Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2015

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



(Dollars in thousands)	2015		2014
Balance at January 1	$	139,773	$	102,625
Acquired in the 1st Financial merger	—		32,915
Acquired in the Bancorporation merger	—		4,233
Balance at December 31	$	139,773	$	139,773

Mortgage Servicing Rights Key Economic Assumptions Used to Value

Key economic assumptions used to value mortgage servicing rights as of December 31, 2015 and 2014 were as follows:



	2015			2014
Discount rate - conventional fixed loans	9.31		%	7.20		%
Discount rate - all loans excluding conventional fixed loans	10.31		%	9.20		%
Weighted average constant prepayment rate	11.01		%	14.25		%
Weighted average cost to service a loan	$	56.61		$	56.02

Schedule of Mortgage Servicing Rights at Amortized Cost

The activity of the servicing asset for the years ended December 31, 2015 and 2014 is presented in the following table:



(Dollars in thousands)	2015			2014
Balance at January 1	$	16,688		$	16
Servicing rights originated	5,910			727
Amortization	(4,002		)	(919		)
Servicing rights acquired in the 1st Financial merger	—			148
Servicing rights acquired in the Bancorporation merger	—			17,566
Valuation allowance reversal (provision)	755			(850		)
Balance at December 31	$	19,351		$	16,688

Schedule of Valuation Allowance for Impairment of Recognized Servicing Assets [Table Text Block]

The following table presents the activity in the servicing asset valuation allowance for the years ended December 31, 2015 and 2014:



(Dollars in thousands)	2015			2014
Balance at January 1	$	850		$	—
Valuation allowance (reversal) provision	(755		)	850
Balance at December 31	$	95		$	850

Schedule of Other Intangible Assets

The following information relates to other intangible assets, all customer-related, which are being amortized over their estimated useful lives:



(dollars in thousands)	2015			2014
Balance at January 1	$	89,922		$	1,247
Acquired in CCBT merger	690			—
Acquired in the 1st Financial merger	—			3,780
Acquired in the Bancorporation merger	—			91,850
Removal due to branch sale	(85		)	—
Amortization	(18,892		)	(6,955		)
Balance at December 31	$	71,635		$	89,922

Core deposit intangibles comprise the majority of the other intangible assets as of December 31, 2015 and 2014. During 2015, BancShares recognized $690 thousand in core deposit intangibles related to the CCBT merger. Core deposit intangibles of $85 thousand were written off in 2015 as it related to previously acquired deposits that were sold in connection with the sale of a branch in December 2015. During 2014, BancShares recognized $91.9 million and $3.8 million in core deposit intangibles related to the Bancorporation and 1st Financial mergers, respectively. Intangible assets generated by acquisitions, which represent the estimated fair value of core deposits and other customer relationships that were acquired, are being amortized on an accelerated basis over their estimated useful lives. The estimated useful remaining lives range from 2 years to less than 9 years.

The gross amount of other intangible assets and accumulated amortization as of December 31, 2015 and 2014, are:



(dollars in thousands)	2015			2014
Gross balance	$	115,201		$	114,596
Accumulated amortization	(43,566		)	(24,674		)
Carrying value	$	71,635		$	89,922

Future Amortization Expense Schedule

Based on current estimated useful lives and carrying values, BancShares anticipates amortization expense for intangible assets in subsequent periods will be:



(dollars in thousands)
2016	$	16,440
2017	14,075
2018	11,710
2019	9,457
2020	7,492