Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Note 7 - Goodwill and Other Intangible Assets

A goodwill impairment test is required under ASC 350, Intangibles – Goodwill and Other, and the FASB issued ASU No. 2011-08, “Testing Goodwill for Impairment,” allowing an initial qualitative assessment of goodwill commonly known as step zero impairment testing. In general, the step zero test allows an entity to first assess qualitative factors to determine whether it is more likely than not (i.e., more than 50%) that the fair value of a reporting unit is less than its carrying value. If a step zero impairment test results in the conclusion that it is more likely than not that the fair value of the reporting unit exceeds its carrying value, then no further testing is required.

Step zero impairment testing is an assessment of qualitative factors that affect the likelihood of impairment. Based upon management’s review, the Company’s intangible assets were not impaired and there has been no impairment through December 31, 2019 Management concludes that the ASC 350 goodwill step zero test has been passed, and no further testing is required.

Goodwill

The change in goodwill during the year is as follows:

	2019		2018
	(dollars in thousands)
Balance, January 1	$	145,909	$	145,909
Acquired goodwill		16,665		-
Impairment		-		-
Balance, December 31	$	162,574	$	145,909

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Table of Contents

CONNECTONE BANCORP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 7 - Goodwill and Other Intangible Assets – (continued)

Acquired Intangible Assets

The table below provides information regarding the carrying amounts and accumulated amortization of total amortized intangible assets as of the dates set forth below.

	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
	(dollars in thousands)
As of December 31, 2019

Core deposit intangibles	$	11,142	$	(5,682)	$	5,461

As of December 31, 2018

Core deposit intangibles	$	6,011	$	(4,274)	$	1,737

Aggregate amortization expense was approximately $1.4 million, $0.6 million and $0.7 million for 2019, 2018 and 2017, respectively. Estimated amortization expense for each of the next five years (dollars in thousands):

2020	$	1,135
2021		918
2022		768
2023		619
2024		493