Bank Premises and Equipment

12 Months Ended

Dec. 31, 2013

Bank Premises and Equipment

Bank Premises and Equipment

7. BANK PREMISES AND EQUIPMENT

The following is a summary of bank premises and equipment at December 31:
($ in millions)	Estimated Useful Life		2013	2012
Land and improvements		$	838	841
Buildings	2 to 30 yrs.		1,763	1,692
Equipment	1 to 30 yrs.		1,581	1,460
Leasehold improvements	5 to 30 yrs.		397	386
Construction in progress			118	141
Accumulated depreciation and amortization			(2,166)	(1,978)
Total		$	2,531	2,542

Depreciation and amortization expense related to bank premises and equipment was $245 million in 2013, $233 million in 2012 and $224 million in 2011.

For the years ended 2013 and 2012, the Bancorp recorded charges of $6 million and $21 million, respectively, of lower of cost or market adjustments associated with bank premises. These adjustments were generally based on appraisals of the underlying bank premises less estimated selling costs. The recognized impairment losses were recorded in other noninterest income in the Consolidated Statements of Income.

Gross occupancy expense for cancelable and noncancelable leases was$98 million in 2013 and $99 million in2012 and2011, which was reduced by rental income from leased premises of $16 million in 2013, $17 million in2012 and $19 million in 2011.The Bancorp's subsidiaries have entered into a number of noncancelable and capital lease agreements with respect to bank premises and equipment.

The following table provides the annual future minimum payments under capital leases and noncancelable operating leases at December 31, 2013:
($ in millions)		Operating Leases	Capital Leases
Year ending December 31,
2014	$	91	8
2015		88	7
2016		82	4
2017		75	-
2018		71	-
Thereafter		339	-
Total minimum lease payments	$	746	19
Less: Amounts representing interest		-	1
Present value of net minimum lease payments		-	18