The right-of-use assets are measured at cost, comprising:
•
the amount of the initial measurement of the lease liability,
•
any lease payments made at or before the commencement date, less any lease incentives received,
•
any initial direct costs incurred by the lessee, and
•
an
estimate
of
costs
to
be
incurred
by
the
lessee
in
dismantling
and
removing
the
underlying
asset,
restoring
the
site
on
which it is located, if the lessee incurs liabilities regarding these costs.
On
the
date
when
the
lease
commences,
the
Bank,
as
a
lessee,
measures
the
lease
liability
in
the
present
value
of
lease
payments outstanding as at that date. The lease liabilities include the current value of the following lease payments:
•
fixed payments less any lease incentives receivable,
•
variable lease payments that depend on an index or a rate,
•
amounts expected to be payable by the lessee under residual value guarantees,
•
the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
•
payments
of
penalties
for
terminating
the
lease,
if
the
lease
term
reflects
the
lessee
exercising
an
option
to
terminate
the
lease.
The
lease
payments
are
discounted
using
the
interest
rate
implicit
in
the
lease,
if
the
rate
can
be
readily
determined,
or
the
Bank’s incremental borrowing rate.
After
the
lease
commencement
date,
the
Bank
taken
into
account
changes
in
lease
payments
(resulting,
inter
alia,
from
changes in the index, rate, lease term), by remeasuring the lease liabilities and the right-of-use assets.
The
Bank
does
not
recognize
the
right-of-use
assets
and
lease
liabilities
for
short-term
lease
contracts
and
lease
contracts
of
low-value
assets.
Short-term
lease
payments
and
payments
for
leases
of
low-value
assets
are
recognized
as
an
expense
in
the
income
statement
on
a
straight-line
basis.
Short-term
lease
contracts
are
lease
contracts
that
have
a
lease
term
of
12
months or less. Low-value assets include mainly lease of space (land) for ATMs.
The Bank as a lessor
At
commencement
date
of
a
lease,
the
Bank,
as
a
lessor,
classifies
each
lease
contract
as
an
operating
lease
or
a
finance
lease.
The
Bank
classifies
a
lease
as
a
finance
lease
whether
it
transfers
substantially
all
the
risks
and
rewards
of
ownership
of
an
underlying
asset.
Conversely,
if
substantially
all
the
risks
and
rewards
of
ownership
of
the
underlying
asset
are
not
transferred,
the
lease
is
considered
to
be
an
operating
lease.
In
the
process
of
determining
the
classification
of
a
lease
contract,
the
Bank
takes
into
account
elements
such
as
whether
the
lease
term
accounts
for
the
major
part
of
the
economic
life
of
the
underlying asset.
Finance lease
At
the
commencement
date,
the
Bank,
as
a
lessor,
recognizes
assets
held
under
a
finance
lease
in
its
statement
of
financial
position
and
present
them
as
a
receivables
from
finance
lease
(presented
in
item
“
Loans
and
advances
to
customers”)
at
an
amount
equal
to
the
net
investment
in
the
lease,
i.e.
at
present
value
of
lease
payments
and
any
unguaranteed
residual
value
assigned to the Bank.
At
the
finance
lease
commencement
date,
the
lease
payments
included
in
the
measurement
of
the
net
investment
in
the
lease
comprise
the
following
payments
for
the
right
to
use
the
underlying
asset
during
the
lease
term
that
are
not
received
at
the
commencement date:
•
fixed payments, less any lease incentives payable,
•
variable lease payments that depend on an index or a rate,
•
any residual value guarantees provided to the Bank as a lessor,
•
the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
•
payments
of
penalties
for
terminating
the
lease,
if
the
lease
term
reflects
the
lessee
exercising
an
option
to
terminate
the
lease.
During
the
lease
term,
the
Bank,
as
a
lessor,
recognizes
interest
income,
based
on
a
pattern
reflecting
a
constant
periodic
rate
of
return
on
the
Bank's
net
investment
in
the
lease.
Lease
payments
paid
over
the
lease
term,
reduce
both
the
principal
and
the accrued interest.
The
Bank
applies
the
derecognition
and
impairment
requirements
in
IFRS
9
to
the
net
investment
in
the
lease.
The
estimated
unguaranteed residual values used in computing the gross investment in the lease are regularly reviewed by the Bank.
Operating lease
During
the
lease
term,
the
Bank,
as
a
lessor,
recognizes
lease
payments
from
operating
lease
as
income
on
a
straight-line
basis
and
presents
them
in
the
item
“Other
operating
income”.
The
depreciation
of
leased
assets
is
recognized
in
accordance
with the principles applied by the Bank for property, plant and equipment.
