Group as a lessee
The
Group,
as
a
lessee,
recognizes
the
lease
contract
as
a
component
of
the
right-to-use
assets
and
the
corresponding
lease
liability
on
the
date
when
the
subject
of
the
lease
is
available
for
use.
Each
lease
payment
is
allocated
between
the
liability
and
accrued
interest
on
the
liability.
Interest
expense
is
recognized
in
the
income
statement
over
the
lease
term
to
obtain
a
constant
periodic
interest
rate
on
the
remaining
balance
of
the
lease
liability.
The
right-of-use
asset
is
depreciated
on
a
straight-line
basis
over
the
shorter
of
two
periods:
the
useful
life
of
the
asset
or
the
lease
term.
The
Group
recognizes
the
right-of-use
assets
in
the
item
of
the
statement
of
financial
position
‘Property,
plant
and
equipment’
and
lease
liabilities
-
in the item of the statement of financial position ‘Amounts due to customers’ or ‘Amounts due to banks’.
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
Group,
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
Group’s incremental borrowing rate.
After
the
lease
commencement
date,
the
Group
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
Group
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.
Group as a lessor
At
commencement
date
of
a
lease,
the
Group,
as
a
lessor,
classifies
each
lease
contract
as
an
operating
lease
or
a
finance
lease.
The
Group
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
Group
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
Group,
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 Group.
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 Group 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
Group,
as
a
lessor,
recognizes
interest
income,
based
on
a
pattern
reflecting
a
constant
periodic
rate
of
return
on
the
Group's
net
investment
in
the
lease.
Lease
payments
paid
over
the
lease
term,
reduce
both
the
principal and the accrued interest.
