GOODWILL AND OTHER INTANGIBLE ASSETS

12 Months Ended

Dec. 31, 2020

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

NOTE 7 – GOODWILL AND OTHER INTANGIBLE ASSETS

Changes in the carrying amount of goodwill were as follows as of December 31 (in thousands):

	2020		2019
Beginning balance	$	19,686	$	24,811
Impairment(1)		—		(1,572)
Reclass to held for sale(1)		—		(3,553)
Acquisition activity		4,505		—
Ending balance	$	24,191	$	19,686

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⁽¹⁾ Item related to sale of Capital Management segment assets, previously reported separately as the Capital Management segment.

During the year ended December 31, 2020, the Company recorded $4.5 million of goodwill as a result of the Branch Acquisition on May 15, 2020. For additional information on goodwill and other intangible related to the acquisition, see Note 2 – Acquisitions.

In 2019, an interim goodwill analysis resulted in the recognition of a goodwill impairment loss of $1.6 million. Additionally, the goodwill associated with Capital Management segment assets was allocated based on the relative fair value, and $3.6 million was reclassified to assets held for sale in 2019. The sale of these assets was completed on November 13, 2020. For changes related to the portion of goodwill reclassified to assets held for sale between segments, see Note 18 – Intangible Assets and Other Liabilities Classified as Held for Sale and Note 19 – Segment Reporting.

Goodwill is tested annually for impairment on October 31 or earlier upon the occurrence of certain events. The Company identified a triggering event as a result of the economic impact of COVID-19 as of September 30, 2020 and performed a Step 1 quantitative analysis. Step 1 of the two-step goodwill impairment analysis includes the determination of the carrying value of the reporting unit, including the existing goodwill, and estimating the fair value of the reporting unit. If the carrying amount of a reporting unit exceeds its fair value, we are not required to perform the second step to the impairment test. Our Step 1 goodwill impairment analysis as of September 30, 2020 and October 31, 2020 both indicated that the Step 2 analysis was unnecessary.

As of December 31, 2020, the Company’s reporting units had positive equity and the Company elected to perform a qualitative assessment to determine if it was more likely than not that the fair value of the reporting unit exceeded its carrying value including goodwill. The qualitative assessment indicated that it was not more likely than not that the carrying value of the reporting unit exceeded its fair value. Therefore, the Company did not complete the two-step impairment test.

The following presents the Company’s intangible assets and related accumulated amortization as of December 31 (in thousands):

	2020		2019
Other intangibles	$	4,593	$	4,540
Less: accumulated amortization on other intangibles		(4,526)		(4,512)
Other intangible assets, net	$	67	$	28

During the year ended December 31, 2019, the Company retired intangible assets in the amount of $4.8 million that were fully amortized and no longer in service.

Amortization expense on definite-lived customer relationship and non-compete intangible assets was immaterial for the year ended December 31, 2020 and $0.4 million for the year ended December 31,2019. The following presents the expected amortization expense on definite-lived intangible assets existing as of December 31, 2020 (in thousands):

Year		Expense
2021	$	17
Thereafter		50
Total	$	67