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Goodwill and other intangible assets (Policies) | 9 Months Ended
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Sep. 30, 2025
Goodwill and Intangible Assets Disclosure |
Goodwill impairment | The Corporation’s goodwill and other identifiable intangible assets having an indefinite useful life are tested for impairment, at least annually and on a more frequent basis if events or circumstances indicate impairment could have taken place. Such events could include, among others, a significant adverse change in the business climate, an adverse action by a regulator, an unanticipated change in the competitive environment and a decision to change the operations or dispose of a reporting unit. Management monitors events or changes in circumstances between annual tests to determine if these events or changes in circumstances would more likely than not reduce the fair value of its reporting units below their carrying amounts. The reporting units evaluated are one level below the business segments and correspond to the legal entities within each reportable segment. In accordance with push-down accounting, all goodwill is assigned to the reporting units following a business combination. When evaluating goodwill for impairment, the Corporation may decide to first perform a qualitative assessment, or “Step Zero” impairment test, to determine whether it is more likely than not that impairment has occurred. The qualitative assessment includes a review of macroeconomic conditions, industry and market considerations, internal cost factors, and our own overall financial and share price performance, among other factors. If it is determined that it is more likely than not that the carrying amounts of our reporting units exceed their fair value, the Corporation will perform a quantitative assessment and calculate the estimated fair value of the respective reporting unit. If the carrying amount of a reporting unit’s goodwill exceeds the fair value of that goodwill, an impairment loss is recognized. To assess a reporting unit’s fair value, the Corporation generally uses a combination of methods such as discounted cash flow analysis and market multiples. The financial projections used in the discounted cash flow (“DCF”) valuation analysis are based on the most recent (as of the valuation date) projections presented to the Corporation’s Asset / Liability Management Committee (“ALCO”). These projections reflect management’s expectations for the reporting unit’s financial prospects considering economic and industry conditions. The Corporation evaluates the results obtained under the valuation methodology to identify and understand the key value drivers, to ascertain that the results obtained are reasonable and appropriate under the circumstances. Elements considered include current market and economic conditions, developments in specific lines of business, and any particular features of the individual reporting units. The Corporation completed its annual goodwill impairment evaluation during the third quarter of 2025, using July 31, 2025 as the evaluation date. Through a qualitative analysis, Step Zero, the Corporation determined that for all reporting units, except for the Popular Equipment Finance (‘’PEF’’) reporting unit, it is more-likely-than-not that the fair value exceeded the carrying value. As a result, the Corporation performed a quantitative test to assess PEF’s goodwill impairment. The results of the PEF annual goodwill impairment test as of July 31, 2025, indicated that the estimated fair value was below it’s carrying amount. Accordingly, the Corporation recognized a goodwill impairment charge of $ 13.0 million, which was mainly driven by lower projected earnings for the forecasted period, primarily due to lower lending activity.

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- Definition Disclosure of accounting policy for goodwill and intangible assets. This accounting policy also may address how an entity assesses and measures impairment of goodwill and intangible assets. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 30 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-30/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-20/tableOfContent + Details
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