First Guaranty Bancshares, Inc.FGBI

First Guaranty Bancshares, Inc. Goodwill & Intangibles Disclosure

10-KFiled Mar 17, 20252 min read
Goodwill and Other Intangible Assets
Goodwill and intangible assets deemed to have indefinite lives are no longer amortized, but are subject to impairment testing. Other intangible assets, such as core deposit intangibles and loan servicing assets, continue to be amortized over their useful lives. Goodwill represents the purchase price over the fair value of net assets acquired from the Homestead Bancorp in 2007, Premier Bancshares, Inc. in 2017 and Union Bancshares, Incorporated in 2019. No impairment charges have been recognized since acquisition. Goodwill totaled $12.9 million at December 31, 2024 and 2023. Other intangible assets not subject to amortization totaled $0.1 million at December 31, 2024 and 2023.

The following table summarizes intangible assets subject to amortization.

 December 31, 2024December 31, 2023
(in thousands)Gross
Carrying Amount		Accumulated
Amortization		Net
Carrying Amount		Gross
Carrying Amount		Accumulated
Amortization		Net
Carrying Amount
Core deposit intangibles$16,266 $13,303 $2,963 $16,266 $12,607 $3,659 
Loan servicing assets2,200 1,789 411 2,198 1,659 539 
Total$18,466 $15,092 $3,374 $18,464 $14,266 $4,198 

The core deposits intangible reflect the value of deposit relationships, including the beneficial rates, which arose from acquisitions. The weighted-average amortization period remaining for the core deposit intangibles is 4.3 years.

Amortization expense relating to purchase accounting intangibles totaled $0.7 million for the years ended December 31, 2024 and 2023, respectively.

Amortization expense of the core deposit intangible assets for the next five years is as follows:

For the Years Ended
Estimated Amortization Expense
(in thousands)
December 31, 2025$696 
December 31, 2026$696 
December 31, 2027$696 
December 31, 2028$696 
December 31, 2029$179 
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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.

Other Available Disclosures

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