GOODWILL AND OTHER INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2024

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

NOTE 7—GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

The Company’s reportable segments are Capital Markets (“CM”), Servicing & Asset Management (“SAM”), and Corporate. A summary of the Company’s goodwill by reportable segments for the nine months ended September 30, 2024 and 2023 follows:

	For the nine months ended
	September 30,
(in thousands)	2024						2023
Roll Forward of Gross Goodwill	CM		SAM		Consolidated(1)		CM		SAM		Consolidated(1)
Beginning balance	$	524,189		439,521	$	963,710	$	520,191	$	439,521	$	959,712
Additions from acquisitions		—		—		—		—		—		—
Measurement-period and other adjustments		—		—		—		3,998		—		3,998
Ending gross goodwill balance	$	524,189	$	439,521	$	963,710	$	524,189	$	439,521	$	963,710
Roll Forward of Accumulated Goodwill Impairment
Beginning balance	$	62,000		—	$	62,000	$	—	$	—	$	—
Impairment		—		—		—		14,000		—		14,000
Ending accumulated goodwill impairment	$	62,000	$	—	$	62,000	$	14,000	$	—	$	14,000
Goodwill	$	462,189	$	439,521	$	901,710	$	510,189	$	439,521	$	949,710

(1)As of September 30, 2024 and 2023 and December 31, 2023 and 2022, no goodwill was allocated to the Corporate reportable segment.

Other Intangible Assets

Activity related to other intangible assets for the nine months ended September 30, 2024 and 2023 follows:

	For the nine months ended
	September 30,
Roll Forward of Other Intangible Assets (in thousands)	2024		2023
Beginning balance	$	181,975	$	198,643
Additions from acquisitions		—		—
Amortization		(11,262)		(12,716)
Ending balance	$	170,713	$	185,927

The following table summarizes the gross value, accumulated amortization, and net carrying value of the Company’s other intangible assets as of September 30, 2024 and December 31, 2023:

Components of Other Intangible Assets (in thousands)	September 30, 2024		December 31, 2023
Gross value	$	220,682	$	220,682
Accumulated amortization		(49,969)		(38,707)
Net carrying value	$	170,713	$	181,975

The expected amortization of other intangible assets shown in the Condensed Consolidated Balance Sheet as of September 30, 2024 is shown in the table below. Actual amortization may vary from these estimates.

	Expected
(in thousands)	Amortization
Three Months Ending December 31,
2024	$	4,101
Year Ending December 31,
2025	$	16,404
2026		16,404
2027		16,404
2028		16,404
2029		16,340
Thereafter		84,656
Total	$	170,713

Contingent Consideration Liabilities

A summary of the Company’s contingent consideration liabilities, which are included in Other liabilities in the Condensed Consolidated Balance Sheets, for the nine months ended September 30, 2024 and 2023 follows:

	For the nine months ended
(in thousands)	September 30,
Roll Forward of Contingent Consideration Liabilities	2024		2023
Beginning balance	$	113,546	$	200,346
Additions		—		—
Accretion		1,496		927
Fair value adjustments		(1,366)		(14,000)
Payments		(34,317)		(26,090)
Ending balance	$	79,359	$	161,183

The contingent consideration liabilities presented in the table above relate to (i) acquisitions of debt brokerage and investment sales brokerage companies and (ii) other acquisitions completed over the past several years. The contingent consideration for each of the acquisitions may be earned over various lengths of time after each acquisition, with a maximum earnout period of five years, provided certain revenue targets and other metrics have been met. The last of the earnout periods related to the contingent consideration ends in the third quarter of 2027. In each case, the Company estimated the initial fair value of the contingent consideration using a Monte Carlo simulation.