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Note 6 - Goodwill and Other Intangible Assets | 9 Months Ended
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Sep. 30, 2020
Notes to Financial Statements |
Goodwill and Intangible Assets Disclosure [Text Block] |
Note 6. | Goodwill and Other Intangible Assets
On May 10, 2018 the Company completed its acquisition of Prime Bank, a Connecticut bank headquartered in Orange, CT. The closing of the transaction added a new Patriot branch located in the Town of Orange, New Haven County, Connecticut. The assets acquired and liabilities assumed from Prime Bank were recorded at their fair value as of the closing date of the acquisition. Goodwill of $2.1 million was recorded at the time of the acquisition, and was adjusted to $1.7 million as of December 31, 2018, primarily due to updating of fair value of the core deposit intangible and adjustment of cash and contingent consideration. The goodwill was further adjusted to $1.1 million as a result of reducing the estimated amount to be paid pursuant to certain problem loans pending resolution by $621,000 as of May 10, 2019. There were no income statement effects resulting from the recorded measurement period adjustments for the three and nine months ended September 30, 2020. The goodwill is all deductible for income taxes over 15 years. Information on goodwill for the three and nine months ended September 30, 2020 and 2019 is as follows:
(In thousands) |  | Three Month Ended September 30, |  |  | Nine Month Ended September 30, |
|  | 2020 |  |  | 2019 |  |  | 2020 |  |  | 2019 |
Balance, beginning of period |  | $ | 1,107 |  |  | $ | 1,107 |  |  | $ | 1,107 |  |  | $ | 1,728 |
Mesurement period adjustments |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (621 | )
Balance, end of period |  | $ | 1,107 |  |  | $ | 1,107 |  |  | $ | 1,107 |  |  | $ | 1,107 |
Goodwill is evaluated for impairment annually, in the fourth quarter of the year, or whenever we identify certain triggering events or circumstances that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or circumstances that might indicate an interim evaluation is warranted include, among other things, unexpected adverse business conditions, macro and reporting unit specific economic factors, supply costs, unanticipated competitive activities, and acts by governments and courts. The Company identified the COVID- 19 pandemic and related reported losses as a triggering event in the first quarter of 2020. Due to this triggering event, the Company performed a qualitative assessment of the goodwill, and concluded it was more likely than not that the fair value of the reporting unit exceeded its carrying value, and goodwill was not impaired. The Company did not perform an interim goodwill test in the third quarter of 2020 as no events occurred which would trigger an impairment assessment. The Company will perform a quantitative assessment as of October 31, 2020, the Company's annual goodwill impairment measurement date.

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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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