Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases Lessor Arrangements Upon the acquisition of Radius, the Company assumed lessor arrangements which consist of sales-type leases for equipment (Equipment Finance). Such arrangements may include options to renew or to purchase the leased equipment at the end of the lease term. For the third quarter and first nine months of 2021, interest earned on Equipment Finance was $2.9 million and $8.1 million, respectively, and is included in “Interest and fees on loans and leases held for investment” in the Company’s Condensed Consolidated Statements of Operations. The components of Equipment Finance assets are as follows:
(1) See “Note 6. Loans and Leases Held for Investment, Net of Allowance For Loan and Lease Losses” for additional information. Future minimum lease payments based on maturity of the Company’s lessor arrangements at September 30, 2021 were as follows:
The Company did not have any lessor arrangements with related parties or any deferred selling profits as of September 30, 2021. Lessee Arrangements The Company has operating leases for its headquarters in San Francisco, California, as well as additional office space for its origination and servicing operations in the Salt Lake City area, Utah, and Westborough, Massachusetts. In addition, the Company assumed operating leases in Boston, Massachusetts upon the acquisition of Radius. As of September 30, 2021, the lease agreements have remaining lease terms ranging from approximately one year to ten years. Some of the lease agreements include options to extend the lease term for up to an additional fifteen years. In addition, the Company is the sublessor of a portion of its office space in San Francisco, with lease terms of approximately one year. As of September 30, 2021, the Company pledged $0.8 million of cash and $5.5 million in letters of credit as security deposits in connection with its lease agreements. The right-of-use (ROU) assets and related liabilities recorded for the leases assumed upon acquisition were both approximately $5.0 million. The ROU assets were adjusted to reflect favorable terms of the lease, when compared to market terms, which resulted in an increase to the acquired ROU of $1.7 million. Lease liabilities assumed were measured based on the net present value of remaining future lease payments on the date of acquisition, with consideration given for options to extend or renew each lease. Remaining future lease payments were discounted at the Company’s estimated incremental borrowing rate on the date of acquisition. The Company reviewed operating lease ROU assets for impairment. For the first nine months of 2021, the Company recognized a net impairment expense of $1.0 million on operating lease assets, included in “Occupancy expense” on the Company’s Condensed Consolidated Statement of Operations. The Company did not recognize an impairment expense on operating lease assets during the third quarter of 2021. For the third quarter and first nine months of 2020, the Company recognized a net impairment expense of $0.9 million and $3.6 million, respectively, on operating lease assets. Balance sheet information as of September 30, 2021 and December 31, 2020 related to leases was as follows:
(1) The difference between operating lease assets and operating lease liabilities is the unamortized balance of deferred rent. Components of net lease costs for the third quarters and first nine months of 2021 and 2020 were as follows:
(1) Includes variable lease costs of $0.4 million and $0.4 million for the third quarters of 2021 and 2020, respectively. Includes variable lease costs of $0.9 million and $1.1 million for the first nine months of 2021 and 2020, respectively. Supplemental cash flow information related to the Company’s operating leases for the third quarters and first nine months of 2021 and 2020 was as follows:
(1) Represents non-cash activity and, accordingly, is not reflected in the Condensed Consolidated Statements of Cash Flows. Amount includes noncash remeasurements of the operating lease ROU asset. The Company’s future minimum undiscounted lease payments under operating leases and anticipated sublease revenue as of September 30, 2021 were as follows:
The weighted-average remaining lease term and discount rate used in the calculation of the Company’s operating lease assets and liabilities were as follows:
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Leases | Leases Lessor Arrangements Upon the acquisition of Radius, the Company assumed lessor arrangements which consist of sales-type leases for equipment (Equipment Finance). Such arrangements may include options to renew or to purchase the leased equipment at the end of the lease term. For the third quarter and first nine months of 2021, interest earned on Equipment Finance was $2.9 million and $8.1 million, respectively, and is included in “Interest and fees on loans and leases held for investment” in the Company’s Condensed Consolidated Statements of Operations. The components of Equipment Finance assets are as follows:
(1) See “Note 6. Loans and Leases Held for Investment, Net of Allowance For Loan and Lease Losses” for additional information. Future minimum lease payments based on maturity of the Company’s lessor arrangements at September 30, 2021 were as follows:
The Company did not have any lessor arrangements with related parties or any deferred selling profits as of September 30, 2021. Lessee Arrangements The Company has operating leases for its headquarters in San Francisco, California, as well as additional office space for its origination and servicing operations in the Salt Lake City area, Utah, and Westborough, Massachusetts. In addition, the Company assumed operating leases in Boston, Massachusetts upon the acquisition of Radius. As of September 30, 2021, the lease agreements have remaining lease terms ranging from approximately one year to ten years. Some of the lease agreements include options to extend the lease term for up to an additional fifteen years. In addition, the Company is the sublessor of a portion of its office space in San Francisco, with lease terms of approximately one year. As of September 30, 2021, the Company pledged $0.8 million of cash and $5.5 million in letters of credit as security deposits in connection with its lease agreements. The right-of-use (ROU) assets and related liabilities recorded for the leases assumed upon acquisition were both approximately $5.0 million. The ROU assets were adjusted to reflect favorable terms of the lease, when compared to market terms, which resulted in an increase to the acquired ROU of $1.7 million. Lease liabilities assumed were measured based on the net present value of remaining future lease payments on the date of acquisition, with consideration given for options to extend or renew each lease. Remaining future lease payments were discounted at the Company’s estimated incremental borrowing rate on the date of acquisition. The Company reviewed operating lease ROU assets for impairment. For the first nine months of 2021, the Company recognized a net impairment expense of $1.0 million on operating lease assets, included in “Occupancy expense” on the Company’s Condensed Consolidated Statement of Operations. The Company did not recognize an impairment expense on operating lease assets during the third quarter of 2021. For the third quarter and first nine months of 2020, the Company recognized a net impairment expense of $0.9 million and $3.6 million, respectively, on operating lease assets. Balance sheet information as of September 30, 2021 and December 31, 2020 related to leases was as follows:
(1) The difference between operating lease assets and operating lease liabilities is the unamortized balance of deferred rent. Components of net lease costs for the third quarters and first nine months of 2021 and 2020 were as follows:
(1) Includes variable lease costs of $0.4 million and $0.4 million for the third quarters of 2021 and 2020, respectively. Includes variable lease costs of $0.9 million and $1.1 million for the first nine months of 2021 and 2020, respectively. Supplemental cash flow information related to the Company’s operating leases for the third quarters and first nine months of 2021 and 2020 was as follows:
(1) Represents non-cash activity and, accordingly, is not reflected in the Condensed Consolidated Statements of Cash Flows. Amount includes noncash remeasurements of the operating lease ROU asset. The Company’s future minimum undiscounted lease payments under operating leases and anticipated sublease revenue as of September 30, 2021 were as follows:
The weighted-average remaining lease term and discount rate used in the calculation of the Company’s operating lease assets and liabilities were as follows:
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