Noninterest Income and Noninterest Expense

6 Months Ended

Jun. 30, 2020

Noninterest Income and Noninterest Expense

Noninterest Income and Noninterest Expense

16. Noninterest Income and Noninterest Expense

Benefit Plans

The Company sponsors an unfunded supplemental executive retirement plan (“SERP”) for certain key executives. In March 2019, the Company’s board of directors approved an amendment to the SERP to freeze the SERP, which became effective on July 1, 2019. As a result of the amendment, since the effective date, there have not been any, and there will be no, new accruals of benefits, including service accruals. Existing benefits under the SERP, as of the effective date of the amendment described above, will otherwise continue in accordance with the terms of the SERP.

The following table sets forth the components of net periodic benefit cost for the Company’s pension and postretirement benefit plans for the three and six months ended June 30, 2020 and 2019:

	Income line item where recognized in	Pension Benefits				Other Benefits
(dollars in thousands)	the consolidated statements of income	2020		2019		2020		2019
Three Months Ended June 30,
Service cost	Salaries and employee benefits	$	—	$	17	$	189	$	159
Interest cost	Other noninterest expense		1,621		2,044		164		206
Expected return on plan assets	Other noninterest expense		(1,194)		(1,195)		—		—
Prior service credit	Other noninterest expense		—		—		(13)		(107)
Recognized net actuarial loss (gain)	Other noninterest expense		1,429		1,564		(26)		(76)
Total net periodic benefit cost		$	1,856	$	2,430	$	314	$	182
Six Months Ended June 30,
Service cost	Salaries and employee benefits	$	—	$	34	$	378	$	318
Interest cost	Other noninterest expense		3,242		4,088		328		412
Expected return on plan assets	Other noninterest expense		(2,388)		(2,390)		—		—
Prior service credit	Other noninterest expense		—		—		(26)		(214)
Recognized net actuarial loss (gain)	Other noninterest expense		2,858		3,128		(52)		(152)
Total net periodic benefit cost		$	3,712	$	4,860	$	628	$	364

Leases

The Company recognized operating lease income related to lease payments of $1.6 million and $1.5 million for the three months ended June 30, 2020 and 2019, respectively, and $3.1 million and $3.0 million for the six months ended June 30, 2020 and 2019, respectively. In addition, the Company recognized $1.4 million and $1.3 million of lease income related to variable lease payments for the three months ended June 30, 2020 and 2019, respectively, and $2.9 million and $2.6 million for the six months ended June 30, 2020 and 2019, respectively.

Amortization of Software Expenses

Amortization of software expenses recorded in other noninterest expense was $1.4 million and $1.0 million for the three months ended June 30, 2020 and 2019, respectively, and $2.6 million and $2.2 million for the six months ended June 30, 2020 and 2019, respectively.