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Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2022

Goodwill and Other Intangible Assets

Note 8—Goodwill and Other Intangible Assets

The carrying amount of goodwill was $1.9 billion and $1.6 billion, respectively, at December 31, 2022 and December 31, 2021. The Company added $342.9 million in goodwill related to the Atlantic Capital acquisition in the first quarter of 2022. The Company made subsequent fair value adjustments related to the Atlantic Capital merger in the second quarter of 2022 that decreased goodwill by $1.5 million and another subsequent fair value adjustments related to the Atlantic Capital merger in the fourth quarter of 2022 that increased goodwill by $581,000.

The Company evaluated the carrying value of goodwill as of October 31, 2022, its annual test date, and concluded that no impairment charge was necessary. The Company will continue to monitor the impact of COVID-19

and other market conditions on the Company’ business, operating results, cash flows and/or financial condition. The following is a summary of changes in the carrying amounts of goodwill:


	Year Ended
	December 31,
(Dollars in thousands)	2022		2021
Balance at beginning of period	$	1,581,085	$	1,563,942
Additions:
Goodwill from Atlantic Capital acquisition		342,021		—
Goodwill from SouthState\|Duncan-Williams acquisition		—		15,816
Goodwill subsequent fair value adjustment from CenterState acquisition		—		1,327
Balance at end of period	$	1,923,106	$	1,581,085

The Company’s other intangible assets, consisting of core deposit intangibles, noncompete intangibles, and client list intangibles are included on the face of the balance sheet. The Company added $17.5 million in core deposit intangibles related to the Atlantic Capital transaction during the first quarter of 2022. The following is a summary of gross carrying amounts and accumulated amortization of other intangible assets:


	December 31,
(Dollars in thousands)	2022		2021
Gross carrying amount	$	278,971	$	257,874
Accumulated amortization		(162,521)		(129,807)
	$	116,450	$	128,067

Amortization expense totaled $33.2 million, $35.2 million and $27.0 million for the years ended December 31, 2022, 2021, and 2020, respectively. Other intangibles are amortized using either the straight-line method or an accelerated basis over their estimated useful lives, with lives generally between 2 and 15 years.

In early 2022 and in connection with the SBA servicing asset acquired through the Atlantic Capital acquisition, which was recorded at fair value on acquisition date, the Company elected to prospectively apply fair value accounting to the Company’s SBA servicing asset. The change in fair value of the SBA servicing asset is recorded in SBA Income, a component of Noninterest Income on the Consolidated Statements of Income, during each applicable reporting period. As a result of the change in accounting treatment, the Company will no longer amortize the SBA servicing asset and therefore excluded the SBA servicing asset from the future amortization expense table presented below. The fair value of the SBA servicing asset was $6.1 million at December 31, 2022.

Estimated amortization expense for other intangibles, excluding the SBA servicing asset, for each of the next five years is as follows:


(Dollars in thousands)
Year ended December 31:
2023	$	27,558
2024		22,395
2025		18,766
2026		15,232
2027		11,756
Thereafter		14,675
	$	110,382