Leases

9 Months Ended

Sep. 30, 2020

We have operating leases for our corporate offices and certain equipment utilized at those properties. We are obligated under a number of noncancelable operating leases for premises and equipment that expire at various dates, through 2030, and in most instances, include options to renew or extend at market rates and terms. Such leases may provide for periodic adjustments of rent during the term of the lease based on changes in various economic indicators.

At the inception of the lease, the lease is evaluated to determine whether the lease will be accounted for as an operating or a finance lease. There were no significant assumptions or judgments required upon applying the new lease standard. Operating lease right-of-use assets and operating lease liabilities are included in our consolidated balance sheets. We have no leases that meet the definition of a finance lease under ASC 842 and our lessor accounting treatment for subleases is not material.

Total recorded balances for the lease assets and liabilities are as follows:


(Dollars in thousands)	September 30, 2020		December 31, 2019
Assets:
Right-of-use assets - operating leases	$	220,493	$	197,365
Liabilities:
Lease liabilities - operating leases	246,652		218,847

The components of our lease cost and supplemental cash flow information related to leases for the three and nine months ended September 30, 2020 and 2019 were as follows:


	Three months ended September 30,				Nine months ended September 30,
(Dollars in thousands)	2020		2019		2020		2019
Operating lease cost	$	11,998	$	10,120	$	35,040	$	29,099
Short-term lease cost	333		370		1,092		1,214
Variable lease cost	830		903		2,548		2,683
Less: sublease income	(346)		(1,140)		(1,633)		(3,363)
Total lease cost, net	$	12,815	$	10,253	$	37,047	$	29,633


Supplemental cash flows information:
Cash paid for amounts included in the measurement of lease liabilities:
Cash paid for operating leases	$	12,273	$	11,514	$	36,753	$	32,752
Noncash items during the period:
Lease obligations in exchange for obtaining Right-of-use assets:
Operating leases	$	14,741	$	7,770	$	55,316	$	7,770

The table below presents additional information related to the Company's leases as of September 30, 2020 and December 31, 2019:


	September 30, 2020	December 31, 2019
Weighted-average remaining term (in years) - operating leases	6.13	6.29
Weighted-average discount rate - operating leases (1)	2.54 %	2.92	%

(1)The incremental borrowing rate used to calculate the lease liability was determined based on the facts and circumstances of the economic environment and the Company’s credit standing as of the effective date of ASC 842. Additionally, the total lease term and total lease payments were also considered in determining the rate. Based on these considerations the Company identified credit terms available under its existing credit lines which represent a collateralized borrowing rate that has varying credit terms that could be matched to total lease terms and total lease payments in ultimately determining the implied borrowing rate in each lease contract.

The following table presents our undiscounted future cash payments for our operating lease liabilities as of September 30, 2020:


Years ended December 31, (Dollars in thousands)	Operating Leases
2020 (excluding the nine months ended September 30, 2020)	$	12,782
2021	50,271
2022	45,430
2023	44,337
2024	38,437
2025 and thereafter	75,799
Total future lease payments (1)	$	267,056
Less: imputed interest	(20,404)
Total lease liabilities	$	246,652

(1)As of September 30, 2020, we have additional leases that have not yet commenced. We estimate that we will record additional lease liabilities of $2.8 million upon commencement. These leases will commence in 2020 with lease terms of two years to ten years.