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Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2011

NOTE 10 - Goodwill and Intangible Assets

Goodwill impairment is tested at the reporting unit level, which is an operating segment or one level below an operating segment on an annual basis. The goodwill impairment analysis is a two-step test. The first step, used to identify potential impairment, involves comparing each reporting unit's fair value to its carrying value, including goodwill. If the fair value of a reporting unit exceeds its carrying value, applicable goodwill is considered not to be impaired. If the carrying value exceeds fair value, there is an indication of impairment and the second step is performed to measure the amount of impairment. Our annual goodwill impairment testing was completed as of July 31, 2011, with no impairment identified.

The carrying amount of goodwill and intangible assets attributable to each of our reporting units is presented in the following table (in thousands):


	December 31, 2010		Net additions		Impairment losses		September 30, 2011
Goodwill
Global Wealth Management	$	128,524	$	5,410	$	0	$	133,934
Institutional Group		173,395		2,190		0		175,585
	$	301,919	$	7,600	$	0	$	309,519


	December 31, 2010		Adjustments			Amortization			September 30, 2011
Intangible assets
Global Wealth Management	$	21,463	$	0		$	(2,148	)	$	19,315
Institutional Group		13,132		(441	)		(1,440	)		11,251
	$	34,595	$	(441	)	$	(3,588	)	$	30,566

The adjustments to goodwill during the nine months ended September 30, 2011 are primarily attributable to adjustments to pre-acquisition contingencies based on facts that existed as of the acquisition date that would have affected our estimate of the acquisition date fair value.

Amortizable intangible assets consist of acquired customer relationships, trade name, non-compete agreements, and investment banking backlog that are amortized over their contractual or determined useful lives. Intangible assets subject to amortization as of September 30, 2011 and December 31, 2010 were as follows (in thousands):



	September 30, 2011				December 31, 2010
	Gross carrying value		Accumulated Amortization		Gross carrying value		Accumulated Amortization

Customer relationships	$	37,068	$	13,854	$	37,068	$	11,015
Trade name		7,981		758		7,981		364
Non-compete agreement		2,441		2,399		2,441		2,238
Investment banking backlog		1,789		1,702		2,230		1,508
	$	49,279	$	18,713	$	49,720	$	15,125

Amortization expense related to intangible assets was $1.2 million and $2.0 million for the three months ended September 30, 2011 and 2010, respectively. Amortization expense related to intangible assets was $3.6 million and $3.5 million for the nine months ended September 30, 2011 and 2010, respectively.

The weighted-average remaining lives of the following intangible assets at September 30, 2011 are: customer relationships, 6.9 years; trade name, 13.8 years; and non-compete agreements, 0.2 years. As of September 30, 2011, we expect amortization expense in future periods to be as follows (in thousands):


Fiscal year
Remainder of 2011	$	1,190
2012		3,909
2013		3,482
2014		3,185
2015		2,853
Thereafter		15,947
	$	30,566

- 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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