Goodwill and Other Intangible Assets

Goodwill

The changes in the carrying amount of goodwill during 2019 are shown in the table below. There were no changes in the carrying amount of goodwill during 2018.



(Dollars in millions)	Regional Bank			Global Corporate & Investment Banking - U.S.			Transaction Banking		MUFG Fund Services		Total
Goodwill, December 31, 2018	$	2,134		$	840		$	251	$	76	$	3,301
Goodwill acquired during the year	59			18			—		—		77
Impairment losses	(1,423		)	(191		)	—		—		(1,614		)
Goodwill, December 31, 2019	$	770		$	667		$	251	$	76	$	1,764

Goodwill	2,193			858			251		76		3,378
Accumulated impairment losses	(1,423		)	(191		)	—		—		(1,614		)
Balance at December 31, 2019	$	770		$	667		$	251	$	76	$	1,764

The Company performs goodwill impairment tests on an annual basis as of April 1, and between annual tests if an event occurs or circumstances change that would more-likely-than-not reduce the fair value of a reporting unit below its carrying amount. The Company adopted Accounting Standards Update No. 2017-04, Simplifying the Test for Goodwill Impairment ("ASU 2017-04") effective July 1, 2019. This standard eliminates Step 2 from the goodwill impairment test. Instead, the Company performs its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and recognizes an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, not to exceed the total amount of goodwill allocated to the reporting unit.

During the third quarter of 2019, due to the decline in interest rates and slower growth than previously forecasted, cash flow projections for certain reporting units were revised lower. The combination of these events led management to believe that it was more likely than not that the fair values of certain reporting units were below carrying value. As a result, the Company initiated an interim quantitative impairment test of goodwill allocated to three of its reporting units: Consumer Banking, Commercial Banking and Real Estate Industries, and Global Corporate & Investment Banking - U.S.

The Company estimated the fair value of its reporting units using a combination of the income and the market approaches. The income approach estimates the fair value of the reporting units by discounting management’s projections of each reporting unit’s cash flows, including a terminal value to estimate the fair value of cash flows beyond the final year of projected results, using a discount rate derived from the Capital Asset Pricing Model. The market approach incorporates comparable public company price to tangible book value and price to earnings multiples.

Certain projected cash flows used to estimate fair value of the reporting units were revised lower than previous projections due to the combination of the following factors: the decline in interest rates through September 30, 2019 and a change in the Company’s expectation that interest rates will remain lower than previously assumed; updates to key loan growth and loan mix assumptions in the forecast to address the Company’s declining net interest margin; and a reduction of the expected growth and cash flow contribution of new initiatives based on a revised economic outlook. Multiples selected in the market approach to estimate fair value were also revised lower than those used in the most recent annual quantitative impairment test due to lower reporting unit earnings.

Upon completing the quantitative impairment test, the Company recorded an impairment charge of $1.6 billion in the third quarter of 2019, which represented the entire amount of goodwill allocated to the Consumer Banking reporting unit and a portion of the goodwill allocated to the Global Corporate & Investment Banking - U.S. reporting unit, which had $667 million allocated goodwill remaining after the impairment.

Intangible Assets

The table below reflects the Company's identifiable intangible assets and accumulated amortization at December 31, 2019 and 2018.



	December 31, 2019							December 31, 2018
(Dollars in millions)	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Core deposit intangibles	$	565	$	(543	)	$	22	$	565	$	(537	)	$	28
Trade names	115		(35		)	80		111		(32		)	79
Customer relationships	238		(79		)	159		238		(63		)	175
Other⁽¹⁾	13		(13		)	—		18		(15		)	3
Total intangible assets with a definite useful life	$	931	$	(670	)	$	261	$	932	$	(647	)	$	285


(1)	December 31, 2019 and December 31, 2018 exclude $270 million and $159 million, respectively, of mortgage servicing rights accounted for at fair value.

Total amortization expense for 2019, 2018 and 2017 was $34 million, $26 million and $30 million, respectively.

Estimated future amortization expense at December 31, 2019 is as follows:



(Dollars in millions)	Core Deposit Intangibles		Trade Name		Customer Relationships		Total Identifiable Intangible Assets
Years ending December 31, :
2020	$	5	$	4	$	16	$	25
2021	4		3		15		22
2022	4		3		15		22
2023	2		3		14		19
2024	2		3		14		19
Thereafter	5		64		85		154
Total estimated amortization expense	$	22	$	80	$	159	$	261