Other assets and other liabilities

6 Months Ended

Jun. 30, 2020

Other assets and other liabilities

Other assets and other liabilities

Note 19 – Other assets and other liabilities

The following table details the Company’s other assets and other liabilities as of the unaudited interim consolidated balance sheet dates.

(In Thousands)	June 30, 2020		December 31, 2019
Other assets:
Deferred tax asset	$	31,803	$	31,803
Tax receivable		8,827		4,019
Deferred loan exit fees		13,942		13,039
Accrued interest		9,332		10,583
Goodwill		11,206		11,206
Due from servicers		3,612		10,127
Right-of-use lease asset		4,263		4,531
Intangible assets		7,647		8,309
Deferred financing costs		1,900		2,046
Other assets		11,169		11,262
Total other assets	$	103,701	$	106,925
Accounts payable and other accrued liabilities:
Deferred tax liability	$	18,757	$	18,757
Accrued salaries, wages and commissions		27,863		21,146
Accrued interest payable		19,476		17,305
Servicing principal and interest payable		33,635		14,145
Repair and denial reserve		7,947		5,179
Payable to related parties		6,183		2,697
Accrued professional fees		1,114		1,809
Lease payable		4,347		4,618
Accrued PPP related costs		5,077		—
Payable to third parties		15,000		—
Deferred PPP loan revenue		14,493		—
Other liabilities		12,282		11,751
Total accounts payable and other accrued liabilities	$	166,174	$	97,407

Intangible assets

The following table presents information about the intangible assets held by the Company:

(In Thousands)	June 30, 2020		December 31, 2019		Estimated Useful Life
Internally developed software - Knight Capital	$	3,378	$	3,694	6 years
Broker network - Knight Capital		1,022		1,156	4.5 years
SBA license		1,000		1,000	Indefinite life
Favorable lease		836		905	12 years
Trade name - Knight Capital		782		855	6 years
Trade name - GMFS		629		699	15 years
Total Intangible Assets	$	7,647	$	8,309

Amortization expense related to the intangible assets previously acquired for the three months ended June 30, 2020 and 2019 was $0.3 million and $0.1 million, respectively. Amortization expense related to the intangible assets previously acquired for the six months ended June 30, 2020 and 2019 was $0.7 million and $0.2 million, respectively. Such amounts are recorded as other operating expenses in the consolidated statements of income.

At June 30, 2020, accumulated amortization for finite-lived intangible assets is as follows:

(In Thousands)	June 30, 2020
Favorable lease	$	643
Trade name - GMFS		594
Internally developed software - Knight Capital		422
Broker network - Knight Capital		178
Trade name - Knight Capital		98
Total Accumulated Amortization	$	1,935

Amortization expense related to the finite-lived intangible assets for the five years subsequent to June 30, 2020 is as follows:

(In Thousands)	June 30, 2020
2020	$	661
2021		1,295
2022		1,268
2023		1,242
2024		1,210
Thereafter		971
Total	$	6,647

Loan indemnification reserve

A liability has been established for potential losses related to representations and warranties made by GMFS for loans sold with a corresponding provision recorded for loan indemnification losses. The liability is included in accounts payable and other accrued liabilities in the Company's unaudited interim consolidated balance sheets and the provision for loan indemnification losses is included in variable expenses on residential mortgage banking activities, in the Company's unaudited interim consolidated statements of income. In assessing the adequacy of the liability, management evaluates various factors including historical repurchases and indemnifications, historical loss experience, known delinquent and other problem loans, outstanding repurchase demand, historical rescission rates and economic trends and conditions in the industry. Actual losses incurred are reflected as a reduction of the reserve liability. At June 30, 2020 and December 31, 2019, the loan indemnification reserve was $2.8 million and $2.1 million, respectively.  

Because of the uncertainty in the various estimates underlying the loan indemnification reserve, there is a range of losses in excess of the recorded loan indemnification reserve that is reasonably possible. The estimate of the range of possible losses for representations and warranties does not represent a probable loss, and is based on current available information, significant judgment, and a number of assumptions that are subject to change. At June 30, 2020 and December 31, 2019, the reasonably possible loss above the recorded loan indemnification reserve was not considered material.