Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and intangible assets deemed to have indefinite lives are not amortized but are instead subject to impairment tests. There were nil, $2 million and $5 million of impairments of indefinite-lived intangible assets recorded for the years ended December 31, 2021, 2020 and 2019, respectively.

The changes in the carrying amount of goodwill reported in the Company’s main operating segments were as follows:

	Advice & Wealth Management		Asset Management		Retirement & Protection Solutions		Consolidated
	(in millions)
Balance at January 1, 2020	$	279	$	797	$	91	$	1,167
Foreign currency translation	—		10		—		10
Other adjustments	—		(1)		—		(1)
Balance at December 31, 2020	279		806		91		1,176
Acquisitions	—		287		—		287
Foreign currency translation	—		(4)		—		(4)
Other adjustments	—		(1)		—		(1)
Balance at December 31, 2021	$	279	$	1,088	$	91	$	1,458

On November 8, 2021, the Company completed its acquisition of the European-based asset management business of BMO Financial Group for $973 million, excluding an estimated $7 million reduction due to customary deferred and contingent adjustments. The all-cash transaction added $136 billion of assets under management in EMEA. The acquisition extends our reach in EMEA and accelerates our core strategy of growing fee-based businesses. Acquisition-related costs were $32 million and are included in General and administrative expense.

The fair value of the total consideration paid and the recognized assets and acquired liabilities assumed for this business are included in the table below. Goodwill of $287 million arising from acquisition consists largely of the synergies and economies of scale expected from combining the Company’s EMEA operations. All goodwill was assigned to the Asset Management segment.

The following table summarizes the consideration paid, assets acquired, and liabilities assumed at the acquisition date:

	November 8, 2021
	(in millions)
Consideration paid
Cash	$	973
Deferred considerations	(35)
Contingent considerations	28
Total fair value	$	966
Recognized Assets / Liabilities
Assets
Cash and cash equivalents	$	397
Investments	77
Receivables	116
Other assets	295
Total assets	885
Liabilities
Debt	2
Accounts payable and accrued expenses	235
Other liabilities	190
Total liabilities	427
Identifiable net assets	$	458
Intangible assets	$	295
Deferred tax liability	74
Goodwill	287

The fair value of the pension plan assets and liabilities, the recognized deferred tax assets and other components of deferred and contingent consideration reflects the provisional valuation of those assets and liabilities.

The carrying amount of indefinite-lived intangible assets consist of the following:

	December 31,
	2021		2020
	(in millions)
Customer contracts	$	848	$	640
Trade names	69		69
Total	$	917	$	709

Definite-lived intangible assets consisted of the following:

	December 31, 2021						December 31, 2020
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
	(in millions)
Customer relationships	$	254	$	(163)	$	91	$	193	$	(155)	$	38
Contracts	235		(217)		18		223		(211)		12
Other	272		(188)		84		226		(168)		58
Total	$	761	$	(568)	$	193	$	642	$	(534)	$	108

Definite-lived intangible assets acquired during the year ended December 31, 2021 were $89 million with a weighted average amortization period of 10 years. The aggregate amortization expense for definite-lived intangible assets during the years ended December 31, 2021, 2020 and 2019 was $34 million, $31 million and $37 million, respectively. In 2021, 2020 and 2019, the Company did not record any impairment charges on definite-lived intangible assets.

Estimated intangible amortization expense as of December 31, 2021 for the next five years is as follows:

	(in millions)
2022	$	31
2023	27
2024	16
2025	10
2026	7