Goodwill and Other Intangible Assets

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

GOODWILL AND OTHER INTANGIBLE ASSETS

The following table presents the changes in the carrying amount of goodwill:

	Three Months Ended June 30,				Six Months Ended June 30,
(dollars in thousands)	2022		2021		2022		2021
Balance at beginning of period	$	1,997,157	$	1,036,994	$	1,036,994	$	1,036,994
Acquisitions and adjustments	(5,623)		—		954,540		—
Balance at end of period	$	1,991,534	$	1,036,994	$	1,991,534	$	1,036,994

During the six months ended June 30, 2022, Old National recorded $954.5 million of goodwill associated with the First Midwest merger. The decrease in goodwill for the three months ended June 30, 2022 resulted from the measurement period adjustments related to updating the fair values of the assets acquired and liabilities assumed in the First Midwest merger. See Note 3 to the consolidated financial statements for additional detail regarding this transaction.

Old National performed the required annual goodwill impairment test as of August 31, 2021 and there was no impairment.  No events or circumstances since the August 31, 2021 annual impairment test were noted that would indicate it was more likely than not a goodwill impairment exists.

The gross carrying amounts and accumulated amortization of other intangible assets were as follows: 

(dollars in thousands)	Gross Carrying Amount		Accumulated Amortization and Impairment		Net Carrying Amount
June 30, 2022
Core deposit	$	170,642	$	(69,819)	$	100,823
Customer trust relationships	56,243		(16,785)		39,458
Total intangible assets	$	226,885	$	(86,604)	$	140,281
December 31, 2021
Core deposit	$	92,754	$	(60,036)	$	32,718
Customer trust relationships	16,547		(14,587)		1,960
Total intangible assets	$	109,301	$	(74,623)	$	34,678

Other intangible assets consist of core deposit intangibles and customer relationship intangibles and are being amortized primarily on an accelerated basis over their estimated useful lives, generally over a period of 5 to 15 years. During the six months ended June 30, 2022, Old National recorded $77.9 million of core deposit intangibles and $39.7 million of customer trust relationships intangible associated with the First Midwest merger.

Old National reviews other intangible assets for possible impairment whenever events or changes in circumstances indicate that carrying amounts may not be recoverable. No impairment charges were recorded during the six months ended June 30, 2022 or 2021.  Total amortization expense associated with intangible assets was $7.2 million for the three months ended June 30, 2022 and $12.0 million for the six months ended June 30, 2022, compared to $2.9 million for the three months ended June 30, 2021 and $6.0 million for the six months ended June 30, 2021.

Estimated amortization expense for future years is as follows:

(dollars in thousands)
2022 remaining	$	13,748
2023	24,342
2024	21,298
2025	18,417
2026	15,614
Thereafter	46,862
Total	$	140,281