Note 11 - Goodwill and Other Intangibles

9 Months Ended

Sep. 30, 2020

Notes to Financial Statements

Goodwill and Intangible Assets Disclosure [Text Block]

Note 11: Goodwill and Other Intangibles

In July 2016, Republic acquired all of the issued and outstanding limited liability company interests of Oak Mortgage Company, LLC and, as a result, Oak Mortgage became a wholly owned subsidiary of Republic on that date. The goodwill related to the acquisition of Oak Mortgage is detailed in the table below:

	Three Months Ended September 30,
(dollars in thousands)	2020			2019
Balance, July 1st	$	5,011		$	5,011
Additions/Adjustments		-			-
Amortization		-			-
Impairment		(5,011	)
Balance, September 30th	$	-		$	5,011
Amortization Period (in years)				Indefinite

	Nine Months Ended September 30,
(dollars in thousands)	2020			2019
Balance, January 1st	$	5,011		$	5,011
Additions/Adjustments		-			-
Amortization		-			-
Impairment		(5,011	)
Balance, September 30th	$	-		$	5,011
Amortization Period (in years)				Indefinite

The Company completed an annual impairment test for goodwill as of July 31, 2019. Future impairment testing was scheduled to continue to be conducted as of July 31 on an annual basis, unless a triggering event occurred in the interim that would suggest impairment, in which case it would be tested as of the date of the triggering event. Triggering events occurred at March 31, 2020, June 30, 2020, and September 30, 2020.

The Company performed a qualitative and quantitative analysis of goodwill at March 31, 2020 and June 30, 2020 based on the triggering event. The qualitative and quantitative analysis at both triggering dates determined that it was more likely than not that goodwill was not impaired.

At September 30, 2020, the Company performed another quantitative analysis. The quantitative analysis determined that goodwill was impaired based on the impact of the COVID-19 pandemic on the economy and the sustained decline in the Company’s stock price. The Company concluded that all of its goodwill was impaired and recorded a non-cash charge for the amount of the impairment against earnings based on the quantitative analysis. The charge had no impact on tangible capital and a minimal impact on regulatory capital.