Bank Premises and Equipment

9 Months Ended

Sep. 30, 2020

Property, Plant and Equipment [Abstract]

The following table provides a summary of bank premises and equipment as of:


($ in millions)	September 30, 2020		December 31, 2019
Land and improvements(a)	$	626	639
Buildings(a)	1,587		1,575
Equipment	2,254		2,126
Leasehold improvements	450		432
Construction in progress(a)	140		85
Bank premises and equipment held for sale:
Land and improvements	27		8
Buildings	17		18
Equipment	1		1
Accumulated depreciation and amortization	(3,012)		(2,889)
Total bank premises and equipment	$	2,090	1,995

(a)At September 30, 2020 and December 31, 2019, land and improvements, buildings and construction in progress included $54 and $51, respectively, associated with parcels of undeveloped land intended for future branch expansion.

The Bancorp monitors changing customer preferences associated with the channels it uses for banking transactions to evaluate the efficiency, competitiveness and quality of the customer service experience in its consumer distribution network. As part of this ongoing assessment, the Bancorp may determine that it is no longer fully committed to maintaining full-service branches at certain of its existing banking center locations. Similarly, the Bancorp may also determine that it is no longer fully committed to building banking centers on certain parcels of land which had previously been held for future branch expansion.

During the second quarter of 2018, the Bancorp adopted a plan to close approximately 100 to 125 branches over the next three years, exclusive of branches identified for closure as part of the MB Financial, Inc. acquisition. As of September 30, 2020, 100 branches have been closed under this plan. Additionally, the Bancorp has identified 37 branches that it expects to close in the first quarter of 2021.

As a result of the MB Financial, Inc. acquisition, the Bancorp identified 46 branches in the Chicago market that it planned to close. Of these locations, 45 were closed in the third quarter of 2019 and the final location was closed in the first quarter of 2020. These 46 branches were not part of the aforementioned plan and were in addition to the branch in the Chicago market that the Bancorp closed in November 2018. In addition, the Bancorp previously identified 11 other non-branch locations that it planned to sell that were acquired from MB Financial, Inc. These locations had a fair value, less cost to sell, of $15 million. Of these locations, seven have been sold as of September 30, 2020.

The Bancorp performs assessments of the recoverability of long-lived assets when events or changes in circumstances indicate that their carrying values may not be recoverable. Impairment losses associated with such assessments and lower of cost or market adjustments were $11 million and $5 million for the three months ended September 30, 2020 and 2019, respectively, and $25 million and $27 million for the nine months ended September 30, 2020 and 2019, respectively. For the nine months ended September 30, 2019, impairment charges included $14 million associated with Fifth Third branches in the Chicago market that were assessed for impairment as a result of the MB Financial, Inc. acquisition. The recognized impairment losses were recorded in other noninterest income in the Condensed Consolidated Statements of Income.