Goodwill and Other Intangible Assets

3 Months Ended

Mar. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

On January 5, 2005, ACNB Corporation completed its acquisition of Russell Insurance Group, Inc. (now ACNB Insurance Services, Inc.) of Westminster, Maryland. The acquisition of ACNB Insurance Services, Inc. resulted in goodwill of approximately $6,308,000.

On July 1, 2017, the Corporation completed its acquisition of New Windsor Bancorp, Inc. of Taneytown, Maryland. The acquisition of New Windsor resulted in goodwill of approximately $13,272,000 and generated $2,418,000 in core deposit intangibles.

On January 11, 2020, the Corporation completed its acquisition of Frederick County Bancorp, Inc. of Frederick, Maryland. The acquisition of FCBI resulted in goodwill of approximately $22,528,000 and generated $3,560,000 in core deposit intangibles.

On February 28, 2022, ACNB Insurance Services, Inc. completed its acquisition of Hockley & O'Donnell Insurance Agency, LLC of Gettysburg, Pennsylvania. The acquisition of Hockley & O'Donnell resulted in goodwill of approximately $2,077,000 and generated $5,835,000 in book of business and covenant not to compete intangibles.

Combined goodwill included in the Corporation’s consolidated statement of condition is 44,184,000. Goodwill, which has an indefinite useful life, is evaluated for impairment annually and is evaluated for impairment more frequently if events and circumstances indicate that the asset might be impaired. The Corporation did not identify any goodwill impairment on ACNB Insurance Services, Inc. or the Bank’s outstanding goodwill from its most recent testing.

Goodwill represents the excess of the cost of an acquisition over the fair value of the net assets acquired. Other intangible assets represent purchased assets that lack physical substance but can be distinguished from goodwill because of contractual or other legal rights. Intangible assets that have finite lives, such as core deposit intangibles, customer relationship intangibles and renewal lists, are amortized over their estimated useful lives and subject to periodic impairment testing. Core deposit intangibles are primarily amortized over ten years using accelerated methods. Customer renewal lists are amortized over their estimated useful lives which range from eight to fifteen years. ACNB continues to evaluate long lived assets to determine if there are events or conditions that require an impairment test.

The carrying value and accumulated amortization of the intangible assets and core deposit intangibles are as follows:


In thousands	Gross carrying amount		Accumulated amortization
ACNB Insurance Services, Inc. amortized intangible assets	$	16,151	$	7,562
New Windsor core deposit intangibles	2,418		1,692
FCBI core deposit intangibles	3,560		1,359

The Corporation completes a goodwill analysis at least on an annual basis or more often if events and circumstances indicate that there may be impairment. The Corporation also completes an impairment test for other intangible assets on an annual basis or more often if events and circumstances indicate a possible impairment. The annual analysis is scheduled to occur within the fourth quarter of 2022. At March 31, 2022, ACNB cannot project the outcome of the annual analysis, however there are no events or circumstances indicating impairment.