Leases

9 Months Ended

Sep. 30, 2019

The Corporation has operating leases for retail and corporate offices, land, and equipment.

These operating leases have original terms of 1 year or longer with remaining maturities up to 43 years, some of which include options to extend the lease term. An analysis of the lease options has been completed and any optional periods that the Corporation is reasonably likely to extend have been included in the capitalization.

The discount rate used to capitalize the operating leases is the Corporation's FHLB borrowing rate on the date of lease commencement. When determining the rate to discount specific lease obligations, the repayment period and term are considered.

Operating lease costs and cash flows resulting from operating lease are presented below:



($ in Thousands)	Three Months Ended September 30, 2019		Nine Months Ended September 30, 2019
Operating Lease Costs	$	2,708	$	8,502
Operating Lease Cash Flows	2,968		8,538

The lease classifications on the consolidated balance sheets were as follows:



	September 30, 2019
($ in Thousands)	Amount		Consolidated Balance Sheets Category
Operating lease right-of-use asset	$	48,127	Premises and equipment
Finance lease right-of-use asset	—		Other assets
Operating lease liability	52,011		Accrued expenses and other liabilities
Finance lease liability	—		Other long-term funding

The lease payment obligations, weighted-average remaining lease term, and weighted-average discount rate were as follows:



	September 30, 2019
($ in Thousands)	Lease payments		Weighted-average lease term (in years)	Weighted-average discount rate
Operating leases
Equipment	$	66	1.08	2.72	%
Retail and corporate offices	54,202		6.63	3.36	%
Land	6,425		12.11	3.34	%
Total operating leases	$	60,693	7.40	3.36	%

Lease payment obligations for each of the next five years and thereafter, in addition to a reconciliation to the Corporation’s lease liability, were as follows:



($ in Thousands)	Amount
Three Months Ending December 31, 2019	$	4,070
2020	10,520
2021	9,828
2022	7,578
2023	5,450
Beyond 2023	23,248
Total lease payments	60,693
Less: interest	8,682
Present value of lease payments	$	52,011

As of September 30, 2019, additional operating leases, primarily retail and corporate offices, that have not yet commenced total $16 million. These operating leases will commence between January 2020 and July 2023 with lease terms of 3 years to 6 years.

Practical Expedients

The Corporation elected several practical expedients made available by the FASB. Due to materiality, the Corporation elected not to restate comparative periods upon adoption of the new guidance. In addition, the Corporation elected the package of practical expedients whereby the Corporation did not reassess (i) whether existing contracts are, or contain, leases and (ii) lease classification for existing leases. Lastly, the Corporation elected not to separate lease and nonlease components in determining the consideration in the lease agreement.