Goodwill and Other Intangibles

12 Months Ended

Dec. 31, 2011

Goodwill and Intangibles Assets Disclosure [Abstract]

The carrying value of goodwill as of December 31, 2011 and 2010 was as follows:



(Dollars in thousands)	Commercial Banking Segment	Wealth Management Service Segment	Total
	$22,591	$35,523	$58,114

The changes in the carrying value of other intangible assets for the years ended December 31, 2011 and 2010 were as follows:



(Dollars in thousands)	Core Deposit Intangible		Advisory Contracts		Non-compete Agreements		Total
Balance at December 31, 2009		$270		$8,591		$82		$8,943
Amortization	120		922		49		1,091
Balance at December 31, 2010	150		7,669		33		7,852
Amortization	150		768		33		951
Balance at December 31, 2011		$—		$6,901		$—		$6,901

The value attributable to the core deposit intangible (“CDI”) is a function of the estimated attrition of the core deposit accounts, and the expected cost savings associated with the use of the existing core deposit base rather than alternative funding sources.

The value attributed to the wealth management advisory contracts was based on the time period over which the advisory contracts are expected to generate economic benefits. The intangible values of advisory contracts are being amortized over a 20-year life using a declining balance method, based on expected attrition for Weston Financial’s current customer base derived from historical runoff data. The amortization schedule is based on the anticipated future customer runoff rate. This schedule will result in amortization of approximately 50% of the intangible asset after six years, and approximately 70% amortization of the balance after ten years.

The value attributable to the Weston Financial non-compete agreements was based on the expected receipt of future economic benefits related to provisions in the non-compete agreements that restrict competitive behavior. The intangible value of non-compete agreements was amortized on a straight-line basis over the six-year contractual lives of the agreements, which ended in 2011.

Estimated annual amortization expense for advisory contracts is as follows:



(Dollars in thousands)
Years ending December 31,	2012		$727
	2013	680
	2014	644
	2015	603
	2016	562
	Thereafter	3,685

The components of intangible assets at December 31, 2011 and 2010 were as follows:



(Dollars in thousands)	Core Deposits		Advisory Contracts		Non-compete Agreements		Total
December 31, 2011:
Gross carrying amount		$2,997		$13,657		$1,147		$17,801
Accumulated amortization	2,997		6,756		1,147		10,900
Net amount		$—		$6,901		$—		$6,901

December 31, 2010:
Gross carrying amount		$2,997		$13,657		$1,147		$17,801
Accumulated amortization	2,847		5,988		1,114		9,949
Net amount		$150		$7,669		$33		$7,852

- 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.

+ References+ Details