Intangible Assets

6 Months Ended

Jun. 30, 2012

Intangible Assets [Abstract]

Intangible Assets

Note 5: Intangible Assets

The Corporation has the following types of intangible assets: goodwill, core deposit intangible assets, mortgage servicing rights (MSRs) and non-compete agreements. Goodwill, core deposit intangible assets and non-compete agreements arose as the result of business combinations or other acquisitions. MSRs arose as a result of selling residential real estate mortgage loans in the secondary market while retaining the right to service these loans and receive servicing income over the life of the loan, as well as a result of the OAK acquisition. Amortization is recorded on the core deposit intangible assets, MSRs and non-compete agreements. Goodwill is not amortized but is evaluated at least annually for impairment. The Corporation’s most recent annual goodwill impairment test was performed as of October 31, 2011, and no impairment existed for the Corporation’s goodwill at that date. No triggering events have occurred since the most recent annual goodwill impairment review that would require an interim valuation.

The following table shows the net carrying value of the Corporation’s intangible assets:

	June  30, 2012		December  31, 2011		June  30, 2011
	(In thousands)
Goodwill	$	113,414	$	113,414	$	113,414
Other intangible assets:
Core deposit intangible assets	$	7,144	$	7,879	$	8,643
Mortgage servicing rights		3,463		3,593		3,577
Non-compete agreements		—		—		107
Total other intangible assets	$	10,607	$	11,472	$	12,327

The following table sets forth the carrying amount, accumulated amortization and amortization expense of core deposit intangible assets that are amortizable and arose from business combinations or other acquisitions:

	June  30, 2012		December  31, 2011		June  30, 2011
	(In thousands)
Gross original amount	$	26,468	$	26,468	$	26,468
Accumulated amortization		19,324		18,589		17,825
Carrying amount	$	7,144	$	7,879	$	8,643
Amortization expense for the three months ended June 30	$	368			$	381
Amortization expense for the six months ended June 30	$	735			$	763

At June 30, 2012, the remaining amortization expense on core deposit intangible assets that existed as of that date was estimated as follows: 2012 — $0.7 million; 2013 — $1.3 million; 2014 — $1.1 million; 2015 — $1.1 million; 2016 — $0.9 million; 2017 and thereafter — $2.0 million.

The following shows the net carrying value and fair value of MSRs and the total loans that the Corporation is servicing for others:

	June  30, 2012		December  31, 2011		June  30, 2011
	(In thousands)
Net carrying value of MSRs	$	3,463	$	3,593	$	3,577
Fair value of MSRs	$	4,938	$	4,757		6,000
Loans serviced for others that have servicing rights capitalized	$	916,815	$	902,812		904,468

The following table shows the activity for capitalized MSRs:

	Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011
	(In thousands)
Balance at beginning of period	$	3,427		$	3,832		$	3,593		$	3,782
Additions		669			203			1,203			711
Amortization		(633	)		(458	)		(1,333	)		(916	)
Balance at end of period	$	3,463		$	3,577		$	3,463		$	3,577

There was no impairment valuation allowance recorded on MSRs as of June 30, 2012, December 31, 2011 or June 30, 2011.