ARROW FINANCIAL CORP Goodwill & Intangibles Disclosure
| Total Goodwill | |||||
Balance, December 31, 2021 | $ | 21,873 | |||
Goodwill Acquired | — | ||||
Balance, December 31, 2022 | 21,873 | ||||
Goodwill Acquired | — | ||||
Balance, December 31, 2023 | 21,873 | ||||
Goodwill acquired related to the acquisition of the assets of A&B Agency, Inc and the Whitehall Branch | 1,916 | ||||
Balance, December 31, 2024 | $ | 23,789 | |||
Depositor Intangibles1 | Mortgage Servicing Rights2 | Customer Intangibles1 | Total | ||||||||||||||||||||
Gross Carrying Amount, December 31, 2024 | $ | 3,202 | $ | 3,340 | $ | 4,786 | $ | 11,328 | |||||||||||||||
| Accumulated Amortization | (2,319) | (2,933) | (4,018) | (9,270) | |||||||||||||||||||
Net Carrying Amount, December 31, 2024 | $ | 883 | $ | 407 | $ | 768 | $ | 2,058 | |||||||||||||||
Gross Carrying Amount, December 31, 2023 | $ | 2,247 | $ | 3,296 | $ | 4,382 | $ | 9,925 | |||||||||||||||
| Accumulated Amortization | (2,247) | (2,725) | (3,843) | (8,815) | |||||||||||||||||||
Net Carrying Amount, December 31, 2023 | $ | — | $ | 571 | $ | 539 | $ | 1,110 | |||||||||||||||
| Rollforward of Intangible Assets: | |||||||||||||||||||||||
Balance, December 31, 2021 | $ | — | $ | 1,010 | $ | 908 | $ | 1,918 | |||||||||||||||
| Intangible Assets Acquired | — | 10 | — | 10 | |||||||||||||||||||
| Intangible Assets Disposed | — | — | — | — | |||||||||||||||||||
| Amortization of Intangible Assets | — | (235) | (193) | (428) | |||||||||||||||||||
Balance, December 31, 2022 | — | 785 | 715 | 1,500 | |||||||||||||||||||
| Intangible Assets Acquired | — | — | — | — | |||||||||||||||||||
| Intangible Assets Disposed | — | — | — | — | |||||||||||||||||||
| Amortization of Intangible Assets | — | (214) | (176) | (390) | |||||||||||||||||||
Balance, December 31, 2023 | — | 571 | 539 | 1,110 | |||||||||||||||||||
| Intangible Assets Acquired | 955 | 44 | 404 | 1,403 | |||||||||||||||||||
| Intangible Assets Disposed | — | — | — | — | |||||||||||||||||||
| Amortization of Intangible Assets | (72) | (208) | (175) | (455) | |||||||||||||||||||
Balance, December 31, 2024 | $ | 883 | $ | 407 | $ | 768 | $ | 2,058 | |||||||||||||||
| Depositor Intangibles | Mortgage Servicing Rights | Customer Intangibles | Total | |||||||||||||||||||||||
| Estimated Annual Amortization Expense: | ||||||||||||||||||||||||||
| 2025 | $ | 166 | $ | 202 | $ | 144 | $ | 512 | ||||||||||||||||||
| 2026 | 149 | 152 | 125 | 426 | ||||||||||||||||||||||
| 2027 | 132 | 33 | 106 | 271 | ||||||||||||||||||||||
| 2028 | 114 | 7 | 86 | 207 | ||||||||||||||||||||||
| 2029 | 97 | 7 | 67 | 171 | ||||||||||||||||||||||
| 2030 and beyond | 225 | 6 | 240 | 471 | ||||||||||||||||||||||
| Total | $ | 883 | $ | 407 | $ | 768 | $ | 2,058 | ||||||||||||||||||
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.