LEASES (Note 5)
The following table presents the components of the ROU assets and lease liabilities in the consolidated statements of financial condition by lease type at December 31, 2025 and 2024.
| | | | | | | | | | | |
| 2025 | | 2024 |
| (in thousands) |
| ROU assets: | | | |
| Operating leases | $ | 313,107 | | | $ | 324,975 | |
| Finance leases | 784 | | | 3,500 | |
| Total | $ | 313,891 | | | $ | 328,475 | |
| Lease liabilities: | | | |
| Operating leases | $ | 371,610 | | | $ | 384,745 | |
| Finance leases | 838 | | | 3,558 | |
| Total | $ | 372,448 | | | $ | 388,303 | |
The following table presents the components by lease type, of total lease cost recognized in the consolidated statements of income for the years ended December 31, 2025, 2024 and 2023:
| | | | | | | | | | | | | | | | | |
| 2025 | | 2024 | | 2023 |
| (in thousands) |
| Finance lease cost: | | | | | |
| Amortization of ROU assets | $ | 152 | | | $ | 53 | | | $ | 16 | |
| Interest on lease liabilities | 31 | | | 12 | | | — | |
| Operating lease cost | 50,124 | | | 49,875 | | | 48,241 | |
| Short-term lease cost | 1,383 | | | 1,498 | | | 1,930 | |
| Variable lease cost | 125 | | | 201 | | | 177 | |
| Sublease income | (4,132) | | | (3,316) | | | (3,303) | |
| Total lease cost (primarily included in net occupancy expense) | $ | 47,683 | | | $ | 48,323 | | | $ | 47,061 | |
The following table presents supplemental cash flow information related to leases for the years ended December 31, 2025, 2024 and 2023:
| | | | | | | | | | | | | | | | | |
| 2025 | | 2024 | | 2023 |
| (in thousands) |
| Cash paid for amounts included in the measurement of lease liabilities: | | | | | |
| Operating cash flows from operating leases | $ | 52,524 | | | $ | 51,581 | | | $ | 49,007 | |
| Operating cash flows from finance leases | 31 | | | — | | | — | |
| Financing cash flows from finance leases | 156 | | | 3 | | | 18 | |
The following table presents supplemental information related to leases at December 31, 2025 and 2024:
| | | | | | | | | | | |
| 2025 | | 2024 |
| Weighted-average remaining lease term | |
| Operating leases | 11.4 years | | 11.9 years |
| Finance leases | 4.1 years | | 5.1 years |
| Weighted-average discount rate | | | |
| Operating leases | 3.98 | % | | 3.88 | % |
| Finance leases | 4.32 | % | | 4.33 | % |
The following table presents a maturity analysis of lessor and lessee arrangements outstanding as of December 31, 2025:
| | | | | | | | | | | | | | | | | |
| Lessor | | Lessee |
| Direct Financing and Sales-Type Leases | | Operating Leases | | Finance Leases |
| (in thousands) |
| 2026 | $ | 274,420 | | | $ | 55,754 | | | $ | 225 | |
| 2027 | 212,129 | | | 49,271 | | | 223 | |
| 2028 | 151,398 | | | 47,537 | | | 223 | |
| 2029 | 104,338 | | | 46,183 | | | 223 | |
| 2030 | 58,673 | | | 45,020 | | | 18 | |
| Thereafter | 24,405 | | | 231,477 | | | — | |
| Total lease payments | 825,363 | | | 475,242 | | | 912 | |
| Less: present value discount | (86,280) | | | (103,632) | | | (74) | |
| Total | $ | 739,083 | | | $ | 371,610 | | | $ | 838 | |
The total net investment in direct financing and sales-type leases was $739.1 million and $746.5 million at December 31, 2025 and 2024, respectively, comprised of $733.6 million and $741.0 million in lease receivables and $5.5 million and $5.5 million in non-guaranteed residuals, respectively. Total lease income was $42.7 million, $39.8 million and $40.1 million for the years ended December 31, 2025, 2024 and 2023, respectively.
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.