Premises, Equipment, and Leases

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Premises and equipment on December 31 are summarized below:



(Dollars in thousands)	2019		2018
Land	$	98,804	$	107,864
Buildings	428,695		461,665
Leasehold improvements	50,032		30,230
Furniture, fixtures, and equipment	205,493		196,469
Fixed assets held-for-sale (a)	9,719		19,617
Premises and equipment, at cost	792,743		815,845
Less accumulated depreciation and amortization	337,737		321,804
Premises and equipment, net	$	455,006	$	494,041

(a) Primarily comprised of land and buildings.

In 2019 and 2018, FHN recognized $26.9 million and $3.9 million, respectively, of fixed asset impairments and lease abandonment charges related to branch closures which are included in All other expenses on the Consolidated Statements of Income. In 2018, $1.5 million of impairment recoveries were recorded upon disposition of the associated properties. In 2019 and 2018, FHN had net gains of $2.3 million and $4.3 million, respectively, related to the sales of bank branches which are included in All other income and commissions on the Consolidated Statements of Income.

FHN has operating, financing, and short-term leases for branch locations, corporate offices and certain equipment. Substantially all of these leases are classified as operating leases.

The following table provides a detail of the classification of FHN's right-of-use ("ROU") assets and lease liabilities included in the Consolidated Statement of Conditions.



(Dollars in thousands)		December 31, 2019
Lease Right-of-Use Assets:	Classification
Operating lease right-of use assets	Other assets	$	201,873
Finance lease right-of use assets	Other assets	2,037
Total Lease Right-of Use Assets		$	203,910

Lease Liabilities:
Operating lease liabilities	Other liabilities	$	223,128
Finance lease liabilities	Other liabilities	2,708
Total Lease Liabilities		$	225,836

The calculated amount of the ROU assets and lease liabilities in the table above are impacted by the length of the lease term and the discount rate used to present value the minimum lease payments. The following table details the weighted average remaining lease term and discount rate for FHN's operating and finance leases as of December 31, 2019.



Weighted Average Remaining Lease Terms
Operating leases	12.36 years
Finance leases	9.61 years
Weighted Average Discount Rate
Operating leases	3.24	%
Finance leases	4.77	%

The following table provides a detail of the components of lease expense and other lease information for the year ended December 31, 2019:



(Dollars in thousands)	2019
Lease cost
Operating lease cost	$	24,797
Finance lease cost:
Amortization of right-of-use assets	114
Interest on lease liabilities	135
Short-term lease cost	98
Sublease income	(366		)
Total lease cost	$	24,778

Other information
(Gain)/loss on right-of-use asset impairment-Operating leases	$	2,551

Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	23,053
Operating cash flows from finance leases	135
Financing cash flows from finance leases	142

Right-of-use assets obtained in exchange for new lease obligations:
Operating leases	47,735
Finance leases	1,475

The following table provides a detail of the maturities of FHN's operating and finance lease liabilities as of December 31, 2019:



(Dollars in thousands)	December 31, 2019
2020	$	26,594
2021	24,627
2022	23,553
2023	22,687
2024	22,224
2025 and after	156,524
Total lease payments	276,209
Less lease liability interest	(50,373		)
Total	$	225,836

FHN had aggregate undiscounted contractual obligations totaling $2.6 million for lease arrangements that have not commenced. Payments under these arrangements are expected to occur from 2020 through 2030.

Minimum future lease payments for noncancelable operating leases, primarily on premises, on December 31, 2018 are shown below.



(Dollars in thousands)	December 31, 2018
2019	$	27,524
2020	24,722
2021	20,954
2022	16,518
2023	13,174
2024 and after	42,370
Total minimum lease payments	$	145,262