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Leases (Tables)

6 Months Ended

Jun. 30, 2019

The Company's right-of-use assets, lease liabilities, and associated balance sheet classifications are presented in the following table:



(Dollars in millions)	Classification	June 30, 2019
Assets:
Operating lease right-of-use assets	Other assets		$1,128
Finance lease right-of-use assets	Premises, property, and equipment, net	25
Total right-of-use assets			$1,153
Liabilities:
Operating leases	Other liabilities		$1,205
Finance leases	Long-term debt	27
Total lease liabilities			$1,232

The components of total lease cost and other supplemental lease information are presented in the following tables:



(Dollars in millions)	Three Months Ended June 30, 2019			Six Months Ended June 30, 2019
Components of total lease cost:
Operating lease cost		$51			$103
Finance lease cost:
Amortization of right-of-use assets	1			2
Variable lease cost	9			17
Less: Sublease income	(2		)	(3		)
Total lease cost, net		$59			$119



(Dollars in millions)	Three Months Ended June 30, 2019		Six Months Ended June 30, 2019
Supplemental lease information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases		$48		$97
Financing cash flows from finance leases	1		2

Lease liabilities arising from obtaining right-of-use assets (subsequent to adoption):
Operating leases	5		24
Finance leases	11		11

Weighted average remaining lease terms and discount rates are presented in the following table:



(Dollars in millions)	June 30, 2019
Weighted-average remaining lease term (in years):
Operating leases	8.2
Finance leases	7.0
Weighted-average discount rate (annual):
Operating leases	3.3	%
Finance leases	6.6

The following table presents a maturity analysis of the Company's operating and finance lease liabilities at June 30, 2019:



(Dollars in millions)	Operating Leases			Finance Leases			Total
Year 1		$184			$5			$189
Year 2	191			5			196
Year 3	178			5			183
Year 4	160			6			166
Year 5	140			3			143
Thereafter	544			12			556
Total lease payments	1,397			36			1,433
Less: Imputed interest	(192		)	(9		)	(201		)
Present value of lease liabilities		$1,205			$27			$1,232

The components of total lease income are presented in the following table:



(Dollars in millions)	Three Months Ended June 30, 2019		Six Months Ended June 30, 2019
Interest income from sales-type and direct financing leases		$37		$74
Lease income relating to operating leases	52		106
Lease income relating to variable lease payments not included in the measurement of the lease receivable	1		2
Total lease income		$90		$182

Components of the Company's net investment in sales-type and direct financing leases are presented in the following table:



(Dollars in millions)	June 30, 2019
Carrying amount of lease receivables		$3,807
Unguaranteed residual assets	149
Net investment in sales-type and direct financing lease assets ¹		$3,956

The following table presents a maturity analysis of the Company's sales-type and direct financing lease receivables at June 30, 2019:



(Dollars in millions)	Sales-Type and Direct Financing Leases
Year 1		$834
Year 2	761
Year 3	600
Year 4	420
Year 5	341
Thereafter	1,347
Total lease receivables	4,303
Less: Reconciling items ¹	(496		)
Present value of lease receivables		$3,807

The following table presents a maturity analysis of the Company's operating lease payments to be received at June 30, 2019:



(Dollars in millions)	Operating Leases
Year 1		$180
Year 2	159
Year 3	131
Year 4	99
Year 5	96
Thereafter	238
Total lease payments to be received		$903

Underlying lessor assets subject to operating leases at June 30, 2019 consisted of the following:



(Dollars in millions)	Useful life (in years)	June 30, 2019
Underlying lessor assets subject to operating leases: ¹
Real estate ²	15 - 20		$125
Equipment	2 - 30	1,507
Total underlying lessor assets subject to operating leases		1,632
Less: Accumulated depreciation		(554		)
Underlying lessor assets subject to operating leases, net ³			$1,078