All of our goodwill and intangibles relate to the business combination (“Business Combination”), via a special purpose acquisition company that closed on November 14, 2019. In the first quarter of 2020, based on additional information obtained about facts and circumstances that existed as of November 14, 2019, we recorded a measurement period adjustment to reduce the fair value of intangible assets in the form of customer relationships from $6.0 to $1.0 million. This adjustment increased the preliminary amount of goodwill previously recorded by $5.0 million resulting in $137.0 million of goodwill as of September 30, 2020. As a result of this adjustment to preliminary values, $0.9 million of amortization of intangible assets recorded in 2019 was reversed in the first quarter of 2020.

We test our reporting unit for goodwill impairment annually in the fourth quarter, or upon a triggering event. Our qualitative analysis performed in the fourth quarter of 2022 considered continued interest rate hikes by the Federal Reserve to curb rising inflation and resulting market volatility, a significant slowdown in real estate transactions and less capital available in the marketplace to

finance real estate projects and further decreases in our stock price. We concluded that it was more likely than not that the fair value of our reporting unit was less than its carrying amount as of December 31, 2022 and, therefore, a quantitative analysis was necessary. The quantitative analysis was based on income and market multiples approaches. Under the income approach, the fair value of a reporting unit was estimated based on the present value of estimated future cash flows covering discrete forecast periods as well as terminal value determinations. We prepared cash flow projections based on management's estimates of long-term growth rates, pre-tax return on earnings, earning asset growth and return on tangible equity, taking into consideration industry and market conditions. The discount rate was based on the weighted-average cost of capital adjusted for the relevant risk associated with business-specific characteristics and the uncertainty related to the reporting unit's ability to execute on the projected cash flows. Under the market approach, fair value was estimated based on market multiples of revenue and earnings derived from comparable publicly traded companies with similar operating and investment characteristics as the reporting unit, as well as observable market values of our reporting unit based on any third-party attributions of value to such unit in the context of potential transactions with us. We weighted the fair value derived from the market approach commensurate with the level of comparability of these publicly traded companies to the reporting unit.

Our 2022 annual goodwill impairment analysis resulted in impairment charges for goodwill related to the Broadmark lending business which is our only reporting unit. The decline in fair value of the reporting unit below its carrying value resulted in changes from expected future cash flows as compared to prior year projections which is more broadly a result of macroeconomic factors and other operational challenges as well as an increase in cost of capital. As a result, we recorded a goodwill impairment charge of $137.0 million in the fourth quarter of 2022.

The reporting unit has no remaining goodwill as of December 31, 2022 and an excess of fair value over carrying value of net assets of 0% as of the annual test date. The business is facing challenges reflected in the results for the year ended December 31, 2022. In the later part of the third quarter of 2022 and continuing into the fourth quarter of 2022, market interest rates rose markedly and rapidly primarily as a result of the Federal Reserve's actions to curb rapidly rising inflation. This led to a significant slowdown in real estate transactions and less capital available in the marketplace to finance real estate projects. During the fourth quarter, rising interest rates and macroeconomic uncertainties in the capital markets lead to a significant decrease in real estate sales in the marketplace and in the availability of capital from traditional lenders for longer-term financing of completed construction and development projects, which negatively affected our borrowers' ability to sell or refinance our collateral and repay our loans. As a result, this led us to have a higher percentage of defaults go into non-accrual, additional properties foreclose or start the foreclosure process and the decision to slow origination pace to preserve liquidity.

The following table sets forth the changes in the carrying amount of goodwill:


(dollars in thousands)	Goodwill
Goodwill as of December 31, 2020	$	136,965
Goodwill as of December 31, 2021		136,965
Less:
Impairment		136,965
Goodwill as of December 31, 2022	$	—

The following table summarizes the balances of intangible assets as of December 31, 2022 and 2021:


(dollars in thousands)	December 31, 2022		December 31, 2021
Asset Type
Customer relationships	$	1,000	$	1,000
Less: Accumulated amortization		1,000		718
Intangible assets, net	$	—	$	282