Goodwill and Intangible Assets

6 Months Ended

Jun. 30, 2020

Goodwill And Intangible Assets Disclosure [Abstract]

Note 5 -- 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 Wealth Management Company and First Mid Insurance. The following table presents gross carrying value and accumulated amortization by major intangible asset class as of June 30, 2020 and December 31, 2019 (in thousands):

	June 30, 2020				December 31,2019
	Gross Carrying Value		Accumulated Amortization		Gross Carrying Value		Accumulated Amortization
Goodwill not subject to amortization (effective 1/1/02)	$	108,752	$	3,760	$	108,752	$	3,760
Intangibles from branch acquisition		3,015		3,015		3,015		3,015
Core deposit intangibles		32,355		19,410		32,355		17,746
Other intangibles		16,389		4,570		16,129		3,917
	$	160,511	$	30,755	$	160,251	$	28,438

The Company has mortgage servicing rights acquired in previous acquisitions. The following table summarizes the activity pertaining to mortgage servicing rights included in intangible assets as of June 30, 2020, June 30, 2019 and December 31, 2019 (in thousands):

	June 30, 2020			June 30, 2019			December 31, 2019
Beginning Balance	$	1,444		$	2,101		$	2,101
Valuation reserve		(259	)		(439	)		(380	)
Mortgage servicing rights amortized		(268	)		(172	)		(411	)
I/O Strip		(17	)		146			134
Ending Balance	$	900		$	1,636		$	1,444

Total amortization expense for the six months ended June 30, 2020 and 2019 was as follows (in thousands):

	Three months ended June 30,				Six months ended June 30,
	2020		2019		2020		2019
Core deposit intangibles	$	821	$	953	$	1,664	$	1,933
Customer list intangibles		327		317		653		635
Mortgage servicing rights		142		553		268		611
	$	1,290	$	1,823	$	2,585	$	3,179

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 01/01/20-6/30/20	$	2,585
Estimated amortization expense:
For period 7/01/20-12/31/20		2,438
For year ended 12/31/21		4,347
For year ended 12/31/22		3,981
For year ended 12/31/23		3,440
For year ended 12/31/24		2,946
For year ended 12/31/25		2,633

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 June 30, 2020 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.