Leases

3 Months Ended

Mar. 31, 2019

LEASES

We lease retail branches, ATMs, datacenters, office space, land and equipment under operating and finance leases. Our leases have remaining lease terms of one year to sixty-two years, some of which may include options to renew the leases for up to ninety-nine years, and some of which may include options to terminate the leases prior to the end date. Certain leases also include options to purchase the leased asset. The exercise of lease renewal, termination and purchase options is at our sole discretion.

At adoption of ASU 2016-02 on January 1, 2019, we elected to account for the lease and nonlease components of existing real estate leases and leases of advertising assets, such as signage, as a single lease component. Effective January 1, 2019, lease and nonlease components of new lease agreements will be accounted for separately. Lease components include fixed payments including rent, real estate taxes and insurance costs and nonlease components include common-area maintenance costs. Generally, we have elected to use the Overnight Indexed Swap rate corresponding to the term of the lease at the lease measurement date as our incremental borrowing rate to measure the right-of-use asset and lease liability. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term.

Certain of our lease agreements include rental payments based on a percentage of revenue and others include rental payments if certain bank deposit levels are met. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Subleases to third parties were not material.

Operating and finance lease assets and liabilities at March 31, 2019 were as follows:

Table 76: Leases



In millions	March 31, 2019
Assets
Operating	$	2,041
Finance	103
Total lease assets	$	2,144
Liabilities
Operating	$	2,198
Finance	109
Total lease liabilities	$	2,307

Future undiscounted cash flows on our operating and finance leases are as follows:

Table 77: Maturity of Lease Liabilities



	March 31, 2019
In millions	Operating Leases			Finance Leases			Total Leases
Remainder of 2019	$	266		$	31		$	297
2020	342			36			378
2021	313			27			340
2022	275			6			281
2023	243			2			245
After 2023	1,015			12			1,027
Total lease payments	$	2,454		$	114		$	2,568
Less: Interest	(256		)	(5		)
Present value of lease liabilities	$	2,198		$	109

At December 31, 2018, operating lease commitments under lesee arrangements were $374 million, $346 million, $308 million, $258 million, $228 million for 2019 through 2023, respectively, and $941 million in the aggregate for all years thereafter.

Lease term and discount rates at March 31, 2019 were as follows:

Table 78: Lease Term and Discount Rates



	March 31, 2019
Weighted-average remaining lease term (years)
Operating leases	9.2
Finance leases	4.2
Weighted-average discount rate
Operating leases	2.34	%
Finance leases	2.31	%

Leases

LEASES

Operating and finance lease assets and liabilities at March 31, 2019 were as follows:

Table 76: Leases



In millions	March 31, 2019
Assets
Operating	$	2,041
Finance	103
Total lease assets	$	2,144
Liabilities
Operating	$	2,198
Finance	109
Total lease liabilities	$	2,307

Table 77: Maturity of Lease Liabilities



	March 31, 2019
In millions	Operating Leases			Finance Leases			Total Leases
Remainder of 2019	$	266		$	31		$	297
2020	342			36			378
2021	313			27			340
2022	275			6			281
2023	243			2			245
After 2023	1,015			12			1,027
Total lease payments	$	2,454		$	114		$	2,568
Less: Interest	(256		)	(5		)
Present value of lease liabilities	$	2,198		$	109

Table 78: Lease Term and Discount Rates



	March 31, 2019
Weighted-average remaining lease term (years)
Operating leases	9.2
Finance leases	4.2
Weighted-average discount rate
Operating leases	2.34	%
Finance leases	2.31	%