GOODWILL AND INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

9. GOODWILL AND INTANGIBLE ASSETS

In accordance with ASC 805, Business Combinations (ASC 805) and ASC 350, Intangibles - Goodwill and Other (ASC 350), all assets acquired and liabilities assumed in purchase acquisitions, including goodwill, indefinite-lived intangibles and other intangibles are recorded at fair value as of acquisition date.

WSFS performs its annual impairment test on October 1 or more frequently if events and circumstances indicate that the fair value of a reporting unit is less than its carrying value. In between annual tests, management performs a qualitative review of goodwill quarterly as part of the Company's review of the overall business to ensure no events or circumstances have occurred that would impact its goodwill evaluation. During the six months ended June 30, 2020, management included considerations of the current economic environment caused by COVID-19 in its evaluation, and determined based on the totality of its qualitative assessment that it is not more likely than not that the carrying value of goodwill is impaired. No goodwill impairment exists during the six months ended June 30, 2020.

The following table shows the allocation of goodwill to the reportable operating segments for purposes of goodwill impairment testing:


(Dollars in thousands)	WSFS Bank		Cash Connect		Wealth Management		Consolidated Company
December 31, 2019	$	452,629	$	—	$	20,199	$	472,828

Goodwill adjustments	—		—		—		—
June 30, 2020	$	452,629	$	—	$	20,199	$	472,828

ASC 350 requires that an acquired intangible asset be separately recognized if the benefit of the intangible asset is obtained through contractual or other legal rights, or if the asset can be sold, transferred, licensed, rented or exchanged, regardless of the acquirer’s intent to do so.

The following table summarizes intangible assets:


(Dollars in thousands)	Gross Intangible Assets		Accumulated Amortization		Net Intangible Assets		Amortization Period
June 30, 2020
Core deposits	$	95,711	$	(18,033)	$	77,678	10 years
Customer relationships	17,561		(8,216)		9,345		7-15 years
Non-compete agreements	221		(168)		53		5 years
Loan servicing rights⁽¹⁾	4,605		(1,994)		2,611		10-25 years
Total intangible assets	$	118,098	$	(28,411)	$	89,687
December 31, 2019
Core deposits	$	95,711	$	(13,326)	$	82,385	10 years
Customer relationships	17,561		(7,416)		10,145		7-15 years
Non-compete agreements	221		(146)		75		5 years
Loan servicing rights⁽²⁾	4,880		(1,568)		3,312		10-25 years
Total intangible assets	$	118,373	$	(22,456)	$	95,917

⁽¹⁾Includes impairment losses of $0.3 million and $0.4 million the three and six months ended June 30, 2020, respectively.

⁽²⁾Includes impairment losses of $0.5 million for the year ended December 31, 2019

The Company recognized amortization expense on intangible assets of $2.8 million and $5.5 million for the three and six months ended June 30, 2020, respectively, compared to $2.8 million and $4.1 million for the three and six months ended June 30, 2019, respectively.

The following table presents the estimated future amortization expense on intangible assets:


(Dollars in thousands)	June 30, 2020
Remaining in 2020	$	5,747
2021	11,194
2022	10,991
2023	10,847
2024	10,685
Thereafter	40,223
Total	$	89,687