GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS

12 Months Ended

Dec. 31, 2019

GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS [Abstract]

GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS

NOTE F:  GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS

The gross carrying amount and accumulated amortization for each type of identifiable intangible asset are as follows:

	December 31, 2019							December 31, 2018
(000’s omitted)	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Amortizing intangible assets:
Core deposit intangibles	$	66,475	$	(50,057	)	$	16,418	$	62,902	$	(44,306	)	$	18,596
Other intangibles		89,266		(42,571	)		46,695		87,616		(32,366	)		55,250
Total amortizing intangibles	$	155,741	$	(92,628	)	$	63,113	$	150,518	$	(76,672	)	$	73,846

The estimated aggregate amortization expense for each of the five succeeding fiscal years ended December 31 is as follows:

2020	$	13,800
2021		11,786
2022		10,105
2023		8,457
2024		7,041
Thereafter		11,924
Total	$	63,113

Shown below are the components of the Company’s goodwill at December 31, 2019, 2018 and 2017:

(000’s omitted)	Year Ended December 31, 2017			Activity			Year Ended December 31, 2018			Activity		Year Ended December 31, 2019
Goodwill	$	739,254		$	(927	)	$	738,327		$	40,307	$	778,634
Accumulated impairment		(4,824	)		0			(4,824	)		0		(4,824	)
Goodwill, net	$	734,430		$	(927	)	$	733,503		$	40,307	$	773,810

During the first quarter of 2019, the Company performed its annual internal valuation of goodwill and impairment analysis by comparing the fair value of each reporting unit to its carrying value.  Results of the valuations indicate there was no goodwill impairment.

Mortgage Servicing Rights

Under certain circumstances, the Company sells consumer residential mortgage loans in the secondary market and typically retains the right to service the loans sold.  Generally, the Company’s residential mortgage loans sold to third parties are sold on a non-recourse basis.  Upon sale, a mortgage servicing right (“MSR”) is established, which represents the current fair value of future net cash flows expected to be realized for performing the servicing activities.  The Company stratifies these assets based on predominant risk characteristics, namely expected term of the underlying financial instruments, and uses a valuation model that calculates the present value of future cash flows to determine the fair value of servicing rights. MSRs are recorded in other assets at the lower of the initial capitalized amount, net of accumulated amortization or fair value.  Mortgage loans serviced for others are not included in the accompanying consolidated statements of condition.

The following table summarizes the changes in carrying value of MSRs and the associated valuation allowance:

(000’s omitted)	2019			2018
Carrying value before valuation allowance at beginning of period	$	1,137		$	1,358
Additions		17			228
Kinderhook acquisition		196			0
Amortization		(378	)		(449	)
Carrying value before valuation allowance at end of period		972			1,137
Valuation allowance balance at beginning of period		0			0
Impairment charges		(326	)		0
Impairment recoveries		28			0
Valuation allowance balance at end of period		(298	)		0
Net carrying value at end of period	$	674		$	1,137
Fair value of MSRs at end of period	$	1,362		$	2,397
Principal balance of loans sold during the year	$	2,204		$	18,228
Principal balance of loans serviced for others	$	294,093		$	333,862
Custodial escrow balances maintained in connection with loans serviced for others	$	4,596		$	4,982

The following table summarizes the key economic assumptions used to estimate the value of the MSRs at December 31:

	2019			2018
Weighted-average contractual life (in years)		20.9			21.4
Weighted-average constant prepayment rate (CPR)		18.7	%		9.3	%
Weighted-average discount rate		3.0	%		3.6	%