Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2016

The following table presents the changes in the carrying amount of goodwill for the years ended December 31, 2016 and 2015:



(Dollars in thousands)	2016		2015
Balance at January 1	$	139,773	$	139,773
Acquired in the Cordia merger	10,828		—
Balance at December 31	$	150,601	$	139,773

Mortgage Servicing Rights Key Economic Assumptions Used to Value

Key economic assumptions used to value mortgage servicing rights as of December 31, 2016 and 2015 were as follows:



	2016			2015
Discount rate - conventional fixed loans	9.45		%	9.31		%
Discount rate - all loans excluding conventional fixed loans	10.45		%	10.31		%
Weighted average constant prepayment rate	10.42		%	11.01		%
Weighted average cost to service a loan	$	62.75		$	56.61

Schedule of Mortgage Servicing Rights at Amortized Cost

The activity of the servicing asset for the years ended December 31, 2016, 2015 and 2014 is presented in the following table:



(Dollars in thousands)	2016			2015			2014
Balance at January 1	$	19,351		$	16,688		$	16
Servicing rights originated	5,931			5,910			727
Amortization	(4,958		)	(4,002		)	(919		)
Servicing rights acquired in the 1st Financial acquisition	—			—			148
Servicing rights acquired in the Bancorporation merger	—			—			17,566
Valuation allowance reversal (provision)	91			755			(850		)
Balance at December 31	$	20,415		$	19,351		$	16,688

Schedule of Valuation Allowance for Impairment of Recognized Servicing Assets [Table Text Block]

The following table presents the activity in the servicing asset valuation allowance for the years ended December 31, 2016, 2015 and 2014:



(Dollars in thousands)	2016			2015			2014
Balance at January 1	$	95		$	850		$	—
Valuation allowance (reversal) provision	(91		)	(755		)	850
Balance at December 31	$	4		$	95		$	850

Schedule of Other Intangible Assets

The following information relates to other intangible assets, all customer-related, which are being amortized over their estimated useful lives:



(Dollars in thousands)	2016			2015
Balance at January 1	$	71,635		$	89,922
Acquired in the CCBT acquisition	—			690
Acquired in the NMSB acquisition	240			—
Acquired in the FCSB acquisition	390			—
Acquired in the Cordia acquisition	2,210			—
Removal due to branch sale	—			(85		)
Amortization	(16,850		)	(18,892		)
Balance at December 31	$	57,625		$	71,635

Core deposit intangibles comprise the majority of the other intangible assets as of December 31, 2016 and 2015. During 2016, BancShares recognized $240 thousand, $390 thousand and $2.2 million in core deposit intangibles related to the NMSB, FCSB and Cordia acquisitions, respectively. During 2015, BancShares recognized $690 thousand in core deposit intangibles related to the CCBT merger. Core deposit intangibles of $85 thousand were written off in 2015 as it related to previously acquired deposits that were sold in connection with the sale of a branch in December 2015. Intangible assets generated by acquisitions, which represent the estimated fair value of core deposits and other customer relationships that were acquired, are being amortized on an accelerated basis over their estimated useful lives. The estimated useful remaining lives range from 2 years to less than 9 years.

The gross amount of other intangible assets and accumulated amortization as of December 31, 2016 and 2015, are:



(Dollars in thousands)	2016			2015
Gross balance	$	118,041		$	115,201
Accumulated amortization	(60,416		)	(43,566		)
Carrying value	$	57,625		$	71,635

Future Amortization Expense Schedule

Based on current estimated useful lives and carrying values, BancShares anticipates amortization expense for intangible assets in subsequent periods will be:



(Dollars in thousands)
2017	$	14,556
2018	12,220
2019	9,892
2020	7,838
2021	5,996