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Goodwill and Intangible Assets (Notes) | 9 Months Ended
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Sep. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Intangible Assets Disclosure [Text Block] | Goodwill and Intangible Assets The Company has goodwill from business combinations, intangible assets from branch acquisitions, identifiable intangible assets assigned to core deposit relationships and customer lists of First Mid Insurance. The following table presents gross carrying value and accumulated amortization by major intangible asset class as of September 30, 2019 and December 31, 2018 (in thousands):
| September 30, 2019 | December 31, 2018
| Gross Carrying Value | Accumulated Amortization | Gross Carrying Value | Accumulated Amortization
Goodwill not subject to amortization (effective 1/1/02) | $ | 108,752 |  | $ | 3,760 |  | $ | 109,037 |  | $ | 3,760 |
Intangibles from branch acquisition | 3,015 |  | 3,015 |  | 3,015 |  | 3,015 |
Core deposit intangibles | 32,355 |  | 16,884 |  | 32,355 |  | 14,017 |
Other intangibles | 16,029 |  | 3,600 |  | 16,029 |  | 2,648 |
| $ | 160,151 |  | $ | 27,259 |  | $ | 160,436 |  | $ | 23,440 |
Goodwill of $26.5 million was recorded for the acquisition and merger of First Bank during 2018. All of the goodwill was assigned to the banking segment of the Company. The Company expects this goodwill will not be deductible for tax purposes. The following table provides a reconciliation of the purchase price paid for the acquisition of First Bank and the amount of goodwill recorded (in thousands):
Purchase price (in excess of net book value) |  | $ | 26,946 |
Purchase accounting adjustments: |  |
Fair value of securities | $ | 320 |  |
Fair value of loans, net | 3,463 |  |
Fair value of OREO | 12 |  |
Fair value of mortgage servicing rights | (1,097 | ) |
Fair value of premises and equipment | 689 |  |
Fair value of time deposits | 1,301 |  |
Fair value of FHLB advances | (328 | ) |
Fair value of subordinated debentures | (1,451 | ) |
Core deposit intangible | (5,224 | ) |
Other assets and other liabilities, net | 1,860 |  |
|  | (455 | )
Resulting goodwill from acquisition |  | $ | 26,491 |
Goodwill of $18.6 million was provisionally recorded for the acquisition and merger of SCB during the fourth quarter of 2018. All of the goodwill was assigned to the banking segment of the Company. Goodwill was subsequently adjusted to $18.4 million to reflect proper valuation of financial assets and liabilities. The Company expects this goodwill will not be deductible for tax purposes. The following table provides a reconciliation of the purchase price paid for the acquisition of SCB and the amount of goodwill recorded (in thousands):
Purchase price (in excess of net book value) |  | $ | 21,694 |
Purchase accounting adjustments: |  |
Fair value of securities | $ | 41 |  |
Fair value of loans, net | 3,377 |  |
Fair value of OREO | 345 |  |
Fair value of premises and equipment | (953 | ) |
Fair value of time deposits | (343 | ) |
Fair value of FHLB advances | (29 | ) |
Core deposit intangible | (7,269 | ) |
Customer list intangible | (12,298 | ) |
Other assets and other liabilities, net | 13,786 |  |
|  | (3,343 | )
Resulting goodwill from acquisition |  | $ | 18,351 |
During 2018, as part of the First Bank and SCB acquisitions, the Company acquired mortgage servicing rights valued at $1,558,000. There have been no mortgage servicing rights added during 2019. The following table summarizes the activity pertaining to mortgage servicing rights included in intangible assets as of September 30, 2019, September 30, 2018 and December 31, 2018 (in thousands):
| September 30, 2019 |  | September 30, 2018 |  | December 31, 2018
Beginning Balance | $ | 2,101 |  |  |  | $844 |  |  | $ | 844 |
Mortgage servicing rights acquired during period | — |  |  | 1,522 |  |  | 1,558 |
Mortgage servicing rights capitalized | — |  |  | 7 |  |  | 7 |
Valuation reserve | (384 | ) |  | — |  |  | — |
Mortgage servicing rights amortized | (293 | ) |  | (242 | ) |  | (308 | )
I/O Strip | 145 |  |  | — |  |  | — |
Ending Balance | $ | 1,569 |  |  |  | $2,131 |  |  | $ | 2,101 |
Total amortization expense for the nine months ended September 30, 2019 and 2018 was as follows (in thousands):
| Three months ended September 30, |  | Nine months ended September 30,
| 2019 |  | 2018 |  | 2019 |  | 2018
Core deposit intangibles | 935 |  |  | 669 |  |  | $ | 2,868 |  |  | $ | 1,680 |
Customer list intangibles | 317 |  |  | 46 |  |  | 952 |  |  | 137 |
Mortgage servicing rights | 121 |  |  | 123 |  |  | 732 |  |  | 242 |
| $ | 1,373 |  |  | $ | 838 |  |  | $ | 4,552 |  |  | $ | 2,059 |
Aggregate amortization expense for the current year and estimated amortization expense for each of the five succeeding years is shown in the table below (in thousands):
Aggregate amortization expense: |
For period 01/01/19-09/30/19 | $ | 4,552 |
Estimated amortization expense: |
For period 10/01/19-12/31/19 | 1,396 |
For year ended 12/31/20 | 4,836 |
For year ended 12/31/21 | 4,192 |
For year ended 12/31/22 | 3,826 |
For year ended 12/31/23 | 3,510 |
For year ended 12/31/24 | 2,910 |
In accordance with the provisions of SFAS No. 142, “Goodwill and Other Intangible Assets,” codified within ASC 350, the Company performed testing of goodwill for impairment as of September 30, 2019 and determined that, as of that date, goodwill was not impaired. Management also concluded that the remaining amounts and amortization periods were appropriate for all intangible assets.

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