Note 7 - Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2017

Goodwill and Intangible Assets Disclosure [Text Block]

NOTE

GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill is tested annually, or more often if circumstances warrant, for impairment. If the implied fair value of goodwill is lower than its carrying amount, goodwill impairment is indicated, and goodwill is written down to its implied fair value. Subsequent increases in goodwill value are

not

recognized in the financial statements. Goodwill totaled

$375.7

million at

September 30, 2017

and

$348.5

million at

December 31, 2016.

The change in goodwill during

2017

primarily includes

$29.4

million recorded as a result of the Company’s

2017

Hardeman acquisition, which is

not

deductible for tax purposes, partially offset by

$4.1

million due to the sale of the Company’s property and casualty insurance lines of business. Goodwill impairment was neither indicated

nor

recorded during the

nine

months ended

September 30, 2017

or the year ended

December 31, 2016.

Core deposit premiums are amortized over periods ranging from

years and are periodically evaluated, at least annually, as to the recoverability of their carrying value. Core deposit premiums of

$7.8

million were recorded during the

second

quarter of

2017

as part of the Hardeman acquisition. Core deposit premiums of

$5.1

million were recorded in the

fourth

quarter of

2016

as part of the Citizens acquisition.

Intangible assets are being amortized over various periods ranging from

years. The Company recorded

$830,000

of intangible assets during the

second

quarter of

2017

related to the insurance operations acquired in the Hardeman acquisition. The Company recorded

$591,000

of intangible assets during the

fourth

quarter of

2016

related to the trust operations acquired in the Citizens acquisition. Intangible assets decreased by

$1.3

million due to the sale of insurance lines of business during the

third

quarter of

2017.

The Company’s goodwill and other intangibles (carrying basis and accumulated amortization) at

September 30, 2017

and

December 31, 2016,

were as follows:

(In thousands)	September 30, 2017			December 31, 2016

Goodwill	$	375,731		$	348,505
Core deposit premiums:
Gross carrying amount		56,532			48,692
Accumulated amortization		(14,297	)		(10,625	)
Core deposit premiums, net		42,235			38,067
Purchased credit card relationships:
Gross carrying amount		2,068			2,068
Accumulated amortization		(1,654	)		(1,344	)
Purchased credit card relationships, net		414			724
Books of business intangible:
Gross carrying amount		15,414			15,884
Accumulated amortization		(2,562	)		(1,716	)
Books of business intangible, net		12,852			14,168
Other intangible assets, net		55,501			52,959
Total goodwill and other intangible assets	$	431,232		$	401,464

The Company’s estimated remaining amortization expense on intangibles as of

September 30, 2017

is as follows:

Year	(In thousands)
Remainder of 2017	$	1,665
2018		6,557
2019		6,247
2020		6,234
2021		6,172
Thereafter		28,626
Total	$	55,501

- 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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