GOODWILL AND INTANGIBLE ASSETS
Goodwill, which has an indefinite useful life, is evaluated for impairment annually or more frequently if events and circumstances indicate that the asset might be impaired. The Corporation did not identify any goodwill impairment on the Bank or ACNB Insurance Services from its most recent testing performed as of November 30, 2025. There were no impairment losses or accumulated impairment losses associated with goodwill as of December 31, 2025 and 2024.
The following table shows goodwill as of the periods presented:
| | | | | | | | | | | |
| (In thousands) | December 31, 2025 | | December 31, 2024 |
| Balance, beginning of year | $ | 44,185 | | | $ | 44,185 | |
| Acquired goodwill | 20,264 | | | — | |
| Balance, end of period | $ | 64,449 | | | $ | 44,185 | |
The following table presents intangible assets, net of accumulated amortization, for the years ended December 31:
| | | | | | | | | | | | | | | | | |
| (In thousands) | 2025 | | 2024 | | 2023 |
| Balance, beginning of period | $ | 7,838 | | | $ | 9,082 | | | $ | 10,332 | |
| Acquired core deposit intangible | 18,854 | | | — | | | — | |
| Acquisition of insurance books of business/agency | — | | | — | | | 174 | |
| Amortization expense | (4,257) | | | (1,244) | | | (1,424) | |
| Balance, end of period | $ | 22,435 | | | $ | 7,838 | | | $ | 9,082 | |
The carrying value and accumulated amortization of the intangible assets as of December 31 are as follows:
| | | | | | | | | | | | | | | | | | | | | | | |
| 2025 | | 2024 |
| (In thousands) | Gross Amount | | Accumulated Amortization | | Gross Amount | | Accumulated Amortization |
| ACNB Insurance Services - amortized intangible assets | $ | 16,331 | | | $ | 10,339 | | | $ | 16,331 | | | $ | 9,658 | |
| Core deposit intangibles | 24,832 | | | 8,389 | | | 5,978 | | | 4,813 | |
| Total | $ | 41,163 | | | $ | 18,728 | | | $ | 22,309 | | | $ | 14,471 | |
The following table shows the amortization expense of the intangible assets for future periods:
| | | | | |
| Year | (In thousands) |
| 2026 | $ | 4,117 | |
| 2027 | 3,628 | |
| 2028 | 3,139 | |
| 2029 | 2,732 | |
| 2030 | 2,324 | |
| Thereafter | 6,495 | |
| $ | 22,435 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.