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Note 6 - Goodwill and Intangibles | 12 Months Ended
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Dec. 31, 2019
Notes to Financial Statements |
Goodwill and Intangibles | Note 6. Goodwill and Intangibles The following table presents the changes in the carrying amount of goodwill for the years ended December 31, 2019, 2018 and 2017:
|  | 2019 |  | 2018 |  | 2017
|  | (dollars in thousands)
Balance at the beginning of period |  | $ | 77,832 |  | $ | 28,334 |  | $ | 13,111
Goodwill from merger with Springfield Bancshares |  |  | — |  |  | 45,975 |  |  | —
Goodwill from acquisition of Bates Companies |  |  | — |  |  | 3,766 |  |  | —
Goodwill from acquisition of Guaranty Bank |  |  | — |  |  | — |  |  | 15,223
Goodwill from acquisition of Guaranty Bank - measurement period adjustment |  |  | — |  |  | (243) |  |  | —
Goodwill from acquisition of Bates Companies - measurement period adjustment |  |  | (84) |  |  | — |  |  | —
Goodwill impairment - Bates Companies |  |  | (3,000) |  |  | — |  |  | —
Balance at the end of period |  | $ | 74,748 |  | $ | 77,832 |  | $ | 28,334
The following table presents the goodwill by reportable segment:
|  | December 31, 2019 |  | December 31, 2018 |  | December 31, 2017
|  | (dollars in thousands)
Commercial banking: |  |  |  |  |  |  |  |  |
QCBT |  | $ | 3,223 |  | $ | 3,223 |  | $ | 3,223
CRBT |  |  | 14,980 |  |  | 14,980 |  |  | 15,223
CSB |  |  | 9,888 |  |  | 9,888 |  |  | 9,888
SFC Bank |  |  | 45,975 |  |  | 45,975 |  |  | —
Other, Parent Company Only |  |  | 682 |  |  | 3,766 |  |  | —
|  | $ | 74,748 |  | $ | 77,832 |  | $ | 28,334
As of November 30, 2019, the Company’s management performed an internal assessment of the goodwill for the Bates Companies reporting unit. As the Bates Companies is located in Rockford, Illinois, the Company had intended to achieve synergies and cross-selling opportunities that significantly enhanced the value of the Bates Companies. With the sale of the assets and liabilities of RB&T, which was the Company’s bank subsidiary located in Rockford, Illinois, the Company’s valuation analysis determined the value had declined and the goodwill was impaired. Specifically, the Company determined a goodwill impairment charge of $3 million was required for the Bates Companies. The Company used a combination of methods to determine the value and related goodwill impairment charge. The methods included prices of comparable businesses as well as recent discussions with existing wealth management providers in the surrounding Rockford market. Note 6. Goodwill and Intangibles (continued) The following table presents the changes in core deposit intangibles (included in Intangibles on the consolidated balance sheets) during the years ended December 31, 2019, 2018 and 2017:
|  | 2019 |  | 2018 |  | 2017
|  | (dollars in thousands)
Balance at the beginning of the period |  | $ | 15,595 |  | $ | 9,079 |  | $ | 7,381
Core deposit intangible from merger with Springfield Bancshares |  |  | — |  |  | 8,208 |  |  | —
Core deposit intangible from acquisition of Guaranty Bank |  |  | — |  |  | — |  |  | 2,699
Amortization expense |  |  | (2,129) |  |  | (1,692) |  |  | (1,001)
Balance at the end of the period |  | $ | 13,466 |  | $ | 15,595 |  | $ | 9,079
Gross carrying amount |  | $ | 19,255 |  | $ | 19,255 |  | $ | 11,046
Accumulated amortization |  |  | (5,789) |  |  | (3,660) |  |  | (1,967)
Net book value |  | $ | 13,466 |  | $ | 15,595 |  | $ | 9,079
The following table presents the core deposit intangibles by reportable segment:
|  | December 31, 2019 |  | December 31, 2018 |  | December 31, 2017
|  | (dollars in thousands)
Commercial Banking: |  |  |  |  |  |  |  |  |
CRBT |  | $ | 2,684 |  | $ | 3,186 |  | $ | 3,694
CSB |  |  | 3,980 |  |  | 4,675 |  |  | 5,385
SFC Bank |  |  | 6,802 |  |  | 7,734 |  |  | —
|  | $ | 13,466 |  | $ | 15,595 |  | $ | 9,079
The following table presents the estimated amortization of the core deposit intangibles:
|  | Amount
Years ending December 31, |  | (dollars in thousands)
2020 |  | $ | 2,085
2021 |  |  | 2,032
2022 |  |  | 1,971
2023 |  |  | 1,776
2024 |  |  | 1,623
Thereafter |  |  | 3,979
|  | $ | 13,466
The following table presents the changes in customer list intangible (included in Intangibles on the consolidated balance sheets) during the years ended December 31, 2019 and 2018:
|  | 2019 |  | 2018
|  | (dollars in thousands)
Balance at the beginning of period |  | $ | 1,855 |  | $ | —
Customer list intangible from acquisition of Bates Companies |  |  | — |  |  | 1,855
Customer list intangible from acquisition of Bates Companies - measurement period adjustment |  |  | (214) |  |  | —
Amortization |  |  | (137) |  |  | —
Balance at the end of period |  |  | 1,504 |  |  | 1,855
The customer list intangible relates to the Parent Company Only (“All Other”) reportable segment. Note 6. Goodwill and Intangibles (continued) The following table presents the estimated amortization of the customer list intangible:
|  | Amount
Years ending December 31, |  | (dollars in thousands)
2020 |  | $ | 109
2021 |  |  | 109
2022 |  |  | 109
2023 |  |  | 109
2024 |  |  | 109
Thereafter |  |  | 959
|  | $ | 1,504

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- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -URI http://asc.fasb.org/topic&trid=2144416 + Details
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