Goodwill and Acquired Intangible Assets

12 Months Ended

Dec. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Acquired Intangible Assets

Goodwill and Acquired Intangible Assets

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

	For the Year Ended December 31,
(In thousands)	2022		2021		2020
Beginning of year	$	252,154	$	221,176	$	205,286
Changes from business combinations	228,165		30,978		15,890
Total	$	480,319	$	252,154	$	221,176

The Company performs an analysis for goodwill impairment annually in the fourth quarter or more frequently as considered necessary. The Company performed a qualitative goodwill assessment in the fourth quarter of 2022, and concluded that a quantitative goodwill impairment test was not necessary as it was not more likely-than-not that the fair value of the Company’s reporting unit was below the carrying amount. Based on the analyses performed, the Company concluded that goodwill was not impaired during the periods presented.

Acquired intangible assets primarily consist of core deposit intangibles (“CDI”), which are intangible assets arising from the purchase of deposits separately or from bank acquisitions. The change in balance for CDI is as follows:

	For the Year Ended December 31,
(In thousands)	2022		2021		2020
Beginning of year	$	12,998	$	14,577	$	18,305
Acquired CDI, including measurement period adjustments	67,388		3,454		2,129
Amortization expense	(9,101)		(5,033)		(5,857)
End of year	$	71,285	$	12,998	$	14,577
(In months)
Remaining average amortization period for CDI	49		39		44

The gross carrying amount and accumulated amortization of the Company's CDI subject to amortization as of:

	December 31, 2022				December 31, 2021
(In thousands)	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Core deposit intangible	$	97,778	$	(26,493)	$	41,596	$	(28,598)

The annual amortization expense for the Company's CDI for each of the five years subsequent to December 31, 2022 is $17.7 million, $13.4 million, $11.3 million, $9.4 million and $7.7 million, respectively.

Certain customer relationships were acquired through the acquisition of Drummond and its insurance agency subsidiary. The value assigned to these relationships, $2.6 million, is being amortized on a straight line basis over 10 years.

The carrying value of servicing rights retained from the sale of the guaranteed portion of Small Business Administration (“SBA”) loans totaled $1.7 million and $1.8 million at December 31, 2022 and December 31, 2021, respectively.