Goodwill and Other Intangible Assets

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

The changes in the carrying amount of goodwill, allocated by operating segments, were as follows (see Note 16):


(In thousands)	Payment Services - Puerto Rico & Caribbean		Payment Services - Latin America		Merchant Acquiring, net		Business Solutions		Total
Balance at December 31, 2021	$	160,972	$	48,402	$	138,121	$	45,823	$	393,318


Foreign currency translation adjustments	—		(1,969)		—		—		(1,969)
Goodwill reclassified to held-for-sale	—		—		—		(5,813)		(5,813)
Balance at June 30, 2022	$	160,972	$	46,433	$	138,121	$	40,010	$	385,536

Goodwill is tested for impairment on an annual basis as of August 31, or more often if events or changes in circumstances indicate there may be impairment. The Company may test for goodwill impairment using a qualitative or a quantitative analysis. In a qualitative analysis, the Company assesses whether it is "more likely than not" that the fair value of a reporting unit is less than its carrying amount. In the quantitative analysis, the Company compares the estimated fair value of the reporting units to their carrying values, including goodwill. No impairment losses were recognized for the periods ended June 30, 2022 or 2021.

As of June 30, 2022, Goodwill of $5.8 million is classified as held-for-sale as the Company entered into a commitment to sell certain assets and transfer certain employees under the Popular Transaction, this commitment constitutes the sale of a business under ASC 805, refer to Note 2 – Held-for-Sale for further details.

The carrying amount of other intangible assets at June 30, 2022 and December 31, 2021 was as follows:


		June 30, 2022
(In thousands)	Useful life in years	Gross amount		Accumulated amortization		Assets reclassified to Held-for-Sale		Net carrying amount
Customer relationships	5 - 14	$	368,223	$	(286,562)	$	—	$	81,661
Trademarks	2 - 15	41,834		(37,281)		—		$	4,553
Software packages	3 - 10	340,651		(230,677)		(18,835)		$	91,139
Non-compete agreement	15	56,539		(44,288)		—		$	12,251
Other intangible assets, net		$	807,247	$	(598,808)	$	(18,835)	$	189,604


		December 31, 2021
(Dollar amounts in thousands)	Useful life in years	Gross amount		Accumulated amortization		Net carrying amount
Customer relationships	5 - 14	$	357,991	$	(272,732)	$	85,259
Trademarks	2 - 15	41,901		(36,684)		5,217
Software packages	3 - 10	326,320		(217,643)		108,677
Non-compete agreement	15	56,539		(42,404)		14,135
Other intangible assets, net		$	782,751	$	(569,463)	$	213,288

During the quarter ended June 30, 2022, the Company acquired a customer relationship in Puerto Rico amounting to $10.6 million that will be amortized over five years. Revenues and expenses in connection with this customer relationship are included as part of the Payment Services - Puerto Rico & Caribbean segment.

Amortization expense related to other intangibles for the three and six months ended June 30, 2022 amounted to $14.8 million and $29.3 million, respectively, compared to $14.3 million and $28.5 million for the corresponding periods in 2021, respectively. During the six months ended June 30, 2022, the Company recorded an impairment loss through cost of revenues of $4.1 million for a multi-year software development for which cash flows used in the internal model will be impacted due to a

decrease in the forecasted revenues to be generated by the software. During the six months ended June 30, 2021, the Company recorded an impairment charge through cost of revenues amounting to $0.6 million for a software solution that will no longer be used. Both impairment charges affected the Company’s Payment Services – Puerto Rico & Caribbean segment.

At June 30, 2022, Software amounting to $18.8 million is classified as to held-for-sale as part of the Popular Transaction, refer to Note 2 – Held-for-Sale for further details.

The estimated amortization expense of the other intangible balances outstanding at June 30, 2022 for the next five years is as follows:


(Dollar amounts in thousands)
Remaining 2022	$	28,868
2023	53,340
2024	42,181
2025	15,494
2026	8,467