Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

NOTE 4. GOODWILL AND OTHER INTANGIBLE ASSETS

The following table presents the changes in the carrying amount of goodwill for the years indicated:



	Goodwill
	(In thousands)
Balance, December 31, 2014	$	1,720,479
Adjustment to acquired CapitalSource Inc. tax assets	7,901
Addition from the Square 1 acquisition	447,911
Balance, December 31, 2015	2,176,291
Adjustment to acquired Square 1 tax assets	(1,842		)
Reduction due to sale of PWEF leasing unit	(500		)
Balance, December 31, 2016	2,173,949
Addition from the CUB acquisition	374,721
Balance, December 31, 2017	$	2,548,670

Goodwill adjustments include: (1) the 2016 finalization of the fair value of the tax assets acquired in the Square 1 acquisition, (2) the 2016 reduction of goodwill in connection with the sale of the PWEF leasing unit, and (3) the 2015 finalization of the fair value of the tax assets acquired in the CapitalSource merger. The finalization of the day one fair value of the acquired Square 1 tax assets was due to completion of the 2015 tax returns. Through the sale of the PWEF leasing unit on March 31, 2016, $0.5 million of goodwill was allocated to this business group; as such, a goodwill reduction was included in the $0.7 million loss on sale of the PWEF leasing unit and included in "Other income" in the consolidated statements of earnings.

We perform our annual goodwill impairment testing in the fourth quarter. In the fourth quarter of 2017, we evaluated the carrying value of our goodwill and determined that it was not impaired.

Our other intangible assets with definite lives are CDI and CRI. CDI and CRI are amortized over their respective estimated useful lives and reviewed for impairment at least quarterly. The amortization expense represents the estimated decline in the value of the underlying deposits or loan and lease customers acquired. The weighted average amortization period remaining for all of our CDI and CRI as of December 31, 2017 is 5.0 years. The estimated aggregate amortization expense related to these intangible assets for each of the next five years is $24.4 million for 2018, $19.6 million for 2019, $15.3 million for 2020, $11.7 million for 2021 and $7.9 million for 2022.

The following table presents the changes in CDI and CRI and the related accumulated amortization for the years indicated:



	Year Ended December 31,
	2017			2016			2015
	(In thousands)
Gross Amount of CDI and CRI:
Balance, beginning of year	$	64,187		$	95,524		$	53,090
Additions due to acquisitions	57,500			—			45,426
Fully amortized portion	(2,190		)	(29,637		)	(2,992		)
Reduction due to sale of PWEF leasing unit	—			(1,700		)	—
Balance, end of year	119,497			64,187			95,524
Accumulated Amortization:
Balance, beginning of year	(27,821		)	(42,304		)	(35,886		)
Amortization	(14,240		)	(16,517		)	(9,410		)
Fully amortized portion	2,190			29,637			2,992
Reduction due to sale of PWEF leasing unit	—			1,363			—
Balance, end of year	(39,871		)	(27,821		)	(42,304		)
Net CDI and CRI, end of year	$	79,626		$	36,366		$	53,220

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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