Noninterest Income and Noninterest Expense

9 Months Ended

Sep. 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 nine months ended September 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 September 30,
Service cost	Salaries and employee benefits	$	—	$	18	$	195	$	160
Interest cost	Other noninterest expense		1,639		2,044		156		203
Expected return on plan assets	Other noninterest expense		(1,206)		(1,195)		—		—
Prior service credit	Other noninterest expense		—		—		(12)		(107)
Recognized net actuarial loss (gain)	Other noninterest expense		1,474		1,564		(80)		(76)
Total net periodic benefit cost		$	1,907	$	2,431	$	259	$	180
Nine Months Ended September 30,
Service cost	Salaries and employee benefits	$	—	$	52	$	573	$	478
Interest cost	Other noninterest expense		4,881		6,132		484		615
Expected return on plan assets	Other noninterest expense		(3,594)		(3,585)		—		—
Prior service credit	Other noninterest expense		—		—		(38)		(321)
Recognized net actuarial loss (gain)	Other noninterest expense		4,332		4,692		(132)		(228)
Total net periodic benefit cost		$	5,619	$	7,291	$	887	$	544

Leases

The Company recognized operating lease income related to lease payments of $1.6 million and $1.5 million for the three months ended September 30, 2020 and 2019, respectively, and $4.7 million and $4.4 million for the nine months ended September 30, 2020 and 2019, respectively. In addition, the Company recognized $1.4 million of lease income related to variable lease payments for both the three months ended September 30, 2020 and 2019, and $4.3 million and $4.0 million for the nine months ended September 30, 2020 and 2019, respectively.