Leases

9 Months Ended

Sep. 30, 2019

Leases

The Company’s lease commitments consist primarily of leased locations under various non-cancellable operating leases that expire between 2019 and 2043. The majority of the leases contain renewal options and provisions for increases in rental rates based on an agreed upon index or predetermined escalation schedule.

The following table shows the details of the Company’s operating lease right-of-use asset and the associated lease liability for the period indicated:

At September 30, 2019, the Company’s operating leases have a weighted-average remaining lease term of 7.5 years and a weighted average discount rate of 3.1%. Cash paid for amounts included in the measurement of operating lease liabilities was $2.8 million for the nine months ended September 30, 2019. Right-of-use assets obtained in exchange for new operating lease liabilities during the nine months ended September 30, 2019 was $9.2 million.

On September 26, 2019 the Company sold one of its Washington facilities and leased back a portion of the facility utilized for branch operations. The resulting gain on the sale was $5.9 million.

The following table shows the components of net lease costs:



		Three Months Ended September 30,			Nine Months Ended September 30,
Item	Statement of Income Location	2019			2019
		(in thousands)
Operating lease cost (1)	Occupancy	$	2,700		$	8,285
Variable lease cost	Occupancy	487			1,510
Sublease income	Occupancy	(297		)	(918		)
Net lease cost		$	2,890		$	8,877

__________

(1) Includes short-term lease costs, which are immaterial.

The following table shows future minimum payments for operating leases for the remaining three months of 2019 and subsequent years:



	Year ending December 31,
	(in thousands)
2019	$	2,717
2020	10,619
2021	10,376
2022	9,795
2023	8,546
Thereafter	22,685
Total future minimum lease payments	64,738
Amounts representing interest	(7,542		)
Present value of minimum lease payments	$	57,196

Future minimum lease payments for the Company’s operating leases as of December 31, 2018, prior to the adoption of the new lease guidance were as follows:



	Year Ending December 31,
	(in thousands)
2019	$	10,947
2020	9,766
2021	8,729
2022	8,102
2023	6,796
Thereafter	18,703
Total minimum payments	$	63,043

Balance Sheet Location

September 30, 2019

(in thousands)

Operating lease asset

Other assets

Operating lease liability

Other liabilities