Huntington National Bank 2003 Annual Report Download - page 117

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
9. Operating Lease Assets
For periods before May 2002, Huntington purchased vehicles, primarily automobiles, for lease to consumers under operating lease
arrangements. These operating lease arrangements required the lessee to make a fixed monthly rental payment over a specified lease
term, typically from 36 to 66 months. These vehicles, net of accumulated depreciation, were recorded as operating lease assets in the
consolidated balance sheet. Rental income is earned by Huntington on the operating lease assets and reported as Non-interest income.
These vehicles are depreciated over the term of the lease to the estimated fair value of the vehicle at the end of the lease. The
depreciation of these vehicles is reported as a component of Non-interest expense. At the end of the lease, the vehicle is either
purchased by the lessee or returned to Huntington. The following is a summary of operating lease assets at December 31:
(in thousands of dollars) 2003 2002
Cost of operating lease assets (including residual value of $814,078 and $1,325,547, respectively) $2,136,502 $ 3,260,897
Deferred origination fees and costs (2,117) (51,920)
Accumulated depreciation (873,945) (1,008,452)
Operating Lease Assets, Net $1,260,440 $ 2,200,525
The future lease rental payments due from customers on operating lease assets at December 31, 2003, totaled $672.7 million and are
due as follows: $335.2 million in 2004; $215.5 million in 2005; $105.9 million in 2006; and $16.1 million in 2007. Depreciation expense
for each of the years ended December 31, 2003, 2002, and 2001 was $367.5 million, $435.8 million, and $468.7 million, respectively.
10. Premises and Equipment
At December 31, premises and equipment stated at cost were comprised of the following:
(in thousands of dollars) 2003 2002
Land and land improvements $ 59,347 $ 56,782
Buildings 216,076 211,700
Leasehold improvements 127,830 123,944
Equipment 477,385 447,374
Total Premises and Equipment 880,638 839,800
Less accumulated depreciation and amortization (530,926) (498,434)
Net Premises and Equipment $ 349,712 $ 341,366
Depreciation and amortization charged to expense and rental income credited to occupancy expense for the year ended December 31
were:
(in thousands of dollars) 2003 2002 2001
Total depreciation and amortization of premises and equipment $46,746 $46,319 $53,805
Rental income credited to occupancy expense 14,837 15,868 17,662
HUNTINGTON BANCSHARES INCORPORATED 115