Leases

12 Months Ended

Dec. 31, 2023

We have entered into operating leases for premises and equipment. The following table summarizes the components of total operating lease costs, net and provides supplemental cash flow information related to leases:



Year Ended December 31,	2023		2022		2021
	(in millions)
Operating lease cost	$	42	$	49	$	87
Variable lease cost	25		33		48

Sublease income(1)	(33)		(39)		(43)
Total operating lease costs, net	$	34	$	43	$	92

Supplemental disclosure of cash flow information:
Cash paid for amounts included in the measurement of operating lease liabilities	$	71	$	79	$	129
ROU assets recognized for new operating lease liabilities	337		2		—

(1)We have entered into agreements to sublease certain office space, including agreements to receive rental income from our affiliates. As lessee of the properties, we have entered into agreements with these affiliates to charge them rent based on the office space utilized by their employees during the period. See Note 24, "Related Party Transactions," for further disclosure.

In addition to the operating lease costs reflected in the table above, during 2022 and 2021, we recorded lease impairment charges of $10 million and $63 million, respectively, to write-down the lease ROU assets associated with certain office space and, in 2021 certain branches, that we determined we would exit as part of our Restructuring Plan. See Note 3, "Strategic Initiatives," for further discussion. These impairment charges are reflected in occupancy expense, net in the consolidated statement of income and were reported in the Wealth and Personal Banking and the Corporate Center business segments.

In November 2023, we commenced a new 20-year operating lease to relocate our U.S. headquarters to 66 Hudson Boulevard, New York, New York which resulted in the recognition of a lease ROU asset of $381 million, including prepaid construction costs, and a corresponding operating lease liability of $324 million. The lease contains certain renewal and termination options.

The following table presents information about our operating lease ROU assets and liabilities:


At December 31,	2023			2022
	(dollars are in millions)
Operating lease ROU assets(1)	$	495		$	139
Operating lease liabilities	488			217
Weighted-average remaining lease term	17.2 years			8.1 years
Weighted-average discount rate	5.1		%	3.0		%

(1)Reported inclusive of prepaid construction costs, net of level lease adjustments and accumulated impairment losses.

The following table presents a maturity analysis of our operating lease liabilities at December 31, 2023:


Year Ending December 31,
	(in millions)
2024	$	60
2025	51
2026	42
2027	40
2028	39
Thereafter	559
Total future operating lease payments	791
Less - imputed interest	(303)
Total operating lease liabilities	$	488

At December 31, 2023, additional operating leases for premises that have not yet commenced and are not reflected in the table above were not material.