Goodwill and Core Deposit Intangible

3 Months Ended

Mar. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Core Deposit Intangible

Note 9 – Goodwill and Core Deposit Intangible

In accordance with ASC 805, the Company recorded $8.9 million of goodwill along with a core deposit intangible asset of $4.2 million of for the five branches acquired in 2019. The Noah Bank acquisition that occurred in 2023 did not generate any goodwill, but the Bank recorded $98 thousand in core deposit intangible asset. The core deposit intangible asset is being amortized over 10 years, using the sum of the year’s digits. Except as set forth below, GAAP requires that goodwill be tested for impairment annually (with the Company’s annual evaluation occurring on May 31 of each year) or more frequently if impairment indicators arise. The reporting unit was determined to be our community banking operations, which is our only operating segment.

ASC Topic 350-20 guidance requires an annual review of the fair value of a Reporting Unit that has goodwill in order to determine if it is more likely than not (that is, a likelihood of more than 50%) that the fair value of a Reporting Unit is less than its carrying amount, including goodwill. A qualitative factor test can be performed to determine whether it is necessary to perform a quantitative goodwill impairment test. If this qualitative test determines it is not more likely than not (less than 50% probability) that the fair value of the Reporting Unit is less than the Carrying Value, then the Company does not have to perform a quantitative test and goodwill can be considered not impaired. The Company performed its annual review at May 31, 2023 and determined that it was more than 50% probable the fair value of the Reporting Unit exceeds the then Carrying Value, therefore a quantitative test was not required as of May 31, 2023.

The changes in the carrying amount of goodwill and core deposit intangible assets are summarized as follows:

	Goodwill		Core Deposit Intangible
	(In thousands)
Balance at December 31, 2023	$	8,853	$	1,422
Amortization expense		—		(121	)
Balance at March 31, 2024	$	8,853	$	1,301

As of March 31, 2024, the remaining current fiscal year and future fiscal periods amortization for the core deposit intangible is (in thousands):

2024		314
2025		353
2026		274
2027		195
Thereafter		165
Total	$	1,301