Goodwill and Other Acquisition-Related Intangible Assets

9 Months Ended

Sep. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Acquisition-Related Intangible Assets

Goodwill and Other Acquisition-Related Intangible Assets

A summary of the Company’s goodwill assets by reporting unit is presented in the following table:

(In thousands)	December 31, 2022		Goodwill Acquired		Impairment Loss		Goodwill Adjustments		September 30, 2023
Community banking	$	545,671	$	—	$	—	$	—	$	545,671
Specialty finance	38,480		—		—		(37)		38,443
Wealth management	69,373		2,622		—		—		71,995
Total	$	653,524	$	2,622	$	—	$	(37)	$	656,109

The wealth management unit’s goodwill increased $2.6 million in the first nine months of 2023 as a result of the Rothschild & Co Asset Management U.S. acquisition. The specialty finance unit’s goodwill decreased $37,000 in the first nine months of 2023 as a result of foreign currency translation adjustments related to the Canadian acquisitions.

The Company assesses each reporting unit’s goodwill for impairment on at least an annual basis and considers potential indicators of impairment at each reporting date between annual goodwill impairment tests. At October 1, 2022, the Company utilized a qualitative approach for its annual goodwill impairment tests of the banking, specialty finance and wealth management reporting units and determined that no impairment existed at that time.

At each reporting date between annual goodwill impairment tests, the Company considers potential indicators of impairment. The Company assessed whether events and circumstances resulted in it being more likely than not that the fair value of any reporting unit was less than its carrying value. Potential impairment indicators considered include the condition of the economy and banking industry; government intervention and regulatory updates; the impact of recent events to financial performance and cost factors of the reporting units; performance of the Company’s stock and other relevant events.

At the conclusion of this assessment of all reporting units, the Company determined that as of September 30, 2023, it was more likely than not that the fair value of all reporting units exceeded the respective carrying value of such reporting unit.

A summary of acquisition-related intangible assets as of the dates shown and the expected amortization of finite-lived acquisition-related intangible assets as of September 30, 2023 is as follows:

(In thousands)	September 30, 2023		December 31, 2022		September 30, 2022
Community banking segment:
Core deposit intangibles with finite lives:
Gross carrying amount	$	55,206	$	55,206	$	55,206
Accumulated amortization	(45,304)		(42,501)		(41,480)
Net carrying amount	$	9,902	$	12,705	$	13,726
Trademark with indefinite lives:
Carrying amount	5,800		5,800		5,800
Total net carrying amount	$	15,702	$	18,505	$	19,526
Specialty finance segment:
Customer list intangibles with finite lives:
Gross carrying amount	$	1,962	$	1,962	$	1,960
Accumulated amortization	(1,826)		(1,785)		(1,771)
Net carrying amount	$	136	$	177	$	189
Wealth management segment:
Customer list and other intangibles with finite lives:
Gross carrying amount	$	26,630	$	20,430	$	20,430
Accumulated amortization	(18,224)		(16,926)		(16,525)
Net carrying amount	$	8,406	$	3,504	$	3,905
Total acquisition-related intangible assets:
Gross carrying amount	$	89,598	$	83,398	$	83,396
Accumulated amortization	(65,354)		(61,212)		(59,776)
Total other acquisition-related intangible assets, net	$	24,244	$	22,186	$	23,620

Estimated amortization
Actual in nine months ended September 30, 2023	$	4,142
Estimated remaining in 2023	1,361
Estimated—2024	4,301
Estimated—2025	3,482
Estimated—2026	2,772
Estimated—2027	2,155

The core deposit intangibles recognized in connection with prior bank acquisitions are amortized over a ten-year period on an accelerated basis. The customer list intangibles recognized in connection with the purchase of life insurance premium finance assets in 2009 are being amortized over an 18-year period on an accelerated basis. The customer list and other intangibles recognized in connection with prior acquisitions within the wealth management segment are being amortized over a period of up to ten years on a straight-line basis. The increase in wealth management segment customer list and other intangibles relates to the acquisition in the second quarter 2023 which is being amortized over a period of ten years on an accelerated basis. Indefinite-lived intangible assets consist of certain trade and domain names recognized in connection with the acquisition of certain assets of Veterans First Mortgage in 2018. As indefinite-lived intangible assets are not amortized, the Company assesses impairment on at least an annual basis.

Total amortization expense associated with finite-lived acquisition-related intangibles totaled approximately $4.1 million and $4.7 million for the nine months ended September 30, 2023 and 2022, respectively.