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Goodwill and Other Intangible Assets
 6 Months Ended
Jun. 30, 2017
Goodwill And Other Intangible Assets [Abstract]  
Goodwill and Other Intangible Assets

Note 11 – Goodwill and Other Intangible Assets

 

The following is a summary of the gross carrying amount and accumulated amortization of amortizable intangible assets as of June 30, 2017, December 31, 2016, and June 30, 2016 and the carrying amount of unamortized intangible assets as of those same dates.

 

   June 30, 2017   December 31, 2016   June 30, 2016 
($ in thousands)  Gross Carrying
Amount		   Accumulated
Amortization		   Gross Carrying
Amount		   Accumulated
Amortization		   Gross Carrying
Amount		   Accumulated
Amortization		 
Amortizable intangible assets:                              
   Customer lists  $2,369    866    2,369    746    2,369    624 
   Core deposit premiums   18,520    9,404    9,730    8,143    8,560    7,660 
   Other   1,032    381    1,032    224    1,032    65 
        Total  $21,921    10,651    13,131    9,113    11,961    8,349 
                               
SBA servicing asset  $862         415         —      
                               
Unamortizable intangible assets:                              
   Goodwill  $139,124         75,042         73,541      

 

Activity related to transactions during the periods presented includes the following:

 

(1)In connection with the January 1, 2016 acquisition of Bankingport, Inc., an insurance agency located in Sanford, North Carolina, the Company recorded $1,693,000 in goodwill, $591,000 in a customer list intangible, and $92,000 in other amortizable intangible assets.
(2)In connection with the May 5, 2016 acquisition of SBA Complete, Inc., an SBA loan consulting firm, the Company recorded $4,333,000 in goodwill, $1,100,000 in a customer list intangible, and $940,000 in other amortizable intangible assets.
(3)In connection with the branch exchange transaction with First Community Bank in Bluefield, Virginia, on July 15, 2016, the Company recorded a net increase of $1,961,000 in goodwill and $1,170,000 in core deposit premiums.
(4)In connection with the Carolina Bank acquisition on March 3, 2017, the Company recorded a net increase of $65,302,000 in goodwill and $8,790,000 in core deposit premiums.

 

In addition to the above acquisition related activity, the Company recorded $415,000 in servicing assets associated with the guaranteed portion of SBA loans originated and sold during the third and fourth quarters of 2016. During the first half of 2017, the Company recorded an additional $513,000 in servicing assets, as well as $66,000 in amortization expense. Servicing assets are recorded at fair value and amortized as a reduction of service fee income over the expected lives of the related loans.

 

Amortization expense of all intangible assets totaled $1,031,000 and $261,000 for the three months ended June 30, 2017 and 2016, respectively, and $1,607,000 and $447,000 for the six months ended June 30, 2017 and 2016, respectively.

 

The following table presents the estimated amortization expense related to amortizable intangible assets, excluding SBA servicing assets, for the last two quarters of calendar year 2017 and for each of the four calendar years ending December 31, 2021 and the estimated amount amortizable thereafter. These estimates are subject to change in future periods to the extent management determines it is necessary to make adjustments to the carrying value or estimated useful lives of amortized intangible assets.

 

($ in thousands)

 

  Estimated Amortization
Expense		 
July 1 to December 31, 2017  $1,615 
2018   2,862 
2019   2,314 
2020   1,750 
2021   1,288 
Thereafter   1,441 
         Total  $11,270