4
Weighted average discount rate - operating		2.72		%	2.65		%
Weighted average discount rate - finance		1.76		%	1.76		%

The components of total lease expense included in the consolidated statements of income were as follows:

		Three Months Ended				Six Months Ended
		June 30,				June 30,
	Classification	2021		2020		2021		2020
Operating lease costs:
Amortization of right-of-use asset	Occupancy and equipment	$	2,171	$	1,389	$	4,110	$	2,678
Short-term lease cost	Occupancy and equipment	102		30		189		166
Variable lease cost	Occupancy and equipment	241		160		476		298
Gain on lease modifications and     terminations	Occupancy and equipment	(787)		—		(787)		—
Finance lease costs:
Interest on lease liabilities	Interest expense on borrowings	8		—		14		—
Amortization of right-of-use asset	Occupancy and equipment	27		—		55		—
Total lease cost		$	1,762	$	1,579	$	4,057	$	3,142

During the three and six months ended June 30, 2021, the Company recorded a $787 gain on lease modifications and terminations on certain vacated locations that were consolidated as a result of acquisitions.

The Company does not separate lease and non-lease components and instead elects to account for them as a single lease component. Variable lease cost primarily represents variable payments such as common area maintenance, utilities, and property taxes.

A maturity analysis of operating and finance lease liabilities and a reconciliation of undiscounted cash flows to the total lease liability as of June 30, 2021 is as follows:

	Operating		Finance
	Leases		Lease
Lease payments due:
June 30, 2022	$	7,734	$	115
June 30, 2023	6,759		117
June 30, 2024	5,696		119
June 30, 2025	5,002		121
June 30, 2026	4,675		122
Thereafter	30,976		1,164
Total undiscounted future minimum lease payments	60,842		1,758
Less: imputed interest	(10,446)		(203)
Lease liability	$	50,396	$	1,555