v3.26.1
LEASES
 3 Months Ended
Mar. 31, 2026
Leases [Abstract]  
LEASES LEASES
We have operating leases primarily for certain branches, office space, land and office equipment. We have finance leases for certain branches. Our operating leases expire at various dates through the year 2046 and generally include one or more options to renew. Our finance leases expire at various dates through the year 2051 and generally include one or more options to renew. The exercise of lease renewal options is at our sole discretion. As of March 31, 2026, we had operating lease right-of-use assets and operating lease liabilities of $206.7 million and $247.8 million, respectively, including $69.9 million in operating right-of-use assets and $100.1 million in operating lease liabilities with a related party. As of March 31, 2026, we had finance lease right-of-use assets and finance lease liabilities of $35.4 million and $38.7 million, respectively.
Our operating lease agreements do not contain any material residual value guarantees or material restrictive covenants. As of March 31, 2026, we have certain operating lease agreements, primarily for administrative office space, that are expected to commence in 2026 with lease terms of up to 20 years. At commencement, it is expected that these leases will add approximately $4.7 million in right-of-use assets and $4.7 million in other liabilities. The Pittsburgh headquarters building is a related party operating lease accounted for in a manner consistent with all other leases on the basis of the legally enforceable terms and conditions of the lease and the related party represents a VIE for which we are not the primary beneficiary.
The components of lease expense were as follows:
TABLE 7.1
Three Months Ended
March 31,
(in millions)20262025
Operating lease cost$11 $10 
Variable lease cost2 1 
Finance lease cost1 1 
Total lease cost$14 $12 
Other information related to leases is as follows:
TABLE 7.2
Three Months Ended
March 31,
(dollars in millions)20262025
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$10 $10 
Operating cash flows from finance leases$— $— 
Right-of-use assets obtained in exchange for lease obligations:
Operating leases$13 $16 
Finance leases$4 $— 
Weighted average remaining lease term (years):
Operating leases1011
Finance leases1717
Weighted average discount rate:
Operating leases4.1 %4.0 %
Finance leases3.7 %3.6 %
Future cash flows of lease liabilities are as follows:
TABLE 7.3
(in millions)Operating LeasesFinance LeasesTotal Leases
March 31, 2026
0 - 12 months$38 $3 $41 
13 - 24 months35 3 38 
25 - 36 months31 3 34 
37 - 48 months29 3 32 
49 - 60 months26 3 29 
Later years148 37 185 
Total lease payments307 52 359 
Less: imputed interest(59)(13)(72)
Present value of lease liabilities$248 $39 $287 
As a lessor we offer commercial leasing services to customers in need of new or used equipment primarily within our market areas of Pennsylvania, Ohio, Maryland, North Carolina, South Carolina and West Virginia. Additional information relating to commercial leasing is provided in Note 4, “Loans and Leases” in the Notes to Consolidated Financial Statements.
LEASES LEASES
We have operating leases primarily for certain branches, office space, land and office equipment. We have finance leases for certain branches. Our operating leases expire at various dates through the year 2046 and generally include one or more options to renew. Our finance leases expire at various dates through the year 2051 and generally include one or more options to renew. The exercise of lease renewal options is at our sole discretion. As of March 31, 2026, we had operating lease right-of-use assets and operating lease liabilities of $206.7 million and $247.8 million, respectively, including $69.9 million in operating right-of-use assets and $100.1 million in operating lease liabilities with a related party. As of March 31, 2026, we had finance lease right-of-use assets and finance lease liabilities of $35.4 million and $38.7 million, respectively.
Our operating lease agreements do not contain any material residual value guarantees or material restrictive covenants. As of March 31, 2026, we have certain operating lease agreements, primarily for administrative office space, that are expected to commence in 2026 with lease terms of up to 20 years. At commencement, it is expected that these leases will add approximately $4.7 million in right-of-use assets and $4.7 million in other liabilities. The Pittsburgh headquarters building is a related party operating lease accounted for in a manner consistent with all other leases on the basis of the legally enforceable terms and conditions of the lease and the related party represents a VIE for which we are not the primary beneficiary.
The components of lease expense were as follows:
TABLE 7.1
Three Months Ended
March 31,
(in millions)20262025
Operating lease cost$11 $10 
Variable lease cost2 1 
Finance lease cost1 1 
Total lease cost$14 $12 
Other information related to leases is as follows:
TABLE 7.2
Three Months Ended
March 31,
(dollars in millions)20262025
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$10 $10 
Operating cash flows from finance leases$— $— 
Right-of-use assets obtained in exchange for lease obligations:
Operating leases$13 $16 
Finance leases$4 $— 
Weighted average remaining lease term (years):
Operating leases1011
Finance leases1717
Weighted average discount rate:
Operating leases4.1 %4.0 %
Finance leases3.7 %3.6 %
Future cash flows of lease liabilities are as follows:
TABLE 7.3
(in millions)Operating LeasesFinance LeasesTotal Leases
March 31, 2026
0 - 12 months$38 $3 $41 
13 - 24 months35 3 38 
25 - 36 months31 3 34 
37 - 48 months29 3 32 
49 - 60 months26 3 29 
Later years148 37 185 
Total lease payments307 52 359 
Less: imputed interest(59)(13)(72)
Present value of lease liabilities$248 $39 $287 
As a lessor we offer commercial leasing services to customers in need of new or used equipment primarily within our market areas of Pennsylvania, Ohio, Maryland, North Carolina, South Carolina and West Virginia. Additional information relating to commercial leasing is provided in Note 4, “Loans and Leases” in the Notes to Consolidated Financial Statements.