STI 2018 Annual Report

Notes to Consolidated Financial Statements, continued 161 charges on repossessed personal property were a component of the ALLL. The Company monitors the fair value of assets under operating leases where the Company is the lessor and recognizes impairment on the leased asset to the extent the carrying value is not recoverable and is greater than its fair value. Fair value is determined using collateral specific pricing digests, external appraisals, broker opinions, recent sales data from industry equipment dealers, and the discounted cash flows derived from the underlying lease agreement. As market data for similar assets and lease arrangements is available and used in the valuation, these assets are considered level 2. During each of the years ended December 31, 2018 and 2017, the Company recognized an immaterial amount of impairment charges attributable to changes in the fair value of various personal property under operating leases. Branch properties are classified as level 3, as their fair value is based on property-specific appraisals and broker opinions. During the years ended December 31, 2018 and 2017, the Company recognized impairment charges of $5 million and $10 million on branch properties, respectively. Land held for sale is recorded at the lesser of carrying value or fair value less cost to sell, and is considered level 3 as its fair value is determined based on property-specific appraisals and broker opinions. During each of the years ended December 31, 2018 and 2017, the Company recognized an immaterial amount of impairment charges on land held for sale. Software consisted primarily of external software licenses and internally developed software that were impaired and for which fair value was determined using a level 3 measurement.