Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2023

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

Note 19 — Goodwill and Other Intangible Assets

The carrying amount of goodwill was $1.9 billion at September 30, 2023 and December 31, 2022. The Company’s other intangible assets, consisting of core deposit intangibles, noncompete intangibles, and client list intangibles are included on the face of the balance sheet.

The Company last completed its annual valuation of the carrying value of its goodwill as of October 31, 2022 and determined there was no goodwill impairment. In between annual impairment analyses, we monitor for any triggering events that may impact the Company’s goodwill.

The following is a summary of gross carrying amounts and accumulated amortization of other intangible assets:

	September 30,		December 31,
(Dollars in thousands)	2023		2022
Gross carrying amount	$	274,455	$	274,869
Accumulated amortization		(179,361)		(158,419)
	$	95,094	$	116,450

Amortization expense totaled $6.6 million and $20.9 million, for the three and nine months ended September 30, 2023, compared to $7.8 million and $25.2 million for the three and nine months ended September 30, 2022.  Other intangibles are amortized using either the straight-line method or an accelerated basis over their estimated useful lives, with lives generally between two and 15 years.  

The Company elected to apply fair value accounting to the Company’s SBA servicing asset. The change in fair value of the SBA servicing asset is recorded in SBA Income, a component of Noninterest Income on the Consolidated Statements of Income, during each applicable reporting period.  As a result of the fair value accounting treatment, the Company does not amortize the SBA servicing asset and therefore excluded the SBA servicing asset from the future amortization expense table presented below.  The fair value of the SBA servicing asset was $5.7 million and $6.1 million, respectively, at September 30, 2023 and December 31, 2022.

Estimated amortization expense for other intangibles, excluding the SBA servicing assets, for each of the next five quarters and thereafter is as follows:

(Dollars in thousands)
Quarter ending:
December 31, 2023	$	6,615
March 31, 2024		6,003
June 30, 2024		5,739
September 30, 2024		5,327
December 31, 2024		5,326
Thereafter		60,429
	$	89,439