Mergers and Acquisitions

12 Months Ended

Dec. 31, 2022

Business Combination and Asset Acquisition [Abstract]

The Company has completed the following acquisition during the last two years:

•Altabancorp and its wholly-owned subsidiary, Altabank

The assets and liabilities of Alta were recorded on the Company’s consolidated statements of financial condition at the estimated fair value as of the acquisition date and the results of operations have been included in the Company’s consolidated statements of operations since that date. The following table discloses the fair value estimates of the consideration transferred, the total identifiable net assets acquired and the resulting goodwill arising from the acquisition:


(Dollars in thousands)	Alta October 1, 2021
Fair value of consideration transferred
Fair value of Company shares issued	$	839,853
Cash consideration	9

Total fair value of consideration transferred	839,862
Recognized amounts of identifiable assets acquired and liabilities assumed
Identifiable assets acquired
Cash and cash equivalents	1,622,727
Debt securities	6,658
Loans receivable, net of ACL	1,901,950
Core deposit intangible 1	7,021
Accrued income and other assets	121,926
Total identifiable assets acquired	3,660,282
Liabilities assumed
Deposits	3,273,819

Accrued expenses and other liabilities	17,981
Total liabilities assumed	3,291,800
Total identifiable net assets	368,482
Goodwill recognized	$	471,380

______________________________

1 The core deposit intangible for each acquisition was determined to have an estimated life of 10 years.

2021 Acquisition

On October 1, 2021, the Company acquired 100 percent of the outstanding common stock of Altabancorp and its wholly-owned subsidiary, Altabank, a community bank based in American Fork, Utah. Altabank provides banking services to individuals and businesses in Utah with twenty-five banking offices from Preston, Idaho to St. George, Utah. The acquisition significantly increased the Company’s presence in the State of Utah. Alta operates as a new division of the Bank under its existing name and management team. The Alta acquisition was valued at $839,862,000 and resulted in the Company issuing 15,173,482 shares of its common stock and paying $9,000 in cash in exchange for all of Alta’s outstanding common stock shares. The fair value of the Company shares issued was determined on the basis of the opening market price of the Company’s common stock on the October 1, 2021 acquisition date. The excess of the preliminary fair value of consideration transferred over total identifiable net assets was recorded as goodwill. The goodwill arising from the acquisition consists largely of the synergies and economies of scale expected from combining the operations of the Company and Alta. None of the goodwill is deductible for income tax purposes as the acquisition was accounted for as a tax-free exchange.

The fair value of the Alta’s assets acquired include gross loans with fair values of $1,902,321,000. The gross principal and contractual interest due under Alta contracts was $1,923,392,000. The Company evaluated the principal and contractual interest due at the acquisition date and determined that an insignificant amount were not expected to be collectible.

The Company incurred $9,546,000 of expenses in connection with this acquisition during the year ended December 31, 2021. Mergers and acquisition expenses are included in other expense in the Company's consolidated statements of operations and consist of third-party costs, conversion costs and employee retention and severance expenses.

Total income consisting of net interest income and non-interest income of the acquired operations of Alta was approximately $29,966,000 and net loss was approximately $9,415,000 from October 1, 2021 to December 31, 2021. The following unaudited pro forma summary presents consolidated information of the Company as if the Alta acquisition had occurred on January 1, 2020:


	Year ended
(Dollars in thousands)	December 31, 2021	December 31, 2020
Net interest income and non-interest income	886,370	898,761
Net income	296,940	309,902