Goodwill, Core Deposit Premium and Other Intangible Assets

3 Months Ended

Mar. 31, 2012

Goodwill, Core Deposit Premium and Other Intangible Assets [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

GOODWILL, CORE DEPOSIT PREMIUM AND OTHER INTANGIBLE ASSETS

Heartland had goodwill of $25.9 million at March 31, 2012, and December 31, 2011. The gross carrying amount of intangible assets and the associated accumulated amortization at March 31, 2012, and December 31, 2011, are presented in the table below, in thousands:



	March 31, 2012				December 31, 2011
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Amortizing intangible assets:
Core deposit intangibles	$	9,957	$	8,925	$	9,957	$	8,815
Mortgage servicing rights	17,329		5,773		16,779		5,503
Customer relationship intangible	1,177		656		1,177		635
Total	$	28,463	$	15,354	$	27,913	$	14,953
Unamortized intangible assets			$	13,109			$	12,960

The following table shows the estimated future amortization expense for amortizable intangible assets, in thousands:



	Core Deposit Intangibles		Mortgage Servicing Rights		Customer Relationship Intangible		Total

Nine months ending December 31, 2012	$	331	$	2,889	$	33	$	3,253
Year ending December 31,
2013	423		2,889		45		3,357
2014	184		2,311		43		2,538
2015	15		1,733		42		1,790
2016	14		1,156		41		1,211
2017	12		578		40		630
Thereafter	53		—		277		330

Projections of amortization expense for mortgage servicing rights are based on existing asset balances and the existing interest rate environment as of March 31, 2012. Heartland's actual experience may be significantly different depending upon changes in mortgage interest rates and market conditions. Mortgage loans serviced for others were $1.63 billion and $1.54 billion as of March 31, 2012 and December 31, 2011, respectively. The fair value of Heartland's mortgage servicing rights was estimated at $12.1 million and $11.5 million at March 31, 2012, and December 31, 2011, respectively. Heartland's mortgage servicing rights are separated into 15- and 30-year tranches. At March 31, 2012, the 15-year tranche had a fair value of $2.52 million in comparison with the book value of $2.53 million. At December 31, 2011, the 15-year tranche had a fair value of $2.41 million in comparison with the book value of $2.43 million. Accordingly, valuation allowances of $6 thousand and $19 thousand, were required as of March 31, 2012 and December 31, 2011, respectively.

- 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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